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Monday, 8 February 2010
Page: 676

Mr FITZGIBBON (7:43 PM) —I say at the outset that I have no intention tonight of making a contribution arguing the science of climate change. I am not going to get into whether or not the globe is warming or, indeed, whether humans are making a contribution to that warming. As far as Parliament House is concerned, that debate has been had. It has come to some conclusions. No major party in this place believes now that action is not required on climate change—not the Labor Party, not the Liberal Party and certainly not the Greens.

So there is no doubt that government action now is inevitable. But let us go back one step. Major parties in this place agree that there is a problem and action is required. The next question is this: is this action a priority for an Australian government or are there bigger and greater priorities for the government of the day at this point in time? We know that the Leader of the Opposition believes it is a priority because he now has a plan to spend some $3 billion of taxpayers’ money on his so-called direct action method. We know the government certainly has a plan. We know the government places a high priority on the need to act on climate change, and it is that plan we are debating for a third time this evening and no doubt will be debating for a little while yet.

So we know the pollies have come to a conclusion. The question then is: are the pollies right? I think it is fair to say, based on the polls, that the politicians are reflecting a broader community view. All the opinion polls tell us that the majority of Australians want their government to act on climate change. Even my electorate of Hunter is an electorate in which I believe the majority of people want the government to act on climate change. It is well known in this place that my electorate is one very relevant to this debate this evening, an electorate in which the coalmining, power generation and aluminium-smelting sectors are very, very prominent. If this debate had been taking place five years ago, I am not sure I would have been able to stand here claiming that a majority of people in my electorate supported government action on climate change, but there has been a big shift in my electorate in recent years. I will share a few anecdotes.

A few years ago a coalmining company was proposing a new coalmine, the Anvil Hill mine, in part of my electorate. At the site where the Anvil Hill mine was proposed, we had a protest action that people described as a picket line—not quite the correct description but it will do. Standing on the picket line on a regular basis were Hunter coalminers, people then currently employed in the coalmining industry, protesting against this mine and its potential environmental effects.

I remember once being asked by one of our major newspapers whether I could organise a photograph of a third generation mining family, a family in which grandfather, father and son had been involved in the mining industry. That newspaper wanted to run this picture as a way of portraying what might be the threats to coalminers in electorates like mine. I could not find one, because coalminers I talked to did not really feel comfortable about associating themselves with an all-out attack on the idea of addressing climate change. They wanted to go with the majority. They understood—the third generation person was the guy I was turning talking to—that times had changed and it was past time that governments started doing something about the environment generally but climate change in particular and all its threats.

The coalmining union in my electorate was well ahead of the Labor Party on this issue, long before the party advocated the emissions trading scheme or at least some carbon constraint, notwithstanding the potential impact on coalmining, because the coalmining union believed that there was no future for coalmining in the long term if the industry did not act to become more sustainable.

So there are big changes in electorates like mine, partly of course driven by demographic change. Younger people tend to be more conscious of environmental concerns than older Australians are. As those younger people continue to wash into the system, attitudes change. So, for all these good reasons, government has decided to act.

I said I did not want to argue the science, because there is a general consensus in this place in any case that the risks are too great not to act. There are plenty of scientists who will tell us that global warming is not real and certainly man’s contribution is not a factor. But I am a great believer in the precautionary principle: if in doubt, act. Australians spend about $3 billion on household insurance every year, mainly to cover them for unlikely but catastrophic events like fire. I do not know what the percentages are, but I suspect that in the broader scheme of things very few houses in Australia burn down each year. But Australians decide to spend that $3 billion or so each year in aggregate because they know it is a small price to pay given the enormous impact a fire could have on them, their family and their family’s future.

What are the risks in the broader sense when we talk about climate change? They are drought, heatwaves, storms, cyclones and rising sea levels, to name a few. Under some scenarios, the consequences could extend right to competition amongst people for water, food and other resources. For some island states, including those in the South Pacific, we know the threat is potentially existential.

It is clear that the parliament and the Australian people have come to the conclusion that the risks are too great to sit back and do nothing. So what do we do? In just under four weeks time, I will have been in this place for some 14 years, as is the case with my comrade from the opposition sitting at the table, the member for Dunkley. My staff advise me that this is my 417th speech in this place. Few debates over that long period of time and during my many contributions in this place have been more important than the debate we are having this evening. But, in addition to that, never in those 14 years have I seen such political opportunism from an opposition. That might be a big statement, but I have seen political opportunism in this place, on a regular basis, from those flying all sorts of colours. I saw it in the mid-1990s, when the then Labor opposition opposed the GST. In hindsight, I think that was a questionable decision. Labor saw a political opportunity and exploited it. There were some differences, of course. The biggest difference of all was that the majority of Labor MPs held strong convictions. Many of them, if not the majority of them, did not accept that the GST could be introduced without having an adverse impact on their largely working-class constituencies. I concede that the GST, a broad based consumption tax, had become a necessary and inevitable thing for Australia, but strong convictions and beliefs were held.

By contrast, this is highly doubtful on the other side of politics. We certainly know that, in the recent leadership ballot, the overwhelming majority of MPs voted for a candidate who was dedicated to taking action on climate change. They were committed not to ‘direct action’, as the now Leader of the Opposition calls it, but to some form of carbon constraint or, more likely, some form of market based mechanism. We know that the majority of those on the opposition benches who have spoken today are not speaking genuinely but are on the path to political opportunism.

We also know that there is a difference because the opposition, having negotiated with the government, last year agreed to support the CPRS, agreed to support the government’s approach to addressing climate change. To his great credit, the member for Wentworth was in here today standing by his commitment to the government, standing by the deal he struck with the government, standing here arguing for an ETS and making it clear to the parliament that he will stand by that deal all the way to crossing the floor in this place. All credit goes to him for doing so. And then we had the member for Warringah. Of course, Tony Abbott knows a political opportunity when he sees one. On many occasions he has demonstrated a willingness to exploit an opportunity when it comes along, and he is certainly grabbing the opportunity with both hands in this case.

But there is another big difference between what Labor did on the GST back in the mid-1990s and what the opposition are doing today. The risks involved here are much different. The risk of a GST not going through did have some medium- to long-term effects. As I said, there was an inevitable shift to a broad based consumption tax as the wholesale tax base narrowed and our services sector grew. But the risk in this case extends to all those things I mentioned earlier, including the existential threat for small island communities, and creates enormous uncertainty for Australian businesses. At least Labor was consistent with the GST, which is something we certainly have not seen from the opposition benches on the question of the CPRS.

We know that the Libs support carbon constraint. There can be no doubt about that. The Liberal Party have a history of support for the free market and for market responses, and I acknowledge that. Certainly in recent decades that has been the position of the Liberal Party. It has not always been the case. If you go back a bit further, they were very strongly under the influence of the National Party. But in the last two or three decades the Liberal Party have been pretty committed to the market and to market responses and to allowing the market to deal with these issues. So it defies belief that the Liberal Party, having acknowledged that there is a need to act on climate change, now believe that this direct action fiasco is the right path, as opposed to a market based mechanism. I do not believe that for a minute. John Howard believed in a market based mechanism. We know that the member for Flinders believes in a market based mechanism. He said so in a thesis he wrote as a university student. Peter Shergold, who did John Howard’s work for him, believed in a market based mechanism. And so do I—I want to make that clear.

So what is this market mechanism? This is where this debate is confusing for the Australian public. They are still wondering what this is all about. The opposition’s decision to belatedly run interference on the CPRS is making the government’s task of communicating that message and explaining the CPRS to the Australian people all the more difficult. For all its complexities, the scheme is really pretty simple. It is complex when you get down to the detail, but at the end of the day it is all pretty simple. The CPRS—or an ETS—is all about putting a cap on the amount of pollution that businesses can emit. In this case, we are talking about 1,000 businesses out of many millions of businesses in this country—for example, power stations, aluminium smelters and fuel refiners. If they cannot stay within that cap, they pay a penalty or have to buy additional emissions permits. That is the basic thrust of the thing. Simplifying it over the longer term as we emerge—that is the system.

Business can do three things. It can absorb the costs into its profit margin, or its bottom line; it can find ways to reduce its emissions; or of course it can pass the cost of that burden onto the consumer. We all welcome the fact that, in a competitive economy, passing it on is not that easy. Certainly absorbing it into the bottom line is not a good option for business. This is about the other option, and that is helping business to reduce its emissions. The extent to which business will pass on the costs we think will be between one and 1.5 per cent in inflationary terms, and of course the government will compensate consumers for that change. The tables are there for all to see on the government’s website. Any family, any individual, can go into those cameos and work out exactly how they will be affected by the CPRS and the extent to which they will be compensated.

We are also helping business in the transition. Energy intensive trade exposed industries will get massive amounts of assistance to help them through the transitionary period. Indeed, all the revenue the government raises under the CPRS goes back to compensation—compensating people, compensating families, compensating businesses through the transition period. The opposition mischievously describes the ETS as a tax. It is not a tax; it is a charge on heavy polluters and it is an incentive for them to drive their emissions down, and of course the revenue from that charge will be used to compensate businesses and families, as I suggested. The government’s CPRS package extends well beyond an ETS. We are heavily investing in the renewables sector and other low-emissions technologies. We are investing heavily on the demand side, helping Australian households reduce their energy consumption, reducing demand on that side of the equation.

When it is all said and done, for all its complexities in the detail, it is a pretty simple proposition. It is the most efficient way of dealing with the challenges we collectively face. It is time the opposition put its political opportunism aside and worked with the government on these issues. The government has demonstrated in the past a preparedness to talk and to negotiate. That is why we are dealing with CPRS mark two. I have no doubt that, to get these very important matters through the parliament, the government is prepared to talk further. But it is absolutely apparent that Tony Abbott, having gone completely in the other direction with his so-called direct action plan, has no intention of indulging in any more talk. The member for Warringah, the Leader of the Opposition, has no intention of further negotiating on the CPRS, because the Leader of the Opposition has one thing in mind and one thing only, and that is the 2010 election. I can say to the opposition leader that, just as Labor lost some credibility on the GST debate, he will lose environmental credibility and economic credibility and he will pay a heavy price in the medium to long term for his political opportunism.