There is absolutely no shame whatsoever in opposing this package of bills—the Clean Energy Bill 2011 and associated bills. In fact, opposing this tax is the only defensible moral position to take. Not only is the carbon tax a bad piece of policy; it is the product of an unprecedented deceit perpetrated on the Australian people. When the Prime Minister looked straight down the barrel of a television camera and said, 'There will be no carbon tax under a government I lead,' people took her at her word. When the Deputy Prime Minister, Wayne Swan, told the Australian people that he rejects 'this hysterical allegation that somehow we are moving towards a carbon tax', people believed him as well.
One of the fundamental rules of parliamentary democracy is that you simply cannot promise one thing a week before an election and do the exact opposite six months after. The Prime Minister has attempted to explain away this towering deceit by saying that she could never have foreseen a hung parliament. That is beside the point. In a democracy, politicians are expected to give an honest account of their intentions before an election and remain true to them after the election. They are the rules.
Moving on to the policy itself, I want to clear something up straightaway, and that is the suggestion that Australia is somehow dragging its feet on emissions reductions. Nothing could be further from the truth. Australians are quite rightly sick to death of sanctimonious lectures by their political leaders about how we are the highest per capita emitters of carbon dioxide in the world—as if being Australian is somehow shorthand for being greedy or irresponsible. Australians are no such thing. In fact, we have an outstanding record of meeting our commitments to climate change action. Australian carbon dioxide emissions account for around 1.3 per cent of global emissions—not bad considering we are the 13th largest economy in the world. Under the Kyoto protocol, Australia committed to limiting its emissions to 108 per cent of 1990 levels. What was lost in the subsequent political bunfight about whether or not to ratify the protocol was that we actually came in well under that target, with an increase of just three per cent.
By way of contrast, Canada promised a six per cent reduction but is on track to deliver a 27 per cent increase. Japan also promised a six per cent reduction but is likely to deliver an eight per cent increase. New Zealand promised to keep emissions static but faces a 26 per cent increase, and the European Union is going to well exceed its promised eight per cent reduction. And what about China and India? China's 2020 emissions will be 500 per cent higher than they were in 1990. India is on track to grow by 350 per cent over the exact same period. So, compared to many of our peers, Australians are entitled to hold their heads high, and that is something we ought to remember as the prospect of any meaningful international agreement recedes.
Despite what the Prime Minister says about the supposedly widespread take-up of carbon pricing overseas, the fact of the matter is that no other country in the world has implemented or is even considering implementing an economy wide carbon tax like the one those opposite are proposing. Canada, America, Japan and New Zealand—none of these countries is even thinking about an economy wide carbon tax. The only place that has anything like what the Labor Party is proposing is the European Union—that lumbering and undemocratic superstate which is doing such a sterling job of looking after its economy. Even there, the European ETS is a piecemeal thing with nowhere near the financial impacts of the one being proposed by this Labor government. As we know, in the first five years of its existence, the European ETS raised $500 million dollars. In Australia we are looking at about $9 billion. That is 18 times as much as was raised in the EU being gouged out of an economy one-thirteenth the size.
To put that into perspective, the European Union has a population of about 500 million. That equates to about one dollar a head. With the $9 billion that is going to be gouged out of our economy, that calculates to around $400 per head. According to a recent World Bank report, the history of the European Union ETS has been one of ongoing rorting, fraud, money laundering and outright theft. That is not surprising. As you might imagine, the buying and selling of carbon credits in an inconsistently regulated marketplace across a dozen different countries is a recipe for every kind of fraud you can imagine. What we have is a government that could not even give away ceiling insulation without making a multi-billion-dollar mess of it now preparing to implement an incredibly complicated carbon pricing scheme 18 times the size of that which has been rorted sideways in Europe. It sounds to me that it is going to be a recipe for disaster.
Meanwhile, our trading partners in South-East Asia must be looking on with disbelief as we prepare to tax ourselves on the inputs they value-add and then export worldwide. In fact, Australia's decision to go it alone places our competitors at a competitive advantage and thereby actually decreases the incentive for them to follow our lead. That is an enormous problem because the government's expert modelling does not just predict that they will do so; it actually depends on it. Inherent within the government's modelling is, frankly, the deluded assumption that, upon seeing what we have done, the rest of the world will suddenly realise the error of its ways and promptly sign up to a global agreement. It is simply not going to happen. In fact, there is every indication that the complete opposite is more likely to be the case. After all, the loftily titled 'accord' that came out of Copenhagen was nothing more than a collection of idle promises—non-binding, unmeasurable and unverifiable. Just as Copenhagen gave us the accord, the subsequent round of talks in Cancun gave us more of the same. In these conditions, there is absolutely no reason to believe that the next round of talks, due to take place in Durban later this year, will produce a binding global agreement. Yet the entire economic rationale for the carbon tax is based precisely on that assumption.
Before moving on, it is relevant to note the absolutely stinking hypocrisy of the union movement in all of this. It is a fact that the union bosses will always support a bad Labor government over any coalition alternative, but the craven way in which they have genuflected to the Greens-led environmental lobby, and thereby abandoned their own members, should be a source of enduring shame. It was only a few short years ago that the union movement mobilised en masse to shriek about the coalition's job-destroying industrial relations laws. We all remember the repeated demands for a guarantee that no worker would be worse off. Fast forward to the present day and suddenly the prospect of widespread redundancies and even the demise of entire industries cannot provoke so much as a whimper of protest from the union movement. Is it any wonder that the majority of Australian workers now see the unions for what they are: out of touch, irrelevant and more interested in perks and fringe benefits than in protecting the interests of their members.
While we are talking about threats to job security, I would like to mention a few businesses in my electorate of Wright which are set to experience real pain under the carbon tax. First there is AJ Bush and Sons, a 100-year-old company still owned by an Australian family. AJ Bush is an animal by-product rendering business producing proteins, tallow and organic fertilisers. David Kassulke and his team there run one of the most energy efficient set-ups imaginable, using biogas produced onsite to power their generators and using leftover water to irrigate nearby farmland. Research out of the United States indicates that, for every metric tonne of carbon dioxide produced by the rendering process, 7.2 tonnes of carbon are removed from the environment, producing a net decrease in atmospheric CO2. Then we have Nolan's Transport, another 100-year-old family owned business, along with the entire transport sector within the electorate of Wright. There is Kalfresh, producers of a great deal of the fresh produce you see in your supermarkets, as well as Gelita Ag, one of the world's leading suppliers of gelatin and collagen. All of these companies are big employers in my electorate and all of them are in line for an absolute walloping from the government's carbon tax, with the flow-on effects to the local community that implies.
What about the community? What about the ordinary mums and dads struggling to pay the bills? What about the retirees, like Walter and Nancy Beal from Kooralbyn, who are finding it hard just to make ends meet at the moment? What about young couples trying to set themselves up for the future? What about the flood victims in my electorate who are still trying to get back on their feet after losing everything earlier this year? What does this tax mean for them? What it means is that life is about to get a lot more expensive. Both the Prime Minister and the environment minister have all but admitted as much. In February this year the Prime Minister said:
I also want to be very clear with Australians about what pricing carbon does. It has price impacts. It's meant to. That's the whole point.
The following month it was the environment minister's turn. Again, I quote directly:
… the true cost of carbon pollution needs to be attached to its production and use …
Put another way, he said:
… carbon emissions need to have a price.
And it is price that changes behaviour.
I could not have put it better myself. This government wants us to sit in the dark.
Despite the impending financial pain and the fact that the whole point of a carbon price is to make things more expensive so people will consume less of them, the government still want you to believe that somehow nine out of 10 households are going to come out in front. Honestly, after the litany of stuff-ups and blow-outs from this government, how are we expected to believe that they are capable of accurately calculating the cost on individual households down to the cent? Even if they could, what do we get for all this? What sorts of emissions reductions will all this economic pain buy? After all, if the carbon price does not reduce emissions, then it is just another tax—just a great big punitive tax to go alongside the 14 others Labor have either introduced or increased since taking office. According to the government's own figures—and here is the clanger—carbon dioxide emissions will still go up under this scheme, which renders the whole thing completely and utterly pointless.
This has led some observers to suggest that, first and foremost, the carbon tax is a vehicle for wealth redistribution rather than a response to climate change. Allow me to expand on that. The carbon tax model is inefficient because it requires tens of billions of dollars to be spent on compensation. In contrast, the coalition's policy requires no compensation because it does not drive up electricity prices. A report by Frontier Economics exposed this fact with analysis it did based on Treasury's 2008 modelling of a carbon price. Looking at electricity generators alone, it found that the actual cost of technology to reduce CO2 emissions from 2012 to 2020 is $6.6 billion. However, during that period, the government would reap $37.5 billion in tax from generators, and consumers would pay an additional $45 billion for electricity. So the government's tax is almost six times the actual abatement cost and the increased cost of electricity is nearly eight times the actual abatement cost. What happens to all this money? Most likely, it will get churned through the Labor-Greens machine and handed out to their preferred beneficiaries.
In conclusion, the carbon tax is, without doubt, the most intellectually dishonest piece of policy I have seen since coming into this place. It was introduced on the back of deceit, it is a poorly designed piece of legislation and it will not work. For these reasons alone, it deserves to be the sad and sorry epitaph of a sad and sorry government. If the government is so confident about this bill, then it should take it to the Australian people. If it is so confident, it should take it to the mums and dads in my electorate. If it is so confident about this legislation, it should take it to my people, who are the silent majority of this nation.