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A Labor perspective on diesel emissions NEPM and Energy Credit (Grants) Scheme.

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  Australian Labor Party   National ALP

Martin Ferguson - A Labor Perspective On Diesel Emissions NEPM And Energy Credit (Grants) Scheme Monday, 26 March 2001

A Labor Perspective On Diesel Emissions NEPM And Energy Credit (Grants) Scheme Martin Ferguson - Shadow Minister for Transport

Address - Australian Trucking Association Diesel Emissions Seminar -Parliament House, Canberra - 8 March 2001

Check Against Delivery

At the outset, I thank the ATA for convening this seminar and inviting me to participate. As I have said in other forums, the leadership shown by the ATA is to be commended.

On a number of matters matters, the ATA plays a valuable role in educating and advocating a perspective that reflects their membership.

The two issues under the spotlight today deserve to be there. That is the issue of the Diesel Emission Measure and the important question of the proposed Energy Grants (Credit) Scheme.

These are important issues because they go to critical issues for the environment, your businesses and the economy.

As members of parliament, we are charged with a great responsibility to make policy with, for and on behalf of our community. That is a responsibility that I take seriously and I know that your Association does too.

In taking positions on particular policy issues, we must all be mindful of our individual responsibilities as well as our broader responsibilities to the community. ATA President Kathy Williams has again acknowledged the ATA's belief in the need for the trucking industry to be good environmental citizens. And, she restated the ATA's support of the need for emission controls and energy efficiency.

I welcome that.


The Labor Party Platform has some strong commitments in relation to the issues of today's seminar.

Labor is committed to strengthening emissions regulations to improve our quality of life. ●

We also recognise the need to develop strategies to encourage alternative modes of transport, alternative fuels, greater fuel efficiency and lower vehicle ages. ●

I want to ensure that we have a transport sector that contributes to our nation's competitiveness.

However, sustainability and safety are also issues of national importance.

These goals - of competitiveness, sustainability and safety - are sometimes in apparent conflict.

Difficult decisions, involving difficult trade-offs, will have to be made as we change the way we do things, in order to reduce our impacts on the environment.

I recognise that the trucking industry is facing a number of issues affecting its competitiveness - including fuel prices generally, safety and skill shortages

In my regional responsibilities, the thing that often strikes me is that people feel like they do not have a say in many of the policy decisions that affect their lives.

Through Kathy and the ATA, you have a strong voice. From my end, what I can offer is that Labor will listen to those views.

Having said that, I cannot guarantee you that I will agree with you on every matter - I suspect I will not.

People bring a range of perspectives to this debate.

It is critical that we are all open to what others in the debate say.

If we are talking to each other, then at least there is some chance that we will work to the common ground.

An open debate will not avoid the need for hard decisions to be taken.

At the end of the day, it is the responsibility of governments to make decisions about the trade-offs involved.

Many of those decisions will be beyond my own portfolio. In fact, both issues today span across a number of portfolio areas.

I want to make this point: we cannot simply reject change.

The challenge is to manage that process to ensure that it works for us.

We have to assist people in the process so that change does not impose an unfair burden on some.

The transport sector is an important part of the emissions challenge.

While I recognise Kathy's point that the trucking industry is only one part of the problem, the industry has to face up to the challenges that it does face.

I appreciate that Kathy has put forward, as she does consistently, the industry's view.

I also know that as an organisation, the ATA is not resistant to change.

At the same time of course, the ATA represents the trucking industry - an industry that plays a vital role in our economy and community - and operators in a highly competitive industry.

From the point of view of the general public, the taxpayer, the general community - ATA operators and we as policy makers have social responsibilities and obligations.

No longer can the issues that affect us be viewed or determined in isolation from each other. It is too simplistic and socially irresponsible for a political parties or community leaders like the ATA to do so.

This goes to the issue of sustainability - because that is what it comes down to.

What is key is how we all work together to ensure that we get sustainable outcomes. Now the World Bank might seem like a slightly unusual source for this, but a paper they produced summed it up like this when talking about sustainability:

Economic and financial sustainability requires that resources be used efficiently and that assets be maintained properly. Environmental and ecological sustainability required that the external effects of transport be taken into account fully when public or private decisions are made that determine future development. Social sustainability requires that the benefits of improved transport reach all sections of the community.


In terms of what we expect from our National Government on this front with respect to transport, I would argue that what we need is some leadership.

Because in the same way that organisations like the ATA understand your obligations to community with respect to the impact of your industry, the Government must be fully cognisant of your business needs when they are leading policy development.

On the 23 June 1999 when the Minister for Transport announced the Diesel and Alternative Fuel Grant Scheme he advised the following:

It is the Government's intention that the Diesel and Alternative Fuels Grants Scheme and the Diesel Fuel Rebate Scheme will sunset in mid-2002, and be replaced with an Energy (Credits) Scheme.


Further, that… The future Energy Grants Scheme will maintain benefits equivalent to those available under the Diesel and Alternative Fuels Credit Scheme and the Diesel Fuel Rebate Scheme. Importantly, it will provide active encouragement for the move to


the use of cleaner fuels.

Well, I have done a lot of checking and those two paragraphs seem to be the sum total of what the Howard Government has said on the future of these Schemes and of the proposed Energy Credit Scheme.

Here we are just 16 months before the sun sets on these two schemes that are very important for not just the trucking industry, but also the rail, bus, mining, farming and marine industries.

In some decision making circles, 16 months may seem significant.

But for the industries I mentioned, decisions are not made in the knee-jerk, snap way that characterises some of this government - such as the decision to spend $26 million on the Alice Springs to Darwin railway in the backroom at a function, with no input from the Treasurer or the departmental officials.

Business people, transport operators and the farm community need to plan. They need to know what the regulatory framework is going to be twelve months down the track.

I do note, however, that part of dealing with change is to accept that we do face some uncertainty.

I cannot in good faith tell you that the regulatory environment will not change.

But having dealt with industry over a very long period - I can assure you that I understand how investment decisions depend on the stability of the regulatory environment.

And I can assure you that this factor will be part of our considerations.

Schemes such as those proposed by the government impact directly on operating costs, decisions about capital investment, business expansion, markets and technological choices for their businesses and families.

The magnitude of these schemes is further insight to their impact on the budget - and therefore the community contribution to your industries - but also the importance of the schemes to industry.

In the most recent Treasury papers, the DFRS scheme was worth almost $2 billion ($1 991 601 000) and the DAFGS was worth $622 million ($622 145 000).

While the final decisions on a particular type of Energy Credit Scheme may not be fully determined until the sun sets on the current schemes, it is very important that this Government gets moving and puts the options and their thinking on the table.

At the very least, industry needs to know what the likely options are to assist with planning, and to be part of the debate.

The resources of Government are intended to be used to do the background research, develop feasible options including accurate costings, canvas public opinion and facilitate constructive, open, debate.

I should clarify that - that is what effective, accountable and representative governments do.

There are very important policy considerations in this scheme.

The Government has said that the new scheme will maintain benefits equivalent to those available under the current schemes and that it will provide active encouragement for the move to the use of cleaner fuels.

That is no comfort and provides little help to those running a business.

And there are a variety of businesses affected, as the ancillary businesses like the truck manufacturers and fuel producers have obvious interests too.

Now the issues that will be raised will span across a number of portfolios within Government and Opposition. Those areas include environment, transport, industry, health and of course, and the Treasury portfolio because of the revenue implications of fuel.

When the issues are on the table in the proper way, we can all clearly see what our respective positions are and pull together a unified response.

The types of issues raised in the debate about the Energy (Grants) Credit Scheme - as it was foreshadowed by the Government - go to the following:

1. Are they fair dinkum? That is the first thing to ask. Let us not forget that the shift to an Energy Credits Scheme was not of this Government's making. These issues were linked to the GST deal with the Democrats. We know that the Howard Government has ratted on that deal already, and the Democrats have been found to be powerless to stop that happening. The Howard Government wanted one thing out of the Democrats and that was their vote on the GST - the tax and the policy that may well lead to the undoing of this Government. They got that vote, they got their tax. The Howard Government can take away what they gave the Democrats in that deal, but the Democrats have no way of taking away the GST. We are seeing a Government against the wall in panic mode - I would not be surprised in the least if this is another part of the Measures for a Better Environment deal that falls apart. Perhaps that is why we are not seeing much output on this one.

In terms of what we will do if we are in Government. The simple truth is that it will depend significantly on what the circumstances are at the time the election happens.

We do not have a policy that says "we will have an energy grants credit scheme that will replace the two diesel schemes". In the past, I have said to the ATA conference that a change to the DFAGS is not on our radar.

We did not want the GST, so we have no specific commitment to the terms the Howard Government did with the Democrats on these issues. So, Labor will determine our position with the interests of constituents in all portfolios in mind and ensure the best outcomes for the community and sustainable transport.

2. The second thing to look at is - how effective have the existing schemes been, have they achieved the objectives they set out to achieve and what were the flaws in the system? We have seen very little evidence of how well existing schemes are working.

3. The third thing to be considered is the extent to which any new scheme is an environmental incentive scheme versus a scheme that is essentially an industry scheme that provides tax relief for a particular industry, or in this case designated parts of the industry. I'd also like to know how the proposed scheme links with the Government's inquiry into fuel taxation.

4. The particulars of the scheme are yet to be determined, and we need to know where the Government's emphases is likely to lie.

It is time for the Government to come clean on what it has in mind.

These are important decisions that need time to work through, debate and prepare for.

The Minister for the Environment, the Minister for Transport, the Industry Minister and the Treasurer need to get off their hands and do the work that needs to be done.

With regard to the issue of Diesel Emissions, I note that the National Environment Protection Council has issued a range of documents that progress this issue.

The Draft National Environment Protection (Diesel Vehicle Emissions) Measure was released at the end of February 2001.

The Measure provides a framework for the management of in-service emissions from diesel vehicles that complements and protects the emissions improvements obtained from existing regimes. (new vehicle emission standards and fuel quality standards are specified in Commonwealth legislation. Strategies to reduce vehicle usage are beyond the scope of the Measure).

There are still a couple of months to run on the consultation process for this issue. I will make two observations.

It is interesting to me that the process for preparing this Measure appears to have been solely in the arena of the Ministers for the Environment - at the State and Federal levels.

I would have thought given the importance of this measure to the transport and other industries - that there would have been broader input to this framework.

The second observation I make is that there is a large reliance on the States doing the right thing. I note the concern of the ATA about potential for inconsistent standards across the States.

Consistent with our Platform, Labor believes the Commonwealth Government must play a leadership role in environmental matters, with an integrated, whole of government approach to environmental protection.

We will strive for the consistency that will help your industry - one that is increasingly a National industry with many key companies operating across all States and Territories -while respecting the rights and capacities of the States.

But the thing to note on this issue is that consistency should not result in the lowest

common denominator. States and Territories need to be brought to the table on appropriate, consistent standards. Just like the national road safety laws where the NT's failure to come to the party meant they were penalised through National Competition Policy.

As with the issue of the Energy Credit Scheme, our response to this will be worked out across a range of portfolios, especially the environment area.

In my capacity as Shadow Transport Minister I will take on board your concerns and listen. The ATA and other representative groups here today know that my door is always open.

I fully appreciate the role and importance of an efficient, sustainable and safe transport industry to our community and economy.

Thank you for the opportunity to be here with you today. Back

Authorised by Geoff Walsh, 19 National Circuit, Barton ACT 2600.

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