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Monday, 17 March 2014
Page: 1135


Senator LUDWIG (Queensland) (10:06): I too rise to speak on the legislation before us, the Clean Energy Legislation (Carbon Tax Repeal) Bill 2013 and related bills. It gives me an opportunity to provide further scrutiny to the carbon price repeal bills introduced by the government. One of the opportunities, of course, is to dissect the government's view about clean energy. The government does not enjoy this process. It would, I suspect, prefer that the process be shunted through as quickly as possible. The Prime Minister wanted, I suspect, to jam the bills through this parliament without a moment to spare. The Prime Minister would have liked these bills to pass in bulk, rushed through without any scrutiny or debate, just as the government wants to shut down transparency and accountability on border security, to hide its plans of backflipping on Gonski and to hide its plans to pull the rug out from under Australian jobs. This is a government that is wedded to ensuring there is no scrutiny, so it wanted to ensure that these bills also passed without such scrutiny. We on this side are here to ensure that they do have scrutiny and that the government's actions are laid transparently out for the public to see.

I am pleased that the Senate has been able to provide some much-needed scrutiny of this government. We are holding this government to account for their actions. One of the things we cannot do, of course, is to hold them to account for their Direct Action Plan, because, as we know, either they are deciding to keep it secret or they do not have one and are scrambling to make one up. More and more, the Australian people are finding out that this is not the government they voted for or the government they were promised. Can I also just place something on the record to establish the type of work that they are doing—the type of obstruction we are seeing every single day in this parliament. The government are ensuring both secrecy and a lack of accountability for their actions.

In examining the Clean Energy Legislation (Carbon Tax Repeal) Bill 2013 in detail, I note that this is a Prime Minister who is obsessed with slogans. I can honestly say I have never met someone who has had to repeat himself so often to get his message through. I suspect he must be trying to convince himself for one of two reasons: either he is uncertain or he believes he is not quite convincing the Australian people as yet. I think it might be the latter. The Prime Minister's cheap throwaway slogans, such as 'scrap the carbon tax', are the type of language the Prime Minister repeats over and over again until it becomes not only boring but, I suspect, a little tedious.

So let us examine the bill in detail. It is about removing the cap on pollution. So it is about letting big polluters run amok. And later—we do not know when—it will introduce a series of cash handouts through a government 'pick the winner' scheme. They may not tell you that, but that will be the final result. It also removes market incentives to limit pollution into our environment, acting contrary to what the once principled Liberal Party would have stood for. It seems odd, doesn't it, that you on the other side are going to remove market mechanisms? Both this side and the government believe in market based incentives, but in this instance your bill is going to remove them. That is quite an odd position for the Liberal Party to be in.

It also creates a massive policy void. One of the strong arguments originally put forward by the now government against the emissions trading scheme was business uncertainty. In this instance, the emissions trading scheme does give certainty. As for the direct action policy, which the government are going to put in in place of the emissions trading scheme, only the fairies at the bottom of the garden know what it actually means. Of itself it will create and drive market uncertainty. It will cast a shadow over Australian businesses until they are provided with the detail as to how the scheme will operate, who will benefit and what the costs to the scheme will be. All of that we will find out about sometime off into the future.

The position on climate change and increased climate volatility is clear. There is a need for action today—not tomorrow, not in the next week, not in the next year. The science is in: climate change is real and man-made, and no amount of posturing or yelling by the National Party rump—as I used to say, the old doormats—can change that fact. Even the Prime Minister, who once called climate change 'complete crap', has accepted as much—notwithstanding the launch of his misguided direct action scheme. Those on the other side now say comprehensively that they do believe in climate change and they want to address it through the direct action scheme. So you must then ask this question: if the Prime Minister believes climate change is real and man-made, then why not have the most efficient and effective scheme to address climate change? We currently have a fixed price carbon period which leads into an emissions trading scheme. In short, it would be far more efficient and far more certain for business to continue an emissions trading scheme than to remove it for an unknown period of uncertainty while the government forms a view as to what direct action would look like. Of course, the current scheme would tackle climate change today, not tomorrow. I suspect that direct action is simply a slogan the government is using to undermine the emissions trading scheme.

When I say the carbon pricing scheme has worked, I am backed up by the facts—something I know this government does not like to deal with. Under Labor, employment in the renewable energy industry more than doubled. We added more than 150,000 jobs to the national economy after the carbon price came in. What is more, the sky did not fall in. Pollution in the National Electricity Market decreased by seven per cent. We showed that you can have a cleaner, smarter economy and jobs growth. Pollution went down; jobs went up. I have to add, having seen this government's record to date, that under Mr Tony Abbott the exact opposite will happen.

I would like to quote from a meat processor, AJ Bush and Sons from Beaudesert in Queensland. Mr Bush said on 20 March 2013, referring to the carbon price: 'I think it's a net positive. I think it will serve to make our businesses stronger.' He was quoted as saying the price would help his company become 'clean and mean', cutting costs and allowing them to grow even further against tough competition overseas. Quite frankly, it is hardly a doom and gloom story. Many of these stories have been reiterated in the press over the last 12 months. Businesses have embraced the opportunities that cutting pollution brings about. It brings about changes in technology and improved efficiencies within organisations.

All of that is now at risk with this government's design not only to remove the carbon price and the emissions trading scheme through this legislation but also to have us all on a tether as to what their Direct Action scheme will be like. Last year the OECD released a report confirming that countries could achieve higher levels of emissions reductions at much lower cost if they relied on this type of scheme. Emissions trading schemes have already been adopted in many countries around the world, including the United Kingdom, France, Germany, South Korea, Canada and parts of the US and China. I think the world will view us as backtracking on climate policy, being regressive in the extreme and not wanting to maintain a vigilant look on this policy.

We know that those opposite do not accept the science of climate change, notwithstanding what they say. I think that is one of the reasons why the Prime Minister repeats himself often, because ultimately he is trying to convince himself that climate change is real. I do not think he has changed. I think the Prime Minister has not changed his spots. He continues to be a doubter in this area.

Looking more broadly at the policy itself, you would have to come to the conclusion that Direct Action is an area where this government should in this debate make plain what it will be. The coalition's approach to carbon pollution is focused on the creation of a $2.9 billion fund, an Emissions Reduction Fund. The fund will pay Australian companies to reduce pollution. The business uncertainty is already starting to be heard: 'What does that mean? Who will get the money? How will it be paid? How will people measure the pollution?' I suspect we will have an array of red tape around the ERF, the Emissions Reduction Fund. Whilst on the one hand this government is heading down the path of suggesting to the world and to Australia that it is going to have a huge red tape reduction day, on the other hand it is already developing its own swathe of red tape with the future Emissions Reduction Fund and the Direct Action policy. Whereas Labor is focused on capping the amount of pollution that can enter the atmosphere and having a system for businesses to find the cheapest way to reduce their pollution, the coalition will resort to the favoured old mechanism of using the taxpayers' money to fund their Emissions Reduction Fund or, as I prefer to call it, big business slush fund.

Independent research and modelling undertaken by SKM and Monash University's Centre of Policy Studies shows that the ERF will see pollution increase by eight to 10 per cent over 2000 levels by 2020. It will not work. That is the final submission about their emissions reduction fund. It will bog down in detail. Businesses will find it impossible to meet it. They will simply take the money and attempt to reduce their pollution. It will require additional investment to achieve 2020 targets, and that will not be met out of the taxpayers' fund.

We will fall short, whereas, if we allowed a market based mechanism to work, it is possible to achieve it at a lot less cost. What we will end up doing is subsidising with public moneys the pollution of businesses that do not make the changes, and that could amount to, as Monash University's Centre of Policy Studies estimated, about $50 billion to 2020. Despite the posturing by the coalition over the last couple of years, they still do not have a credible alternative policy to the one they are currently trying to get rid of. Labor's approach has provided unprecedented support for renewable energy through the Renewable Energy Target, the Clean Energy Finance Corporation and the Australian Renewable Energy Agency. Support for businesses to become more efficient and productive came from the Clean Technology program and jobs in competitive programs, and there was support to reduce land sector emissions through the Carbon Farming Initiative.

One of the ironies in this is that, as you travel around the bush, you find that farmers do want to embrace the ability to reduce their pollution. They do see the benefits in reducing their emissions and being part of the Carbon Farming Initiative, while this government is hell-bent on removing it. In the various farming communities that I have talked to over the years they understand the need to maintain a good environment. They are good land managers, they do provide good results and they do want to participate in things like the Carbon Farming Initiative. They understand the need to reduce their emissions, whereas this government is going to remove that. I think it is a sad day for the bush to find that the government is not only removing the emissions trading scheme but also ensuring that the Carbon Farming Initiative will no longer be available for rural areas. More importantly, that overall drive to reduce emissions will peter out under this government.

The purpose and structure of these three bills repeal the Clean Energy Act and associated legislation. The main repeal bill, the Clean Energy Legislation (Carbon Tax Repeal) Bill 2013, repeals or amends acts that legislate a price on carbon to remove that function, removes the power of the Australian Competition and Consumer Commission—the ACCC—to monitor the exploitation in relation to the carbon price and removes a 15 per cent tax offset for conservation tillage.

Again I want to concentrate on the last two in the time available. First, farmers have been able to use the 15 per cent tax offset to improve their outcomes. This is being removed. I am not sure Mr Joyce has been out there telling farmers that the 15 per cent is also being removed as part of the carbon price repeal. The second area, of course, is how they will utilise the ACCC to monitor for price exploitation. I suspect the truth is that the government does not care one jot about the result other than to remove the carbon price and these pieces of legislation from the statute books.

The government has taken a view—be it political or otherwise—that this scheme should end. The difficulties will be passed through price and monitoring powers of the ACCC. I think the government needs to clarify how it will ensure that there will not be price exploitation during this process. I think it will create business uncertainty. Businesses will be subject to costs and imposts whilst the ACCC continues to do its work—and without any clear benefit. And, under the CFI, farmers and landholders could voluntarily undertake projects to reduce or store greenhouse gas emissions. All of this will be lost under this legislation, should it pass. What that means is that many landholders who have embraced the 21-odd methodologies—in the categories of agriculture, vegetation and landfill, and alternative waste treatment—will be stuck. The government has no plans in place to follow through with what happens next. The government is solely centred on this one point, without any plans as to how it will manage to meet our 2020 target for emissions reduction. Shame on this government!