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Thursday, 13 August 2009
Page: 4842


Senator WONG (Minister for Climate Change and Water) (10:43 AM) —I thank senators for their contributions to the debate and the Senate for its consideration of the Carbon Pollution Reduction Scheme Bill 2009 and related bills, bills which are crucial to Australia’s economic and environmental future. At the outset and at the conclusion of this debate I would like to acknowledge the enormous amount of work that has gone into getting us to this point. I would like to thank my colleagues in the government for their commitment to tackling climate change, consistent with our election commitment. I want to thank my department, the Department of Climate Change, for their tireless work and the many dedicated officials across government who have played such important roles in developing Australia’s response to climate change and have served both governments, governments of both political persuasions, so professionally.

It is important to acknowledge the considerable work that was done, despite the lack of political will to do so, before the Rudd government was elected and before I had carriage of this reform. Work on emissions trading in this country has been going on for more than a decade. Prime Minister Howard received numerous reports on climate change and emissions trading before finally agreeing, before the 2007 election, to implement cap-and-trade emissions trading. So what we have been debating has actually had bipartisan support. Under the most conservative Prime Minister since Robert Menzies, there was bipartisan support for a cap-and-trade system—for what the Senate has been debating.

When I say we have been debating climate change, that might be somewhat generous. While many senators in this place have prepared thorough and researched contributions, you would have to say that some of the contributions in recent days have been very disappointing indeed. Some senators have been looking to the future, but others have resorted to fear and extraordinarily cheap shots. Let me quote just one, Senator Bushby, who said of me:

If she were allowed to, I suspect she would like to burn at the stake all who dare question the truth of the science behind climate change.

Senator Bushby and others, including Senator McGauran, who made similar remarks, really are letting their side down. When they say that about me, what they are in effect saying is that all Australians who believe that climate change is a serious problem are extremists. I suggest these senators should look around behind them. Have a look behind yourselves. What they would soon see is that mainstream community opinion, just like mainstream scientific opinion, is simply not with them.

It has been more than a hundred years since the first realisation that the earth’s climate might be sensitive to atmospheric concentrations of gasses, creating a greenhouse effect. The IPCC’s fourth assessment report, the largest assessment of climate science ever undertaken, concluded that warming of the climate system is unequivocal and it is 90 per cent likely that this warming is caused by human activity. The impact that this is having on our environment and on our economy is not something we can simply brush aside. By the end of this century, climate change could see irrigated agricultural production in Australia’s food bowl, the Murray-Darling Basin, drop by more than 90 per cent. By mid-century, heat related deaths could increase by 5,000 a year. We know what this could mean if nothing is done for the rest of the world.

If senators want to take this huge gamble with our future, with the future of our children and those who come after us, they should explain it to the Australians who put them here. Those on this side of the chamber believe Australia’s future is worth too much to take that risk. Others have made extreme and scaremongering claims about the impact of this legislation—extreme claims about thousands of jobs. In many places, some who made these claims—and I notice one has just walked into the chamber—made them not because of a serious concern for jobs but in an attempt to gain credibility for their discredited ideas around the denial of climate change science.

What we know from the Treasury modelling is that under this scheme real wages increase, jobs increase, output increases, GNP increases and so does GDP. The Treasury modelling reminds us what we already know to be true from all the work that has been done by others, including Professor Garnaut and Lord Stern, and that is that the costs of inaction are greater than the costs of responsible action now. The Treasury modelling also shows that economies that act early to reduce their emissions face lower costs than those that act later. Economies that defer emissions pricing become relatively more emissions intensive and eventually, when a global emissions price is introduced, they will face even higher costs. You know what? That explains why the world is moving. That explains why the world’s leading economies are moving.

Many senators have made reference to developments in the US and have urged the government to effectively photocopy the assistance that is offered under the current United States legislation. They say this is about protecting jobs. I again remind people of the facts. The Carbon Pollution Reduction Scheme, in the bills before the Senate, is already more generous in its treatment of emissions-intensive trade-exposed industries than the legislation which is before the United States congress. So if senators want a scheme that supports jobs by offering the right level of assistance to our industries while we transition to a low-carbon future then they should be voting for these bills. We have tailored these bills to Australia’s circumstances, just as the United States will tailor their bill to US circumstances.

One important thing that the bills in the US and here have in common is that they are both for a cap-and-trade system. In fact, this is what the world has in common, and last month’s G8 declaration made that clear. In implementing emissions trading, some countries are ahead of us and some are behind us. Many are gaining on us. People who look to the future understand that this is the new economic race—to develop low-pollution goods and services, to enable the world’s economies to grow while maintaining our environment. This is not a race we can win from the grandstand and we cannot win it from the commentary box. Australia did not sit back and wait for the full force of the global recession to hit us. We took early and decisive action, and the results of government action to stimulate our economy are clear. Climate change is no different. We have to give ourselves the best chance, which means starting the transition to a low-carbon future now and doing what is right in Australia’s national interest.

There are others in this debate who have made extraordinary claims about the impact on prices. Senator Macdonald, whilst claiming that climate change was not about delivering what Australia wants and engaging in a personal attack on me and others, claimed yesterday that electricity prices would increase by 200 per cent. His approach, I think, reflects an unfortunate tendency in this debate: if you do not like something, do not worry about the facts; just use whatever fact or figure you want in order to try and scare people. The fact is that electricity prices are likely to rise by about $1.50 a week in the first year of the scheme and $2.80 in the second year. The fact is that, to reflect this, the government is providing very significant assistance to low- and middle-income Australians.

We have always been upfront about the fact that tackling climate change will have an effect on prices, but we are not alone. Let us remember what Prime Minister Howard said:

... the idea that you can bring about changes that are needed and which many people have advocated, without there being any impact at all at any time on the cost to the consumer, is quite unrealistic.

It is quite unrealistic, but that is precisely what those opposite are trying to peddle to the Australian people. What Mr Howard was saying is that, fundamental to tackling climate change, those goods and services which worsen climate change will cost relatively more than those which are low carbon. Despite the fearmongering from those opposite, the overall impact on prices is modest. The CPI impact is about 1.2 per cent over the first two years.

In this debate we have also had quite a lot of discussion about agriculture and the impact of the CPRS on agriculture. I do not know if those opposite have not read the bill or are simply being wilfully mischievous, because agriculture is already excluded from the scheme until at least 2015. It is not in the bills before the Senate, and I am not sure how we could exclude it any more. A number of senators have also made the erroneous claim that we are moving ahead of the rest of the world. Well, as I said, some countries are ahead of us, some are behind us and many are gaining on us.

Climate change policy is the one and only area where the Liberal Party have been consistent. Through their years in government and in opposition their efforts to divert and to delay have been consistent. Their most consistent mantra has been: ‘We should wait until after Copenhagen. We should not be rushing. We should see what the rest of the world is doing.’ The reality is—and I think Australians are aware of this—these excuses have nothing to do with taking stock at Copenhagen and have nothing to do with looking at what the rest of the world is doing; this approach is all about avoiding the hard decisions, debate and division inside the Liberal Party. That is what this position is all about.

Just three days ago, on the eve of this vote, the opposition released a new proposal produced by a consulting firm. It was an approach which would replicate the failed Canadian experiment, to the severe detriment of the Australian economy. Mr Turnbull described it as cheaper, greener and smarter. It is not cheaper to increase uncertainty across the economy. It is not cheaper to undermine investment and jobs by pretending that uncertainty does not matter. It is not cheaper to throw away opportunities to reduce carbon pollution in Australia. It is not cheaper to exempt emissions-intensive trade-exposed industries from playing their part in reducing carbon pollution.

There is nothing cost-effective about giving electricity generators so much assistance that they make windfall gains. There is nothing cost-effective about making low- and middle-income households worse off by scrapping their compensation. There is nothing cost-effective about increasing budget risks if the poorly designed alternative cannot deliver the targets we sign up for at Copenhagen. I remind those opposite about these comments from the Business Council of Australia:

We are very concerned there is the potential for increased electricity demand to breach the national cap and for the government to then have to intervene and buy international permits ... this could put real pressure on future budgets.

So much for fiscal responsibility; so much for economic responsibility!

It is not greener to toy with a scheme that gives away the opportunity to deliver lower cost abatement in Australia than what is provided under the government’s scheme. It is not true to claim that to deliver an unconditional 10 per cent reduction by 2020 is greener when the government’s plan delivers cuts of as much as 25 per cent by 2020. And it is not smarter to avoid a decision today to allow Australia’s carbon emissions to continue to rise. It is not smarter to pretend this will not leave us isolated from the rest of the world and it is not smarter to undermine our transition to a low-pollution economy.

Opposition senators interjecting—


Senator WONG —I remind senators that this proposal still does not represent coalition policy, and I hazard a guess to say that it is highly likely that it never will. I have said time and time again—and I will say it again in this place—the government will consider any serious credible amendment to these bills that is put forward in the national interest and that is put forward with the support of the opposition party room. I have made that offer time and time again, but there is not a single amendment on this enormous challenge. On this very substantial economic environmental reform, you have not had the wherewithal and the strength to put one single amendment before this chamber.

Opposition senators interjecting—


Senator WONG —There has been no policy from those who claim to be the alternative government. There is no recognition of the serious need to act now to preserve Australia’s national interest in the face of climate change.


Senator Cormann —It’s not too late to pull it and start again.


Senator WONG —There appear to be some in this place who believe Australia to be so irrelevant that what we do on climate change does not matter.


Senator Cormann —This is a dud scheme and you know it.


Senator WONG —Let me assure you that the world is watching.

Opposition senators interjecting—


The ACTING DEPUTY PRESIDENT (Senator Troeth)—Order! The level of interjection from those on my left is becoming unsustainable. It is difficult for the minister to be heard. I ask that you accord her the respect of someone speaking on these bills.


Senator WONG —Thank you, Madam Acting Deputy President. As I was saying, there are some in this place who appear to believe that this nation is so irrelevant that what we do on climate change does not matter—well, you are wrong. Indeed, an article in today’s Wall Street Journal describes Australia’s action on climate change as a case study for where the action is overseas. To others who look to developed nations like Australia to take leadership on climate change and to the Australian people, who have made it clear that they want action on climate change, on behalf of the government I have one simple message: these bills may be going down today, but this is not the end. We may lose this vote, but this issue will not go away, because we on this side understand Australia cannot afford for climate change action to be unfinished business, and we will not let it be.

Other senators may fail to take the responsibility on climate change, but this government is not going to give up. We will press forward and on with this reform for as long as we have to. We will bring these bills back before the end of the year because it is the right thing to do. We will bring these bills back before the end of this year because it is the responsible thing to do. We will bring these bills back before the end of the year because we on this side understand we have to start the economic transformation we need. We will bring these bills back before the end of the year because, if we do not, this nation goes to Copenhagen with no means to deliver our targets. If we do not, the message to Copenhagen would be that Australia is once again going backwards on climate change.

This Senate is supposed to represent the Australian people. The question for every senator in this place who votes today for Australia’s carbon pollution to keep rising will be this: are you really doing what the Australian people want? Australians expect this government to deliver on climate change and Australians will expect the Senate to do the same—and it should. It is important for all of us to remember this: the chance for us to avoid any climate change at all is gone; it is lost to us. What we do have is a window to lessen its impact. We have a window to reduce the risk, and that is a window of opportunity which is closing.

That is why we will bring these bills back. We will give this Senate the opportunity to do better. We will give this Senate the opportunity to do the right thing. We will give this Senate the opportunity to do what Australians expect it to do. That is what the Senate should do, because anything less shows an arrant disregard for the demands of Australians today and the inheritance of Australians tomorrow. I commend these bills to the Senate.

Question put:

That the amendment (Senator Milne’s) be agreed to.