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Monday, 26 November 2012
Page: 9761

Senator IAN MACDONALD (Queensland) (18:11): I want to start my contribution to the debate on the Clean Energy Amendment (International Emissions Trading and Other Measures) Bill 2012 and related bills by reading from some articles by a news organisation called Point Carbon over the last few days. The first one I will start with is: 'Greece sells 500k second phase EUAs for 6.76 euros each'. The article states:


you know, that great example of good financial management—

sold 500,000 European Union carbon permits … at 6.76 euros a tonne each, according to Athens Stock Exchange …

The next one talks about Italy proposing to replace the European emissions-trading scheme, which we are tying ourselves up with, by a carbon tax. So, whilst Australia is going to an ETS, the Italians are talking about going to a carbon tax. Another article states:

European carbon prices rose for a second day, gaining as much as 2.8 percent after the UK pumped 6.5 million allowances into the market in the biggest permit auction to date.

There is a purpose in raising these articles, Madam Acting Deputy President, which I will come to. But, before I do, can I just again read from the same source this article about New Zealand:

Spot permits in New Zealand’s carbon emissions market rose 8.1 percent week-on-week to close Thursday at NZ—

wait for it—

$2.92, pulled up by vanishing supply although traders said buying interest was also lacklustre.

So it is $2.92 per tonne for our friends across the ditch in New Zealand.

'Chinese firms face 1.5-bln loss on re-jigged CO2 deals', says a consultant, is the next headline. I am sorry I am wasting the Senate's time going through these, but they just make such magnificent reading. These are headlines in the last few days.

Here is another one: 'EU carbon allowances for delivery next month were largely unchanged Thursday after the EU sold about 4.5 million permits at $6.64 euros, in line with market expectations'.

The next headline is: 'Germany on Friday sold 3 million carbon allowances from the third phase of the EU Emissions Trading Scheme at 6.75 euros each, the auction host German bourse EEX said'. And so it goes on: 'EUAs hit 5-day high on firmer energy'. Then this statement:

European carbon prices rose to a five-day high above 7 euros on Friday amid firmer energy prices and as speculators covered short positions …

I only raise these issues to show that the Labor Party wants us to align ourselves with the European market, which is so volatile. Let me do a quick calculation. Those euros I just mentioned equate to A$9 or A$10. The New Zealand price of $2.11 equates to about A$1.50. That is what the Labor Party wants to associate our carbon pricing scheme with.

Today we are debating a bill that will remove the legislated carbon tax floor price of $15. Hang on a second! Didn't we just pass a piece of legislation a matter of weeks or months ago that actually put in that $15 floor price? Why did that $15 floor price go in? Clearly, because someone was looking at the European and New Zealand floor prices, which are down around A$5, A$6, A$7, A$8, A$9, A$10 or, if you look at the New Zealand price, around A$2. So the government, in all its wisdom on this carbon tax, decided that we would have a floor price of $15. I could not quite understand that. The government's funding of this whole carbon tax debacle is based on the fact that carbon will sell in Australia for $23 a tonne. Forget about the $15 floor price, forget about the European schemes at around $8, $9 and $10 a tonne or the New Zealand scheme at $2 a tonne—the government's figures on what it is going to get from the carbon tax are based on $23 a tonne. But it does not stop there. By next year the $23 a tonne is to go up to $29 a tonne and, by 2020, it is to go up to $39 a tonne and, by 2050, to about $350 per tonne.

If the government's figures are based on those amounts, why did they put in this floor price of $15 a tonne? I could not understand it then. Why do you need a floor price of $15 a tonne when all your figures, all your tax receipts, all the money you are giving away, all the loans that you are borrowing from overseas lenders and that you will have to repay are calculated on the basis of $23 per tonne, increasing to $29, $39 and $350 a tonne?

Why did we need the floor price? I could not understand that. But here we are today, as I understand this legislation, removing the $15 floor price and equating it directly to the European prices which, as I said at the beginning of my contribution, are so volatile. They range from A$7 to A$10.

How are the government ever going to make their books balance? Nobody believes that they ever will. They are still running on the pretence that they will make the books balance, based on $23 a tonne and here we are associating it with the European scheme that will, as at today's prices, get them back about $10 a tonne.

I only raise these things to show how totally incompetent the Australian Labor Party are when it comes to running anything. Who would trust them at all with anything to do with the carbon tax? Quite clearly, the Australian public knew that. They did not want anything to do with the carbon tax and that is why Ms Gillard dishonestly promised the Australian public, on the eve of the last election, that there was no way there would ever be a carbon tax under her rule. She dishonestly and deliberately misled the Australian people. I repeat that: she in fact dishonestly and deliberately misled the Australian people by saying that the Australian Labor Party would never introduce a carbon tax. So why would you, I or indeed any other Australian believe Ms Gillard and her government on anything at all they say about the carbon tax and indeed, by extension, on anything at all?

As I travel around my home state of Queensland I get the distinct impression that Queenslanders—and I am sure this applies across Australia—have simply stopped listening. It is very much, I might say, the same feeling that we had in Queensland before the state election. I have worked on polling booths for 40 years, handing out how-to-vote cards. The last Queensland election was notable in that more voters than ever before, and a considerable majority, refused to take anyone's how-to-vote card. Why? Because they had made up their minds on what they were going to do. They did not need a how-to-vote card. They did not need election promises. They did not need Ms Bligh crying on TV about something. They did not need all those false accusations about Campbell Newman and his family. It did not make one iota of difference: people in Queensland had made up their minds six months before that all they wanted was the end of a dishonest, disreputable, incompetent Labor government.

My impression as I serve my state of Queensland is that the same is occurring federally. People simply do not bother talking about anything Ms Gillard says anymore. They know that she deliberately and dishonestly lied to the Australian public before the last election and they now have no interest in anything she says. She can say all she likes about not being involved, back at Slater & Gordon, in the slush fund. It does not really matter because nobody listens to her. Nobody gives any credence to what she says. I might add in passing that if I as a lawyer had conducted my practice as a solicitor the way Ms Gillard is alleged to have conducted her practice then I would have been disbarred. That does not seem to apply in the case of Slater & Gordon and people who are partners in that firm. But that is by the way; what we are talking about here is that, within four months of the commencement of the carbon tax scheme, we are onto our eighth major change to this legislation.

Madam Acting Deputy President Stephens, if you want to have a good laugh, don't watch the cartoons or 7.30 or Q&A, just go to what was said about the need for having a legislated carbon price. On 13 September last year Ms Gillard said that we have to have a price cap and a price floor in the first three years 'to provide certainty'. In November last year she said 'we have set a floor and cap so there can be stability in pricing'. In July 2011 she said there was 'a price ceiling and a price floor which we have announced' and that 'this is essential for certainty'. Mr Combet said: 'We have legislated for a floor price, that is quite well known. It is essential.' On 13 September last year he said, 'We've put in a floor price and a price cap to provide some confidence over the first few years about potential variability.' He also told ABC Radio National, the great mouthpiece of the ALP, on 12 July this year that the federal government had negotiated a price floor as part of the multiparty climate change committee. That multiparty committee, mind you, was the Labor Party and the Greens, that is how multi that was—but, again, that is beside the point. Mr Combet went on to say, 'We have a legislated three-year fixed-price period.' That was in July this year. We are now in November, five months later, and we are doing away with that floor price and associating ourselves with those bastions of good economic management, the socialist governments of Greece, Italy, Spain and now France. I acknowledge that in some of those countries the socialists were tossed out in their elections but they were the ones that caused the economic chaos. So Australia is associating itself with those bastions of good economic management, the European Union. I guess it would be a competition as to which are the most incompetent financial managers, Mr Swan and the Australian government or the former socialist governments of Europe who have put the European economy in such a mess.

I would hope that I have this wrong and that someone from the coalition or the Greens—

Senator Jacinta Collins: The coalition?

Senator IAN MACDONALD: will get up and say: 'No, all those prices that Senator Macdonald quoted from the carbon market in the last few days are wrong. Senator Macdonald has read those incorrectly. We don't have to worry about $15 or $23 or $29 a tonne, which we've got to have to balance our books. Those prices he read out of $8, $9, $10, $11 are all wrong.' I am just waiting for someone from the Labor Party to get up and say, 'Senator Macdonald got that wrong about the New Zealanders.' As one of the Labor Party members said in a very significant interview a few weeks ago: 'The Australian government has adopted a similar carbon tax proposal as the New Zealand parliament—exactly the same.' Yeah, yeah! Only the Australian price is $23 a tonne, the New Zealand price is $2.11 per tonne. Yeah, the same price! What a joke. This would be a laughing matter if it were not so serious for the Australian economy.

Quite frankly, I say with some regret that I think Labor Party politicians are in permanent denial mode. I know most of them are not game to go out and face their constituents at the moment. I know most of the Queensland Labor MPs in the lower house—the few that there are—avoid public meetings like the plague. Why? Because every one of their constituents is suffering as their costs of living skyrocket. Why? Because of the carbon tax. You can have all sorts of other excuses and explanations, but can I just say to the Labor Party senators here: don't bother wasting your voice even trying to explain it. People in Queensland know that they have been done over, that their costs of living have risen because of the price of carbon. They also know that the carbon tax and the mining tax are causing real uncertainty. I challenge any Queensland Labor senator to go and spend a few days in Gladstone, talk to people there and you will find in that magnificently active and aggressive industrial city of Gladstone that people are worried. They are worried about their jobs. They are worried about their futures. They are worried about their mortgages.

Sitting suspended from 18:30 to 19:30