Labor’s ETS - a leap into the unknown
16th December, 2008
Labor’s White Paper on an emissions trading scheme opens up a bucket load of complications and anomalies, leaving Australian families and industry exposed to higher taxes that most of the rest of the world will not pay.The Leader of The Nationals and Shadow Transport and Regional Development Minister, Warren Truss, said the complexity of the proposed ETS would make it a nightmare beyond any economic reform seen in this country.
“A political leader of the past once had trouble trying to explain how the different components of a birthday cake were going to be taxed,” Mr Truss said.
“The Rudd Government has unveiled a baker’s shop full of birthday cakes.”
The Government may argue that agriculture is “exempt” from an ETS until at least 2015, but fails to take into account the increased cost of inputs and energy that will be used in producing Australia’s clean and green food and fibre.
For example, New Zealand has decided to exempt food processing from its ETS. Rudd Labor’s White Paper does not provide the same exemption for Australia, so energy intensive industries like dairy processing would be placed at a severe disadvantage.
“This means that we will see a flood of New Zealand dairy products onto the Australia market and our producers will lose the international markets they have fought long and hard to enter.”
Mr Rudd was also unable to explain why an effective 100 million tonne decrease in Australian emissions will counter an expected 10 billion tonne increase in China’s emissions. The Rudd Government plan will just export emissions and Australian jobs.
All the critical numbers in White Paper are based on a five percent reduction in emissions between 2000 and 2010 – that is effectively one tonne in every five compared with business as usual. The Rudd Government’s modelling assumes that the rest of the world will act at Copenhagen next year and Australia will not be going it alone.
“The ETS will hit some of the nation’s most energy efficient transport sectors such as rail, coastal shipping and aviation with much higher energy taxes.
“Instead of trying to encouraging commuters to use rail to get to work, electric passenger rail services will be slugged with new taxes on the electricity they use.
“If you live in remote Australia and need to fly to the city you will be taxed, which could lead to emissions rising, not falling. If you fly around Australia you will pay Labor’s new ETS, but if you go overseas it appears you won’t,” Mr Truss said.
The Government’s White Paper is 800 pages long and the Coalition has asked the Centre for International Economics to examine Labor’s proposals and to report on the implications for Australian industry.
