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Wednesday, 13 November 2013
Page: 80

Mr HUNT (FlindersMinister for the Environment) (10:41): I move:

That this bill be now read a second time.

The Australian people delivered a clear message on 7 September that they do not want a carbon tax.

The government is meeting this promise to the Australian people by repealing the carbon tax and simplifying unnecessary climate change bureaucracy.

Repealing the carbon tax will boost Australia's economic growth, increase jobs and enhance Australia's international competitiveness by removing an unnecessary tax which hurts businesses and families.

Repealing the carbon tax will reduce annual ongoing compliance costs for around 370 liable entities by almost $90 million per annum.

Repealing the carbon tax will lower retail electricity by around nine per cent and retail gas prices by around seven per cent, as opposed to what they would otherwise be in 2014-15 with the carbon tax.

Repealing the carbon tax will remove over 1,000 pages of primary and subordinate legislation.

This bill is part of a package of bills which contribute to the government's delivery of its commitment to repeal the carbon tax and remove unnecessary bureaucracy.

The government has a longstanding commitment to abolish the Climate Change Authority, because it is not needed. I say this with no disrespect to the members or staff of the Climate Change Authority. We will bring its relevant functions in house: into the Department of the Environment.

In an economic environment that demands greater rigour in the spending of public money, the Australian people want a smaller climate bureaucracy. Our pledge to abolish the Climate Change Authority will make a significant contribution to making this happen.

The government is already well placed to receive authoritative advice on climate change matters from existing government bodies.

We have the Bureau of Meteorology to advise on climate trends and climate science. We have the CSIRO to advise on the environmental effects of climate change, climate science and the most appropriate and effective technological and scientific responses to climate change. We have an entire department of state—in the Department of the Environment—dedicated to providing the government authoritative advice on environment and climate change policy.

The principal role of the authority is to provide advice concerning the ongoing operation of the carbon tax, and, without this role, the need for a separate body to do this and other things will be gone.

The government is clear—evidenced by our introduction of the carbon tax repeal bills today—that the carbon tax will be repealed.

We are abolishing the carbon tax to reduce cost pressures on households and businesses, boost economic growth, increase jobs and enhance Australia's international competitiveness.

The government is also abolishing the carbon tax because it does not work.

It does not work because, at its heart, the carbon tax is an electricity tax. It relies upon the assumption that people will either change demand for or supply of electricity.

The problem is that demand for electricity is largely inelastic because it is an essential service. This means that the carbon tax pushes up the price of electricity without actually reducing emissions.

The previous government's own modelling from November 2012, which it submitted to the United Nations Framework Convention on Climate Change, shows that domestic emissions increase under the carbon tax from around 560 million tonnes in 2010 to 637 million tonnes in 2020.

This scheme, at this time, in this form, will not reduce Australia's emissions and will not reduce global emissions. In other words, the carbon tax does not work.

Let us be clear. The government accepts the science of climate change. The government is committed to our unconditional emissions reduction target to reduce emissions by 5 per cent below 2000 levels by the year 2020. The government will consider further actions and targets in 2015, as has been our policy and as the Prime Minister reaffirmed only yesterday, on the basis of comparable real global action, in particular by major economies and trading partners.

However, the government believes there is a fundamentally better way to reduce emissions than through a carbon tax.

The Australian government will reach its emissions reduction target through its Direct Action Plan to efficiently and effectively source low-cost emissions reductions and improve Australia's environment.

This will be done primarily through our Emissions Reduction Fund which will purchase the lowest cost abatement. The fund will provide incentives for abatement activities across the Australian economy, rather than pushing up prices.

I will now turn to the details of the bill. The bill repeals the Climate Change Authority Act 2011 in order to abolish the Climate Change Authority.

The bill makes consequential changes to other legislation to reflect the fact that the authority will no longer exist. To this end, references to the authority in other legislation will be removed, including references which allow for the sharing of information with the authority or concerning the authority's financial management.

The bill provides that the limited functions of the authority that are required in the future will continue. The bill amends relevant acts to provide that the legislated reviews of the Carbon Farming Initiative, the National Greenhouse and Energy Reporting Scheme and the renewable energy target will be undertaken at the direction of the minister.

It is my intention that these reviews should be undertaken by the Department of the Environment, which has the requisite skills and expertise to do them. The review of the renewable energy target will be undertaken in consultation with the Department of Industry.

Lastly, the bill transfers any assets and liabilities of the authority to the Commonwealth and makes arrangements for the winding up of the authority's activities.

The abolition of the authority is expected to result in a saving of $22 million over the forward estimates, further improving the budget bottom line.

I also wish to thank all of the departmental staff who have worked extraordinary hours over the last eight weeks in preparing this package of legislation, and I commend the bills to the House.

Debate adjourned.