Topics: Labor’s new electricity tax
Let's now go to the Environment Minister Greg Hunt, listening to all of that.
He of course is the man who has been to the Paris Climate Summit, where he reaffirmed Australia's commitment to a cut of 26 to 28 per cent in our emissions compared with the 2005 levels.
And now, the question I guess Greg Hunt – and good evening to you – is whether an emissions trading scheme in Australia ultimately becomes inevitable?
No I don't think it is at all. I think what we see here is that we have a return to the past.
A massive electricity price hike.
And it doesn't matter what they call it – A, it's a carbon tax, and B, it's an electricity tax.
at its fundamental core this is about driving up the cost of electricity.
And so you have two effects. You have an effect on households, particularly – so many of your listeners who are in families where they struggle to pay their bills.
This is going to drive up their electricity bills.
Labor's own modelling of their own policy when they were last in government for this target range said – a 78 per cent increase in wholesale electricity prices and a $4900 impact on average incomes by 2030.
And then the second thing is, it has an impact on jobs, it has an impact on business.
So at the worst most vulnerable time, when we're making progress, can you imagine the impact of this on an Arrium, the impact of this on a BlueScope or other vulnerable firms, or small businesses struggling to meet the cost of their bills?
It couldn't be a worse impact in terms of electricity prices and it fails to do the job of actually reducing emissions.
But even your own Prime Minister has admitted that it is likely that these targets will rise as the years go by.
You've been to those Paris talks, the climate summit there. You must've certainly picked up the same vibe through those talks?
Well I think one of the things that came out of the meeting in New York at the UN headquarters on Friday where we all signed the Paris Agreement, and Australia committed to ratify it, is that we were actually meeting and beating our targets.
Sometimes nations pledge and don't meet their commitments. We're one of the nations which is not just meeting our targets but beating them.
We've turned around a massive gap Labor left in terms of what we needed to do with regards to emissions.
We're now well and truly in surplus, and we've done that with our policies which are working.
And that's effectively providing incentives to reduce emissions rather than trying to put a massive handbrake as the economy, as the Prime Minister said, by driving up electricity prices.
If you want to understand what Labor's policy is – it's electricity, electricity, electricity.
It's just the cost of living being turned against households.
I heard you say today that there were significant falls in electricity prices once the carbon tax had been scrapped by the current government.
The one thing also is that in many places electricity prices fell because those network providers stopped gold-plating their own networks, and as a result the reduction in capital works also helped to bring down the cost of electricity for many of the households and industries around the place.
So we've got to be realistic and say it wasn't just the price of carbon that brought down the prices, it was other aspects that were also very significant – network prices, for example, coming down were also a significant impact.
The ACCC looked very specifically at the impact of the carbon tax on, and then the impact of the carbon tax being taken off, electricity.
And what they said was that the full amount which was put on – the 10 per cent increase on average – came off. And it came off in full in every case.
So what you see is they then attributed the largest fall in electricity price rises to this.
Now, there can be other impacts which can either increase or decrease, but the entire amount of the carbon tax came off.
They pointed to and made statements to the fact that the $550 a year – which was electricity, gas, groceries, refrigerants, other things that all went into the bag – on average came off for households around the country.
So very significant changes in household living expenses.
And the flipside, is you put it back on, you drive toward their particular target using this particular mechanism and you get the worst possible approach at the worst possible time.
It's not going to do the job on emissions, but it's sure going to do a job on family electricity budgets.
Do you believe ultimately that Australia would pay not just through the prices we pay for electricity, but also potentially in government revenues – how much would have to be paid out?
And we know that government funding right now is in very short supply as there is a massive struggle to try and restrain and retain the size of the budget deficits.
Are there other direct costs that this Labor policy might also put in place?
Sure, look you only need to look at Bill Shorten's last run in government where – when he wasn't changing leaders they were putting in place Pink Batts and Green Loans, Cash for Clunkers.
They gave $5.5 billion to Victoria's brown coal generators because on the one hand they were putting pressure on them, on the other hand they were trying to take pressure off them.
So you had households paying higher electricity prices, and then a $5.5 billion gift of taxpayer's money or credits to the very people that they said should be subject to the policy.
It was a bizarre approach, and it all appears as if this is going to be repeated, but repeated on steroids.
It's going to be interesting just to watch exactly how it goes, and certainly you wonder whether Bill Shorten has handed the government a real coup in regards to its advertising and marketing coming into the forthcoming federal election by raising the spectre of carbon pricing yet again.
Greg Hunt, the Environment Minister, always good to have you on the program.
Thanks very much Ross.