15-December-2008
Portfolio Media Releases, Emissions Trading Scheme
Subjects: Emissions trading scheme white paper.
MALCOLM TURNBULL: Well the Government has presented today its 800 page white paper on its emissions trading scheme and we will be considering that with great care. It’s a very detailed document, and we’ll be reviewing it carefully. The Government has to ensure that it acts responsibly. Mr Rudd will be very irresponsible if he brings in an emissions trading scheme which has the effect of exporting jobs and exporting emissions, doing great damage to our economy and doing nothing to save the Great Barrier Reef or the Murray-Darling Basin. So the devil as always is in the detail. We’ve seen with the green paper there were many flaws in it. They were the subject of considerable criticism from us and from industry and others, and some of those criticisms have been addressed in the white paper, but this is a very detailed document and we’ll be reviewing it with great care. I’ll just ask Andrew to describe how we’re going to go about that.
We’ve asked the Centre for International Economics under the Chairmanship of David Pearce, who will head up the study for us, to report back in the second half of February with a detailed assessment, not only of the long term, but very importantly to look at what will be the impact over the next ten or fifteen years of the white paper on jobs, on businesses, on emissions, on the capacity or otherwise for firms to remain in Australia or whether they’ll be forced overseas. And the difference between what we’re doing and what has been done to date by the Government is that we will look at the impact of the global financial crisis on industry’s ability to cope with such a scheme, and we’ll also look at the impact of countries not necessarily agreeing to sign up to a global deal on climate change. We need to have that sort of information to find out whether the white paper is in fact not only environmentally important and achievable but is economically achievable. And those results will be given to us in the last half of February. In the meantime, we will seek to meet with dozens of companies throughout many industries to seek their assessment. I’ve now visited some 51 companies in the last eight weeks and every one of them had peculiar problems with the green paper. They will all be working on whether the white paper has in fact solved those problems and we will seek to be informed by all of those companies over the next few weeks so that when we do come out with a final position it will be a well-informed one and well-considered one.
So none of these targets, neither the lower end of the range or the higher end of the range, are easy or simple. There is nothing easy about this. It’s very challenging for our economy and one of the criticisms that we have made of the Government is in their Treasury modelling that looks at the economic impacts of an emissions trading scheme they do not take into account the scenario where the rest of the world does not act. And many people would say that that is a scenario that is, if not the most likely, at least a very likely scenario. So it’s something that we have to bear in mind. We have to remember that we have a lot of industries in this country which provide a lot of jobs and a lot of prosperity, which are emissions intensive and which compete with countries that are very unlikely to have, in the foreseeable future, an emissions trading scheme or a carbon tax or anything of that kind. So the impact on emissions-intensive trade exposed industries is a critical element. Now the Government has made some significant changes in the white paper from what they proposed with great confidence in their green paper. So they have recognised their previous paper had big flaws in it. That’s why we’ve got to go through this one with great care, going through the detail with great care because there may be as many flaws in this as there were in their previous effort.
QUESTION: What chance do you think there will be of a world pact before 2015?
MALCOLM TURNBULL: Well it is very hard to say. The critical question, and I have represented Australia as Australia’s Environment Minister at global climate change discussions, and I’d say based on that experience and what we have seen since, the critical element is can the United States and China reach agreement? Now we have a new administration coming into office in January in the US that’s committed to an emissions trading scheme in America, and committed to a global agreement. Whether President Obama, as he will be, can reach agreement with China remains to be seen. But they are the two biggest economies, the two biggest emitters, and without their agreement there simply won’t be a global pact. So that’s what everything hangs on.
QUESTION: So you’re sort of maintaining your stance that we shouldn’t jump into anything like this anyway until the rest of the world and bigger emitters indicate that they’re definitely gong to start it off?
MALCOLM TURNBULL: No we’ve described what our position is and it’s set out in what we said and in the press release. But plainly global action is critical, everybody agrees with that. I get back to the fundamental point – Australia could cut its emissions to zero and in the absence of global action it would make no difference.
QUESTION: Your investigation aside, is it a good idea to exclude agriculture for five years and also emissions from forestry?
MALCOLM TURNBULL: Well that will be the subject of the review, but that is consistent with the proposal we had with the Shergold emissions trading scheme paper last year. There are some very significant challenges in including agriculture in a scheme of this kind and I think many people would think that even five years is ambitious as being able to include it.
QUESTION: Is 5 to 15 per cent, considering how hard they pushed their climate change platform before the election, it just seems both vague and also particularly unimpressive compared to what they were talking about beforehand. What is 5 to 15 per cent [inaudible]?
MALCOLM TURNBULL: Well I think it’s important to bear in mind that a 5 to 15 per cent cut from 2000 levels is a very significant cut in per capita emissions by 2020. So when you actually look at what this means in terms of a cut in emissions from business as usual, it is a very significant cut. So I wouldn’t be misled by the fact that 5 per cent, for example, looks like a low number. It is I think well over 20 per cent cut from business as usual; I think about 24 per cent cut in emissions on a per capita basis from business as usual.
ANDREW ROBB: Thanks Malcolm. We have decided, given the complexity and the importance of this emissions trading scheme and the whole climate change issue, to be well-informed and to commission an independent organisation to give us an assessment of the white paper and its impact on jobs, its impact on emissions, its impacts on industries, its impact on the community, its impact on the national revenue – and not only over the next forty years but in the next ten to fifteen years.
Indeed, and this is something worth reflecting on, if all of the developed countries in the world cut their emissions to zero it still would not reduce global emissions to the levels the scientists tell us we have to reduce them to without significant action by developing countries like China and India. So the key message is that only concerted global action will have the effect that we’re all seeking. So countries have to proceed but they have to proceed in concert, they have to proceed together and that’s why it’s very important to understand how our action is influenced by and meshes in with the actions of other countries. Thanks very much.