TED O’BRIEN – SHADOW MINISTER FOR CLIMATE CHANGE AND ENERGY
DOORSTOP, PARLIAMENT HOUSE
27 March 2023
Topics: Safeguard Mechanism, emissions cap, Labor capitulates to the Greens, broken promise, energy prices, cost of living crisis,
TED O’BRIEN: Today, the Labor Party has announced a plan to deindustrialise the Australian economy. This is not a plan to decarbonise the Australian economy, but rather a plan to deindustrialise it. and agreement with the Greens that the Prime Minister assured his government would never do. His government would never do deals with the greens. But how many broken promises can one government stack up? This government is certainly a record breaker in that regard. The core of the labor-greens deal is a hard cap on emissions. This is a hard cap on growth of the Australian economy this is a carbon tax on prosperity. And this will lead to an offshoring of emissions. This plan is bad for the economy, and it’s bad for the environment. In order for Australia, to decarbonise our economy, we have to get the balance right. And that balance has to be between cutting emissions and allowing the economy to grow. But what we see today is a deal between Labor and the Greens that throws that balance out of whack. This is going to jeopardize the future of the Australian economy. It will make the Australian economy weaker and the Australian people poorer. It will ultimately be the Australian people who will have to pay for the carbon tax that Labor introduces in the deal done with the Greens today. When people are paying for everything from fuel to groceries through to household materials, building materials, they’ll be seeing higher prices because of the plan that has been announced today. This Labor-Greens plan also sets into motion the next energy crisis that Australia will have right now. As a nation, we are amidst an energy crisis and we’re amidst a cost-of-living crisis. This plan announced today under the safeguard mechanism reform ultimately hurts both those issues. It sets Australia up for an even worse energy crisis in the years to come. While also making it harder for everyday Australian families who need to pay their bills. It doesn’t matter if it’s the ACCC or the market operator. The Australian government has been told time and time again. That the energy crisis we face as a nation is due to a lack of supply. Again, they do a deal with the brains that actually restricts supply even further. Makes it even harder for the Australian economy. It’s wanting to decarbonise the Australian economy. But you don’t want to decapitate it on the way. And that is precisely what this dirty deal with the Greens is all about. Happy to take any questions.
QUESTION: Ted O’Brien, would it have been better than for your side of politics to negotiate with the government to make this plan better in your view?
TED O’BRIEN: Well, we said from the get go as a coalition that we don’t believe that introducing a punitive carbon tax is the way to go. And as a as an opposition. We will be constructive where we can but we must be critical too where we must. And when it comes to this carbon tax policy. We have to be critical. Now this is the most punitive carbon tax in the world bar none. Both the level of emissions reduction and the carbon pricing together makes it the most punitive. The scheme that Labor is looking at introducing hasn’t been successful elsewhere. It’s why a lot of other nations do not price carbon in this way and certainly not as high. You know, eight out of our 10 trading partners only had about 10 top trading partners that either don’t have a carbon price or to such a lower level that this puts us in a real disadvantage. I mean Australian industry are already on their knees because of the price of of energy. And now introduce this we’re going to see ultimately businesses will close. Now, this caps Australian industry it caps growth and that’s what a hard cap is all about it caps the growth of the Australian industry. So if a business caught within this scheme wants to grow further, the risk is they won’t be allowed to and what will happen? Well, those operations will be going overseas. Now in my discussions, especially with manufacturing businesses that are going to be hit with this carbon tax. It’s most likely India and China. That will fill the void when Australian industry is either close or they can’t grow. Now we know that China and India’s emissions are somewhere between probably four and five times that of Australia’s and so this isn’t good for the environment, but every time an Australian business closes, that’s jobs gone. That’s Sovereign capability gone. That’s usually regional communities hit. And its emissions, not just taken offshore, but taken offshore and multiply. And so this is bad for the economy and is bad for the environment.
QUESTION: Mr. O’Brien the Coalition several years back introduced its own Safeguard Mechanism. The government now is seeking improvements on it? So, by coming out against the safeguard as it stands now, is that also admitting in your view that the previous Coalition safeguard was inadequate then?
TED O’BRIEN: No, you see Labor has done what Labor is very good at? It’s been their cunning plan. They’ve picked up something the Coalition created – the safeguard mechanism – and they’ve turned it on its head, completely changed it, and they used it as a Trojan horse for a carbon tax. So, this looks nothing like what the Coalition introduced years ago. There is no doubt that we need to see the Australian economy continue to decarbonise and if we come from a track record as a coalition, that which we’re proud you know, we had over 20% reduction in emissions, it’s on our 2005 levels. And in that time, we’re able to see the Australian economy grow by over 40%. And that’s what it’s all about. Nobody in this debate is saying that the economy can’t decarbonize. It’s critical. It must, but you have to balance that with allowing the economy to grow. You have to balance that with industry with jobs with manufacturing. The fact that the government has introduced what it calls its signature climate policy, and it has not had Treasury or the department to do any modeling on the impact. That says it all. If indeed, the minister talks about the challenge ahead being akin to the Industrial Revolution, and this is the signature policy to deliver on something like the Industrial Revolution, you would think the government will have done economic modeling on the impact of regional Australia, communities, industry jobs, it hasn’t done any of those things, and therefore should not be surprised when the Coalition that believes you must get the balance right between the economy and the environment. Starts to say, well hang on. That doesn’t stack up.
QUESTION: You’ve spoken in the past about industries like aluminium and cement and how they’ll get hurt by this policy. The government’s putting $400 million into helping those kinds of industries decarbonize.. Sure, oppose the policy as a whole. But on that specific point. Does that funding ease your concerns there?
TED O’BRIEN: Well, we’re yet to see the detail other than press conferences. We’re yet to see the detail of what the government is proposing, especially for cement, aluminium and steel. But, you know, when you look at the government’s fund, I put to you this, the government is importing its climate policies from Europe. Europe has had an emissions trading scheme for many, many years. There has been billions and billions of euros spent to support industry. What the government is looking at doing here is not just more punitive than Europe’s policies, but it is certainly not providing support anywhere near that which has been provided by the European Union.
QUESTION: Mr. O’Brien you’ve described it as a hard cap on growth. But you’ve also said Australian economy needs to decarbonize isn’t the EU saying that the only way Australia can grow is through carbon industries?
TED O’BRIEN: The only way that we can decarbonize the Australian economy or keeping the lights on while ensuring that younger generations not only have a cleaner future, but one in which they have a country that is still prosperous and strong, is to get the balance right. And that balance is between economic growth and decarbonisation. Now, the government is really telling the Australian people you can only have one of those two things. Now history has shown through the Coalition’s past terms that you can do both. And that has always been our belief and that’s why we believe so much in the importance of technology. It’s technology that is going to be driving decarbonisation. We need to back technology. All of the above. No one doubts how complicated and difficult this is but it has to be something where you back industry, you don’t cripple it. It has to be something where you say technology has to be the driver here and not tax. And that’s where you see a fundamental divide between the approach that Labor has taken together with the greens to look to taxation to try to decarbonize the Australian economy effectively penalize industry. On the other side, the Coalition has always believed that the answer here lies in technology and working with industry.
QUESTION: You say technology and industry and you’re blocking the government’s National reconstruction fund a large part of which is directed directly at boosting those green industries.
TED O’BRIEN: Again, if you look at the reconstruction fund, again, what we see is an ideological bias by the government. It will decide what sectors are in and what sectors are out. And this is the problem with a Labor government. It’s all about big government. Big Government means they believe they can steer the economy as a government, let industry and enterprise go government dictates. I have no confidence in the Labor government dictating the Australian economy. They sought to do that since they have come in. Certainly in the portfolio area I look up it has been an unmitigated disaster. We’ve seen prices skyrocketing like never before. And this is a government that came to the Australian people and promised a $275 reduction in household power bills. Now they’ve been going up by hundreds of dollars right across Australia. And we found out just over a week ago, that somewhere between 20 and 34%. They’re going to rise again for Australian households the second half of this year. This government breaks promises. It cannot deliver on its on any economic management it has proposed and I have no faith that they will be able to get this right.
QUESTION: Many of the technologies that would help us reduce our carbon emissions are yet to be realized. So what is the alternative that you would provide? And if so, what would be so different to this one when businesses are already pushing the government to actually go ahead with a safeguard mechanism?
TED O’BRIEN: Well, most of the businesses I have spoken to have had grave concerns about about this mechanism, grave concerns and that is because they know that it is going to cost them more. Now there are different groups here. You will have some industries that will say they are okay with a safeguard mechanism will form a carbon tax. Those industries that say they’re okay, typically plan to pass on the costs to consumers, and so they themselves as businesses, are not the ones that are carrying the burden, but the voice of the consumer, the voice of the household, the voice of mom and dad that is struggling to make ends meet the voice of the seniors who don’t know where they can heat their house or cook the dinner at night. That’s the voice that we need to have heard in this debate. So, they will be they will be the ones bearing the cost. Now there will be other businesses, other businesses that simply cannot hold the cost. They can’t pass it on, and they can’t compete in a market. They’re the businesses that will be at risk of closing down. And now that we have this, this hard cap on growth, agreed with the Greens, they’re the same businesses that probably won’t be able to grow in Australia. So, future growth of those sectors we will see in higher emitting countries like India and China. And we have to remember this is a global challenge of climate change, a global challenge. How do we do our bit if all we’re doing is offshoring it to higher emitting countries that are going to make it even worse? I think it’s rank hypocrisy on the part of both Labor and the Greens.
QUESTION: Can I just draw you back to the point you made earlier that you wanted to wait for the detail on the funding before deciding how you feel about that? Why not wait for the detail of the whole policy before deciding to oppose it?
TED O’BRIEN: There are key principles in this policy that we have disagreed with from the get go. The announcements made today double down on that and make it worse. The deal that the Labor Party has done with the Greens today is far worse than I had anticipated. To put a hard cap on growth the Australian economy sets Australian up for failure. This is a plan to deindustrialise. It’s not a plan to decarbonise.
QUESTION: Can you give us specific examples of what industries…
TED O’BRIEN: I’ll give you specific examples of of concerns. In particular, we have concerns from the manufacturing businesses. Certainly, the three already mentioned cement, aluminium, and steel. But there have also been concerns by some of the other larger players. Now their concerns range. They range from firstly the inability to grow from where they are today. Their concerns have been around their concerns where they’re part of multinationals that multinationals might just choose to reallocate investment offshore now as in other places in Australia, which leaves them the choice to either close them down or if there’s growth, they go elsewhere. And then there’s sort of concerns around the detail mechanisms of how things are calculated, some of which the government may or may not have addressed, so I’ll hold off on there. But you know, we’re talking about people here we’re talking about jobs. We’re talking about multi-generational families that have worked in sectors. And what they’re being told today is that there’s going to be a hard cap on their growth. This isn’t going to be about decarbonizing the Australian economy. It’s about deindustrializing it. And it’s a sad day. And my heart goes out, not just to many people in manufacturing in Australia, who know what lies ahead. But to the many families who don’t know, who are only going to feel it, they’re going to feel it in the bills they pay and they’re going to feel it as investment dries up. Energy crises get worse and more frequent. And they end up paying the cost of what has been a very dangerous deal between the Greens and the Labor Party. Thanks for your time.