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Thursday, 15 September 2011
Page: 6174

Senator THISTLETHWAITE (New South Wales) (11:03): I speak in opposition to the Carbon Tax Plebiscite Bill and I do so because the bill is nothing more than a political stunt, a waste of taxpayers' dollars and a refusal by the opposition to accept the results of two elections and the willingness of the people for the government to take action on climate change. It is a significant waste of the parliament's and the Senate's time at a period when the government is undertaking significant reform—significant economic reform, significant social reform and reform that will modernise our economy, transform our society and protect our environment. This bill seeks to have a plebiscite regarding the government's plan to price carbon. But despite that wish to have a plebiscite the Leader of the Opposition, Tony Abbott, has said to all Australians that he will not accept the outcome of that plebiscite if it does not go the way that he wants. This is nothing more than an irresponsible, cheap political stunt that does not deserve the time and extensive consideration of the Senate.

We have been elected to this place to represent the people of our states, to debate issues, to represent interests and to work together to resolve issues and to map out a future for our nation. With each of our individual mandates to sit in this great chamber comes a responsibility to show leadership and a responsibility to act in the interests of the people of Australia. Yet through this bill those opposite seek to abrogate that responsibility. They abrogate that responsibility that each and every one of us has as senators. Under our democracy the people elect parliamentarians to represent their communities, to debate issues and to make laws. This is a point that was well made by the former Prime Minister John Howard when he told ABC radio in Perth on 17 September 1998:

Unless you resort to a method of having plebiscites or referendums on each individual issue. And I think the Australian public would get very angry and tired about that. They would say: what’s wrong with you fellas, we elected you for three years, you go away and take all the decisions you want to on individual issues and then when those decisions have been taken at the end of your three year period if we don’t like you we’ll vote you out. I don’t think you can run it any other way.

Well said by the former Prime Minister. This bill is nothing more than a waste of taxpayers' money. It is estimated by the Australian Electoral Commission that the cost of running such a plebiscite will be in the vicinity of $80 million—$80 million for a plebiscite which the Leader of the Opposition says he will not accept if the decision does not go in his favour; $80 million despite the fact that in two elections the people of Australia voted for action on climate change; $80 million despite the fact that no less than 37 inquiries regarding action on climate change have recommended that this parliament take action to price carbon and that the most effective measure for taking action on climate change is through a market based mechanism; $80 million despite the fact that the Multi-Party Climate Change Committee recommended the measures that are currently being debated in the House of Representatives. The opposition were invited to participate in this multiparty committee to debate the issues associated with climate change and to work with the government and the Independents in a responsible manner to map out a plan to deal with this important economic and social issue.

It will be an $80 million waste of taxpayers' money—an abrogation of our responsibility as senators. It shows a complete lack of leadership from the opposition, because of their denial of the advice of experts on this important economic and social challenge. They refuse to accept the result of the 2010 election and refuse to accept that the majority of representatives in this parliament want action on climate change. It will be an $80 million waste of taxpayers' money—$80 million of fiscal recklessness. On top of this, the opposition refuse to come clean with the Australian people about how they will cost their policy for action on climate change.

The government and the opposition agree that there needs to be action on climate change. In fact, we have the same target for emissions reductions—five per cent by 2020 on 2000 levels. Yet the opposition have a different policy, a direct action policy—a policy of subsidising companies who pollute our atmosphere, a policy that the Liberal Party website says will cost $11 billion over the next four years but which the Department of Climate Change and Energy Efficiency has costed at closer to $30 billion to 2020. Yet the party that claims the moral ground on fiscal responsibility are acting with complete contempt for the Australian people by refusing to say how they will fund their policies—how they will fund this $30 billion subsidy to polluters.

They claim that they will produce a surplus in government. How will they do that? How will they do that without the revenue from the minerals resource rent tax? How will they do that without the revenue from pricing carbon? They will do it one way: through cutting services. They will cut services to deliver on their commitments. It has been leaked from the opposition party room that those cuts to services will be in the vicinity of $70 billion—$70 billion of political karate chops to many schemes, policies and services that the Australian people rely on.

It is time for the opposition to come clean with the Australian public. It is time for those senators opposite to tell the Australian people how they are going to fund this $70 billion of cuts. What is on the line? Is it Medicare? Is it the childcare rebate? Is it the increase in pensions? Indeed, is it a reduction in the company tax rate? It is time for those opposite to come clean with the Australian people and tell them how they are going to fund $70 billion of cuts and how they are going to fund their direct action policy—the $30 billion to 2020 that the department of climate change estimates it will cost.

Labor's plan will ensure that we act responsibly on this issue of climate change. It is agreed by all the parties that human activity is causing damage to our environ­ment, that increasing pollution is warming our planet and that this will lead to changes in weather patterns—severe weather conse­quences, increases in sea levels, possible extreme drought periods and other extreme weather events. We need to take action to reduce and mitigate the effects of global emissions on our environment. All the experts say that the longer we wait to take action the greater the cost. As a parent of two young children, I do not want to saddle them with the burden of unbearable costs to deal with this important economic and social issue. That is why all the parties agreed to a five per cent reduction in carbon emissions by 2020. It is a commitment that our nation has signed up to in international forums.

Why are we going down this path of pricing carbon rather than the opposition's plan of direct action? As all good govern­ments do, we engaged the advice of experts. We said to the best economists and the best scientists in our nation, 'How can we achieve a reduction in emissions in the least-cost manner, in the most efficient manner for our economy and in the most efficient manner for households, for workers and for bus­inesses?' Overwhelmingly, all of those economists and all of those scientists say that the most efficient and most effective method of reducing emissions and ensuring that our economy transforms itself and transitions to a clean energy future is through a market based mechanism. Putting a cost on carbon emissions will ensure that consumers, businesses, households and communities can make their own decisions in a market based economy about how they reduce their emissions and how they respond to pricing that externality of carbon. It is a plan that, over time, will lead to a change in behaviour.

The scheme will work by ensuring that we tax the 500 biggest polluters—initially, during the early days of the scheme, they will be asked to pay $23 per tonne of carbon pollution. We will then move towards a market based mechanism which will kick in in 2015. This will send a clear signal to polluters that they can no longer get away with pumping carbon emissions into our atmosphere for free. And then companies will do what companies do: they will find a way to reduce this cost. They will find a way to invest in cleaner technology. They will find a way to invest in new industries based on renewable energy. This will lead to a boost in jobs, in investment and in new renewable energy sources. Most importantly, it will also improve our environment, because over time it will reduce the level of emissions that would have otherwise occurred had we not taken action.

There will be costs associated with this scheme. Nobody is denying that. But the Australian Treasury modelling indicates that the increase in costs will be 0.7 per cent on the consumer price index—a 0.7 per cent effect on inflation. I think this needs to put in context. When the GST was introduced back in 1998, the effect on the consumer price index was modelled by the Treasury at 2.49 per cent. Treasury said that the increase in costs associated with the GST would be 2.49 per cent. What was the outcome? It was 2.5 per cent; that was the eventual increase in costs associated with the GST. So Treasury have a history of getting it right when it comes to this modelling, and their estimates are that the cost effect of pricing carbon in our economy will be 0.7 per cent on the consumer price index.

How will this affect households and how will households meet this extra cost? Half of the revenue that will be raised from pricing carbon will go directly to households. It will go to assisting low- to middle-income households to make the transition to the new carbon-constrained economy. The other half will go to assisting businesses and to ensuring that our nation is promoting and investing in renewable energy sources. Six million households will benefit from the assistance package. As for pensioners, sole pensioners will get an increase of $338 a year and couple pensioners will get an extra $510 a year. Students will get an extra $177 a year. Job seekers will get an extra $218 a year. Furthermore, there are tax cuts associated with the plan that are targeted to provide an average tax cut of $300 per year for those on an annual income of less than $80,000. The tax-free threshold will be increased from $6,000 to $18,000. And this assistance will be permanent, and it will increase as the carbon price rises during the move to a market based mechanism. There is $9.2 billion worth of assistance for trade-exposed industries, those that are trading in the global marketplace—most notably, steel and aluminium, and the coal industry, for which there is a $1.3 billion assistance package. Assistance to community organisa­tions will be provided through funding from the scheme to ensure that they can put in place and invest in technology that will reduce their carbon footprint and reduce, above all, their electricity costs.

Some have said that we are taking action ahead of the rest of the world. Some have said that Australia will be leading the pack when it comes to pricing carbon. But, when we look at what is happening throughout the world, we can see that this is a complete lie and misstatement by those opposite. The Productivity Commission studied what was occurring in key economies, and nine of our trading partners were taking action on climate change. In the words of the Productivity Commission's report:

… the estimates for Australia … appear to lie in the middle of the range of countries.

Thirty-five nations or states throughout the world have an emissions trading scheme. They include the nations of the European Union; a major trading partner of ours, New Zealand; and parts of Canada. In China at the moment, in three of their major provinces—Beijing, Shanghai and Guangdong—they are trialling an emissions trading scheme, and the Chinese government has a five-year plan for moving to an economy-wide trading scheme. It is a complete fallacy that Aust­ralia is acting irresponsibly, ahead of the rest of the world and in a manner that will harm our competitive advantage and many of our businesses.

Many of the Liberals have, in the past, supported what the Gillard government is doing in attempting to price carbon and transform our economy as we move into a clean energy future. I draw the Senate's attention to the first speech of none other than Senator Cormann, one of the opposition's chief combatants when it comes to the issue of pricing carbon. In his first speech to this place on 15 August 2007, Senator Cormann said:

The government's recent announcement of a national emissions trading scheme, including offsets for trade exposed industries, is a positive and sensible approach to addressing global warming.

I could not have said it better myself. I find it hard, but I actually agree with what Senator Cormann said. It was a very eloquent statement of what the government is trying to do.

So from those opposite there was support in the past for what the government is trying to do. The change is that the Leader of the Opposition sees it now as an opportunity to win government, a cynical exercise in vote buying. That is despite the fact that all of the experts say that the Labor approach is the least-cost approach for our economy and the best option for our nation. No credible economist will back their plan. And their opposition is despite the fact that we have had 37 inquiries, all of them recommending that we take action on climate change and that the form of action should be to price carbon through a market based mechanism. This is a waste of time, a waste of taxpayers' dollars, and I urge the Senate not to support this bill.