APPROPRIATION BILL (NO. 1) 2012-2013 – CONSIDERATION IN DETAIL (CLIMATE CHANGE AND ENERGY EFFICIENCY PORTFOLIO)
June 18, 2012
Mr CHESTER (Gippsland) (16:33): I thank the minister for his attendance today and for the opportunity to ask him some questions, particularly given the Gippsland-Latrobe Valley region is recognised, I think even by the government, as one of the regions that will be most adversely affected by the carbon price—or the ‘carbon tax’, as we like to call it in the Latrobe Valley, even though apparently no-one on the other side of the House likes to call it a ‘tax’ anymore. I will refer specifically to the regional structural adjustment package, which is supposedly being developed as part of the government’s carbon tax package. It has been confirmed by the minister for regional development that there are no guidelines in place for the distribution of this $200 million package. Even when you consider that this $200 million package is grossly inadequate to assist the affected regions, it strikes me as staggering that we are only days away from the implementation of the carbon tax and this $200 million structural adjustment package is without guidelines.
Given that there are no guidelines now and that the tax will come into effect in just a couple of weeks time, can the minister explain how regions which are going to be adversely affected by the carbon tax will be compensated for those adverse impacts?
The Minister for Regional Australia, Regional Development and Local Government was in my electorate quite recently—I think it was last Wednesday or Thursday—and he gave the impression that the vast bulk of the money that was allocated under the package would be contingent upon regions demonstrating that they had been adversely affected by the policy through such things as contracts for closure. Given that the government so far has refused to fund even a socioeconomic analysis of the Latrobe Valley to assess what the impacts of the carbon tax or a contract for closure would be, I am interested to know how the government proposes to demonstrate which regions have been adversely affected and how these funds will be allocated. On that specific issue of the contract for closure, given that we are just days away from the implementation of the carbon tax and given that the government was going to make some announcements on 1 July in relation to the contract-for-closure tender process, will the minister deny that the government is going to announce an extension of time for contract for closure?
Mr COMBET (Charlton—Minister for Industry and Innovation and Minister for Climate Change and Energy Efficiency) (16:35): I thank the member for Flinders for his questions. I appreciate that he has a number of apprehensions, and I hope that I can dispel them to the extent appropriate this afternoon. Sometimes the coalition believe their own propaganda, and I think that is part of the problem we are dealing with here. They have gone around the country—and in particular the Leader of the Opposition—to regions like the Latrobe Valley and terrified the living daylights out of people and created enormous apprehension. I have experienced the same in my own region, which is a coalmining region, where, because the Leader of the Opposition has done the most unconscionable thing and stood before people and said to them, ‘You are going to lose your job,’ it has created enormous apprehension—
Mr Chester interjecting—
The DEPUTY SPEAKER: Order! The minister is responding.
Mr COMBET: One of the first things I learned as a trade union official is that you never, ever, ever mislead people, and the Leader of the Opposition will pay for what he has done. He has created this apprehension in the Latrobe Valley and in many other regions with statements to the effect that Whyalla will be wiped off the map. Just imagine what that means to families in Whyalla—what a disgrace. You have to stand before people and deal with them with some integrity, and that has been lacking in the coalition’s approach. As the carbon price comes into effect, this will become clearer and clearer to members of the community, including the Latrobe Valley.
I do not suggest the question was put in any inappropriate way. I know that the member is genuine in his concerns, but I think that we have to keep things in perspective here. We are acutely conscious of the circumstances that the Latrobe Valley and, in particular, the brown coal generation sector find themselves in. A very significant amount of funding of course was allocated in the form of energy security payments in the package to ensure that there was confidence on the part of the investors, the equity holders and the debt providers, for the brown coal generators in the Latrobe Valley, and I think there is evidence that those payments have been successful by their continuing confidence in the assets that are there. That is very important for people’s jobs as well. The government committed significant funds to ensure that there was ongoing confidence in those assets and in the region.
I have visited the Latrobe Valley a couple of times over the last 12 or 18 months to talk to people about this issue, and I can assure the member that I am as concerned as anyone else to ensure the wellbeing of that community. A number of the electricity generators in the Latrobe Valley region did indicate that they would like to discuss, in the appropriate process, the contract-for-closure issue, and those discussions have been continuing in an appropriate way through the department of my colleague the Minister for Resources and Energy. They are commercial-in-confidence discussions. Our public policy announced in July last year, to which we continue to adhere, is that that process would be brought to a conclusion by 30 June, which of course is imminent. That remains our policy position.
It is not appropriate for me to speculate on the outcome at this point in time, but the process that we initiated should appropriately be continued and a conclusion reached. I can say to people in the Latrobe Valley that we are very mindful of the circumstances there. We have put a lot of resources into supporting them. We are working very closely with the business community and, I might add, with the Victorian government in relation to these issues.
Mr CHESTER (Gippsland) (17:00): I must admit that I was struck by the member for Chifley’s question before. It seemed like the ‘don’t mention the war’ episode out of Fawlty Towers, only he slipped up and mentioned the carbon tax. ‘I did it once but I think I got away with it’. I am sorry to say, Member for Chifley, that the people of my electorate and right throughout Australia do not feel that you are getting away with it. They know what this tax is going to do to their lives. This is a tax, and all the bribes and the slick advertising will not hide the fact that this tax is going to cascade through the economy and have a big impact on regional communities. It is also a tax that your Prime Minister specifically ruled out ever introducing. But I do thank the minister for his answer previously, and I also acknowledge, Minister, that 1 July is the government’s policy in relation to contract foreclosure. But the practical reality of the situation is that contract foreclosure negotiations are going nowhere fast, and I think the minister knows that. My community in the Latrobe Valley is suffering right now because of the uncertainty being created by your government’s policy. Your government has no plans in place in relation to structural adjustment. Your Minister for Regional Development, Regional Australia and Local Government has acknowledged that as well. There are no guidelines in place for that particular policy, and there is a crisis of confidence going on right now in the Gippsland and Latrobe Valley region which is directly related to the carbon tax policy which the Prime Minister explicitly ruled out in the lead-up to the last election.
I repeat my question from before, Minister. Will the minister deny that government is going to announce an extension of time for its contract foreclosure negotiations?
Mr COMBET (Charlton—Minister for Industry and Innovation and Minister for Climate Change and Energy Efficiency) (17:01): Our policy, just to restate it, is that it will be resolved by 30 June.