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Thursday, 22 March 2012
Page: 2531

Senator RYAN (Victoria) (09:48): I rise to speak in favour of the Solar Hot Water Rebate Bill 2012. This bill is actually quite a simple one. All it does is compel the government to spend the full $63.5 million in funding allocated to the Solar Hot Water Rebate under its Renewable Energy Bonus Scheme in 2011-12. The important point about it is that the Senate is not seeking to appropriate money; it is merely seeking to force the government to live up to its word. It is merely seeking to allow the people of Australia and the businesses involved to have a degree of confidence that a government program cannot be shut down on five minutes notice. Just as occurred in 2009 with Minister Garrett and the solar panel rebates, we have here a Labor Party that has pulled the pin mid-stream.

The parliamentary secretary, Mr Mark Dreyfus, the member for Isaacs, gave the solar hot water industry just five minutes notice on a Tuesday night that there would be no more applications accepted. While the government is allowing applications to be lodged up to 30 June this year, to be eligible for the scheme the systems had to have been installed, ordered or purchased on or before 28 February, the day the scheme's closure was announced. The problem with this is, again, the complete lack of predictability and the capriciousness of government action. I have little doubt that it is due to their desperate need to shuffle money around to confect and contrive a fake surplus, at least on paper, to be announced in May. We will see the proper result when the final budget outcome is released towards the end of next year. But this desperate need by the government to try and shuffle money around in order to create that false surplus has again left a particular industry in the lurch. The government did this with solar panels; they have done it with roof batts; they have done it with the live cattle trade; and now they have done it with solar hot water. It is reckless decisions like this that change the goalposts for business decisions and, indeed, consumer decisions. That these decisions are made on a completely unpredictable basis does a great deal of damage to business and consumer confidence.

We are seeing in survey after survey consumer and business confidence falling. They are two of the most important yardsticks by which we can see the direction in which the economy is going. Without confidence to invest and without confidence to spend, the problem that we will see is people hoarding cash, not because they are trying to save but merely because they do not have a degree of confidence in what the government may or may not do.

The words of a small solar business owner, Jeff Knowles of Pure Solar, last week summed this up:

I guess what Helen and I would like to say is very simple. It’s been tough in the solar industry—we all know that, but the timing of the hot water rebate closing couldn’t have been worse. We had the Royal Canberra Show here—we had 60 or so leads. We were following them up. People have just said listen, we can afford a top system like behind me; we can go the extra, you know, $100, $200 maybe $500 to $4,500, but we can’t go to $5,500. So, that $1,000 means a lot to the people I knock on the doors of and it’s just really unfortunate timing for us again in the solar business.

The challenge is again simply one of certainty; it is simply one of predictability. What we have here is a business owner who is basing his activity and the activities of his business on a program. He tells consumers, 'Here's a particular program available to you to support the purchase of a product.' When that is capriciously changed, when the rug is pulled out from underneath them at such short notice, it does enormous damage to the business.

Rheem, a major manufacturer in Australia, said they have $10 million worth of stock on hand and the jobs of workers at the Rydalmere facility now hang in the wind, precisely because they have all this stock on hand. Their government relations manager, Gareth Jennings, said, 'This is the worst possible time to take away support.'

On news of the program cut, the Clean Energy Council said:

The clean energy industry says the unexpected cut of a key government solar hot-water program late yesterday will put jobs under threat …

The key point there is the unexpected nature of it. This program was expected to expire. People were planning for that. There was no shortage of funds in the program. There were no allegations of the program being rorted. What happened here was a government unilaterally, capriciously and unpredictably pulling the rug out from underneath businesses and people that were making plans.

As I said earlier, this is merely an attempt to contrive a budget surplus. We do not know how the government are going to be shuffling money around, but when we look at the expenses that have been put off budget over the last few years—with the money being spent on electricity industry support, for example, there is not so much next financial year but more this financial year and the financial year after the next budget year—we know they are desperate to contrive a budget surplus.

I point out here that, while some expected the solar hot-water rebate program to end on 30 June this year, the government's own program guidelines did not specifically mention a closure date. The coalition believes that this withdrawal of the program at such short notice is reckless and damages consumer and business confidence. It is a sign of a government in chaos and it is further confirmation of its incompetence in managing basic programs. All we have asked for with this piece of legislation is for the government to live up to what was in last year's budget papers. No new funding is required to deliver this solar hot-water rebate as was committed by the government and the parliament. This bill will need to be passed this week if it is to come into effect and reinstate the rebate before the end of the financial year. I commend the bill to the Senate.