A plea for responsible government

A responsible government doesn't junk a decade of detailed policy debate and deliberation before knowing what they'll replace it with. Will Abbott learn from the Howard government?

It is the day before the election and there are still so many things left unanswered about how the Coalition policy will function to deliver its emission reduction targets. The Coalition had promised repeatedly over the past few years that we would see the detail with good time before the election.

This has not happened.

For example we only learned a week before the election that the emissions reduction fund would operate via the use of emission intensity baselines – a fundamental design feature. And this was only volunteered under probing from a journalist. This creates a range of challenges for the environmental integrity and fiscal efficiency of the scheme that are worthy of public debate in an election Abbott bills as a referendum on pricing carbon.

We also only received confirmation on Monday from Tony Abbott that if the Direct Action budget was inadequate to deliver the emissions reduction target, then the target would be sacrificed.  

In addition, despite repeatedly reassuring stakeholders over the past few years that it fully supports the Australian Renewable Energy Agency, the Coalition has only recently revealed it will cut its budget and commandeer its funding to support its populist million solar roofs plan. Again, this was only revealed under media questioning. Furthermore, we remain in the dark as to the precise nature of the cuts to ARENA’s budget. All we have from the Coalition is a line item in their budget costings labelled, Abolish other carbon tax measures no longer needed’ which lists funding reductions of $1.468 billion to 2016-17.

Perhaps what is most concerning, though, is that the Coalition has not even bothered to release an updated version of its Direct Action climate policy for this 2013 election. Instead they have left us to rely on their 2010 election statement. The reality is that the policy articulated by Greg Hunt in a number of speeches this year is noticeably different to the 2010 policy statement. It seems strange that with Abbott billing this election as a referendum on carbon pricing, he has chosen not to provide a formal policy statement detailing his alternative.    

Sure, this wouldn’t be the first time that an opposition (of both political persuasions) has gone to an election with vaguely specified policies. Developing policy from opposition is extremely challenging as you lack the vast resources of government. 

However, on this occasion there is good reason to set the bar higher. The Coalition is proposing to dismantle a comprehensive policy response to climate change, in placing a price on carbon, which has the support of far more than environmentalists. It is in fact the product of a more than a decade of debate, deliberation and design involving emissions-intensive businesses, the finance community, emissions abatement businesses and government public service officials from not just the Environment Department but also Treasury, Resources and Energy and even the Productivity Commission.

As early as 1998 the Howard government had thought an emissions trading scheme was an appropriate response and was actively working towards implementing an ETS. Alexander Downer remarked in a speech back then:

A well-designed, competitively-priced international emissions trading regime will deliver the flexibility necessary to achieve emission reductions at the lowest-possible cost. It also provides a strong incentive for achieving the maximum level of emissions reductions.

In the end Howard had second thoughts. But in 2003 Peter Costello and David Kemp, a blue blood Liberal if ever there was one, recommended such a scheme again. Again it didn’t get up, but over time 'Corporate Australia' in particular came to accept that climate change as an issue couldn’t be wished away. And they recognised an ETS was the best way to address the problem in an economically efficient and business investment friendly manner. With business, the public service and the environmental community pushing for an ETS, John Howard agreed.

Later, in arguing why he would cross the floor and vote for the Labor government’s ETS, Malcolm Turnbull said:

Until 1 December last year [when Turnbull was deposed] there was a bi-partisan commitment in Australia that this carbon price, this exercise in reducing emissions should be imposed by means of an emissions trading scheme.
At their core these bills are as much the work of John Howard as of Kevin Rudd. The policy I am supporting today as an Opposition backbencher is the same policy I supported as John Howard's Environment Minister.

The Greens, and sections of business angling for extra concessions, might like to claim the current carbon price design is substantively different to the earlier version that Turnbull and the Business Council of Australia supported. But the reality is the differences are actually pretty minor and its design follows reasonably closely the recommendations of the 2007 Shergold Review.

Also, the argument that the disappointment of Copenhagen changes everything simply doesn’t hold water. As Turnbull has observed, concerted international efforts to address climate change are more apparent now than they were in 2007, when Howard agreed to implement an ETS .

Australia’s ETS has its problems, in particular the unconstrained link to a European ETS that lacks an effective cap on emissions. But with tweaks such problems can be addressed.

A responsible government simply doesn’t throw the product of such extensive intellectual debate and thoughtful design into the bin without being damn sure about what you’re going to replace it with.

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