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Thursday, 27 March 2014
Page: 3371

Mr FLETCHER (BradfieldParliamentary Secretary to the Minister for Communications) (12:16): I am very pleased to rise to speak in the consideration in detail stage of the Clean Energy Finance Corporation (Abolition) Bill 2013. There is a very clear question before the chamber contained in the terms of the bill we are debating this afternoon: whether the Clean Energy Finance Corporation should be maintained or whether it should be abolished, as schedule 1 to the bill would have the legal effect of doing.

It is the policy of the Abbott government that it should be abolished. The first reason why the parliament should support this bill is that we were very plain, we were very clear, we were very explicit when in opposition that we did not think the Clean Energy Finance Corporation was a good idea. We said very clearly that we intended to abolish it. We took that to an election, and we were resoundingly supported. Let there be no doubt in this House: we have a very clear mandate to give effect to the policy that we took to the 2013 election, which was that the Clean Energy Finance Corporation should be abolished.

Why did we take that policy to the election? If you listen to the previous speakers opposite, you would think that what we were proposing to do was to strangle a marvellous vehicle that was going to produce an endless stream of commercially viable, profitable and wonderfully environmentally supportive ventures, and that we are turning our back on this economic and environmental nirvana that the previous Greens-Labor coalition had invented. We are very sceptical that the Clean Energy Finance Corporation would work as it was intended to, and we have expressed clearly our scepticism from the outset.

Let us consider what the fundamental business model of the Clean Energy Finance Corporation is. If I quote from a press release issued by the then Treasurer on 12 October 2011, the mission is to:

… act as a catalyst to private investment which is currently not available—

and apparently was going to:

… overcome capital market barriers that hinder the financing, commercialisation and deployment of renewable energy, energy efficiency and low emissions technologies.

The business model of the Clean Energy Finance Corporation is for the taxpayer to be the mug who comes along and invests in projects that the private sector has passed on investing in. The business model here is that when the private sector has examined the opportunity for investment and has determined, on the basis of that examination, 'We do not intend to put money in here because it is too risky and we are not going to get a return,' then apparently the taxpayer should come along and invest money to do that. And by the way, where was the taxpayer going to get that money from? Where was the government of Australia going to get that money from? Of course, it was going to borrow that money because of the chaotic state in which the public finances of this nation have been left by the Rudd Gillard Rudd governments.

This was a proposal from the previous government, this was a measure from the previous government that was predicated on a deeply unwise assumption that a government-owned corporation would do a better job of investing in risky ventures than the private sector would. It was predicated on the deeply unrealistic assumption that you could establish this venture and that it could invest in a way that was not subject to any kind of political pressures, that did not expose it to any kind of expectation on the part of Labor and the Greens who set it up that money would flow to all kinds of projects that they thought were virtuous. It is a venture that has been set up in ignorance—in clear and studied ignorance—of the tragic track record of these kinds of investments and ventures around the world.

In the brief time I have available, let me mention Solyndra, which was the US example of a new photovoltaic solar panel manufacturing facility, a $US535 million loan guarantee given by the Obama government. And guess what? Within just a few months the expansion was postponed; three-quarters of that guarantee was called on. The taxpayer there was left as the mug, and under this venture the taxpayer would always have been the mug. That is why we have opposed this ill-judged venture from the outset.