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Monday, 23 November 2009
Page: 8514

Senator WILLIAMS (12:51 PM) —I rise to speak on the proposed Carbon Pollution Reduction Scheme Bill 2009 [No. 2] put forward by the Rudd government. I commence by looking at the term in it. My colleague Senator Parry has said he cannot see the word ‘tax’ anywhere, and perhaps ‘tax’ should be in it. It is called the Carbon Pollution Reduction Scheme, but carbon is not a pollutant. In fact, 70 per cent of the food we eat is carbon. So, under the title of this legislation, when you have your evening meal tonight enjoy it, because it is 70 per cent pollution that you will be eating under what is proposed here. I have in front of me the original list of hazardous air pollutants—173 pollutants are listed. There is carbon disulphide and carbon tetrachloride. There is no ‘carbon’ or ‘carbon dioxide’ mentioned there. So I say the title of this scheme is a furphy in itself.

Carbon is essential to life: 18 per cent of our bodyweight is carbon; carbon dioxide is food for our plants. Without carbon dioxide in the atmosphere we do not have anything green. Crops, trees, plants and grasses are destroyed without carbon dioxide. Everything around us contains carbon, yet the title of this legislation is about carbon pollution. That is wrong, and the word ‘pollution’ should be removed from it. If the government want to call it the carbon dioxide reduction scheme, so be it, but it is not a carbon pollution reduction scheme because carbon is not a pollutant.

We can see how the climate has changed. The climate has been changing for millions of years. The climate has been changing over time since day 1. We have been in and out of many ice ages. All of a sudden we now have some people pushing an agenda and saying that they are going to control the climate. I find that simply amazing. People say: ‘It’s climate change that caused the droughts in many parts of New South Wales since early 2002. They were caused by the coal fired generators producing electricity and by the exhaust fumes from motor vehicles and other transport, trucks, tractors et cetera.’ Well, I question what caused the 12-year drought in western New South Wales from 1895 to 1907. There were not coal fired power generators in those days and there were very few motor vehicles, yet the droughts ran on. As Dorothea Mackellar said, in Australia we are in a land ‘Of droughts and flooding rains’. Just last week we heard the Prime Minister talking about climate change, global warming and how hot it has been in Adelaide, making records, but he did not mention that at the same time in Perth it was 19 degrees and raining. Yesterday I was interested to hear, when listening to Macca on Australia All Over, that they were talking about how 12 months ago yesterday it was snowing in Gundagai. But that does not get a mention. They only talk about the hot days; they do not talk about the cold days.

I intend to bring some common sense into this debate. I refer to the Minister for Climate Change and Water, Senator Penny Wong, when she said, ‘We must act now. It is vital to save the earth, to save the planet.’ On 27 March 2009 in an address to the International Peace Institute in New York, Minister Wong said:

And we have reached a point where action is needed, and needed now, while we still have an opportunity to act.

So what have the government done? They have delayed it for 12 months. What irony! What hypocrisy! Minister Wong said in March in New York that we must act now, but then she said: ‘Oh no, we are going to put it off for 12 months. We will put it off and introduce it on 1 July 2011.’ Why is that?

Senator Boswell interjecting—

Senator WILLIAMS —Aha! My colleague Senator Boswell has mentioned the word ‘election’. It is because the government know for sure that they can have an election prior to Australia’s commencement of pain—when people start to suffer the costs, when people’s jobs will be threatened et cetera. So I question how committed the government are to acting now when they have gone into delay tactics.

Let me talk about the science. We hear of the scientists who say that the globe is definitely warming as a result of more carbon dioxide in the atmosphere. We are well aware that there is more carbon dioxide—280 parts per million in the year 1750 having now risen to 380 parts per million in the year 2009. There is no question about that. Ice samples certainly prove it. The question is: are those extra levels of carbon dioxide in the atmosphere causing the globe to warm? That is the question here. I want to refer to one of the leading German scientists, a Professor Latif, who is one of the leading climate modellers in the world. He is a recipient of several international climate study prizes and a lead author of the United Nations International Panel on Climate Change. He has contributed significantly to the IPCC’s last two five-year reports that have stated unequivocally that man-made greenhouse gas emissions are causing the planet to warm dangerously. But in Geneva in September this year at the UN’s world climate conference, an annual gathering of the so-called scientific consensus on man-made climate change, Professor Latif conceded that the earth has not warmed for nearly a decade and that we are likely entering into one or two decades during which the temperatures will cool, so he is flip-flopping all over the place. This is one of the leading scientists, one of the advisors to the IPCC, and he is saying that the climate has not warmed for around a decade and that we are going to have 10 to 20 years of cooling.

I find that quite amazing when we look back at other scientific facts and real issues, such as the River Thames freezing in the mini ice age. From the 1400s to the late 1800s in the 19th century it was not uncommon for the River Thames in London to freeze over. So why, at the start of the 1900s, did the Thames stop freezing? To me that is quite a logical, sensible question to ask. Why did the Thames stop freezing at the start of the 1900s? We know that there were not coal fired power generators. There were not Boeing 747 jets. There were not V8 Falcons and V12 Jags with members of the London population in them chucking donuts around Trafalgar Square or anything like that—this was the early 1900s. So why did the climate warm and why did the Thames stop freezing over when the CO2 levels were obviously not rising? The reason is climate change—climate change that we have had for millions of years. And, no matter what we do, we will never change, alter, prevent or do anything to stop nature running its course. That is the fact of the matter.

We have the argument about sea levels. It is quite amazing how at the centre of Australia you can find seashells. Obviously at some stage that land was under water. Yet we know that thousands of years ago the sea levels were so low that the Indigenous people travelled from Indonesia to the mainland of Australia and to Tasmania. That is a variation that we know of over thousands and thousands of years. But do not worry about it; it is going to rise by a couple of metres by the end of the century, according to the Minister for the Environment, Heritage and the Arts, Mr Garrett, and he will control it. What people are saying is just outrageous. He will not control it. Nature will run its course and climate change will go on forever.

So what is our solution to this? This is the government’s solution. For a start, they are going to impose a tax on our electricity industry. Everyone in Australia will pay, but the government will compensate some because they will get a fair bit of money from the permits they sell and they can distribute that to the pensioners and low-income earners for the tax they put on our industries. Let us look at some of the taxes we are going to suffer. They include energy, fuel, transport and food processing—costs on virtually everything. As my colleague Senator Joyce has made quite clear to the Australian people over months, Mr Rudd and his tax will be in every part of your life. Whether you are eating at home or travelling around on holidays, no matter where you go you will be taxed.

What is the result of that? We know the threat exists to shift our industries overseas—industries such as cement which will not survive in Australia because of this tax. We know that jobs are going to go. We know coalmines are going to close down. This is a cost that Australians must realise is going to happen if this emissions trading scheme proceeds. I raise a point that I think is vital to this whole debate. We know about inflation. We have heard about the ‘genie in the bottle’. Inflation is a situation where demand exceeds supply. As a result of demand exceeding supply, prices rise, and the amount the prices rise determines the inflation rate. I remember the criticism of Mr Keating when the Howard government had the courage to introduce a goods and services tax to give some proper funding to the states and territories of this nation: it was going to be a ‘monster tax’. In fact, it was a replacement tax.

The funds flowed to the states, but if we want to go the way of spending the money perhaps we could refer to Premier Nathan Rees, if my colleagues would like—we could go down that road with pleasure. But what do we have here? We have a new tax. The price of everything will rise. The price of electricity, the price of food, the price of transport, the price of travel—everything is going to go up. When those figures read into the inflation figures, my question is how much the Reserve Bank will raise interest rates. They run hand in hand: higher price rises and higher inflation rates mean higher interest rates to slow the economy. The last thing that we want in this nation at the moment is another rise in interest rates; we are already getting enough of those because the government will not wind back its spending. There is too much money in the economy, according to the Reserve Bank, and the government is continuing on its borrowing-and-spending spree and is, hence, responsible for the rise we have had so far.

So the emissions trading scheme is going to give us higher inflation rates and, obviously, higher interest rates. Then we go on to the higher Australian dollar, which also runs hand in hand. Every time the dollar goes up a cent it wipes hundreds of millions of dollars off the nation’s income from exports. These are the ramifications that are going to result from this emissions trading scheme. But of course it will save the world. I will get to that in a minute. I just want to point to the serious parts of this emissions trading scheme. The serious parts are the cost to industry, the cost to households, the cost of doing business and remaining competitive in international markets and, of course, the interest rate rises that will put the pain on the battlers—the ones who are having a go—in Australia. They are the ones who suffer the most from higher interest rates.

Then the government propose to have a scheme where the price of carbon will be set on the stock market. It will trade around the world. I just mentioned the Australian dollar. We have the Australian dollar trading around the world, and in the last 12 months we have seen it go from 60c to 93c. That is the dealers trading it up. I had five years trading on the foreign exchange market during a time in my life I wished I had not been in a foreign currency loan. It was in Swiss francs. It is the dealers who trade the exchange rates up with positive sentiment, so we know exactly what the Australian dollar is doing. The dealers are trading it up, because as interest rates go up in Australia the differential between US and Australian interest rates gets wider and, hence, those overseas see an opportunity to make a bit of extra money. The sentiment in the market is positive.

We are going to do this with carbon. We are going to have a situation where the cost of running your household or the cost of running your business will depend on the dealers in stock markets all around the world. To me this is outrageous. Already the exchange rates cost Australia enough when it trades up. Now they are going to give us a double whammy; the cost of doing business in Australia will be determined by the dealers on the stock markets. We have already had reports from National Australia Bank saying the price of carbon could trade as high as $100 a tonne.

Senator McGauran —Whoa. Really?

Senator WILLIAMS —That is what their quotes are, Senator McGauran. Let us have a look at the costs that we are going to put on our industries. I refer to Macquarie Generation. Macquarie Generation run the Liddell and Bayswater power stations, as I am sure Senator Forshaw is familiar with. In the first year, at $10 a tonne—and we know the government has fixed the price at $10 a tonne because it is going to go a lot higher—Macquarie Generation will have to buy 25 million permits. That is $250 million for Macquarie Generation. The only one who is going to be jubilant about that will be the bank. What industry—especially a government owned facility in New South Wales—would have a spare $250 million in their hip pocket? No, they will have to go borrow that and pass the cost on to consumers. In the second year, if carbon is at $25 a tonne Macquarie Generation will have to buy $625 million worth of permits. The federal government will welcome the money. That will be great—money in the kick for the feds—but look at the cost to the people of New South Wales.

The question will be what it will do. The answer is that it will not do anything at all. The reason is that Australia produces 1.4 per cent of the world’s greenhouse gases. I will give some facts. If the rest of the world’s emissions remain the same till the year 2020 and we reduce ours by 20 per cent, instead of producing 1.4 per cent of the world’s greenhouse gases it will produce 1.12 per cent. To hope the rest of the world, including China, India and those growing countries, will stay the same is being very optimistic in itself, but when we reduce ours by 20 per cent at a cost of $120 billion or $200 billion—whatever the cost is, depending on the price of carbon by the year 2020—what we are going to do is reduce the carbon dioxide levels around the globe from 380 parts per million to 379 parts per million. One part per million is what the $200 billion tax is going to mean for the whole global atmosphere.

One part per million—how can I describe that? Imagine if we had a huge tub out on the floor down there and that big tub had one million $1 coins in it and we took one coin out of it: that is the difference it is going to make—absolutely nothing. But it is going to cost a swag of jobs, it is going to cost industry a fortune and it is going to cost the Australian people a tremendous amount of money. We all know that; it is going to cost high interest rates and put a cost through our economy that we simply cannot afford, especially at this time of the economic cycle. And we are going to take one $1 coin out of that tub of one million coins. To me that is just plain stupidity, but this is the proposal coming up.

This is why the National Party have opposed this from day 1. We know that regional Australia will cop the most. Even though agriculture is excluded, we know regional Australia will cop the biggest one because agriculture will still have to pay for the extra costs on electricity, fertiliser, chemicals, freight and transport. Even though they are being excluded on the debit side as far as greenhouse gases with the ruminants go, it is still going to cost agriculture a fortune—and to achieve what? If we were serious about looking after our environment, we would be looking at carbon sequestration in the soil, building our soil better. I wish people could go out to Northparkes Mine and see the job that Geoff McCallum has done there.

If we were serious we would start managing our national parks and get grazing in there. The best way to reduce the fire fuel levels is by stock grazing those national parks. But, no, we will not do that. It is just amazing that for every bushfire there is around 200 tonnes of carbon dioxide per hectare, so what did it cost us in the 450,000 hectares of the terrible fires on Black Saturday? About nine million tonnes of carbon dioxide, about double what Australia produces in a year just in the bushfires of those days, not to mention the Canberra bushfires. If the government were serious they would get serious about managing the environment.

There is a lot about this whole plan that has been put forward that I find quite amazing. The government’s chief adviser, Professor Garnaut, is not a scientist; he is an economist. Why would you rely on someone who is an economist to give you all this information and detail on a scientific issue? That is simply unbelievable.

I foreshadow that I will move the second reading amendment standing in my name on sheet 6016:

At the end of the motion, add:

and further consideration of the bills, which will impose the single largest structural change to the Australian economy, be made an order of the day for the first sitting day after:

         (a)    the Copenhagen Climate Change Summit has concluded; and

         (b)    the United States Senate has clarified its position by finally voting on the American Clean Energy and Security Act (the Waxman-Markey bill).

We think that this is just a way for the government to collect money. This is not about global climate change; it is about global taxation and global control. That is why we will never support it. I thank the Senate for its time.