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Wednesday, 15 June 2011
Page: 6158


Mr RAMSEY (Grey) (16:56): I rise to speak on the Carbon Credits (Carbon Farming Initiative) Bill 2011 and the amendment moved by the member for Flinders. The climate change conference, three weeks ago now, reaffirmed the problems and challenges facing the world. Mercifully, at least for now, we have an open admission that only a worldwide effort can actually make a difference to our CO2 emissions and the actions Australia takes in isolation in fact make very little difference. That does not mean what we do is not important or that we should not try. We must be seen to be part of the world community in taking action in this area.

The coalition's position is that we should take the least-harm option to meet the minimum cuts of five per cent by 2020, goals both the government and the opposition agree on in this debate. Some say that the coalition's plan will not deliver the necessary cuts—the five per cent by 2020—but of course an equal question remains: will the government's tax deliver the five per cent by 2020? There are industry reports circulating at the moment that the coal-fired power industry would need a price of around $60 a tonne for carbon to be able to switch off coal.

Australia is often identified as a villain, as the world's highest or second highest emitter of carbon on a per capita basis. Like many things in many debates, there are things that are definitely true, there are half truths and then there are things that are absolute misrepresentations. I put this one in the category of half truths. While it can be shown to be true on paper, in fact 18 per cent of Australian emissions are embedded in our exports—those emissions are consumed in third countries, making their balance sheet look good and our balance sheet look bad. If you remove that 18 per cent we in fact come in at around number 12 on the list of highest emitters in the world—about mid-range for a modern industrialised nation.

For good policy outcomes we must accept reality. In the latest year I have figures for, 2008-09, China installed 50 gigawatts of coal fired electricity capacity, which is roughly 35 times as much as the total South Australian output of electricity. We must also recognise that two of our greatest competitors, Canada and the US, have abandoned plans for trading schemes and it is important that we understand our place in the world. A scheme which makes a sacrificial lamb of Australia will achieve a worse result for the world's environment. That is why we support the policy of direct action, just as President Obama does. It enables Australia to grab the low-hanging fruit. My father was a great gardener and he had a wonderful orchard. We never started picking fruit from the top of the tree; we always went for the low-hanging fruit. I think it is very sound policy because, in fact, the fruit at the top could be eaten by the birds by the time we got through the fruit at the bottom.

As I said, if we embark on a policy of direct action, as we approach the point of 2020 we can re-assess where we are—is the rest of the world serious?—and we can adapt to suit. But, if we follow the path of tax and we have carbon leakage, then, of course, the nation is seriously disadvantaged. In particular the regional electorate which I represent will be seriously disadvantaged. The government promotes certainty and they plan to ramp up the tax. The question is: what will happen if the rest of the world fails to deliver? Any government will be forced to change the rules and that will not give investment certainty.

In turning to the bill, Australia covers 7.6 million square kilometres and is the sixth largest nation by land mass in the world. Australian farmers manage 60 per cent of the continent and the land is recognised as an enormous potential carbon sink. If we are to utilise its potential, it stands to reason that we must find a way to involve the land managers, that is, the farmers. This legislation is about establishing a framework aimed at encouraging positive and long-term land management practices and it is a step in the right direction. Repeated farming practice largely gives a stable outcome. That means the rain falls on the ground, the sunshine is applied and the plants grow. They soak up carbon, lock that carbon up for a certain period of time—normally not long—and livestock may eat it or we may reap the crops, and then we release the carbon when the food is consumed. So, it is a cycle. To increase carbon storage in that cycle we have to change practice.

The change in farming practice in the last 30 years across Australia has been enormous. Many of the things which store carbon in the soil are already commonplace practice on farms. Not only is it the direct storage of carbon in the soil, it is the way the land is managed which can have a big effect. For instance cultivation is a big culprit when it comes to soil erosion with wind and water. Soil erosion leads to salinity, salinity leads to loss of production and the ability to store carbon long term. If you kill off the trees and the crops in an area then no carbon will be stored. It has an impact on the world environment in a similar manner, which I will come to in a moment.

The experience differs from farm to farm and having set rules for any particular farm can mean that you get varied effects. Australia is a huge place and conditions vary greatly across it. In some places there is high rainfall of metres per year. In the part of Australia that I represent it is down to less than 100 millimetres a year. It is tropical in the north to an almost frigid climate in southern Tasmania. There are deep black self-mulching soils, rocky mountain grazing and sandy flats in Western Australia. The reason for pointing out these different agricultural backgrounds is to show that picking technologies is dangerous. Whilst many people see trees as being the ultimate answer in locking up carbon, in the area I farm, trees can be quite an impediment to farming. There is the idea that you have shelter belts but, in fact, when you live in a low rainfall environment, trees will stretch their roots for maybe five times their height into the paddock because they have to be shallow rooted trees to live in those environments. That means that, rather than covering up a small area of ground, you actually lead to erosion pits around the trees and loss of production. It is important that any policy should not just stimulate a knee-jerk reaction in forestry which, in fact, could have a detrimental overall effect.

I have a serious concern that parts of this policy will lead to people buying up land in the most productive parts of Australia and locking it up under trees for a 100-year time frame. In the end that is counterproductive to world food production. While we are told that the CO2 challenge is the greatest moral challenge of our lifetime, feeding a world of nine billion people will also be a great moral challenge for this planet. Taking prime land out of agricultural production will lead to much greater logging and clearing of rainforests in Third World countries. It is important that we keep our agriculture production at the large end, the most productive end, and that we get the most out of the available soil in the world without having to clear more areas.

Estimates of deforestation around the world contributing to CO2 emissions range from between seven per cent and 25 per cent a year. That is a big range and it shows you how difficult carbon accounting can be. That brings me to a recurring theme in the treatment of agriculture and in how we support agriculture. I said to a friend almost 30 years ago that I thought agriculture was a sunrise industry. He recently spoke to me and said, 'I didn't know what you meant then, but I think I'm starting to get it now.' He is starting to understand what a challenge it will be for the world to feed itself. I have often raised the issue of agricultural research in the House. It will be very important, if we are to utilise this legislation, that governments invest in the research which will deliver the tools to farmers so they can adequately measure and manage the carbon cycle within their soils. At the moment the technology is, at best, in its infancy. Farmers will know how to access the program if we put the framework in place. They will work out how to access the money and how to access the policy but you have got to give them the tools to do so. In fact, our agriculture departments have been run down around Australia by various state governments with a lack of investment such that the horsepower to do the job is being challenged at the moment.

I am concerned this bill has no allocation for funding to develop the science. It attempts a quick fix. It sounds good but, like most pieces of government legislation, we get the announcement before we get the meat on the bones. We were just told by the member for La Trobe that there was plenty of detail in this legislation. In fact, there are 300 pages in the bill and 160 pages of explanatory notes, but there is no clear understanding of actually how this is going to work. There is plenty of detail but nothing which helps farmers to understand what the compliance will be in detail and what it will mean for them on their properties to go out and work with this legislation.

While it is moving in the right direction, and that is why the opposition supports it, there needs to be more work going into it at this stage so it can be adequately accessed by farmers. Recent suggestions that a carbon price may have to be as high as $40 or even $100 a tonne would certainly excite farmers when it came to producing carbon credits. However, the implications of such a tax might well mean there are no farmers left to get excited. Much of what the government wants to do appears to involve a blank cheque, which is why the member for Flinders has moved his amendment. This legislation follows the government's track record of an announce and defend mentality which has the government under siege to some extent. Through the last 3½ years we have had many examples of a big policy announcement and no detail 'as it will be worked out later'. Of course, the devil is always in the detail. So I look forward to seeing how the government is going to try to implement this policy and we look forward to working with the government to implement the policy. As I said in my opening remarks, 60 per cent of the land mass is controlled by Australian farmers and if we want to find a way to sequester carbon into soil obviously we must involve the land managers. So in that case we need carrots—and sometimes we need sticks but this is certainly about carrots. But it needs to be tightened up a fair bit before I can see many of my neighbours actually saying: 'Gee whiz, this is a good idea. I'm going to get on with it.'