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Language Changes as Fluid as the Changes to the Tax Itself, If Not More

The carbon tax, price on carbon, carbon price, fixed price carbon reduction scheme, call it what you want has by far been the most talked about public policy decision made, with the prodding of the Greens in order for minority government support. It has been the subject of political debate ever since Prime Minister Gillard uttered those words “there will be no carbon tax under a government I lead” just a short time out from the August 2010 election. The political to-and-fro over the carbon price has been ferocious with the Opposition making their disdain for such a policy, one they once supported, a central feature of the discourse of the last two years.

Over recent months there has been much discussion and debate over specific elements of the carbon price. We’ve seen the floor price dropped so that our framework, once transitioned to an Emissions Trading Scheme, could be linked to the European Union ETS in a common carbon market.

There had been much talk and pleading from different quarters, calling for the floor price to be dropped ahead of the floating price which begins in 2015. However, we were repeatedly assured by the Gillard Government that the floor price would remain while simultaneously it seems, the government were in discussion with the Greens, convincing them that abandoning the floor price would be okay.

Then there’s also the other not so small matter of the ALP deciding to abandon plans to buy back and secure the closure of the five dirtiest coal-fired power stations.

Both these decisions bring an amount of uncertainty to the usefulness of the scheme, with these facets of carbon pricing seen to make it easier and more certain that the carbon reduction benefits of such a policy would be realised. Now, that task of reducing emissions and the hopes of raking in sufficient revenue to pay for the compensation and other benefits of the Clean Energy Future appears to be on very shaky ground. If the aims are to be achieved, they will now be done the hard way.

These moves imply that the Labor Party were worried about the policy, particularly the public perceptions of the price on carbon, which has since improved markedly. They make a government already low in confidence and in the polls publicly appear uncertain of their prospects, scared of the electoral defeat which is still highly likely, some time after July next year.

This slippery and slidey approach to the carbon tax policy has also been mirrored in the use of language by the Coalition. The same messages and implications have broken through from the altered usage of words to describe the pollution reduction scheme, as were received through the dumping of the floor price and the decision to not close down the dirtiest power stations.

In fact, the language to negatively describe the carbon tax has changed more than the policy itself.

First we had the Opposition describing the carbon price as a “cobra strike”. This characterisation said to people that the impacts of the carbon price would be immediate and deadly for certain sectors and the economy and the population more broadly, the venom spreading fast across the economy and gradually breaking down bodily (economic) organs.

Next up was the description of the carbon mechanism as being a “python squeeze” on the economy. This screams slower suffocation of the organs of the economy, but still ultimately says that the patient will die but the death might well be slower. It also gives an air of avoidability, that suffocation can be more easily overcome than a deadly poison coursing through the veins of the economy.

The latest expression to be used by the Opposition Leader is that the price will be like an “octopus’ embrace”, its tentacles grabbing hold of various parts of the Australian economy, far and wide, as well as the people. Presumably though, it’s not a Blue-Ringed Octopus as they’re poisonous.

Curiously, if a Blue-Ringed Octopus wasn’t in mind with this example, it’s the only one that doesn’t imply that death is a near certainty.

Either way, both the language to deride the climate change policy of the Labor Government and the policy itself have undergone changes, with the shifts in both sides ostensibly implying the same thing, uncertainty over their relative positions.

Question Time Ahead of Time

Just as quickly as federal parliament rose, so it has come by just as fast. Our federal MP’s will return to Canberra this week after a brief break from the federal capital based hostilities, read for another parliamentary sitting week. Much has happened during the last few weeks in federal politics. In the last couple of weeks we’ve had a major new dental plan announced, the Gillard Government wanting to proceed with the Gonski reforms but not without COAG negotiations and of course the ever-present asylum seeker and carbon price debates, with the floor price now gone on the latter. Sadly too, over the weekend, the Prime Minister lost her father and won’t be present while her family grieves.

In light of the tragic passing of Prime Minister Gillard’s father, hopefully, in her absence we can expect to see a more subdued parliament that more than likely will pause briefly to reflect on the passing of John Gillard. Mr Gillard migrated to Australia with his wife and daughter whom he saw become Prime Minister of her adopted country.

One question that does remain, but will probably be answered in the negative, is: will the Tony Abbott led Opposition heed the words of their former leader, Malcolm Turnbull and diversify their Question Time strategy, becoming more subdued and asking questions of the government in a wider array of policy areas than in recent times.

The Opposition will more than likely stick to familiar territory, the carbon price, Minerals Resource Rent Tax and perhaps asylum seekers from time to time. Of late too, the Coalition has asked questions of the Treasurer, Wayne Swan about budget forecasts and priorities given new spending commitments like the dental health changes announced, all $4 billion worth, as well as reforming education which will also cost in the billions of dollars.

It might be reasonable to expect maybe a question or two on education, but that will more than likely be in the prism of how will the government fund it and/or work with the states to achieve the implementation of such a big reform.

The ALP Government as has become their practice particularly this year, will again use the Dorothy Dixer to canvass a wider variety of policy areas than the Coalition. So far this has included the carbon price, infrastructure, health, families, community services, disability reform and education in particular.

It is likely that both health and education will be a major focus of the questions that government back-benchers ask of their ministerial colleagues in light of the dental and education reforms announced over the past weeks.

It is also a distinct possibility that the Immigration Minister will be asked to update the parliament on the progress towards re-opening the immigration facilities on Nauru and Manus Island.

Question Time, as always begins from 2pm and can be seen live on your television or on the radio. Let’s hope its a more respectable week of parliament ahead.

 

Government Still Emitting Mixed Messages and Potentially Leaking Revenue

Carbon pricing is happening, it’s been legislated and that legislation has commenced. The fixed price period began almost two months ago now, on July the 1st. But today things have moved forward as far as the floating price, the emissions trading scheme which will commence in just under 3 years time after the fixed price period ends. The Australian Government has today announced that they’ve reached an agreement with the European Union to link their respective schemes which means Australia joins with 30 other nations in a common market for carbon credits.

But there’s also been a step backwards from existing Labor Party carbon pricing policy, there will no longer be a floor price, that’s gone as part of the pact with the EU linking Australia and European Union countries. This new market, though heavily regulated, will be the largest carbon market in the world, but by no means does it cover anywhere near the majority of the globe and its population. The European ETS covers ┬ájust over 500 million people and Australia will add a further 22 million people living under the carbon market.

For the first 3 years of the emissions trading scheme, Australians will have access to European carbon credits but not vice versa. European businesses being able to purchase carbon credits in Australia will be allowed to occur from 2018.

Aside from the broken promise over the carbon price, the biggest point of contention since the decision was made in minority government to pursue the carbon price was over the floor price.

The floor price was instituted by the government supposedly to provide certainty to business and to avoid the price of emissions becoming too low. This price was to be set at $15 per tonne from 2015 when the market-based trading scheme will start. We were told, just as recently as last week that the floor price would happen, though reports had surfaced that the ALP were considering backing away from this element of their climate change policy.

Essentially now, the common market with the European Union will determine the price, any price it likes, and if the EU example is an indication, that price has the potential to go quite low, well and truly under the $29 per tonne that the Treasury modelling banks on for the year 2015-16. This means the revenue projections are surely under serious threat.

But Greg Combet doesn’t think so. The Climate Change Minister today said that the long-term average over the past 4 years of the European ETS has been $23 per tonne of carbon emissions. But whether that’s enough to achieve an effective price of $29 in 2015-16 alone is fanciful. This is especially so with a European economic community in chaos financially, a common market that has seen their permits go as low as single digits per tonne of carbon emissions.

Worse still, this backdown on the floor price is in effect an admission that the Gillard Government was wrong with its legislated policy direction. Rightly or wrongly, it will be construed as the government admitting that a floor price would have hurt Australia and our competitiveness and the people dealing with the flow-on costs of the scheme and that could easily have further negative implications at least temporarily for the struggling ALP.

For an administration struggling with expectations, the mixed messaging and second backflip this month doesn’t bode well in trying to run consistent messaging in areas of public policy and that just makes the government look confused and scared.

By far the biggest damage will be to revenue and that will in turn make promises much harder to deliver, though maybe they’re not too worried about that given the chances that they’ll hold the purse-strings at the start of the floating price are slim. Oh, and the fact that the trading scheme might well not be there under a Liberal Government. But who knows, it’s certainly much, much harder to repeal now.

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