Celebrating the carbon tax


Living GreenerAt last, an Australian government has presented for public consideration an intelligently conceived framework for a national carbon emissions plan. Much work must be done over the next four to five months to flesh out the key elements, so it can be put to Parliament for approval as law.

Has Julia Gillard broken her pre-election 'no carbon tax' promise? Does it matter? Her promise was legitimately overtaken by events — the election outcome leaving Labor in precarious minority government, with the ascendant Greens and two interested Independent members (Tony Windsor and Rob Oakeshott) enjoying a powerful voice in climate change policy.

One may doubt whether this plan would have been put forward so soon in Gillard's first elected term, had her hand not been forced.

The election outcome reflected disenchantment with Labor's repeated climate change policy failures since 2007, and the resulting haemorrhage of Labor's youth and inner urban vote to the Greens. Even so, carbon emissions policy might have stayed in the too-hard basket for another term, if Gillard had had any parliamentary choice. She does not.

The incoming Minister, Greg Combet, made clear soon after the election that the Multi-Party Climate Change Committee (MPCCC) would study all policy options for setting a price on carbon.

The committee, whose proceedings are confidential, has now announced a hybrid package with a temporary fixed carbon price (or tax) starting in mid-2012, but with firm plans to move to an emissions trading scheme three to five years thereafter.

The plan to which Gillard has committed herself is an intelligent bid for Labor's political survival at the next election, as well as being entirely in the national interest.

The Greens and Labor may dispute parenthood of this jointly supported plan: actually it was first put forward in Ross Garnaut's 2008 Climate Change Review.

Tony Abbott is the bad fairy at this christening, determined to blight this baby's future. His confected outrage is opportunistic. He is trying to whip up the same alliance of climate change denialism and conservative business opposition that brought down Nelson, Turnbull and Rudd.

It is a tragic mistake for the Coalition that under Abbott's leadership they have abandoned any serious participation in national policy-making on climate change. Abbott will be remembered as a wilfully shortsighted obstructionist, who puts his own perceived tactical political advantage ahead of the national interest.

Fortunately, Abbott speaks here to a dwindling and increasingly discredited constituency.

There is no doubt that the mainstream electorate now better grasps the need to tackle climate change with effective national policies. A traumatic sequence of destructive extreme weather events, the manifest failure of tokenistic policies like coal industry carbon capture and storage, and the shelving of unattainably grandiose international carbon trading ambitions, have concentrated serious minds on things that are necessary and achievable at the national level.

Labor has learned lessons from its bad experiences in 2007–2010. It is focusing on issues more likely to unite than divide: the need for business certainty, and the importance of Australia not falling further behind the energy changes that are happening internationally. Combet and Christine Milne, with admirable pragmatism, are downplaying target-setting and climate change doomsaying.

What might go wrong now, apart from Labor losing office before the 2013 election through adverse by-election contingencies? After mid-2011, Labor and the Greens will together have numbers in the Senate for many years to come. Were the Coalition to win in 2013, it could still not legislate to end an already functioning carbon price law.

The next few months will see a messy but necessary debate involving all interested stakeholders to determine the final scope and numbers of the plan. This debate — which already began last weekend between the Prime Minister and Senator Milne over taxing petrol — will be partly played out in public and partly privately within the MPCCC, where Greens and Independents exercise real policy influence.

The Opposition will be quick to exploit any public evidence of rancour in the committee.

This is why government ministers, the Greens and the Independents must hold to the discipline of a civilised, contained debate. After the overblown rhetoric, false policy starts and humiliating backdowns to powerful interests over the past three years, Gillard and Combet need this year to get some real carbon policy runs on the board.

They can only do this by a process of patient, courteous but steel-willed negotiation. Any sign of policy weakness will be quickly exploited by enemies.

Here is a brief roadmap of the key issues.

First, the committee must agree and win public approval for an initial carbon price of between $20 and $30 a tonne.

The renewable energy and gas industries, as well as Greens and environmentalists, will argue that only an upper-end figure will send meaningful price signals to the coal power industry and to renewable energy industries waiting to go forward. The coal lobby and Labor's industrial conservatives will press for the lowest figure. I hope for something above $25.

Second, they must decide the scope of the coverage of the scheme. It would be prudent to limit it initially to the electricity generation sector — producing over 40 per cent of Australia's carbon emissions — while compensating flow-on domestic electricity price increases to poorer consumers.

This will maintain community support by sending an encouraging message that the tax is doing the job, as new non-polluting (wind, solar) or less polluting (gas-fired) power stations get underway.

Third, the vexed transport sector: the largest carbon emitter after electricity generation. Garnaut has warned that exempting fuel would undermine the scheme. But petrol price rises will directly hurt consumers already worried by petrol price hikes caused by Middle East unrest.

I would expect the Greens to stand firm on the principle that petrol must be included in the scheme. Labor should press the Greens to accept an interim fiscal compromise, initially offsetting the tax for a few years by reducing the existing fuel excise tax.

Fourth, when and how far to extend coverage to industry. Some industry processes of themselves emit carbon dioxide, e.g. Bluescope Steel's blast-furnace technology. There are fears that direct carbon taxing would further handicap such import-competing industries, threatening their sustainability and 'hiding' Australia's carbon pollution in expanded imports of manufactured goods.

It is an emotive argument, based on the value of industrial jobs at home and a fair playing field for our threatened manufacturers. The Greens would do well to respect such concerns.

Environmental groups and Greens will press for (and should get) complementary policy measures as well as a carbon price, to speed up movement to a renewables-based energy sector.

Agriculture, while relieved that its emissions will not come under the scheme, will press for positive incentives to carbon-conserving farming practices, and fair treatment for irrigators.

Last week's announcement was the important first step on a hard road. Now it will be up to the community to unite behind building an achievable multiparty consensus. Otherwise, Coalition troglodytes — weaker now, but still with capacity to divide and harm — will wreck Australia's best hope yet for a good carbon emissions policy. 

Tony KevinTony Kevin is the author of Crunch Time, a book exploring Australia's inadequate policy responses to the climate change crisis.   

Topic tags: Tony Kevin, carbon tax, julia gillard, climate change, emissions trading scheme, greg combet, Tony Windsor



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Existing comments

Thanks Tony for your article
..........helped me to see through the maze and be able to answer some of the questions posed in groups I attend.

There are so many nay sayers and deniers it becomes difficult to keep up the positive and essential argument for change.

GAJ | 01 March 2011  

I guess as I read your imput the only thing we agree on is the imperative for change . God created us to do two things , live as his image which we do a lousy job at and be masters of his created world which we also do a lousy job at.

Carbon tax is an indirect economics view of how to deal with the problem and as such appeals to the lawyers and school teachers of labor and the greens but will have little impact on the real world .If you want to change peoples car use tax cars according to co2 emissions ,do you really think another 6 cents will do anything but loose suport, do you really think a driver will change their car over 6 cents?

If we want to reduce generation carbon than spend Government money to replace the power stations now with hydro , which the greens hate , or with nuclear ,which they also hate ,otherwise the tax will foster no base load power just some fringe small uncompetative stations .

The fix is in engineering not ecomomic games .
On this issue Abbot is ahead.

John Crew | 01 March 2011  

Thank you for that clear summary of the carbon emissions issues. i hope you have the politics right also.

Faye Lawrence | 01 March 2011  

A lie is a lie is a lie.

Skye | 01 March 2011  

The nub of the argument is to turn Coal-fired Power Stations to alternative energy; the problem is there are no viable alternatives other than Coal-seam gas(volume wise) , which also attracts the nay-sayers.

The Wind/solar proposals for NW Qld where there is an abundance of solar in the day and constant wind at night (across the Downs country) the energy produced is 5 times the cost of coal fired energy
The carbon tax is like a placebo, we will get the pain without having an impact on CO2.

I believe part of the answer is in clean coal technology, washing the coal properly will reduce emissions by 30%,practical atlernative are no substitute for a public squabble. It reminds me of the introduction of the Vegetation Management legislation, no one wanted to talk about what works in the landscape, the energy was for the squabble about erosion of landholder rights.

Nev Hunt | 01 March 2011  

Nobody can ever trust a liar and nobody can ever trust Julia Gillard. The introduction of a carbon tax will do nothing to enhance the environment in Australia. Many families already struggle from high rent, interest rates, fuel prices, water charges and numerous other costs.

If Australia wants to achieve a low-carbon economy, a carbon tax is totally wrong. For example people will need money to purchase solar panels, low carbon emission cars etc. If Australian is taxed more, they are less likely to buy a new and less polluting car. It is more likely they hang on to their old stinker. People with a low income will be even less able to find the cash to buy solar panels to reduce their electricity cost.

Australia can achieve meeting and exceeding all carbon reduction targets without having a new tax. For example Australia does not have a period of frost and our landscape is not covered in snow for several month every year. Australia has an active carbon sink with evergreen plant growing all year round and we have warm water rivers, lakes and ocean capable to absorb all the locally produced carbon dioxide within a few kilometres of its emission.
Australia needs to achieve to improve land management practices on only about 2.5% of its land surface to achieve these targets. It would mean that some grazing land would become a National Park.

We have also very innovative technologies developed in Australia. Our own CSIRO had developed maybe the world’s best ceramic fuel cells, capable of reducing CO2 emission by about 60%. The Ceramic Fuel Cell (Bluegen) is now manufactured and sold in Germany, based on this unique Australian technology. Widespread use of this technology would help to achieve targets and would also provide direct saving to householders. In Australia a few leading organisations including the Adelaide City Council and the Government of Victoria are testing this technology.

In Australia we can do it better and we can do it by rewarding good behaviour and not by introducing more taxes to build an even larger public service.

Beat Odermatt | 01 March 2011  

If only it would work; I wish, I wish. Do we have any real, solid evidence, Kevin, that the imposition of a carbon tax, with all the "compensation" surrounding it, will actually lower CO2 emissions, the primary objective?

And if those industries, power generation in particular, can simply pass their costs, as they always do, onto the consumer then who suffers most? Who benefits?

John R. Sabine | 01 March 2011  

Why would it matter if Gillard lies this time? It never has before.

No one in the mainstream media raised so much as an editorial peep when Gillard brazenly lied about her period of involvement in and status as a member of the management committee of, the communist front Socialist Forum.

Nor was there outrage when it was revealed that, in the lead up to the 2004 election, Gillard had rigged a interview with a small regional radio station in which she purported that an email [mistakenly] sent to Tony Abbott the night before confessing that the health portfolio was too confusing for her, was sent to him deliberately as a lark - in order to forestall an attack by Abbott in Question Time.

Lies - or honest admissions that one might occasionally lie in the heat of political battle - only matter, only raise questions about moral character, only have scribblers wringing their hands and renting their garments, if the alleged liar is on the right, like Tony Abbott.

HH | 01 March 2011  

Does it matter that Julia Gillard lied? Yes. It certainly mattered to Tony Smith and many posters that Tony Abbot had admitted to lying. In his article "Phony Tony" (Eureka Street Issue 9: Published 21-May-2010) the virtues of honesty and trust were extolled. You cannot condemn Abbot out of hand and let Gillard off the hook.

As to the merits of this tax, the best review I have read on it comes from Bob Carter. His thoughts on it can be found here.


With polls in the papers saying that around 85% of the population are opposed to it, the Prime Minister may well have made what Sir Humphrey would have called a courageous decision.

John Ryan | 01 March 2011  

Thanks Tony, for the finely articulated distinctions you make that will test the character of each player in this drama acting out before us. I hope it can fully engage us as citizens choosing our future.

Mark Spain | 01 March 2011  

Thank you Tony for a sensible article about carbon pollution. New Zealand's ETS has been operating since July 2010 with a minimum of fuss. It's sad to see the paucity of political bipartisanship on this national issue.

Peter Edwards | 01 March 2011  

Well done, Tony!I really think, with you, that those who still "don't get" that the most important thing today and for the future, is "the climate change, stupid!" are living in a planet of their own. There are a lot of people thinking the way we do, so, Julia has done well and we will continue to push Labor and Greens and Independents to finish the job! God bless!

Nathalie | 01 March 2011  

Some time ago Julia Gillard was Margaret Throsby's guest on ABC Classic FM's Mornings. When asked what it was that attracted her to politics she replied, "I love the power." Honest perhaps , but also a little disturbing now that what she professes to love, her power base, is so dependent on such as the Greens. This partially explains her pragmatic view of most things especially the carbon tax.

grebo | 01 March 2011  

A change of government policy in the face of very much changed circumstances is not a lie. Probably there is no ideal answer that would resolve the world's ever increasing environment problems.These are problems calling for immediate action by all responsible political leaders:they can no longer be ignored with "a she'll be right, mate" attitude.Sadly the mindless,intemperate, and negative contributions from the Leader of the Opposition are nothing more than a destructive distraction.

David | 01 March 2011  

"Carbon tax" ? More accurate to call it a "fine for polluting".

Geoff | 01 March 2011  

We saw that this modern environmentalist movement is pro-abortion, pro-population control, and anti-human at its core; and that there are scientists by the thousands who challenge the entire concept that global warming is a man-made phenomenon; or that global warming is even happening! Meteorologist John Coleman calls the whole notion "the greatest scam in history".

for further read these 2 posts:


Trent | 01 March 2011  

We do not need a carbon tax because CO2 is NOT pollution (it is plant food). Refer to the recent books by professors (geology) Bob Carter and Ian Plimer. Climate change is caused by natural factors, most unlikely by human CO2 emissions(one cannot isolate and measure the human effect anyway).
Only a third of Australian now believe the CO2 csare story (Galaxy poll by Institute of Public Affairs).

Gerard Tonks | 01 March 2011  

Gillard has labelled herself as a liar. That is not Abbott's fault!
You'd have to agree the ALP had little chance, if
any of gaining even enough seats to manage a hung
parliament if Gillard had not told that huge lie
virtually on the eve of the election. She has lost all credibility.

Bill Barry | 01 March 2011  

Thank you for this article. Labor's promise (via its current PM) was indeed legitimately overtaken by events. And validly, I'd say. Ross Garnaut's 2008 climate change review would approve. The calamity of global warming asks, nay begs, for solar enerhy, wind and thermal power and I trust that no politician will put the possibility of winning an election before the greater good.

Joyce | 01 March 2011  

With the current state of technology, you are either pro carbon, pro nuclear or pro black out.

Despite the wishful thinking of the Greens and their acolytes, we simply do not yet have the technology to meet the our power needs through renewable energy.

The talk that green technology will create jobs is not supported by reality. Spain has poured millions into green power. It was nothing more than a government subsidised disaster. The government would do well to let the market come up with the technology for renewables. I have every faith that human ingenuity will rise to the challenge once hydrocarbons are gone. But the government trying to force the issue will only lead to pain for no gain.

Tim | 01 March 2011  

I don't mind if the industry keeps burning fossil fuels but they should have pay some tax for that to compensate the price-hike on electricity produced from green sectors. Domestic consumption of energy must come from renewable sources - as Australia goes through a transitional period from old tech to new tech society.

Australia should invite EU countries to come and invest in solar and wind, and even geothermal, for their own EU consumption. This will make, if EU is interested, a new export. Australia is, unlike the middle-east, able to provide stability for long-termed investment.

At the same time, Australian society should change in lifestyles to fit with new reality. Instead of expending towns and cities and clearing up forests that eat CO2, Australians should enjoy clean sky and pure atmosphere within the areas they live. i.e. to condense the cities and towns make more affordable lifestyles.

Should give what belong to the nature to the nature and take least but enough for prosperity and healthy standards.

AZURE | 01 March 2011  

Wow Tony, you really flushed out the extreme right-wing neo cons this time! There is Beat, who can 'never trust a liar', but has had no problems with 'Iraq-has-WMDs-Howard', or 'children-overboard-Reith', or 'I-forgot-the-meeting-with-the-Cardinal-Abbott'. And John Ryan - an obvious fan of 'no-stolen-generations-Quadrant' and the '85%-opposed-Murdoch-press'. And Trent, with his grand all-encompassing Anti-Christ conspiracy of Greens, lefties, scientists, and (true) liberals.

Hopefully, Gillard will be able to use her not inconsiderable negotiating skills to craft legislation that will at least get us started on winding back the fossil-fuelled basis to our economy before we do much more damage to our common environment.

Ginger Meggs | 01 March 2011  

Thanks for this article. Gerard Tonks refers us to Professors Plimer and Carter. I refer Mr Tonks to Professor Ian Enting, who has prepared a page-by-page listing of the errors, obfuscations and straight-out fabrications contained in Plimer's "Heaven + Earth". It's called "Ian Plimer’s ‘Heaven + Earth’—Checking the Claims", and can be accessed online at http://www.complex.org.au/tiki-download_file.php?fileId=91 Enting, by the way, is at the ARC Centre of Excellence for Mathematics and Statistics of Complex Systems, U Melb.

David Arthur | 01 March 2011  

Gillard lied - and everyone knows she did. Don't you know what the message was in the story of the little boy who cried wolf, Kevin? How can we ever believe or trust Gillard again.

Peter Flood | 01 March 2011  

Agreed, we are being burnt down or drowning while the imbeciles whine and nero fiddles.

Marilyn Shepherd | 02 March 2011  

to GINGER MEGGS You are displaying all the essential skills needed to become a member of the Greens. You have the skills to chant slogans and label people. You seem to be not only politically correct at all times, but you display a great zest for all the stories told to you. You are the proof that the bible is right as it is written "that meek will inherit the earth".But please let be assured that I will never join you in any of your slogan chanting sessions! By the way a "carbon tax" is a paid permit to pollute and not a solution to reduce pollution.

Beat Odermatt | 02 March 2011  

What crazy kids here. Howard lied and got us into a war that has killed over1 million people, displaced 7 million and destroyed an entire country and you whine about carbon tax which won't hurt a soul. It's so easy to pick the Howard huggers but I don't understand why they don't stick to Bolt's pages insteading if infesting this fine production.

Marilyn Shepherd | 02 March 2011  

Well Ginger Meggs, I really appreciate the way that you added to the tone of the debate. Thanks for taking time to get past the labels and getting down to debating some substantial facts! As for Quadrant, the articles that I read on the "Stolen Generations" argued point by point against many of the claims made by the likes of Robert Manne. Last I heard, Manne would not meet Keith Windshuttle in an open debate. Yes the Murdoch press may not be the most representative sample, but I have heard other polls running at 2 to 1 against the tax. As for Julia using her negotiating skills, I would be inclined to accept a carbon tax if I thought that there was disastrous warming because of CO2. But I don't. According to a hydrologist featured on Counterpoint on ABC National a week or so ago, the droughts and floods we are having are all part of the extreme variability of the Australian climate. I could give you the link, but you would probably want to avoid listening to an extreme right-wing, fascist, racist, neo-con show. Why engage in debate with those who disagree with you when you can write them off with a label? It's much easier, isn't it?

John Ryan | 02 March 2011  

Well said John Ryan.

Even if Australian humans stopped producing CO2 TOTALLY right now (ie they were carbon-taxed to death) the world temperature would be a measley .0123 degrees C cooler and sea levels 2 mm lower. Big deal.

Conclusion: Tony Kevin and the left in general are much more serious about coercing everyone into living according to their own agenda than they are about actually getting the global temperature down (even if the latter were at all desirable, which is highly debatable).

HH | 02 March 2011  

JULIA GILLARD IS A LIAR, that isnt tony abbots fault. Carban tax is a just a foney reason fabricated by the goverment to get money off us. bastards.

Hey | 03 March 2011  

Julia Gillard could not do anything else but break her election promise that there would not be a carbon tax introduced.She is under the complete control of the Greens and Independants.

John Tobin | 04 March 2011  

There is a desperate need to reduce industrial emissions of all kinds including carbon. I cannot imagine a good argument other than short-term self interest to oppose it.To link it to "climate change " runs the risk that the need to reduce emission is dependent on an issue which is (a) highly contentious ( b) heavily politicised ( c) vulnerable to the careerism of scientists who have hitched the wagon to this fund supported concept (d) misunderstood by the majority of punters who, in our style of democracy, are the vote wielders who can make or break good policy ( e)vulnerable to the spoiling actions of opposition parties of whatever colour.

If this is such an important issue we should rearticulate the debate in terms of a just and fair way to treat the world we live in and share with others. In short it is simply the right thing to do whether it is causing "climate change" or not.

graham patison | 20 March 2011  

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