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Gillard's climate coup


Julia GillardIf the Gillard Government manages to serve a full term — if it survives the random risks of MP health and mortality, and Tony Abbott's determined wrecking program — there is a good chance that Parliament will pass a well-designed, effective national carbon pricing policy into law in 2012.

Such an achievement would be a major policy success that Gillard could legitimately boast of, going into a 2013 full-term election.

Certainly the new Cabinet climate change advisory committee (announced on Monday) is unusually well-conceived, in terms of both mandate and membership.

It starts with the premise that some form of national carbon pricing is needed soon, in order that Australia not fall behind its international trading partners and competitors. This premise cuts the ground from under the feet of climate change deniers, making their arguments irrelevant.

Second, it breaks the destructive 'the best is the enemy of the good' Labor-Greens disputes of the Rudd years. The Greens are firmly in the tent, effectively co-chairing this committee. They have had to give up something important: the committee's mandate is to advise on the best method of carbon pricing — a carbon tax, or emissions trading scheme — not on what national emissions reduction targets to aim for.

But Labor has had to give up something important too. In opting under Rudd for an ETS, and discarding a carbon tax as politically impractical, Labor went a long way down the road of making politically necessary but painful compromises with industry special interests, in order to build broad industry support for their ETS approach (thereby losing the Greens).

All that hard-won achievement is now back in the melting pot. Business will be loath to lose the concessions and profit opportunities it had won under the Rudd ETS.

But Greg Combet made clear that the new committee is going back to the drawing board on whether an ETS or a carbon tax is the best way to go. In the post-Copenhagen international environment, all policy bets are open. Though the influential insider publication Climate Spectator opines that the ETS is likely to prevail, I am not so sure of this. It will be a real policy argument now.

The important thing is that by the end of 2011, there will be a broad-based recommendation as to the best means of carbon pricing. The committee will not have done its job if it sits on the fence.

Its membership is well-chosen. Gillard as Chair won't have a strong initial view. Her two deputy chairs are Milne and Combet. Milne may favour a tax now, but Combet, I would guess, still has an open mind.

There are four other current members. The Treasurer may be swayed by Treasury's preference for emissions trading over taxing (we know the Treasury view from their published Red Book of advice to the incoming Labor Government).

Independent Tony Windsor, on the other hand, is alert to the risk of perverse market rationalism-driven outcomes of a broad ETS embracing agriculture. He is concerned that food production may fall if farmers are market-driven to growing biofuels or to sequestering carbon in forestry.

Significantly, there are three vacant seats on the committee: one for Rob Oakeshott or Andrew Wilkie as Independents, and two for the Coalition if it should rethink its present boycott of the committee.

The committee has four expert advisers: Ross Garnaut, who seems to incline to a limited carbon tax now, leaving open the transition to an internationally linked ETS later on; Professor Will Steffen, who will keep current global climate science accurately before the committee; Rod Sims, who represents an industry pro-ETS view; and Patricia Faulkner who will represent the consumer interest in keeping energy costs down.

Energy Minister Martin Ferguson, while not on the committee, will be a key offstage voice (and trusted conduit to and from the coal mining and energy industries). Importantly, he now favours some form of carbon pricing, for international trade competitiveness reasons.

But he says the paramount interest here should be Australia's national interests in mining and manufacturing — not in creating profit opportunities for the financial services industry. This suggests he might favour a carbon tax or a simple tax-ETS hybrid scheme.

The committee will function in secret as a Cabinet committee. This is good: it limits the opportunities for powerful special interest lobbying, until the committee has agreed on and submitted its recommendations to Government.

There will be limited opportunity for public consultation: not enough for climate change deniers to distort the process, as they did under the Rudd Government. The tide of public climate change knowledge and opinion in any case is now moving in the direction of accepting the need for Australia to have some form of carbon pricing, and soon.

Despite The Australian's persistent rearguard action, voices like Marius Kloppers of BHP and Grant King of Origin Energy now have the public's ear.

If the Coalition were smart, they would quickly review their position on climate change policy. They will find the business sector leaving them behind as irrelevant, if they do not get on board this committee process. But this would require Tony Abbott to change his stated views.

The above optimistic prognosis assumes the Gillard Government can go to full term. If not, it could all fall in a heap again as it did under Rudd. The game is not yet won. 

Tony KevinTony Kevin is the author of A Certain Maritime Incident, about the fate of the Indonesian fishing boat SIEV X.

Topic tags: tony kevin, carbon price committe, gillard, climate change, ross garnaut



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Existing comments

Carbon trading will be a dream for many. It seems like selling a place in heaven in Europe during the Dark Ages. Selling and trading something nobody owns is ideal to make massive profits. If the aim is to provide a few rich dealers more opportunities to make money for a few more yachts, then carbon trading is good.
If we want to conserve resources for our grand children and reduce the impact of a potential climate change then there are far better options.

In Australia massive energy losses occur through transmission of electricity over huge distances. A CSIRO innovation is being commercialised in Europe by Ceramic Fuel Cells by providing a small domestic power station, which can reduce CO2 emission by 60%. At the moment it seems on Victoria seems to have taken some interest in this invention and unlike the UK, no feed-in tariffs have been provided as yet.

We don’t need more taxes and shonky carbon trading scams; we need to use innovation to reduce energy efficiency. If the Gillard Government would use some of the spare cash from the 46Billion NBN scheme, it would allow Australia to meet the strictest international conditions on CO2.
I hope that common sense, science and innovation win over ideological tunnel vision and dis-information.

Beat Odermatt | 29 September 2010  

It is incorrect to call the critics of carbon pricing proposals 'climate change deniers'. E.g.Read carefully what professors and geologists Ian Plimer and Bob Carter say and write which is to concur that climate change is happening but that anthropogenic CO2 emissions are not the proven or likely cause. Global warming has occurred before in human history when they emitted no industrial CO2.

The scientific debate is not settled and still goes on!

Gerard Tonks FCA | 29 September 2010  

"There will be no carbon tax under the government I lead" Julia Gillard before the election. Now after the election, she wants to put a price on carbon. What a back flip but understandable Julia has made a secret deal with the Greens.

The climate change advisory committee is a joke. Tony Kevin's view that if Parliament will pass a carbon pricing policy into law in 2012 then Julia Gillard would legitimately boast of going into 2013 full term election is wishful thinking. One only has to mix with ordinary people to find out that the vast majority can't wait for the next Federal Election to get rid of the Labor-Greens coalition.

Ron Cini | 29 September 2010  

Thanks Tony for a well-researched and balanced article. Despite the many nay-sayers, even the Coalition has its share of climate change faithfuls and I look forward to see how Malcolm Turnbull, an intelligent politician with a conscience and a optimistic view of the future, manages to reconcile himself with the views of his party under the Howard-inspired leadership of Tony Abbott. Our present times may have their conflicts but the younger generation will not tolerate for long the dilly-dallying of rear guards and sceptics. Either move on or lose relevance.

Eveline Goy | 30 September 2010  

The way to reduce CO2 emmissions is to develop nuclear power. Will this be on the table for discussion by the committee? I doubt it. Yet it should be if this committee is serious.

CT or an ETS will have minimal effct on reducing CO2 emmissions. The population will simply be punished by rising costs for everything.

Will anything Australia does stop climate change? The answer is an emphatic NO.
There is just as much certainity for business in saying no to a CT as there is in saying yes - and less punishment for the people to boot.

deric davidson | 03 October 2010  

Gerard Tonks FCA would do well to, along with Professors Plimer and Carter, read and understand that anthropogenic CO2 emissions are the dominant cause of the present global warming. they can all do so by looking up "The Human Fingerprint in Global Warming" (http://www..com/human-fingerprint-in-global-warming.html).

The Union of Concerned Scientists have even provided a downloadable 3-page summary (http://www.ucsusa.org/assets/documents/global_warming/humanfingerprints.pdf) for printing and reading on the train.

Deric Davidson, perhaps more sensible than Plimer or Carter, advocates nuclear power, and asserts that a carbon tax will achieve nothing. I dispute both propositions; a trans-national HV DC power link between Eastern State grids and WA could be fed from Nullarbor solar thermal stations, as proposed by Zero Carbon Australia (http://beyondzeroemissions.org/zero-carbon-australia-2020), with wind farms lining Australia's south coast from Ceduna to Albany.

[ The same power line could also power a trans-continental Very fast Train, which would connect Perth to the Eastern States (services by Virgin Trains, perhaps?) ].

All we need is a revenue-neutral carbon tax. With a GST surcharge of $16 per tonne of fossil fuel carbon, we could rid ourselves of payroll tax and raise the taxfree threshold to $9000.

After that, we're defeated only if our imaginations fail.

David Arthur | 07 October 2010  

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