Engaging ag with climate policy

23 Jul, 2014 10:15 AM
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Environment Minister Greg Hunt.
Carbon tax flow-on costs hit Australian farmers every time they paid for essential electricity ...
Environment Minister Greg Hunt.

THE Abbott government remains under pressure to implement an effective climate change policy that can successfully engage farmers in genuine projects to reduce greenhouse gas emissions.

After several weeks of vacillating political negations, the carbon tax was repealed last week supported by the eight crossbench senators who hold the balance of power, including the three Palmer United Party senators.

Prime Minister Tony Abbott described the carbon tax repeal in terms of it meeting the government’s key election promise and economic value, including reducing input costs to farmers.

He said the carbon tax was a 9 per cent impost on the price of power, a $9 billion-a-year handbrake on the national economy and $550-a-year hit on household budgets.

“A useless, destructive tax which damaged jobs, which hurt families' cost of living and which didn't actually help the environment is finally gone,” he said last week.

After the legislation passed the Senate, Environment Minister Greg Hunt read out the National Farmers Federation’s (NFF) media statement, during question time in the lower house.

The statement said ‘Australian agriculture is breathing a sigh of relief now the tax has finally been abolished’.

“Carbon tax flow-on costs hit Australian farmers every time they paid for essential electricity, fertiliser, chemical and fuel supplies,” Mr Hunt said.

“It is not just the NFF saying this sort of thing; it is the Australian Industry Group, the Business Council of Australia, the Australian Petroleum and Production Exploration Association, the Cement Industry Federation and the Australian Retailers Association.”

However, the NFF’s media statement also highlighted the government’s pressing need to institute more effective pathways for agriculture to participate in its Emissions Reduction Fund (ERF) which underpins the government’s Direct Action policy.

The Direct Action policy includes measures like the Carbon Farming Initiative (CFI) and Green Army - budgeted $525 million over four years - to conduct projects that reduce greenhouse gas emissions to help meet government targets.

NFF president Brent Finlay said the government’s new policy response must be accompanied by a firm commitment to invest in research and development, in order to develop and convert carbon science and methodologies into practical and feasible on-farm action.

He urged the new Senate to prioritise “business certainty” when deliberating on key legislative initiatives, “including those that deliver on the government’s election commitments”.

The Greens have heavily criticised the government’s climate change policy, saying programs like the Green Army lack environmental credentials and don’t engage farmers in worthwhile projects.

Shadow Environment Minister Mark Butler said Labor had been “been crystal clear” in saying, since July last year, it would be happy to see the carbon tax terminated, “provided a meaningful climate change policy was put in its place”.

But he said Australia was now left with “no climate change policy whatsoever”.

Investment in the renewable energy market had also largely stalled due to the uncertainty introduced by Mr Abbott into that space, he said.

Mr Butler said the ALP had a long-running policy for a cap on carbon pollution underpinned by a market mechanism and complemented by strong support for renewable energy.

He said most Australians supported climate change science and action and an Emissions Trading Scheme was “far more popular than Direct Action, which is less popular than a carbon tax”.

Opposition Leader Bill Shorten said the government’s Direct Action policy was “a Clayton's climate policy designed for the audience of Internet trolls and shock jock radio announcers and climate sceptics”.

“It’s a mandate from the flat earth society to give a lot of money to big polluters,” he said.

But Mr Abbott said the Coalition had always believed the smartest way to tackle green house gas emissions was through more trees, better soils and smarter technology.

“The carbon farming initiative is part of the better soils that we want to see supporting agricultural productivity and also reducing emissions,” he said.

Mr Hunt said funding for the government’s ERF had already been approved in the federal budget while the CFI legislation had already passed through the House of Representatives.

He said “in due course” that legislation would also be presented to the Senate and “I am confident that we will find a way through that”.

“Just as we did not stop until the carbon tax was repealed – we won't stop until we have implemented the CFI legislation and the better way,” he said.

Independent SA Senator Nick Xenophon said with “modifications”, the CFI had a critical role to play in reducing green house gas emissions and would also be a vehicle for Direct Action, combined with renewable energy technologies.

“If it’s designed properly and implemented well, the CFI will be a very efficient way of reducing carbon pollution and giving a huge boost to regional communities around Australia,” he said.

Senator Xenophon said Direct Action policy and CFI programs needed “more teeth” to reduce green house gas emissions and engage the farm sector constructively with “powerful” inbuilt incentives.

The CFI and any replacement policy must be more transparent and independently scrutinised to ensure taxpayer dollars are not wasted, he said.

“All of my senate colleagues on the non-government side, the ALP, Greens and crossbench senators, including the PUP, can’t write this off until we’ve seen the final details,” he said.

Senator Xenophon said the carbon tax’s inherent structural problem – and ETS proposals – was that they imposed “enormous revenue churn” on the national economy, which generated “enormous waste” and little environmental rewards.

Mr Hunt said Direct Action was a long-term policy designed to be flexible. He said the Coalition would achieve a 5 per cent reduction in greenhouse gas emissions in the same time frame, but through incentives, rather than a tax.

“It is very clear that you can reduce emissions – we will reduce emissions,” he said.

“We will do it without a carbon tax because at the end of the day pushing on electricity and gas prices has been an utterly inefficient way, as well as an utterly unfair way of trying to reduce our emissions.

“We're not giving any funds out unless there is a real and genuine emissions reduction. We are purchasing emissions reduction and once the legislation is through the Senate, then we will be in a position to take the steps that we propose.

“We have got an incentive-based system, not a penalty-based system.

“We think we've allocated an appropriate amount of money from the Budget to tackle this issue.

“We think this is the sensible way forward and let's face it, we didn't just take it to the 2013 election – we took it to the 2010 election too. I think that the Parliament should respect the mandate that we've got to do it.”

Mr Abbott also rejected the assertion Australia was in environmental limbo without an actual mechanism for achieving its emissions reductions targets.

“We are a government which absolutely appreciates that we have only got one planet and we should pass it on to our children and grandchildren in at least as good shape as we found it,” he said.

Mr Butler said over the coming weeks and months, people would see “the complete fantasy and the complete overreach and hysteria of Tony Abbott’s cost of living campaign” in relation to the carbon tax.

“We are not going to see prices come down because they scarcely went up in the first place,” he said.

“We might see some very modest reductions in electricity prices, which was covered by our increases to pensions and family payments anyway, but frankly Tony Abbott’s lies about this will be exposed over the next few weeks and months.”

Mr Shorten said “Tony Abbott is sleep-walking Australia to an environmental and economic disaster".

"He will try and do and say anything to avoid the science of climate change. He still believes, as he famously said, it is ‘absolute crap’," he said.

FarmOnline
Colin Bettles

Colin Bettles

is the national political writer for Fairfax Agricultural Media
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READER COMMENTS

Archibald
23/07/2014 10:44:12 AM

One must remember, John Howard did a deal with the State Governments to look up the carbon in trees and farmers lost agricultural production and were not compensated for the "stolen carbon" at all. I'd say farmers would be a bit wary of the LNP after this little incident.
John Newton
24/07/2014 8:27:48 AM

That 'useless destructive tax' has been found to have reduced our emissions to the lowest in 24 years, and would have raised revenue of somewhere around $6-8 billion dollars in the next four years. It was a very useful tax, especially in getting Abbott into the prime ministership.
angry australian
24/07/2014 9:15:14 AM

Yes John Newton by being a contributor to us exporting our carbon emissions and jobs to places like China in the manufacturing industry and NZ in the food processing industry, even oil refining to Singapore.For the carbon tax must have been on the agenda of those firms which closed Australian operations and sent them offshore. Got to be the worlds greatest hypocrites if we continue to export coal, and then re import it as steel and cars,don't we?
Frank Blunt
24/07/2014 8:29:39 PM

Why is Australia going down this loopy climate change road of insanity which will destroy our economy ? Are the cranks who want carbon taxes and ETSs on our industry insane and intentionally trying to sabotage our country and its people and economy ? What have we got to gain from all this mindless madness ? Nothing . We will go broke that's about all.

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Forward selling grain is always a risky proposition and we are now seeing further evidence of
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A big old debt bomb globally. The farm sector will not be immune.
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budget update the other day ... we will be going backwards after we have banked this record