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Monday, 20 August 2012
Page: 9201

Mr HUNT (Flinders) (21:18): Let me deal with this carbon tax. It does not work, nobody else is doing it and there is a better way. Let me deal with the fact that it does not work. I will take the member for Wakefield to page 18 of the summary modelling document in Treasury's own modelling. What does that say? That between 2010 and 2020 Australia's emissions will go up from 578 million tonnes to 621 million tonnes. Hang on. We have a carbon tax. It has been brought about to reduce emissions. Yet Australia's emissions go up by 43 million tonnes or almost two tonnes per person. The raison d'etre, the purpose, the cause, the reason for being of this carbon tax is to reduce Australia's emissions—and it does not. It does not work. It does not achieve its basics. It does not achieve the very thing for which it was created. That is why, before you even get to the issue of electricity prices, gas prices and refrigeration costs, Australians are saying very simply, 'What's the point?' I am one that does believe that we need to take action, that does want to reduce emissions. This carbon tax does not do it, because electricity is a fundamentally inelastic good—not perfectly inelastic, but it is an essential service. That means its susceptibility to price change is limited. That is why around the world an electricity tax is not what is actually happening.

This brings me to the second point: nobody else is doing it. What the government would have us believe is that everybody is rushing to the carbon tax, right around the world. Let us look at the reality. The United States has made sure that there will be no carbon tax under a government that anybody leads in that country over the next 10 years. Of that I am as certain as I could possibly be in terms of anything at the geostrategic level. Canada has just held an effective referendum with its last election, and the proponents of the carbon tax were decimated, destroyed, obliterated. That was the electoral fate of the carbon tax in Canada. In Japan it has been deferred indefinitely. In Korea it was not brought forward; it was put back. And the amount of free permits is up to 100 per cent in the vast majority of cases. So the reality is that there is the fig leaf but no actual functioning tax remotely like anything else. In India, no chance. In China they are seeing the greatest growth in coal emissions in human history.

What we are seeing is a growth in coal from 1.4 billion tonnes in 2002 to up to four billion tonnes in 2015. That is the reality. In Europe—which the government cites as if it is the great saviour of the drowning government—over their first five years they averaged a take of $500 million, for a population of 500 million, so it was $1 per person. In Australia, we will make $9 billion from the carbon tax by taking it from the people in the first year. In the first year we will have approximately 18 times the take of Europe's first five-year average, and our population is 22½ million people. So the difference is between $1 per person and $400 per person. That is why there can be no comparison between Europe and Australia.

As the Productivity Commission said, no other country has an economy-wide carbon tax or emissions trading scheme equivalent to that which is being proposed in Australia—all of which leads to the knowledge that there is a better way. And it is very simple: we just hold a reverse auction. All we do is what we do with water. We buy the lowest cost emissions reduction, the lowest cost abatement—whether it is capturing carbon in soil, capturing carbon in trees, cleaning up waste landfill gas, cleaning up waste coalmine gas, cleaning up our power stations or pursuing energy efficiency at the industrial, domestic or commercial level. That is what we do. It is not difficult. It is in fact exactly as the UN's Clean Development Mechanism operates. This carbon tax is lonely. It is a failure. It does not work, and that is why it should be utterly rejected.