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Monday, 7 November 2011
Page: 8278


Senator WONG (South AustraliaMinister for Finance and Deregulation) (11:13): I think I have just answered that about seven times for Senator Xenophon. I will repeat what I said: deferred payment arrangements increase the administrative complexity of options and inhibit the development of secondary markets to manage carbon pricing risk. Obviously, secondary markets actually provide firms with an indication of where the price is going in the future—that is important for business. I have also indicated the government has said we will offer loans to emissions-intensive generators who are otherwise unable to secure finance on reasonable terms, to buy future vintage carbon units at auction. This addresses working capital constraints directly, without interfering with the function of the auction. We are also providing $5½ billion of assistance under the Energy Security Fund to the most emissions-intensive generators.