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Wednesday, 2 March 2011
Page: 942

Senator ABETZ (2:00 PM) —My question is to the Minister representing the Treasurer, Senator Wong. Isn’t it the case that a carbon tax does not guarantee emissions reductions? Isn’t it also the case that a carbon tax is a recipe for abrupt and unpredictable changes as the government would need to adjust the tax frequently to meet the emissions reduction target, each time subjecting these adjustments to the inherent uncertainties embedded in the political process?

Senator WONG (Minister for Finance and Deregulation) —I think those words have a familiarity to them. It should be remembered that what the government is proposing, and has laid out in the mechanism that was made public after the Multi-Party Committee on Climate Change, is a mechanism that is an emissions trading system but has a transitionary mechanism of a fixed price. Some of the issues you raised are some of the policy considerations that you have to consider when looking at the various models of abatement. It is true that some of the criticisms of a tax include whether or not the environmental outcome will be met. But in the context of this a number of things should always be remembered. The first is that the government has proposed a market mechanism—that is, an emissions trading scheme. We propose also, after dialogue with the multiparty committee, an interim transitionary period of a fixed price. That is true.

It should also be remembered that Mr Abbott himself has advocated for a carbon tax. It is interesting—

Senator Cormann —Not before the last election. You know that.

Opposition senators interjecting—

Senator WONG —I hear the interjections, including from Senator Cormann. Here they go. They are very sensitive about this issue because they know that on this they have no credibility whatsoever. You have variously advocated an emissions trading scheme, a carbon tax, no action and, now, taxpayer funding of carbon abatement, and I will certainly have more to say later about the slug on Australian families that the opposition is proposing.

The PRESIDENT —Order! On both sides I need silence. Senator Sherry and Senator Cormann.

Senator ABETZ —Mr President, I ask a supplementary question. Isn’t it the case that the introduction of the carbon price ahead of effective international action can lead to perverse incentives for industries to relocate or source production offshore and that there is no point in imposing a carbon price domestically that results in emissions and production transferring internationally for no environmental gain?

The PRESIDENT —Order! Senators on my right.

Senator WONG (Minister for Finance and Deregulation) —These are some of the policy matters that have to be taken into account when designing the market mechanism.

Opposition senators interjecting—

Senator WONG —If the opposition want to engage in the detail of this policy discussion and actually put forward some sensible propositions about how you do manage your emissions-intensive, trade-exposed sector and how you do manage moving with the international community, we would welcome it. But that is not your position. Your position is to simply slug Australian families so that polluters can be paid, possibly to do what they would have done anyway. The reality is that you have no policy on this issue. You are completely divided. I know that Mr Abbott has had to read the riot act to you to try to resolve or paper over the fundamental philosophical differences you have on your side.

Honourable senators interjecting—

The PRESIDENT —Order! I remind senators on both sides that I need to hear the response of the minister. If you are having an exchange across the chamber, as interesting as it may well be for you, it does not allow me to hear the answers that have been given. That is the fairness that needs to prevail in this place, just as people need to be heard in silence when the questions are being asked.

Senator ABETZ —Mr President, I ask a further supplementary question. Given that the minister reluctantly acknowledges that she made the statements that I quoted in my first two questions, and given her previous position, so eloquently expressed, against a carbon tax, can she explain how she got it so right then and so wrong now?

Senator WONG (Minister for Finance and Deregulation) —Well, wasn’t that a tricky question? What a tricky question. Perhaps I should lay it out very clearly.

Honourable senators interjecting—

The PRESIDENT —Order! Senator Wong, resume your seat. Both sides, the time for debating this is at the end of question time, as I often point out. Senator Wong has the call.

Senator WONG —As I explained in my answer to the first question, we are proposing an emissions trading scheme as the mechanism. We are also proposing, in consultation with other members of the parliament, a fixed price for a period of time as an interim transitionary measure. We have been upfront about that. We are doing that because we believe that action on climate change is important and we also believe that working with the parliament to provide a carbon price is in the national interest.

That really stands in contrast to the way the opposition approach these issues—in stark contrast. Really, if you want to understand the Leader of the Opposition’s thinking, or lack of thinking, on this issue, you need to go back to last year and this quote: ‘I think my assessment of the policies has never changed that much; I think all that’s changed is my assessment of the politics.’ (Time expired)