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Tuesday, 5 July 2011
Page: 4081

Senator XENOPHON (South Australia) (18:42): I would like to comment on Senator Macdonald talking about those who are driving home from work and listening to this debate on the Carbon Credits (Carbon Farming Initiative) Bill 2011, Carbon Credits (Consequential Amendments) Bill and Australian National Registry of Emissions Units Bill 2011. Well, I think that would be all of six or seven people, Senator Macdonald!

Senator Ian Macdonald: That's not right—

Senator XENOPHON: That is not right?

Senator Ian Macdonald: and if they knew you were about to speak there would be literally tens of thousands!

Senator XENOPHON: Senator Macdonald, flattery will get you nowhere. The carbon-farming initiative has, according to the explanatory memorandum to the bill, been designed to be 'complementary' to a carbon pricing mechanism. The Oxford English Dictionary defines 'complementary' as 'mutually complementing or completing each other's deficiencies'. So, without knowing how the carbon-farming initiative will operate alongside the government's proposed reduction plan, which we do not yet know the full details of, it is difficult to fully understand how this bill and the government's plan on carbon will 'complement or complete each other's deficiencies' or, on the other hand, to understand its benefits.

I have concerns that we are debating this bill without knowing the full details of the government's carbon pricing plans, and I note that the government is making a major announcement on this Sunday. I welcome that. I would like to indicate at this time that I will be moving an amendment during the committee stage that there be a review of this act within 12 months of any legislation regarding the introduction of a carbon price being tabled in parliament. I think that is a very important accountability mechanism. This will enable the parliament to appropriately assess the carbon-farming initiative in terms of how it will interact with—how it will complement—a carbon reduction plan.

Having said that, I do believe that the intent of these bills and the establishment of a carbon-farming initiative is right. I do not think members of the coalition disagree with that general principle. Agriculture makes up about 20 per cent of carbon emissions. It is seen by some as part of the problem but, unambiguously, I see agriculture as a big part of a solution to reducing CO2. It is clear from the committee inquiry report into this package of bills that industry is broadly supportive of a carbon-farming initiative. But it is all about the implementation, and that is what concerns me. I note the broad support of the National Farmers Federation, the Australian Landfill Owners Association, traditional land owners and local and state governments, but their support does not come without some significant concerns. Concerns have been raised about the take-up rate of the carbon-farming initiative, the potential cost burden on industry, issues of permanence and the treatment of native title holders.

Page 28 of the Senate committee's report, the majority report by the government, says that the New South Wales Farmers Associa­tion 'was concerned by the application' of tests in this. They have very real concerns as to how this will actually work. The report says:

The association argued the methods by which a farmer increased or conserved carbon were less important than the fact the farmer had done so.

I think that makes sense.

I also note that there are very serious concerns about native title. The report states, 'The Kimberley Land Council … was more forthright in their criticism.' The Kimberley Land Council submission said:

The treatment of non-exclusive native title is discriminatory and fails to accord proper importance to the interests carried by native title.

While the bill gives certainty to exclusive native title rights, and treats them in a way that is fair and appropriate, there is a concern by the NNTC that the 'failure to provide a clear pathway for non-exclusive native title holders into participation in offset projects' is a 'major weakness'. I think that is the case, and we need to be very wary of that. If we want to give Indigenous communities the right to participate fully in this, then we need to deal with that particular issue, raised by a number of Indigenous groups, with particularly strident criticism from the Kimberley Land Council.

It is crucial that these issues are resolved and that the fine details, the minutia, of this scheme, which will determine its success, are clear and established in the legislation and not left to be determined so broadly by regulation. We need that basic framework so that we know how this will work. For example, AUSVEG, a peak industry body, said during the Senate committee inquiry into these bills that they are very concerned about the uncertainty about the 'positive list' described in the legislation. I quote AUSVEG's submission:

The test is still defined “as not been widely adopted”. What, how and who determines the definition of “widely adopted” ?

As this requires a Ministerial decision, after receiving advice from the Domestic Offsets Integrity Committee, it will ultimately be open to political considerations.

This is an area that is unlikely to remain clear in any short time-frame …

That is a very serious concern for a peak industry group, the vegetable growers of Australia. The positive and negative lists provided in the legislation will be determined in regulation, and I do not think that is adequate. There are projects that we can say right now should not be approved and should be included in the legislative framework of the scheme so that it is clear what can and cannot be included.

For starters, any project that will have an adverse impact on the availability of water should be an excluded offsets project. It is that simple. Ensuring Australia's water availability is vital, and to say that it may or may not be on the negative list, that it is something that the minister will consider, is quite outrageous. I will be moving an amendment to this effect, stating that any project that has an adverse impact on the availability of water should be an excluded offsets project and, similarly, that projects that will have a beneficial impact on the availability of water should be on the positive list.

I acknowledge the opposition's amend­ment with regard to including land and resource access for agricultural production as a matter of consideration in the development of the negative list, but I think it is clearer than that. Any project that will have an adverse impact on Australia's food security and food production must be on the negative list, and those which will have a beneficial impact must be on the positive list. Let's be unambiguous about that.

Furthermore, and I know I am not alone in my concerns about managed investment schemes, where a forest was established as a managed investment scheme, I believe it should also be on the excluded offsets list. I know that the government will be likely to respond to these amendments by saying they do not want to be too prescriptive, but I think that water and food security are matters that do not need to be left open for consideration.

Furthermore, I note the use of the word 'significant' in this section of the bill and I do not believe that the threshold, if you like, should be applied. What does 'significant' mean? What does it mean in percentage terms? Does it mean 40, 50, 60 or 70 per cent? The word 'significant' is, I think, quite problematic in terms of the application of this act and in terms of how the bill will operate. I seek leave to continue my remarks.

Leave granted.