Thursday, 21 June 2012
That the Senate condemns the Labor Government for imposing the world's biggest carbon tax on the Australian economy at the worst possible time, when the Prime Minister (Ms Gillard) promised before the 2010 election that there would be no carbon tax under a government she leads and when it will:
(a) push up the cost of living;
(b) push up the cost of doing business;
(c) make Australia less competitive internationally;
(d) cost jobs;
(e) result in lower real wages and cause a cumulative reduction in Australia's gross domestic product in the order of $1 trillion between now and 2050, according to the Government's own Treasury modelling; and
(f) shift economic activity and emissions overseas, therefore doing nothing to help reduce global emissions.
In about 10 days from now, the people of Australia will be hit with the world's biggest carbon tax. It is a carbon tax that, before the last election, our Prime Minister, Ms Gillard, promised the people of Australia in the most emphatic way they would not get. No Australian should forget that time when the Prime Minister looked down the barrel of a camera and said, 'There will be no carbon tax under the government I lead.' We need to remember that the Prime Minister made that most emphatic pre-election commitment, in the shadow of an election that was going to be difficult for her to win, because she knew that unless she provided that absolute, emphatic guarantee the chances were that she would lose the support of the Australian people and be unable to form a government.
We have to remind ourselves that Kevin Rudd went to the 2007 election promising that he would sign Kyoto and that he would introduce an emissions trading scheme. Over a three-year period we had a pretty intense and robust debate about whether or not imposing a carbon pollution reduction scheme—imposing a price on carbon—would be an effective way of helping to reduce global greenhouse gas emissions. The conclusion at the end of that robust debate, the conclusion after a number of parliamentary inquiries, including some very good inquiries conducted by the Senate, was that, no, putting a price on carbon when our trade competitors were not likely to go down the same path, now or in the foreseeable future, would not be a sensible way for Australia to go. It is not only people on this side of the chamber who came to that conclusion. Ms Gillard and Mr Swan, our current Prime Minister and Treasurer, walked up to then Prime Minister Rudd, to the great disappointment of Senator Wong, who is in the chamber, and said to him, 'Don't go ahead with this. It is not a good idea for you to press ahead with this carbon pollution reduction scheme when there are significant economic clouds on the global horizon. This is the worst time to introduce this sort of scheme. Don't do it; scrap the thing.' Of course, Mr Rudd had been on Q&A, telling all the world about the engagement that he had with his then Deputy Prime Minister and the Treasurer. People across Australia as they went to the ballot box at the last election knew that Ms Gillard had said to Mr Rudd: 'Don't proceed with this carbon pollution reduction scheme; scrap this price on carbon.' They knew that Ms Gillard had given a most emphatic pre-election commitment that there would be no carbon tax under the government she led, only to find after the election that they were going to have a carbon tax from 1 July 2012. The people of Australia are entitled to feel absolutely deceived and lied to by this government. They are entitled to punish this bad government at the next election because of that deception.
The Prime Minister's promise that there would be no carbon tax is not the only lie at the centre of this tax. The Prime Minister wants the Australian people to believe that, somehow, a carbon tax will help to reduce global greenhouse gas emissions. Imposing this tax will push up the cost of electricity, the cost of gas, the cost of living and the cost of doing business in Australia. It will make us less competitive internationally and will shift economic activity and jobs overseas into countries where, for the same amount of economic output, emissions will be higher than if that economic activity had occurred in Australia. The people of Australia know that this tax will impose economic sacrifices in Australia and be bad for household budgets and the federal budget but will not actually do anything to help global greenhouse gas emissions, because it is a tax that will take emissions from Australia and shift them to other parts of the world where those emissions will be higher arguably than if that economic activity had happened in Australia.
The verdict was in pretty well immediately. The Australian people were quite insightful post the announcement of a carbon tax by Prime Minister Gillard with the then de facto Deputy Prime Minister, former Senator Bob Brown, who got himself out of this chamber just in time, before the carbon tax hits the Australian people on 1 July 2012. The verdict from the Australian people was as emphatic as the Prime Minister's pre-election promise that there would be no carbon tax. The public verdict was that Australians do not want this tax. Overwhelmingly, people across Australia sent a very strong message to the Prime Minister that they do not want this carbon tax that will push up the cost of living and the cost of doing business, make us less competitive internationally, cost jobs, lead to lower real wages, according to the Treasury's own modelling, and take about $1 trillion in cumulative economic growth out of the economy between now and 2050. We do not want it, particularly because it will not do anything for the environment.
Faced with an overwhelming backlash against this fundamental breach of faith, what did the Prime Minister say?
The Prime Minister said to her backbench and to the Australian people: 'Don't you worry—as soon as we have explained the compensation, as soon as we have explained the transitional detail, people will like this tax. People will understand it's not that bad. People will understand that this is actually a good thing. Even though I promised people before the election that there would be no carbon tax under the government I lead, people will see the light and they will say a carbon tax was what they always wanted. People will come back in their droves and support the Labor Party that has been complicit in this fundamental breach of faith with the Australian people.' When that did not happen, the Prime Minister said: 'Don't you worry. What I'll do after the parliament rises in July 2011 is I will wear out my shoe leather. I will go up and down every single main street. I will go up and down every single shopping centre. I will explain to the Australian people what a wonderful tax this carbon tax is.'
Guess what? People still did not like it. In fact, the more they heard about it the less they liked it. Now the Prime Minister is telling us: 'You know what? On 1 July 2012, when the Australian people realise the sky has not fallen in, people will love the carbon tax.' All of the people on the Labor side have now put their hope into the idea that people across Australia will pass judgment on the success or failure of the carbon tax on 1 July 2012 and forget from 2 July 2012 onwards that this is a tax which will continue to push up the cost of living, which will continue to push up the cost of doing business in Australia, which will continue to make us less competitive internationally as it imposes a cost on business in Australia that is not faced by most of our competitors in other parts of the world. They just hope that, from 2 July 2012 onwards, people will forget all about it because on 1 July 2012 the sky did not fall in.
Of course the sky is not going to fall in on 1 July 2012. This is just political trickery by the Labor Party. They are trying to lower expectations such that as long as we are still alive, as long as the sky does not fall in on 1 July 2012, the carbon tax is a great success. 'It's a fantastic success! Isn't it great? The sky has not fallen in.' This is what you call expectations management, I guess, in politics. It is about setting the bar very low. We on this side of the parliament have higher aspirations for Australia and for our economy than to create a situation where at least the sky has not fallen in. We have higher aspirations on this side of the parliament.
When I say that people on the Labor side are pinning their hopes that this time around the Prime Minister will actually be right when she has been wrong before, that this time around people across Australia will flock back to the Labor Party because they will see what they did not see before, that this carbon tax is the best thing since sliced bread, that is not entirely true. Increasingly, people in the Labor Party are telling us on and off the record that they think the carbon tax should be watered down, that it should be scrapped, that it should be moved into a floating price more quickly. We have had a plethora of different positions out there from the Labor Party. Kristina Keneally says that it should be scrapped altogether. People who are briefing out of cabinet say that if Mr Rudd came back as Prime Minister they would water it down, they would reduce the price or they would make it a floating price. I assume, Mr Acting Deputy President Cameron, given that you were part of the Rudd team back in February and March 2012, that you are in the school that wants to water the carbon tax down and move it into a floating price more quickly. But you might be able to—
Thank you, Mr Acting Deputy President. The point here is that even inside the Labor Party people are increasingly aware that this carbon tax will not all of a sudden become popular come 1 July 2012. People inside the Labor Party now understand that, where all of the hopes that were put into getting the public on side with this broken promise in the past have failed, people after 1 July 2012 will become increasingly aware that this is a bad tax based on a lie which will push up the cost of living, push up the cost of doing business, make us less competitive internationally, cost jobs, result in lower real wages and take significant potential economic growth out of our economy.
I refer the Senate to an article in the West Australian today. The headline is 'Carbon tax won't save Labor, say Ruddites'. I quote:
Kevin Rudd's supporters—
and I would not want to reflect on the chair, but there are people who must be identifying themselves as Kevin Rudd supporters—
say the July 1 introduction of the carbon tax will not be the "game-changer" being promised by Julia Gillard and Wayne Swan, increasing the likelihood of the Labor leadership being revisited in spring.
And so it goes on. I strongly encourage senators to have a good read of that article by Andrew Probyn in the West Australian.
That is the point. Those people who are talking to Andrew Probyn, those people inside the Labor Party who are backgrounding and briefing Andrew Probyn about their concerns about the Labor-Greens carbon tax, are 100 per cent right. They are right because 1 July is not going to be the key date. What is going to happen as of 1 July, progressively moving forward, is that Australia will be heading in the wrong direction. Australia will be heading in a direction where the government is imposing sacrifice on the Australian people that will not make a difference. We are heading in a direction where the Australian government is going to impose cost increases on the Australian people that will not actually lead to reductions in greenhouse gas emissions.
All you have to do is look at the government's own Treasury modelling. The government's own Treasury modelling shows in black and white that emissions, even in Australia, will continue to rise under the carbon tax. The Treasury modelling shows that under the carbon tax the cost of living will continue to go up and up. The Treasury modelling shows that under the carbon tax real wages will be lower than they otherwise would be while prices and the cost of living will continue to go up. That is a very toxic combination—lower real wages than there otherwise would be and higher prices than there otherwise would be. The carbon tax, in those circumstances, at the worst possible time, will of course have significant consequences for people's quality of life.
If it was a sacrifice imposed on the Australian people that would actually make a difference, we would be having a very different conversation. But to actually ask the Australian people to make a sacrifice for something that is not going to make a difference is cruel. It is outright cruelty. People should look at the Treasury modelling to get a sense of some of the implications of the government's carbon tax in that regard.
One of the things that really shocked me in the government's own Treasury modelling was when I looked at 2050. As a result of the carbon tax, our GDP in 2050 is expected to be $100 billion lower than it otherwise would be. We have to bear in mind here that this Treasury modelling is based on some very generous assumptions that are designed to minimise the perceived economic impact that the carbon tax will have. For example, there are assumptions that the US, China and others will have equivalent carbon pricing arrangements in place by 2016, which of course will not be the case. We have to remind ourselves that in the context of the CPRS Treasury modelling the government assumed that the US would have an emissions trading scheme equivalent to our emissions trading scheme in place by 2010. It did not happen then and it will not happen now.
Despite all of these errors and heroic and unrealistic assumptions that are designed to minimise the perceived economic impact of the carbon tax in Australia, let us just take the modelling figures as they are. Even the government's own Treasury modelling shows that by 2050 our GDP will be $100 billion lower than it otherwise would be. 2050 is the out year. Some people might say, 'That is a long time away. Who cares what happens in 2050?' None of us is going to be around. Senator Carr ain't going to be around. I am not going to be around. So who cares about what is going to happen in 2050? We should care because it is not what happens on 1 July 2012 that matters; what matters is what happens between now and 2050. What is important is what happens over the 38 years or so between now and 2050, which is the period that the Treasury modelling looks at. If you look at the cumulative impact year after year after year then you will see that in today's dollars the impact on our economy from the carbon tax, according to the Treasury's own modelling, is a loss of economic growth, a loss of GDP, of $1 trillion. That is a staggering amount to take out of the economy as a result of the carbon tax between now and 2050. $1 trillion in today's dollars is effectively the whole GDP for the whole of Australia for a whole year. It means that as a result of Labor's carbon tax, the carbon tax that we were promised we would not get, every single person across Australia who works will be expected to work for nothing for a whole year in order to pay for the impact of the carbon tax between now and 2050.
Some people might say, 'So what? People across Australia should be expected to work for nothing for a whole year between now and 2050 to pay for the impact of Labor's carbon tax because it is such a great thing.' If that were the case surely you would want to know that, if you were going to work for nothing for a whole year—every working Australian will have to work for nothing, effectively, for a whole year—that sacrifice was actually going to make a difference. But, no. If you look at the Treasury modelling again you will see that emissions will continue to grow. They will continue to go up.
The government would say, 'But they will grow by less than they otherwise would have.' That is true. According to the Treasury modelling, emissions will grow less than they otherwise would have. But what happens to the emissions that otherwise would have happened? They will just be transferred to other parts of the world. Those emissions will go to China, the US and even Europe, because the carbon tax even in Europe is much lower than the world's biggest carbon tax here in Australia.
This is a bad tax. It is a tax that is based on a lie. The Australian people will judge this government very harshly for the very bad impacts that will flow from this carbon tax over many years to come until such time as the coalition—hopefully after the next election—can rescind this carbon tax once and for all. (Time expired)
I speak to this motion in a sense to try to find some way in which to dispel the myths and absurdities that Senator Cormann espoused through his contribution to the motion. Before doing that, I have to say that there were two areas where I could bring myself to agree with Senator Cormann in his contribution. One is that, no, the sky will not fall in come 1 July. Senator Cormann acknowledged that, and I certainly acknowledge that as well. The sky is certainly not going to fall in. We are going to continue on. Our economy will continue to grow. We will continue to have a sustainable future and a future where we look at our economy and our economic growth in a sustainable way which has an impact on the emissions and pollution that our economic activity creates.
The other area which Senator Cormann referred to is what the future is going to be like by 2050. I think that is a really important thing for us to think about, and that is exactly why we are acting now to ensure that when we are gone from this place and 2050 comes about—and even 2060, 2070 and so on—our planet, and our nation as part of it, continues to be a planet that we have left sustainable and things continue as best they can, both economically and environmentally. Of course that is not for us; that is for our future generations. That is exactly why the Labor government is acting now. That is exactly why various other nations around the world either are already acting or have already acted when it comes to addressing carbon pollution.
Senator Cormann says Australia is heading in the wrong direction. I think it is about time he comes to understand that Australia, with a number of other countries, is actually leading in ensuring that we address something that is fundamental to our planet. It is so fundamental that we are not alone in addressing the emissions that are continuing to rise in nations around us. Countries such as China, which at this point in time has become the largest emitter, are addressing the issue of carbon pricing and are also looking at introducing emissions trading schemes. China is looking to do so in something like seven provinces and will take that pilot as an example of how they can introduce a national emissions trading scheme. The reason they are doing that, and the reason Australia, Europe and a number of other countries on the globe are addressing this issue in the context of introducing an emissions trading scheme, is that they know one of the most efficient and cost-effective ways of addressing carbon is through a new economic model—that is, emissions trading.
Of course that is in complete opposition to the position of the current opposition, which is to have a direct action policy, which we know is a much more expensive method of addressing carbon. But we also know that it was not always the opposition's policy to have direct action. We know that once upon a time many senators and members of the opposition were very much for introducing an emissions trading scheme. I only have to look at a number of quotes that are on the public record from opposition MPs such as Julie Bishop, who said:
Fancy that, eh? And Greg Hunt said:
... the market system is a preferable regime as it better ensures that the polluter bears full responsibility for the cost of his or her conduct.
Funny, that, isn't it, Senator Cormann! Some of your fellow opposition members who are still part of the opposition and who currently make up your team—unlike former Prime Minister John Howard, who I know was also very much a fan of an emissions trading scheme but has now gone from this parliament—have 'changed their minds', so to speak, and no longer support an emissions trading scheme, which was once supported by their former Prime Minister. For example, Christopher Pyne said:
The idea that somehow the Liberal Party is opposed to an emissions trading scheme is quite frankly ludicrous.
Your fellow opposition member Christopher Pyne in July 2009 on Sunday Agenda said that to be opposed to an emissions trading scheme is 'quite frankly ludicrous', Senator Cormann. And here it is: you come into this place with a motion which claims that Australia is heading in the wrong direction by introducing an emissions trading scheme. We in government on this side of the chamber know—very much so—that the longer we delay taking serious action to reduce our emissions the more costly it will certainly be for our economy in future. That is why we need to act now—very much so. We need to introduce an emissions trading scheme now to reduce that cost on our economy going forward and also to do something about emissions.
In fact, the International Monetary Fund, which is tasked with advising governments about how best to manage their economies in the context of prevailing global economic conditions, with that in mind said two important things last year, and I want to share those things with Senator Cormann. One was: 'The Australian economy is strong and well placed to withstand current fragilities in the international economy. Australia is right to be introducing a carbon price starting with a fixed price and moving to an emissions trading scheme.' The International Monetary Fund, and OECD, support for a carbon price went on. The IMF said:
We support the proposed introduction of a carbon price as part of a transition to a permits trading system to mitigate greenhouse gas emissions.
On top of that, we have the incredible force and weight of scientific evidence, which has also led us to the position of acting on climate change and introducing a carbon price. But of course that scientific evidence was around before 2007. In fact, that scientific evidence was the reason that the coalition went to the 2007 election on the platform of delivering a carbon price through an emissions trading scheme, something which, as I said earlier, was stated by many members of the opposition. There are a number of myths that continue to be raised by opposition members, including Senator Cormann, about climate change itself and about why the Gillard Labor government is acting, through an emissions trading scheme, and those myths certainly need to be corrected in the context of the motion before us. One of those myths is that the climate is not changing and that the science is wrong. I have heard a number of times those senators and members alluding to that very myth. Of course, governments do have a responsibility, I believe, to follow peer reviewed scientific advice. That scientific advice, which has been presented to the government, is that the climate is changing. It is that greenhouse gas emissions caused by human activity are contributing to that changing climate. And it is that, if climate change is not tackled, it will cause significant human, environmental and economic costs. So I ask Senator Cormann: on the basis of that scientific advice, does he really think it is in Australia's interests not to act and address climate change through reducing our emissions? Does he really think that Australia, as he says, is heading in the wrong direction?
Organisations that have given the government this kind of advice are none other than the CSIRO, the Bureau of Meteorology and the Australian Academy of Science—and, of course, across the globe we have also had from 2001 to 2010 the warmest decade on record. Each decade, in fact, in Australia since the 1940s has been warmer than the last. These findings are backed by the overwhelming majority of climate scientists whose research has been published. It has been peer reviewed. It is in scientific journals. You can go online and read it. It is out there for all to read and see, every day and night that you want to read about it. But those senators opposite would have us believe that the science is wrong and therefore the government is going in the wrong direction.
Another myth that Senator Cormann and other senators have referred to is that Australia is acting alone when it comes to addressing climate change—another furphy from those senators opposite. That is certainly not right. Australia is certainly not acting alone; in fact, Australia is not even the first when it comes to introducing an emissions trading scheme. Many countries around the world are taking action to reduce their carbon pollution, including putting a price on carbon. In fact, 90 countries have made pledges in the United Nations international climate change conference to reduce their carbon pollution by 2020 and beyond. This does, in fact, include the United States and China, the two biggest emitters. Many countries also already have carbon taxes, carbon prices or emissions trading schemes in place. These include 27 countries in the European Union and Norway, Iceland, Switzerland, New Zealand and the United States, in relation to California. Several other countries have legislated or are planning carbon prices to start in the next two to three years. These include South Korea, South Africa, Mexico and the seven Chinese cities I referred to earlier, all of which have a combined population of more than 200 million people.
This is significant because we know that in addressing climate change we all have to act together as a globe and do something about it. Carbon pollution certainly does not fit within the nice boundaries of each country. It is only through coming together and coordinating our efforts, by trying to change the behaviour of some of those biggest emitters, through introducing an emissions trading scheme, that we will act in unison to reduce those emissions. And that is exactly what we are doing by joining with some of the nations in our region and also some of the nations on the other side of the globe.
I understand that Senator Cormann and those other opposition senators have also referred to the fact that Australia's carbon price that we are introducing is one of the biggest in the world.
Thank you, Acting Deputy President. The fact that Australia is introducing the biggest carbon tax in the world is simply not right. People who make this claim ignore two things. Firstly, several countries have carbon prices similar to or even higher than Australia's. These include—for Senator Williams's information—Norway's carbon price, which on petrol is up to A$64, and Switzerland's carbon price, which is around $37. Sweden has a tax on heating fuels of $145. Ireland has a carbon tax of around $24. Finland's taxes on fuels range from $38 to $76. In Canada, the province of British Columbia's carbon tax is around $28. The UK has introduced a price floor for the electricity sector starting at $24 from next year.
While Australia's headline carbon price starts very much at $23 a tonne, the government is giving extensive assistance, as those senators opposite would know, to industries that compete in those international markets. Those industries, like steel, aluminium, oil refining, papermaking, cement manufacturing and the like, will get up to something like 94.5 per cent of their carbon permits from the government for free. That means that the effective carbon price they will pay is actually $1.30 a tonne, not the headline $23 a tonne—which is the other lack of detail and myth that Senator Cormann, along with those other senators, likes to contribute. It is actually $1.30 a tonne through the fact that, through the government's package, we have addressed those industries I have listed that will get extensive support to compete in those international markets. That, of course, in turn will support jobs in those industries, which obviously face strong international competition.
I think I also heard Senator Cormann allude to the fact that our climate change package, our carbon price, will not actually achieve anything—that it will not actually cut Australia's emissions. Again, that is another furphy, another myth by Senator Cormann. The carbon price will exactly reduce Australia's carbon emissions—by at least 150 million tonnes, in fact, in 2020. That is the equivalent of taking more than 45 million cars off the road by 2020. How will that be achieved? The carbon price will not only apply, of course, to the large emitters such as the coal-fired electricity generators and other large industrial activities. Those emitters will have to buy a carbon permit from the government for each tonne of carbon pollution that they put into the atmosphere each year, which creates very much a powerful incentive to cut their pollution. When the carbon price moves to an emissions trading scheme from 2015-16, the government will put a limit, or cap, on the number of carbon permits it issues each year. This cap is how the government ensures Australia will meet its targets for reducing carbon pollution. Both sides of politics have agreed that Australia should reduce its carbon pollution to a level five per cent below the year 2000 level, by 2020. The difference is that we understand that the carbon price—the carbon-pricing system, the ETS—is the best way of achieving this pollution reduction target at the lowest cost to our economy.
I have been able to demonstrate in my contribution some of the ways in which this motion by Senator Cormann is about fearmongering and not putting forward the truth about the government's carbon-pricing scheme. Senator Cormann's motion is about denying that there is actually a problem. It is about not accepting the science, not wanting to act and misleading those in the community who actually listen to them. That is what I have been able to demonstrate through my contribution today—that some of Senator Cormann's contribution to this debate is nothing but fabrication.
I could go on to talk about a number of other claims made by Senator Cormann and other opposition senators: their fearmongering about the cost-of-living impact, their claim that the carbon price will not achieve anything; their claim that the carbon price will make electricity prices rise astronomically or their argument that, since Australia only produces a fraction of global emissions, there is no point in acting. We have all heard the opposition this week blame the carbon price for job losses at Fairfax and for electricity price rises—when the carbon price is not even in yet. It is not even 1 July, but we already have the opposition out there front-footing it: 'Blame the carbon price. Let's blame everything on the carbon price.' That will be their next mantra—in fact it has already started being their mantra this week. It is an easy stock standard line they can throw around to try to generate more fear in the community and to put more mistruth into the debate.
We all know very well that recent electricity price rises have been driven by the fact that a lot of the infrastructure that provides our electricity is ageing—it is really old. Coming from Tasmania, I can certainly attest to that. We have one of the oldest hydro schemes in the country and, yes, those wires and that infrastructure need to be updated. The electricity price rises were certainly not the result of a carbon price that has not even come in yet. It will start on 1 July. When it does, we know that the sky will not fall in and that we will be acting to reduce our carbon emissions—and that is good for Australia and Australia's children.
It is with pleasure that I rise to speak on this motion about the carbon tax, a very good motion put forward by my colleague Senator Cormann. Senator Singh talked about scaremongering and fearmongering. Let us look at some of the scaremongers. Tim Flannery said that Brisbane would run out of water and so would Melbourne. 'You will never see the dams full again,' he said. Adelaide, he said, would be as dry as a bone. What is the situation now? Who was doing the scaremongering? Who was spreading the fear that, if this tax did not come in, it was never going to rain again—we would never again have the big floods. Well, we had a drought in Australia from 1895 to 1907—12 years. That was followed by floods. This time we had a drought from 2002 to 2010—and what was it followed by? Floods. Every drought is broken by a flood.
Let us get back to the point of this great motion put forward by Senator Cormann and to that promise made by Prime Minister Gillard before the last election. That promise will haunt her to her political death, which will probably come in about—I give it until October. I know, Mr Acting Deputy President Cameron, that you are not a gambling man; you would never behave that way. But I will be looking for someone to have a $10 lottery ticket with me that Ms Gillard is not Prime Minister by the end of October this year. The numbers are being counted. Mr Rudd will not give up. Perhaps, Senator Stephens, you would like to join in that lottery ticket wager?
The numbers are being counted—the word is getting around parliament that Mr Rudd will not give up until he gets his job back. If the polls do not improve, if they still show a 31 or 32 per cent primary vote for Labor come October, who is going to follow Ms Gillard over the political cliff come the next election? They will be wanting Mr Rudd back to restore some credibility for the next poll.
This magnificent carbon tax being introduced—why do we have it? Who drove this tax? People are saying the Greens drove it with their balance of power. I say that there is a certain member for New England, Mr Tony Windsor, who drove it as much as anyone. He demanded, before he gave his vote to the Labor-Greens alliance and put them into government, that the Multi-Party Climate Change Committee be formed. It is quite amazing. Just prior to the last election—on 21 August 2010, I believe—Mr Windsor was being interviewed on ABC Radio in Tamworth. Prior to that, he had introduced a private member's bill into the House of Representatives seeking a 20 per cent reduction in emissions from Australia by 2020 and a massive 80 per cent by 2050. When Kelly Fuller, the well-known broadcaster on the ABC's Morning Show in Tamworth, asked, 'Mr Windsor, why did you put this bill in?' he said, 'That is not my bill—I just did that on behalf of some of my constituents.' He walked around it. But he would not support Mr Rudd's Carbon Pollution Reduction Scheme because it was only five per cent by 2020. Then he drove us all away.
The people of New England will not be fooled and the polls this week showed it. Mr Windsor, who got a 62 per cent primary vote in New England at the last election, is now polling at 24 per cent—62 per cent down to 24 per cent. Politicians do not own those seats; the people own those seats. They will have their say and they will square up with Mr Windsor at next election for the way he deceived his electorate—the way he let them think he was a conservative Independent and then aligned himself with the socialist government we have in this nation today. The people will have the final say and we look forward to it. This tax is a tax on regional Australia. Already we have higher electricity prices than in the cities. I again congratulate Senator Cormann for moving this motion. In rural Western Australia the price of electricity is 30 per cent more than in Perth. Add 10 per cent onto that and who pays the biggest increase? Those in the rural and regional areas. The one group that will be hit big time is our truckies. We have just passed legislation about fair rates. I was not too concerned about it—although I know that the big end of town likes to force our truckies to work hard and perhaps work for next to nothing. But this government has already taken 6 cents a litre off the truckies rebate—$480 million. Senator Carr will be interested to know that the truckies use eight billion litres of diesel a year. The government has added $480 million to the cost of truckies' fuel. These are the people who carry our nation, and those opposite are supposed to represent them. Senator Sterle and Senator Conroy are staunch supporters of the Transport Workers Union, yet on 1 July 2014 they are going to put another $520 million tax on the truckies. That will be $1 billion a year extra tax on our truckies' fuel.
Who is affected the most by this tax? Those in regional Australia—in places like Inverell, where I live. We do not have a rail system. Everything in town comes in on the road, by truck. Every load of wool, every load of wheat, comes by road, and the thousand head of cattle slaughtered each day at abattoirs in Inverell come in on the road and they go out on the road. We are going to tax our truckies an extra $1 billion fuel tax a year, and that is going to change the planet. It will mean that, come next election, if there is not a change in government the truckies will face that extra $520 million on 1 July 2014. There will not be one truckie voting for the Labor Party come next election. They know the government is doing them over for $1 billion worth in total, and they will change their vote.
Mr Sheldon, the boss of the Transport Workers Union, calls this a death tax. The Transport Workers Union will no doubt finance the Australian Labor Party come election time, and no doubt many on that side of the chamber are supported by the Transport Workers Union, yet Mr Sheldon calls this a death tax. Why? Because he says it sweats the trucks and it sweats the drivers even more. What he means is that we are making the drivers work longer hours, trying to exist, and then they are shortcutting maintenance on the trucks by, for example, not replacing the brake linings when they are due and not checking or replacing half worn-out universal joints, making it more dangerous to drive the truck. That is what Mr Sheldon is saying, and I agree with him totally. That is what this tax on our truckies is—it is a death tax. Make no mistake about it, with a change in government at the next election the truckies will not face that extra $520 million tax on their diesel, brought on by these people who are supported by the Transport Workers Union. It is amazing what they are doing to the people who support them.
I mentioned the abattoirs. Senator Cormann and our Select Committee on Climate Change visited Tamworth—unfortunately, Mr Acting Deputy President Cameron, you were not present in the room with us that day at Tamworth but you were certainly there in voice on the telephone. There will be a $1.74 million cost to Bindaree Beef in the first year. They employ 630 people. They pay, I would say, $650,000 in gross wages a week in our country town of 12,000 people, and the government is going to put another cost of $1.74 million onto them through the carbon tax. See how it affects regional Australia? This is the area our nation's wealth is derived from, and it is those who export our iron ore and coal and our food exports including beef and grain that will cop it the most. American abattoirs are competing against Bindaree Beef at Inverell—an export abattoir, supplying beef into those great markets such as South Korea and Japan—but in America they do not have to pay these costs. Yet we are expected to compete. How do we do that when the government just keeps lumping charges onto magnificent industries like this.
Macquarie Generation is situated in the Hunter Valley between Singleton and Muswellbrook. They produce 40 per cent of New South Wales's electricity. This year they will make a profit of $125 million for their owners, the New South Wales government. New South Wales, Queensland and Western Australia are the only states that still own their generators. Next year their profit will be reduced from $125 million down to $20 million, and the year after their profit will be? Absolutely zero. What is that going to cost the state government of New South Wales, already struggling for money with a $5 billion hole in its budget left by that rabble of a government that was thrown out on 26 March 2011? They left a huge financial mess, and that is why they got massacred—just like in Queensland. That will be the cost to the New South Wales government just in one small sector. I still say they should have had a closer look at the Constitution. I notice that when Macquarie Generation make $125 million a year they do not pay any tax to Canberra because section 114 of the Constitution says that the Commonwealth shall not impose any tax on property of any kind belonging to a state. Macquarie Generation is owned by the state. How can the Commonwealth put a carbon tax on Macquarie Generation, a state-owned property? The Constitution says it cannot. I wish Queensland, New South Wales and Western Australia had challenged the constitutionality of this tax in the High Court. I do not think it is constitutional, but it is probably a bit late in the day for that.
What will this tax do to local government? Again, when our Senate select committee was in Tamworth we heard it was going to cost the Tamworth council an extra $300,000 a year for electricity alone. Where does a local government just pluck $300,000 from? Of course they get it from their ratepayers. But it gets worse. The local Tamworth council rubbish dump—landfill, local tip, call it what you like—has now been listed as one of the 33 landfills in Australia, out of more than 500 local governments, that is going to come under the carbon tax. If action is not taken in some way or another, it will cost them at least $350,000 a year by 2017 to operate their rubbish tip. Yet the rubbish tip down the road that might only have 20,000 tonnes does not bear any cost at all. So here we are in New England, the seat of Mr Windsor, the people's representative—and I will get to that in a minute. He is now in discussions with the government, saying, 'How do we save costs for the LPG industry and how do we save costs for the Tamworth council?' With his primary vote at 24 per cent, he would want to be doing something to try and save the furniture; the house is already gone.
Mr Windsor did a poll of New England which had 1,600 responses returned, out of 93,000 voters, on same-sex marriage and other issues, but he did not poll the electorate on the carbon tax. We had a poll at the last election where 44 per cent of the people in New England voted for the Liberal and National parties in the Senate. Easily coming in second was the National Party candidate, Tim Coates. I sent out forms in New England, and 4,947 were returned, of which 4,408, or 89 per cent, said they did not support the carbon tax. It is no wonder Mr Windsor's primary vote is down to 24 per cent. In Inverell, where I live, 775 were returned: 94 per cent said no, and just 46 votes said yes. The people's representative said no. But, just like the Prime Minister with her promise—which, as I said, will haunt her to her political grave—the member for New England turned his back on his electorate, and now we face this tax.
Let me give you a few figures, Mr Acting Deputy President Cameron. We have the Greens wanting to shut down every coalmine in Australia—every one. It is amazing. China produces 51 per cent of the world's coal. Last year, they burnt 3.1 billion tonnes of coal, increasing their consumption of coal by a massive 434 million tonnes. In one year, they increased their burning of coal by 434 million tonnes. In Australia last year, we produced a total of 421 million tonnes of coal, domestic and export. So China increased their burning of coal by more than the whole of Australia produced in a year. But, if we shut down every coalmine in Australia, that is going to change the planet? That is rubbish. China will produce 10.3 billion tonnes of carbon dioxide this year. Senator Singh said, 'China's taking action.' But, under Treasury figures, China will produce 17.9 billion tonnes of coal by 2020. They are going to go up by 7.6 billion tonnes. And is this tax that is coming in in Australia going to change something? No, it is not. Australian produces 578 million tonnes of CO2. Under the government's plan, we will get up to 621 million tonnes by 2020. We are going to go up by 43 million tonnes a year. Those are the government's figures; that is Treasury's plan. That is not a reduction.
How are we going to reduce our emissions by five per cent or whatever? We are going to spend $3½ billion a year buying carbon credits. From where? From overseas. People are going to say, 'We've planted this many trees and here's a carbon credit for sale,' but who is going to check that? This opens the whole thing up to fraud. We are spending $3½ billion of taxpayers' money and our CO2output is going up by 43 million tonnes a year under the government's plan. It is just going to open up a whole network of falsified credits and fraud throughout the world. It is simply outrageous.
I turn to the cement industry. In Australia, we produce 10 million tonnes of cement a year. We also import two million tonnes. That is 12 million tonnes of cement a year. When we make one tonne of cement in Australia, we produce 0.8 of a tonne of CO2; so, for 10 million tonnes of cement, we would produce eight million tonnes of CO2. In China, they produce one billion tonnes of CO2 a year—one billion. But when they make one tonne of cement they produce 1.1 tonnes of CO2. This is a $10 million tax on our 14 cement plants in Australia, which are in regional Australia, of course. They cannot afford an extra $10 million in tax, with the high dollar and cheap imports. It will shut down those 1,875 blue-collar jobs for workers whom the Labor Party is supposed to represent. When they go, they will ask why.
So, if we shut down the industry in Australia, those 10 million tonnes of cement that produce eight million tonnes of CO2 will be produced in China, where they will produce 11 million tonnes of CO2. By producing our cement, their CO2 emissions will go up by three million tonnes. That is what we mean about transferring our industries overseas; whether it be steel, aluminium or cement, this is what we are facing. But somehow this carbon tax is going to reduce CO2 emissions around the world and cool the planet! It is outrageous.
I am a firm believer in climate change. I think the climate has been changing for thousands of years. For instance, 18,000 years ago, the Whitsunday Islands off Queensland did not exist. They were part of the mainland of Australia, with all that ice over the landscape. Then, 10,000 years ago, the planet started to warm, the ice started to melt, sea levels rose and the Whitsunday Islands were formed. Now, what made the planet warm 10,000 years ago? I do not think it was coal-fired electricity generators. I do not think it was V8 Mustangs roaring around the United States or wherever. I do not think it was even four-cylinder petrol cars being burnt or the truckie running his 600-horsepower Cummins up the track. It was Mother Nature and climate change. It has been happening for thousands of years. And somehow we are going to stop all that? No, we are not. We will not stop it. Nature will run its course.
What we need to do is look after our environment, look after our land. Australia's greatest asset is the soil on our farms that produces our food. If we increase the level of carbon in that soil by three per cent—which is equivalent to 150 tonnes of CO2 per hectare—over 450 million hectares of agricultural land in Australia, we will neutralise 100 per cent of our emissions for more than 100 years and we would have better farm country for it. Some of the farm county—Moree, the black soil plains—used to be five per cent carbon. Now it is down to one per cent, even to 0.5 per cent. We need to increase carbon in the soil. We need to give an incentive to farmers to help them balance the calcium and magnesium in the soil by putting more lime on the country and raising the calcium level and to let mother nature do its thing. That is better for the soil—fewer chemicals. That is what we want to do. If you do not have healthy soil, you do not grow healthy food. If you do not have healthy food, you do not have healthy people. People need nutrition in their food and that is what we intend to give them. We do not intend to treat farmers the way Bob Carr did when he was Premier of New South Wales—with a big stick. We intend to entice farmers with a carrot, working with the man on the land and his wife and family to help them achieve what they want to achieve. It is very hard for them to be green when so many are so far in the red. That is what we wish to do.
The government say that agriculture is excluded. No it is not. You are putting the cost on the truckies for fuel and you are putting the cost of electricity up. Do you think farmers drive the shearing shed with the old hand-wound machines? No, they have electric shearing plants. Agriculture will be included. The costs will flow on and once again our farmers, trying to competing on the world market, will have extra costs here. This is simply crazy.
Senator Cormann, we commend you for the motion. This is a tax that Australia will not accept. Australians will let the government know that at the next election. The government misled the people at the last election and the people will not put up with it again. They will square up come next election day.
I do not support the motion put before the chamber by Senator Cormann. I really do believe that the opposition is becoming very desperate on this issue. Clearly they are becoming desperate because, as we all know, 1 July is just 10 days away and then there will be a price on carbon. In 10 days Australia will take serious and comprehensive action in the global effort to tackle climate change. And when the sky does not fall in, the earth keeps spinning and the sun comes up in the morning, all of which will happen after 1 July, the outlandish claims being made by the opposition, their desperate fear mongering, the relentless negativity that is the hallmark of this opposition, will amount to nothing. It will be a total fizzer. It will be exposed for the political sham it is.
The Australian government, in the national interest, as a responsible government and a responsible global citizen, has taken decisive action to minimise the impact of climate change and has taken decisive action to intensify investment in clean energy. As I have said before in this chamber, acting in the national interest is not just about telling people what they want to hear. It is not just about belittling debate on important issues with platitudes and abuse—the hallmark of those on the other side of this chamber. It is to speak and act, conscious of the need to ensure a vibrant, strong and competitive future for our nation, which will take the courage necessary to undertake reform. Of course that can be unpopular and of course that means that governments need to make controversial decisions. So in just a few days, for the first time in our history Australia will have a price on carbon. This has been a long and bitter process. It has been a difficult debate but I believe it is absolutely integral to our national interest.
The planet is warming and we must take action. Putting a price on carbon will ensure that our nation's economic and environmental interests remain secure. We live on the driest continent on earth. We live in a place renowned for droughts and flooding rains. Putting a price on carbon is the first step to significantly address the impact of climate change.
I say, as I have said consistently for two decades in debates about this issue in this parliament, the science is in. Reports from the IPCC, from our own scientists at the CSIRO and from those at the Bureau of Meteorology show that the climate is warming, that seas are rising, that coastlines are shrinking and that weather patterns are changing. This will continue to happen as a result of greenhouse gas emissions from human activity. If greenhouse gas emissions continue to grow unabated, the problem will get worse. The carbon price will cut carbon pollution and drive investment in clean energy technologies and infrastructure like solar, gas, and wind. It will help build a cleaner energy future, which is what future generations of Australians deserve. This is not just about us. It is not just about those who happen to sit in this Senate chamber in the year 2012; it is about all of those who come after us. It is a heavy responsibility, I believe, on this generation of Australian parliamentarians, and I am of the view that it is critically important that the Australian government meets its responsibility.
The Australian government has worked hard to ensure that Australians are not dramatically impacted by the carbon price. Overall, the carbon price will see prices rise by less than one per cent. The big polluters will pay the carbon price, not ordinary Australians. The carbon price will be paid by fewer than 500 of our biggest polluters. Millions of Australians will in fact pay less tax. Tax cuts and increased payments are targeted at those who need it most. The government will make sure that pensioners, low- and middle-income earners and families doing it tough, the most disadvantaged people in our community, are looked after. Nine out of 10 households will get a combination of tax cuts and increased payments. Almost six million households will get tax cuts or increases in payments that cover the entire average price impact. Over one million Australians will no longer need to lodge a tax return. And the government will review the adequacy of assistance each year and will increase it further, if that is required.
In relation to the issue of assistance to industry, which is so often raised in this debate, I would say that assistance provided to industry maintains the incentive for companies to reduce the level of their carbon emissions, partly because they will compete with other companies looking to cut costs by cutting pollution and partly because the assistance will decline over time. Funding and grants will be provided to businesses seeking to invest in renewable energy, in low emissions technology and in energy efficient research and technology. The Jobs and Competitiveness Program will provide assistance to emissions intensive trade exposed industries to support jobs and reduce the risk of companies moving overseas and continuing to pollute.
This ongoing program will provide $9.2 billion in assistance over the first three years of the scheme. The assistance is specifically targeted at those companies that produce a significant amount of carbon pollution but are constrained in their capacity to pass through costs in global markets—industries like steel, aluminium, cement and zinc manufacturing and the like. The purpose of the carbon price is to make the economy grow stronger but with less carbon pollution, with a smaller amount of carbon being emitted into the atmosphere.
Climate change is a global problem. Again, contrary to what you hear so often in this debate, the rest of the world is acting on this issue. It is not true to say that Australia is going at it alone. We are not going at it alone: 89 other countries, representing 80 per cent of global emissions and 90 per cent of the world's economy, have already pledged to take action on climate change.
There is analysis from the Department of Climate Change and Energy Efficiency which shows that from 2013 there will be more than 50 national or subnational, if you like, emissions trading schemes in place around the world. That is 33 countries with national emissions trading schemes, including Switzerland, the European Union's 27 member countries, Norway, Iceland and Lichtenstein. There will be another 18 subnational jurisdictions with emissions trading schemes, including: the US states of California and New York, the Canadian province of Quebec and, I am pleased to say, seven provinces and cities in China. These schemes will cover a combined population of more than 850 million people. Other countries such as South Korea, Brazil, Turkey, Chile, South Africa and Mexico have also strongly signalled their intention to develop emissions trading schemes.
Globally, more money is now invested in new renewable power than in conventional high-pollution generation. Just think of that; think of the difference we have seen over recent years. China is now the world's largest manufacturer of both solar panels and wind turbines, and it is a world leader now in renewable energy research. There is an old expression which my friends from the National Party—who used to call themselves the Country Party—always liked to quote: 'You make hay while the sun shines'.
You do? That is the one thing in this debate you have got right, Senator Williams. I knew I would eventually hear you say something sensible and you have. You have not let me down. As Senator Williams says—he is very insightful—'You make hay while the sun shines'. Our economic fundamentals are solid and our investment pipeline is strong. Now is the time to implement our comprehensive clean energy future package. I say to the Senate that putting a price on carbon is the cheapest and most effective way to reduce our carbon footprint. It will ensure that our nation's economic and environmental interests remain secure. I do strongly support the introduction of this measure on 1 July.
No senator should forget why this is being done or why responsible governments have to stand up and be counted on this issue. The climate is warming; sea levels are rising; weather patterns are changing. This is a global problem on which developed nations like Australia can and should show leadership. Many years ago—in fact in the mid-1990s—I was Australia's environment minister and I proposed a small carbon levy at that time. I was very committed to that course of action. Whether or not I was ahead of my time, I could report that it was not warmly welcomed by all, either in my own party or in the coalition at the time. But just look at the reports of the IPCC; look at the science; look at what our own agencies, the CSIRO and the Bureau of Meteorology, are saying. It is responsible to act; it is responsible to act now. I, for one, proudly support what the government is doing in this regard and completely reject the nonsense from the opposition and that which is contained in Senator Cormann's motion this afternoon.
I rise to support the motion and I obviously have some views that are quite contrary to the contribution from the previous speaker, Senator Faulkner. In some of his closing remarks, Senator Faulkner said that we need to focus on why this is being done. I think that is a fundamental question, not necessarily for the chamber to consider, but certainly for those opposite. Senator Faulkner is, in my considered opinion, a great orator. He has made some wonderful contributions to this place, but sometimes it is about how he says it, rather than the substance of what he says. Senator Faulkner put his hand on his heart and said, 'The reason we are doing this is that we need to show the globe leadership.' He said that we need to ensure that because we are the driest continent on the earth, we talk about droughts and flooding rains. He basically went on to make the case that the Labor Party are motivated in this matter by a whole range of good things. The party to his right, the Greens—Senator Di Natale, my old mate Senator Ludlam and Senator Whish-Wilson, who I have just met and who I am sure is a very fine stamp of a man; I am looking forward to getting to know you better, mate—have at least always had a consistent position on this, about going to an election and saying, 'We are going to have a carbon tax.' Yes, it was slightly different and a little bit more aggressive than the position of those on the other side. But, Senator Faulkner, I would remind you of the reason we are here debating this. Sadly, it is not because Julia Gillard put her hand on her chest and said, 'We need to show the globe leadership.' It is because we have a hung parliament. It is because she had to do a deal.
Senator Ludlam, I usually take your interventions, but the point I am making is that those opposite are singly motivated because they had to do a deal with the Greens. It was not a long-term plan to go and deal with the environment and it was not a long-term plan to introduce a carbon tax. The now well-worn phrase, 'There will be no carbon tax under the government I lead,' said a few days before the election pays credit to that. So I do not think anyone on the other side can have any credibility at all in saying: 'This was a fantastic idea. We went to an election with this and we have always believed in it.' I would probably take Senator Faulkner on his word personally that it may have been one of his values, but it certainly was not that of the leader or of the majority of those on the other side.
As many of us who represent constituencies in regional and remote Australia know, the cost of doing business and the cost-of-living pressures are even more intense; we may love to live in regional and remote Australia but of course it is a more expensive process. This carbon tax is a tax on remoteness. It is going to hurt the Territory in far greater ways than it will hurt capital cities. And I have not noticed anything in this legislation that somehow pulls Darwin or Katherine or Alice Springs closer to Sydney—horror the thought.
As I have indicated, we had this spectacle of the current Prime Minister, Julia Gillard, just days out from the election, assuring everybody that this was a tax that we were not going to have. In Lingiari just before the election I was doing the standard 'fear and loathing', as one does in a campaign, telling people, 'They have been talking about this carbon tax; it is going to be horrible.' In the last few days of the campaign there was some relief. People were saying: 'Look, Nige, she has been absolutely clear: there is not going to be a carbon tax. I am sorry, I am not going to be concerned about that anymore. She has absolutely clarified it for me. I am more than likely going to stick with voting Labor because I am a Labor voter, I am a swinging voter.' Many Territorians that I speak to today still rue the day that they accepted that as the truth.
One of the most important impacts on the cost of doing business and the cost of living in the Northern Territory is fuel. Wherever you go in Darwin is not dissimilar in distance to a lot of other cities, but certainly the cost of fuel is. I was speaking to a mate of mine, Dave Gray, the other day. He is a mango farmer. He used to farm not far down the road from where I was farming mangoes in a previous life. He told me that he has gone through his books and looked at increases in fuel, electricity, refrigeration and the freight on the box costs. He indicated that he is going to suffer some 25 per cent gross profit loss. A lot of people say, 'How can that possibly be?' I would have to acknowledge that he is running at a pretty thin margin, as many people do. It might seem a lot in terms of profit, and it is—it is horrific. But, for people who are running at a pretty slim margin, this is going to have a significant impact on their capacity to do business. He has rated his increase in fuel at around about three per cent and his box costs at about two per cent. He has done calculations of his electricity prices, particularly for the cool rooms, and he knows the increase is going to be significant. He is not actually sure how much it will be. He has calculated that at 16 per cent, but I would say that is pretty conservative given some of the price hikes in other parts of the world.
I hear the Prime Minister and the government constantly saying that this is only on the 400 big polluters. Poor old Dave Gray, with the arse out of his pants, is saying, 'I am not really sure that I consider myself a big polluter, Nigel.' I say, 'Well, mate, apparently you are on that list now.' How many businesses like this mango grower are going to invest in an industry with reasonably slim margins, as has always been the case, with potentially a 25 per cent reduction in profitability? When the markets are remote, we are not going to know the transportation costs. Senator Faulkner and others say, 'Look, the sky is not going to fall in on 1 July.' It probably will not, but there will be a bit of squealing and creaking about eight weeks after that as soon as this impacts. Part of the concern of my constituents is that this is simply unknown. They are scribbling down sums, they are trying to work out what to do, they are trying to run a budget. They are invariably small business, family businesses, and they are finding it very difficult.
About 1,500 Northern Territory businesses are going to face quite considerable increases in their fuel costs under the carbon tax when there is a reduction in the diesel fuel rebate. I have been speaking to the Chamber of Commerce and they are having some difficulty in providing information to all those in business who are trying to work out exactly what some of these cost implications are going to be. Australian Taxation Office data has also shown that Territory businesses are going to be hit five times as hard by the tax as average businesses in other states. I think about 60 per cent of that is due to remoteness and transport costs, but there are some other complexities. That may be just about the Northern Territory, but it is certainly significant.
In addition to the obvious impact on mining operations, there will be an impact on Northern Territory construction, manufacturing, retail, wholesale and particularly tourism operators. By tourism I do not mean grand hotels and magnificent big schemes—invariably, they will get through. The problem is with the small operator, whose costs are fixed. Many of them have a fishing tour operator with a car, a wish and a dinghy that goes and they might own a small lodge somewhere on the Mary River. If tourists decide not to travel because it is now too expensive, many of those small operators will go out of business, as happened I recall in some of the downturns in the past.
According to the tax office data, Northern Territory businesses claim an average of $55,000 under the Fuel Tax Credits Scheme. The reduction in the credit as a result of the carbon tax will mean that NT businesses will face an additional cost of $9,200 a year, on average. Yes, that is an average and it is obviously raised by some of the larger businesses, but some operators would find it very difficult to amortise even 25 per cent of that. The number of businesses affected is going to increase to more than 100,000 on 1 July 2014, which is when the road freight sector, on which all of us in the Territory depend for our groceries, including tens of thousands of owner drivers, is going to become liable for the carbon tax on fuel. We know that fuel prices are always increasing. In Darwin, last week, the average petrol price across jurisdictions was $1.40.6; for the rest of the Northern Territory the average price was $1.58—that is a clear 18c a litre above everywhere else. In any event, we are starting behind the eight ball. Perhaps that is why the profitability of some of these small businesses is so marginal. An increase of some 6.5 cents a litre in the price of petrol, which has been indicated, is going to put even further pressure on small and marginal businesses.
The Chamber of Commerce NT did a study using a carbon price of $25 a tonne, before the $23 a tonne price was announced. Given that the price is going to $29 a tonne in 2015-16, its figure could be used as a conservative measure. The study has indicated that the cost of carbon to the Territory economy is going to be around $147 million in the first year, which equates to $642 for every man, woman and child, regardless of where they live. Again, if the government is saying that only the big polluters will pay it is simply not being honest. Everybody is going to pay, particularly those people who are in the business of creating or making something. As you look around, you will see that the new tax collector will be the electricity outlet, the three-slotted maw in the wall. I suppose that the whole notion behind the carbon tax is: be careful when you turn something on; do not use as much electricity. If you are a wasteful person, that would make you think, but most of us use as little fuel as we can. We are as efficient as the technology will allow us to be, we use the minimum amount of electricity and hot water and we whinge at the kids even more to do the same. That is the environment we are in. I appreciate the motivation behind having a tax to change behaviour; I am just very cynical about what it can achieve if people do not have the choice to change their behaviour.
Families and businesses—very small and medium businesses—in the Northern Territory are going to be hurt, but they are the ones who can least afford it. There has been a lot of discussion about pensioners. The Northern Territory pensioners I have spoken to are already concerned about the high cost of living. Remember, people's pensions are not indexed just because they live in the Northern Territory and have a much higher cost of living than anywhere else. They have made a choice to live there, but they know that people with a fixed income are going to be hurt by the increase in the carbon tax. The government has said that it will give them a one-off settlement for that. I know that that is welcome to some degree, but it is being sold as: 'By the way, I'm just putting your pension up. I am a nice bloke, because I do not like to talk about it in the context of a tax.' Of course, the carbon tax will go up and up; one adjustment will not assist these people.
We have already said that, if elected, the very first thing the coalition will do is repeal the legislation. That will be our first order of business. We have also gone on to say, 'If those opposite attempt to block the scrapping of the carbon tax we will go to a double dissolution election.' We have made that very clear, and that is exactly what we will do.
Senator Evans, I am sure that you will not remember my betting you a beer on that, mate, but I am sure we will have a beer on the result, in any event.
We are already facing substantial cost of living pressures. The carbon tax will only increase these pressures, particularly in those regions that can least afford it. Figures already show that the carbon tax is going to go up and up. This tax is going to increase. It is a new, $9 billion a year tax that will cause a 10 per cent hike in electricity bills in the first year alone. I am being conservative—very realistic—about the figures; I know that there are other figures quoting between 18 per cent and 20 per cent for some of the other jurisdictions. There will be a $3.4 billion hit on the budget bottom line and a nine per cent hike in gas bills in the first year alone. Our forgotten families are already struggling; a carbon tax is going to make a bad situation worse. Households around the country will be paying $515 on average, against $642 that we Territorians will pay because of our remoteness. It will be a trillion-dollar cost to the economy over coming decades that will send hundreds of billions of dollars of Australian business overseas. There will be $3.5 billion spent each year on foreign carbon credits by 2020, which will rise to $57 billion by 2050. Senator Faulkner and some on this side have talked about 50 years being a long way off. These sorts of figures, where we will be making a contribution for foreign carbon credits to the tune of $57 billion, to anybody with any sense seem almost sublime. Perhaps 2050 is not really in our context, but $3.5 billion each year on credits by 2020 is in our context and is a considerable amount of funds. A lot of Australians are having great difficulty understanding why that is an investment, not a cost. On those sorts of figures, we will see every Australian slugged about $40,000 over the coming decades. To many people that is the equivalent of a year's work for Labor's broken promises.
The 2012-13 budget confirmed the government is forecasting the carbon tax to rise from $23 a tonne to $29 a tonne by 2015. A lot of people would really like to understand what the impact of that will be. Sadly, the government is running an advertising campaign that does not appear to be informing people. Many people are disturbed about what the full impact will be on them personally. There is $36 million for an advertising campaign that will start in 2012-13. They are spending a total of $70 million of taxpayers' money on carbon tax advertising, and that includes last year's campaign. So when the Prime Minister tells the ACTU conference, 'Nobody has anything to fear from carbon pricing,' I think we all find it difficult to understand why she does not appear to have the courage to include the term 'carbon price' in the advertisements.
Quite clearly the circumstances of people who are just trying to eke a living in regional and rural Australia are difficult enough, but this is a toxic tax on remoteness. Certainly all of the constituents that I speak to are sick and tired of being told by this government that this is all about leadership: 'We're here to change the climate. We're here to change the environment.' They made a rock solid promise. I do not believe that the Prime Minister, Julia Gillard, was lying at the time. That is my personal view. But circumstances that arose later meant that she had to do a deal. She went and did that deal, which made it a lie. I think people are sick and tired of being told that this is a good idea. Labor are out there beating their chests saying the world is going to be a better place because of the introduction of this tax. If the polls are not telling those opposite, they should listen to their constituents. I speak to quite a wide diaspora of individuals and I certainly do not have many who would tell me that this is a good idea today, for the future, for those people living in the cities, for the global environment or, most importantly, for our national interest.
I heard Senator Kim Carr today describe the coalition as knuckle draggers. I must say, what a performance of knuckle dragging from Senator Cormann, Senator Williams and Senator Scullion. When people have a look at the Hansard in years to come and they do an analysis of Australia's response to this terrible, terrible problem of carbon pollution in the atmosphere, they can look at those three contributions and say: 'What a bunch of knuckle draggers the coalition were.' The skin has all gone, they are through to the bone and they are still dragging their knuckles on this very important issue.
But they have not always been like that. It has only been since the extremists in the coalition took over. There was a group of coalition MPs—even, if I have to say so myself, up to the former Prime Minister John Howard—who recognised that climate change had to be dealt with because of the danger it posed to the future of this globe, to the extent that on 10 December 2006 Prime Minister John Howard announced a joint government business task force. It was known as the Shergold inquiry. The Shergold inquiry came up with a number of unchallengeable propositions that had to be dealt with. Remember, this was an inquiry established by John Howard. That is when the coalition determined they would have to put a price on carbon.
I will go through a couple of quotes from the Shergold report. It says:
Australia has a vital interest in the form of any emerging global response. Given our exposure to the impacts of climate change we want an approach that is effective.
It then goes on to say:
However, waiting until a truly global response emerges before imposing an emissions cap will place costs on Australia by increasing business uncertainty and delaying or losing investment. Already there is evidence that investment in key emissions-intensive industries and energy infrastructure is being deferred.
After careful consideration, the Task Group has concluded that Australia should not wait until a genuinely global agreement has been negotiated. It believes that there are benefits, which outweigh the costs, in early adoption by Australia of an appropriate emissions constraint. Such action would enhance investment certainty and provide a long-term platform for responding to carbon constraints.
There is much more I could go to in the Shergold report. All of this was done under a coalition government and there was an emerging political consensus that we had to deal with global warming.
Then came the current Leader of the Opposition, Tony Abbott, who then described himself as the weathervane for the coalition—one minute a climate change denier, the next minute saying something had to be done on climate change. Whatever the Australian or the Murdoch press were saying about climate change, that is where you would find Tony Abbott. And then Tony Abbott linked up with all the climate change sceptics and shared a stage with Viscount Monckton, the climate change sceptic in chief. No scientist of any standing places any confidence or any credibility in Lord Monckton. But what do the extremists in the coalition do? They line up with Lord Monckton and Gina Rinehart. They help sponsor Lord Monckton to come here to run all his climate change nonsense.
This motion before us talks about the cost of living, the cost of doing business and competitive international issues. Extremists do not care about that. This is a cover for those in the coalition who refuse to accept that climate change is real and that it has to be dealt with. They are prepared to back their big business mates so that there is no cost on the polluters in this country—and it is typical of the coalition to be doing the bidding of big business—and to try to ensure that everyone else in the community accepts the cost of climate change but not big business. Big business are looking at the short term on this. They are not looking at the long term.
I am looking at the long term and the Labor Party is looking at the long term. I am looking at the long term because I have two beautiful grandchildren—six and four years old. I want to leave them an environment in which they can have the same benefits that we have had over the years. That means that the economies that have taken advantage of being able to pour uninhibited amounts of carbon into the atmosphere need to take the lead. As John Howard himself said, we need to take the lead. But the extremists are in control in the coalition and the lead will not be taken by them.
I get pretty angry, I must say, when I hear the knuckle-dragging speeches from the coalition claiming that this is about economics when it is about the future of the planet. It is about the future for my grandkids and it is about the future for kids around this country. If we simply take the knuckle-dragging line of the coalition then we will ignore doing the right thing. We will ignore the coalition's Shergold inquiry. We will ignore what John Howard has said, which is that we should deal with this. We will ignore the scientific community in this country if we refuse to do something about global warming. That is the issue that we have to face. The coalition are controlled by the extremists. The Lord Monckton cheer squad and knuckle draggers over in the coalition are in absolute control.
They just refuse to accept the science. I have so many pieces of scientific literature here. I have Climate change: science and solutions for Australiaby CSIRO. This is our scientists telling us what the problem is. I would say to the knuckle draggers, 'Read this and then tell anyone that we should not be putting a price on carbon, tell anybody that they should ignore the scientists and the CSIRO.' They say that there will be huge ecological and health impacts from not dealing with climate change.
CSIRO have written another one called the State of the climate—2012. Why don't you read that? Why don't you listen to the Climate Commission when they outline all of the literature on climate change? Why don't you take note of our scientists in The Copenhagen diagnosis, where the leading scientists from across Australia say that we must do something about climate change? They are saying that there are surging greenhouse gas emissions around the world, that the recent global temperatures demonstrate human-induced warming, that there is an acceleration of the melting of ice sheets, glaciers and ice caps, that there is rapid Arctic sea ice decline, that the current sea level rise is underestimated, that the sea level predictions have to be revised upwards, that any delay in action risks irreversible damage and that the turning point must come soon.
The coalition do not listen to CSIRO, the Bureau of Meteorology or the credible scientists in every university in this country. Instead, they listen to Lord Monckton and Gina Rinehart and do their bidding and get their advice. I would rather listen to the advice of our scientists than that absolute fraud Lord Monckton any day. For the Leader of the Opposition to be sitting down with Lord Monckton, railing against climate change action, shows how the extremists have got absolute control.
We heard Senator Williams talk today about socialists. Lord Monckton talks about the communists having control of this debate. This is a guy who says he is a member of the House of Lords when he is not, who says he is a Nobel laureate, which he is not, who claims to have single-handedly won the Falklands War and who says he has invented a cure for Graves' disease. This is the guy who the Leader of the Opposition cohabitates with in the climate change debate. He is not someone who can be taken seriously. He calls young demonstrators against his climate change scepticism 'the Hitler Youth marching in and breaking up meetings'. These are the types of people the Leader of the Opposition sits down with and tries to treat credibly. Senator Williams talks about the socialist takeover and about the Pew foundation and Greenpeace trying to close Australia down.
I do not know what the opposition think about NASA. I do not think NASA is inhabited by communists. I do not think NASA is inhabited by the Socialist Left in America. I do not think NASA can be seen to be some loony left-wing group. But NASA says that the climate has changed. All you have to do is go onto its website and have a look at what it says. We get arguments about the cost. My colleagues who presented here before, Senator Faulkner and Senator Singh, have gone over the issues. I will not go over them again; I want to concentrate on the issue of the science. If you do not agree with the science, the knuckle-dragging analysis from the coalition becomes a reality for them. You have to listen to our scientists; you have to understand the science.
The National Aeronautics and Space Administration of the United States is clearly one of the leaders in science. It says there are certain facts about the earth's climate that are not in dispute. It says:
The heat-trapping nature of carbon dioxide and other gases was demonstrated in the mid-19th century.
Ice cores drawn from Greenland, Antarctica, and tropical mountain glaciers show that the Earth's climate responds to changes in solar output, in the Earth's orbit, and in greenhouse gas levels.
It goes on to say that there is a global temperature rise. It says:
All three major global surface temperature reconstructions show that Earth has warmed since 1880. Most of this warming has occurred since the 1970s, with the 20 warmest years having occurred since 1981 ...
NASA says the oceans are warming; the top 700 metres has increased by 0.302 degrees Fahrenheit since 1969. It says:
The Greenland and Antarctic ice sheets have decreased in mass. Data from NASA's Gravity Recovery and Climate Experiment show Greenland lost 150 to 250 cubic kilometers (36 to 60 cubic miles) of ice per year between 2002 and 2006 ...
There is declining Arctic sea ice. There is glacial retreat; the glaciers in the Alps, the Himalayas, the Andes, the Rockies, Alaska and Africa are in retreat. And there is ocean acidification. So the CSIRO, the Bureau of Meteorology, NASA—every one of the experts in the field—say you have to deal with this issue. Yet the coalition are denying that there is change. We heard the contribution of Senator Williams earlier. He said, 'Yes, I accept there is climate change' and then went on to try to justify it as a natural phenomenon of the Earth. He did not deal with the issue of CO2 emissions. He did not deal with any of those issues, which are so important.
What are NASA doing? As I said, you cannot say that they are the communist underbelly of the United States. NASA are out there with an education program for schoolkids. I would like to send Senator Joyce, Senator Williams and a few of the coalition knuckle draggers along to one of these NASA education programs. We should all pass a resolution that we pay for them to go to the NASA education program. The grade 5 to 8 program would be enough. They would not have to go to the high science; just send them to the kiddies science training that NASA does.
Just little words, little theories. What does NASA say to grade 5 and 8 kids in the United States? They are down there in the heart of communism, in Minnesota and Arkansas, telling the kids, 'You've got to rebel against climate change'! Even in those areas of the US they are talking about climate change, and one of the questions they ask is: 'Do you know the difference between weather and climate?' I have heard Senator Williams. I have heard Senator Joyce. Obviously, they do not know the difference. They should go to NASA's kiddies class so they can understand the difference between weather and climate. That is long overdue. On their website NASA ask:
Is Earth's Climate Changing?
And they say, 'Yes, the Earth's climate is changing.' They ask:
What Is Causing Earth's Climate to Change?
Some causes of climate change are natural.
But Senator Williams tries to say that all of it is about nature. NASA go on to say:
Most scientists think that recent warming can't be explained by nature alone. Most scientists say it's very likely that most of the warming since the mid-1900s is due to the burning of coal, oil and gas.
Then they ask:
What Is the Forecast for Earth's Climate?
Remember, this is to the kids at school. It is something that the kids in America are being taught and that the leaders of the coalition do not understand. So let us get them to some basic education, some kiddies school education, on climate change. NASA say:
Climate models predict that Earth's average temperature will keep rising over the next 100 years or so.
They ask, 'What are the impacts?' They say:
Some impacts already are occurring ... sea levels are rising, and snow and ice cover is decreasing. Rainfall patterns and growing seasons are changing.
This is the US's NASA. It is not some green group. It is not any group that is setting about to try to destroy the capitalist economies of the world.
This is NASA. They say the same thing as the CSIRO and they say the same thing as the Bureau of Meteorology: if we do not do something about it we are in real trouble. And what do we get from the coalition? We get denial of climate change. Well, I say we should pass resolutions in this place to send the knuckle-dragging coalition climate change deniers over to NASA to do the kiddies class in climate change. They should do the kiddies class in climate change that NASA has so that they can understand that their analysis is wrong, that their economic arguments are flawed, that we need to deal with climate change now and that there are huge implications in not dealing with climate change—and I think NASA would host them even though it might be more difficult for them to deal with the knuckle-draggers opposite than with some of the kiddies. So those opposite should go and understand the science of climate change.
I have heard of this before from Senator Cameron, that we on this side of the Senate do not believe in climate change, and I have said several times before—and I have a speech in front of me from 11 August 2009 that says this—that I believe in climate change and that climate change is real. I come from the south-west of Western Australia and I know rainfall in the south-west has dropped by something like 30 per cent over the last 25 years. We do not deny that climate change is real, Senator Cameron; we do not deny it at all. But we do disagree about the causes.
For example, the year before last I went to Barrow Island, where it is possible to demonstrate no less than seven different sea levels over the last few thousand years. If you go to Marble Bar in the inland, in the Pilbara, and dig into the dirt, you will find that you have seashells there. The Pilbara used to be an ancient seabed and there used to be a land bridge to Indonesia. So the seas have fallen and risen and this has gone on in a cyclical fashion over the millennia and it is part of the natural history of the earth. It is true, as you say, that since the beginning of the last century we have burnt more coal and produced more carbon dioxide. Nevertheless, the fundamentals are the same: the great galactic forces control the climate of the earth, so things like variations in the earth's orbit and the activity of sunspots. These things, Senator Cameron, are more important than a simple rise in carbon dioxide in terms of the magnitude of the forces needed to change the climate of the earth.
We do not deny that there has been pollution. In fact, we think pollution should be reduced. But we do not think this carbon tax is the way to do it. Here we are in Australia with 1.4 per cent of the world's pollution—that is all we contribute—so we are a very minor contributor to the levels of carbon dioxide in the world's atmosphere and yet the Labor Party plans to hit the people of Australia with the world's highest carbon tax. This is completely out of proportion and it is going to have really severe effects on the Australian economy and the lifestyle of the Australian people. As I said, here we are with just over one per cent of the world's pollution and we are going to be slugged by the world's biggest carbon tax.
Senator Cameron referred constantly to the science being decided. He referred to the International Panel on Climate Change of the United Nations. But obviously he reads very selectively about the IPCC because he does not seem to have noticed there have been a lot of articles critical of the IPCC and its methodology and the fact that a lot of their so-called experts are really junior- or middle-grade scientists chosen from around the world so there is a nice balance, in the way the United Nations does things. He ignores the fact that, in what must be one of the biggest scandals of the scientific world, the University of East Anglia, I think, was found to have cooked some of the results the IPCC bases its claims on. Even here in Australia, sadly, a few years ago at estimates we heard about a scientist in the CSIRO who was put under so much pressure because he did not agree with the accepted view of climate change—and, in fact, he was something of a sceptic about the causes and the impacts of climate change and so was pressured and ostracised—that he left and went to live in Norway, where he found a different kind of approach to scientific method and scientific research. I think that whole story was a very sad reflection on the commitment of the CSIRO to scientific research, because scientific research is based on the scientific method, where you do an experiment, you get results and you accept those results however surprising they might be. So this argument that Senator Cameron and the ALP in general put up, that the science of climate change is absolutely rock solidly proven, is really very far from being the case.
So here we are with Australia facing the imposition of a carbon tax from 1 July. Even though, as I have said, we only contribute 1.4 per cent of the world's emissions, we are going to have the world's largest carbon tax. We are going to be charged $23 per tonne of carbon dioxide emitted and that tax will go up year by year according to the government's own budget. It will be $29 a tonne by 2015-16 and that will be raking in for the government something like $9 billion a year and $36 billion over four years. By 2020 the carbon tax will be $37 a tonne—an enormous fee—and by 2050 it will be $350 a tonne as the world's broadest and biggest carbon tax. One has to wonder what the outcome of that will be. What will that mean for the average Australian? Who will pay, for example?
Everyone will pay. Electricity companies will pay the most and they are passing those costs directly on to the customers. In New South Wales the average price rise for electricity will be 18 per cent, with half directly attributed to the carbon tax. From 1 July this year, every time you turn on a light, boil the kettle, switch on the computer or put on the heating or air-conditioner, you will pay the carbon tax.
If you look around Australia, electricity bills will go up. In New South Wales it is 18 per cent; in Victoria 14.8 per cent; in Queensland commercial electricity bills will go up by 15.9 per cent; in South Australia 18 per cent, and the lucky people of Adelaide will be paying the world's highest prices for electricity; in WA the increase will be 12.6 per cent; in Tasmania 15 per cent; in the Northern Territory 9.6 per cent; and here in the ACT the lucky people will have an increase of 17.7 per cent. This means that ordinary Australians, the people we know living in the suburbs, ordinary people, are going to have to bear the cost of this tax, which is, as I have said, the biggest carbon tax in the world.
It is also going to affect industry. It will mean a huge imposition on industry. It is going to lead to losses of industry, industries like the cement industry and oil refining. Many mining companies say they will no longer do business in Australia once this tax and the subsequent emissions trading scheme are introduced because it will mean that there are cheaper places for them to operate in around the world and they will follow the cost trail and take jobs overseas. So this is going to have a very big impact on Australia and the Australian economy.
Yet, as I have said, there is nobody else in the world who is going to have a carbon tax of this size. The Europeans have a carbon tax but nothing like as big as this. When this changes into an emissions trading scheme as it is scheduled to in 2015, we are going to have the problem of the fact that, except for the small emissions trading scheme in the European Union, there will be nobody to trade our emissions with. Our major trading partners, the United States, China, South Korea, Taiwan and Japan, are not going to have emissions trading schemes. Admittedly New Zealand has an emissions trading scheme, but very small. So the Australian public will end up bearing the cost of the emissions trading scheme, which will run into hundreds of millions of dollars a year, great increases in prices and the loss of jobs and industries for this country. That I think is an absolute tragedy.
Having said those things, I would like to move that we proceed to vote on this matter.
Senator Eggleston, you are unable to move that motion for closure as you are not a minister, as I understand it. And you have spoken. Had you done so before you spoke, it was possible. That is the advice I have. Senator—
Senator Brandis in fact went to take a point of order, but moving to put the vote is not a point of order. You can interrupt the debate to take a point of order and I was about—I had started to speak Senator Thistlethwaite's name to give him the call. Senator Brandis interrupted me to take a point of order but in fact he moved to put the vote, which I would think, seeing as Senator Thistlethwaite was getting the call, is not appropriate. Senator Thistlethwaite.
On a point of order, Madam Deputy President: in relation to what you have just had to say, first of all, as you know, and as the record will show, you had not begun to recognise Senator Thistlethwaite. Perhaps you were about to but you had not in fact begun to, and I did not interrupt you in calling him. Secondly, I have moved that the question be put. That motion is now, unobjected to, before the chair.