Speech from the Prime Minister, Julia Gillard, on "Moving forward together on Climate Change".
THANK YOU for coming to this event and thanks for that welcome.
Climate change is a pivotal issue for Australia. It is fundamental to the question I have put to our people. The question about whether our country moves forward or back. A lot of people have been anticipating this day. I thank them for their patience.
Today I will set out my approach to the challenges of responding to climate change and reducing pollution.
I will do that by explaining my beliefs and my commitments and by setting out the steps that the Labor Government will take if it is re-elected.
My starting point is that climate change is real and it is caused to a significant extent by human activity.
That human activity is an essential part of economic development. It has brought prosperity and security to generations of people in our country. But we also know now that it has other consequences.
As our economy has grown over the last century, much of that growth has relied on the use of high-polluting energy sources.
We know now that if we continue to rely only on those sources, the problems they cause will grow. The consequences of inaction are ultimately threatening for our planet. We also know that we can do something about it.
And so I adopt this perspective.
That we must show leadership and chart the way foward.
That the price of inaction is too high a price for our country to pay. The price of inaction is a price ultimately that our country will not be able to afford.
Because the price of inaction is price rises, job losses and innovations lost.
Conversely, step by step action, deliberate and considered steps, bring opportunities that could make our country even greater.
A confident Australia can meet this challenge and emerge even stronger.
Now, for those who dispute the science I respect your views and your participation in the debate. I also respectfully disagree.
Global temperatures are rising.
2009 has been ranked the fifth warmest year on record globally and finished off the hottest decade in recorded history.
The temperatures are largely driven by pollution created by carbon emissions.
Climate change has a particular environmental and economic impact on Australia.
2009 was the second hottest year in Australia and ended our hottest decade.
Each decade since the 1940s has been warmer than the last.
With climate change, the number of droughts could increase by up to 40 per cent in eastern Australia, and up to 80 per cent in south-western Australia within the next six decades.
Without action to reduce our pollution, irrigated agricultural production in the Murray-Darling Basin is projected to fall by over 90 per cent by 2100.
About 85 per cent of Australians live in coastal regions.
Just under 250,000 residential buildings, worth up to $63 billion, will be at risk from sea inundation if the sea-level were to rise by 1.1 metres.
Coastal industries, such as the tourism industry, will also face increasing challenges with climate change.
These are just a few examples of the risks Australia faces if climate change is not addressed.
I believe that many Australians understand this.
They recognise that, as a nation, we need to find the right way of responding to this challenge.
If we fail to act, the cost to the Australian economy and to future generations will be even greater.
This is a big challenge.
Reducing this pollution is part of the wider challenge of making Australia’s economy sustainable.
Australia has faced big challenges before. And we can do it again.
And it is not an Australian thing to do just to leave a problem like this to our kids to deal with.
So what is required to meet this challenge?
The science tells us that we need to limit the growth of carbon pollution in our atmosphere to 450 ppm if we are going to have a chance of limiting global temperature growth to two degrees or less.
That in turn helps to explain the commitment that the Australian Government has made, to cut our pollution levels by at least five per cent by 2020 compared to our pollution levels in 2000.
That is a big step, and further steps will be needed in time.
In taking those steps, we must work towards a new model of economic growth.
Meeting the challenge means no less than a transition, over time, to a cleaner economy in which we are not dependent on polluting sources of energy for our economic growth.
This will require massive investment and hard work.
But the good news is that this investment has begun to flow and the hard work is already under way.
And the transition will create new opportunities for Australian success.
I also offer this word of temperance: there is not a switch to flick or one single behaviour to change.
There is hard work to do that will be even harder without consensus.
But with hard work and with consensus we can achieve great momentum. We can achieve genuine progress.
Of course, taking action to reduce pollution was part of the Labor Party’s platform in 2007.
Many Australians supported it. And we developed a policy, through the leadership of Kevin Rudd, the tireless work of Penny Wong and many other Ministers.
Our approach to developing an emissions trading scheme to suit the Australian economy – the Carbon Pollution Reduction Scheme (CPRS) – got a long way during the last two years.
Ours was an ambitious, economy-wide scheme, which sought to put a limit on pollution – a limit that reflects the true cost of that pollution for our economy and our environment.
The CPRS would require firms that need to use carbon in their work to acquire permits and allow those permits to be traded so that there is an incentive to reduce carbon pollution and so the permits can be used in the most efficient and most productive ways.
Revenue from the scheme – from the sale of permits – was planned to be used for assistance to help communities, families and firms to make the transition to a low carbon economy.
So the principle is that the biggest polluters should pay for the pollution they create, that overall pollution should be limited and reduced, and that people should get assistance with the costs of adjusting to this new way of doing things.
As I said, it is an ambitious and complex scheme.
When we brought it to the Parliament, which we did twice last year, it took up 11 separate Bills.
Penny Wong did an outstanding job in consulting with many different stakeholders, negotiating and putting forward an agreed approach within budget.
And we came very close to achieving a bipartisan consensus on this issue.
We worked, we listened, we negotiated throughout last year. And at the end of it, the Greens Party and the Liberal Party voted against the legislation that would have brought in the Carbon Pollution Reduction Scheme.
They will explain those decisions to the voters themselves.
My job now is to explain the approach that a Labor Government will take to this challenge as we learn the lessons of the last year and look forward.
The CPRS is, no doubt, a complex piece of policy.
It is full of technical detail and focused on achieving long term economic change.
It is effective. I believe, and I think the scientific and economic consensus shows, that emissions trading is essential to limiting and reducing pollution.
It is ambitious, in the sense that the aim was to introduce emissions trading across much of the economy and to introduce it quite fast.
I don’t apologise for the ambition.
But I recognise that there are some lessons to learn.
These are the lessons:
The first lesson is that, if you want to make a big change for our nation, the political process must be connected with the community.
The extent to which this was not the case can be measured by the speed with which the near consensus collapsed.
In my view the consensus we build must be stronger and must go beyond a notional political consensus.
We need community consensus and above all else this requires a reasonable explanation...not a strategy that relies only on political consensus, the very type of consensus Tony Abbott destroyed to support his own narrow political ambition.
And so we must start with this: we must acknowledge that Australians have real concerns about making changes that are this big and they need more information.
They are concerned about the impact on jobs and the impact on the prices of goods and services that they rely on, especially electricity.
It is not wrong to be concerned.
I understand that a lot of families are under pressure.
My Government will always act with the interests of those Australians in mind.
I have argued before that it is the job of good governments to take on major economic challenges and work through them in a way that makes sure every Australian can participate in creating the solution.
Labor Governments have done this before in the 1980s and 1990s.
And together, we can do it again.
So no, it is not wrong to be concerned.
What is wrong is to exploit those concerns deliberately in order to create fear and anxiety with the aim of holding action back.
That is what my opponent Mr Abbott is doing.
He pretends to want real action on climate change. But he is full of empty slogans.
Tony Abbott was elected by his party with a mandate to oppose real action on climate change. His policies reflect this.
This week he ruled out a limit on pollution.
Once again, he will say anything in a desperate attempt to get through an election campaign.
Before that, he has gone backwards and sideways on this issue to try to satisfy the vested interests that surround him.
He claims that he will take action to achieve the same targets that the Australian Government has committed to: reducing carbon pollution by between five per cent and twenty-five per cent by 2020.
But his policies to achieve this do not have integrity or economic credibility.
He claims that he can meet Australia’s commitments to reduce pollution.
But under his policies, pollution levels will still increase by an estimated 13 per cent – not reduce by the five per cent promised.
And he claims that he wants to be economically responsible.
But he is the champion of an inefficient, top down, taxpayer funded approach which would increase pollution.
There is no responsible government in the world, no credible organisation, that is advocating this way of approaching the challenge.
And to achieve all this, he wants to use taxpayers’ money...to pay the polluters.
Let me just quote Malcolm Turnbull talking about the approach that Tony Abbot now wants to take.
He said on 7 February this year that
“Having the government pick projects for subsidy is a recipe for fiscal recklessness on a grand scale.
And there will always be a temptation for projects to be selected for their political appeal."
Mr Abbott’s record shows that his actions in Government cannot be relied on.
One big issue that concerns many people is rising electricity prices.
I share that concern, particularly when you look at recent increases.
It is right to be concerned. But it would be wrong to conclude that the increases are somehow the result of climate change policy.
These prices are influenced by many factors.
One is investment.
We need investment in new sources of energy to meet rising demand and to provide cleaner, more sustainable options for Australian households and the Australian economy.
Those investment decisions are the responsibility of different sectors.
Australia’s electricity generation is projected to grow by nearly 50 per cent between now and 2030 to meet growing demand.
Recent price increases reflect the fact that investment has not been sufficient in recent years.
State Governments like New South Wales and Western Australia recently fronted up to the need for greater investment.
As Premier Colin Barnett said just this week "I regret it, but it's something that simply had to happen".
In March, the Australian Electricity Regulator said:
“These higher prices are necessary to enable higher levels of investment in the States (NSW) electricity distribution networks to improve network security and reliability of supply in line with license conditions imposed by the NSW Government.”
I have been pleased to see State and Territory Governments increasingly recognising the need to lift energy rebates for pensioners and low income earners to offset the impacts of higher electricity prices.
But we shouldn’t confuse current pressures on electricity prices with the effects of a CPRS. After all, a CPRS has not been introduced.
In fact, many people in industry are now calling out for a clear direction in energy policy, including a proper approach to reducing carbon emissions, so that investment decisions can be made with certainty.
And fair enough.
The Energy Supply Association of Australia recently reported that a combination of financial market upheaval and policy uncertainty have reduced the forecast capital expenditure on power generation capacity in years to come.
As Brad Page, Chief Executive of Energy Supply Association, said, and I quote:
“Delaying a clear carbon constraint is going to cause electricity prices to go up anyway.''
I recognise that business needs certainty in order to make new investments that will help make energy cleaner and more affordable.
And I recognise that the Australian Government’s decisions have an impact on that level of certainty.
It is not the job of the Commonwealth to prop up State-run electricity systems. But the Australian Government can help make that investment climate more secure and encourage faster progress towards the cleaner, more efficient sources of energy that our country needs.
Last week a group of leading businesses including Westpac and KPMG estimated that regulatory uncertainty would cost the Australian economy and consumers through higher electricity prices.
This is the approach that Mr Abbott is now advocating. His approach will increase prices and reduce reliability.
I will take a different approach. I will provide the certainty that our economy needs.
So now I will set out for your consideration the approach that I will take to this issue if my Government is re-elected.
In April, the Government took a difficult decision which deferred the CPRS until at least 2012.
This decision followed Tony Abbott’s destruction of a bipartisan consensus on this issue and the Greens’ decision not to support the CPRS that we put forward.
This was a consensus supported by John Howard; Peter Costello; Brendan Nelson; Malcolm Turnbull and many others across the Australian community.
In the wake of that decision, and of the Copenhagen Conference in December, I accept that we should have made our position clearer to the Australian community.
We have not abandoned our commitment to take action on climate change.
But if we learn the lessons I have outlined then we need a different approach.
We need national consensus on this vital, long term issue of national interest.
We need consensus among political parties.
But we need consensus in the community even more.
And it is vital to be clear what I mean by that community consensus.
I do not mean that government can take no action until every member of the community is fully convinced.
Pivotal reforms like this are often controversial when they are first introduced. Medicare, or Medibank as it was then known, was controversial and initially opposed by the parliamentary opposition.
But the policy was responding to a deeply felt recognition in the community that a new way was needed to meet the health needs of Australians.
That support grew stronger as people saw the policy and its implementation. As it grew, the opposition parties came to the conclusion that bipartisan support was the only reasonable position.
When that community recognition and support exists, it means that a choice by a political party to reverse bipartisan support would not destroy the consensus. Instead the consensus would remain and the political party would be repudiated by the Australian people.
If we are going to meet this pollution challenge, we need the consensus on a market-based solution to reducing carbon emissions to be like the kind of consensus we have about Medicare.
Our challenge is to answer the community’s questions and develop the community’s commitment to taking the right action.
In my view, consensus on this issue should not depend solely on a fragile agreement between political parties.
Adopting a market based mechanism to price carbon will transform the way we live and the way we work. Such a major change cannot be made and unmade on the oscillations of the political pendulum.
Instead this transformational change must have as its foundation the genuine political support of the community, a consensus that will drive bipartisanship.
To build that community attachment, here are my commitments.
I will prosecute, as Prime Minister, the case for action to reduce pollution and build a more sustainable Australia for future generations.
I will make the case in public and in parliament. I will lead the debate and lead the advocacy for our approach in the community.
My Government will create an independent, properly credentialed source of information and expert advice – a Climate Change Commission – to explain the science of climate change and to report on progress in international action.
I will honour my commitment to building a consensus that is informed by the facts, tested by robust debate and concluded through common sense and open-mindedness.
And my Government will support a rigorous process to work through the issues and test the level of consensus.
There will be ongoing national debate and vigorous parliamentary debate.
This should not just be a debate between experts.
It must be a real debate involving many real Australians.
It will not convince everybody, and I will not allow our country to be held to ransom by a few people with extreme views that will never be changed.
But I want to see a process that directly involves a representative range of ordinary Australians.
And so today I announce that if we are re-elected, I will develop a dedicated process – a Citizens’ Assembly – to examine over 12 months the evidence on climate change, the case for action and the possible consequences of introducing a market-based approach to limiting and reducing carbon emissions.
These methods have been used in a number of countries, and in some Australian communities, to work through complex long term issues.
I envisage that those involved would be genuinely representative of the wider Australian public. They would be voluntary participants, but selected through the census/electoral roll by an independent authority.
Their work would be supported with evidence, analysis and access to the views and positions of a wide range of advocates.
At the same time the Citizens’ Assembly is at work, I will work with State and Local Governments, business and community groups to maximise information and discussion in the community overall.
The role of this Citizens’ Assembly will not be to become the final arbiter or judge of consensus, but to provide an indicator to the nation of the progress of community consensus and the issues that will need to be addressed in making the transition I have described today to a successful, lower pollution economy.
Put simply, I believe in the skills, capacity, decency and plain common sense of Australians. I therefore believe that through dedicated discussion a representative group of Australians drawn from all age groups, parts of the country and walks of life, will help us move forward.
And if I am wrong, and that group of Australians is not persuaded of the case for change then that should be a clear warning bell that our community has not been persuaded as deeply as required about the need for transformational change.
The second commitment I will give today is that, if we are re-elected, I will use the CPRS as the basis for this Citizens’ Assembly and community consultation on the way forward in reducing pollution through a market mechanism. In doing so, I recommit to the need for a market mechanism.
And I will maintain the Government’s current commitment to review our progress in 2012, as we approach the end of the current Kyoto commitment period.
But now that review will be informed by the independent public commentary of the Climate Change Commission on the dimensions of international action and by the common sense of the Australian people.
This means I will act when the Australian economy is ready and when the Australian people are ready.
But just as I will not rush headlong into economy-wide changes that people are not familiar with; neither will I hold back actions that could move us forward from today to create a cleaner, more efficient future.
That is why I also announce today that, if the Labor Government is re-elected, we will introduce a policy that rewards businesses who take early action to reduce their pollution.
To give industry certainty about future investment, the Government will ensure that emission baselines for industry assistance will not be increased – they will be as determined under the CPRS.
Retaining these baselines will ensure that any efforts undertaken by a business now to cut pollution will be rewarded. Retaining these baselines will encourage action early rather than causing businesses to delay action until a market mechanism is introduced.
I am committed to take further action now to maintain a clear direction towards a competitive, lower pollution Australian economy.
If the government is re-elected, our actions will be based on the following principles.
- We will encourage polluters to take responsibility for their pollution.
- We will harness the power of natural resources – wind, sun, geothermal energy and biofuels.
- We will do our part to develop international solutions and we will move in step with the world’s major economies.
- We will seek to avoid locking in investments and technologies which lengthen our dependence on high pollution energy sources.
- We will provide certainty to market participants who need to make long term investment decisions.
- We will continue to pursue efficient, competitive markets as a means of reducing pollution.
- We will work with Australians to make positive changes where we live, where we work and when we travel.
We need investment to flow into new power generation capacity.
But we also need to avoid locking in technologies that might be in operation for 30 or 40 years and cause unacceptable levels of pollution.
So today I announce that, if we are re-elected, Labor will ensure that all new power stations will have to meet best practice standards for their carbon emissions.
New coal fired power stations would also have to be carbon capture and storage ready, capable of being retrofitted to capture and store the pollution caused by burning coal.
The new standards will be determined by Government following a process of consultation open to all the key stakeholders, including technical experts, energy market institutions, industry and environmental groups.
Our starting point for this consultation will be that the new standards should encourage better emissions performance than the level referenced under the CPRS. And that they should enable advances in clean coal technology to contribute to our future electricity supply.
This means that we would never allow a highly inefficient and dirty power station to be built again in Australia.
These new standards will not apply to existing projects or to projects which have been committed to when the standards come into effect.
But we will not hold back from setting a new direction.
And by doing this we will help to end the uncertainty that has been holding up investment in the energy sector.
There will be big changes to make, transitions to work through. But these decisions will, over time, make it possible for the investment to flow that we need in order to keep the cost of electricity down and reduce the pollution in our environment.
We will also advance renewable energy sources in Australia even further.
The Government has already made significant commitments to this agenda.
Martin Ferguson is delivering a range of policies that will genuinely accelerate the development of renewable energy options for Australia.
We have invested $5.1 billion through the Clean Energy Initiative.
Investments in clean coal, wind, geothermal and biofuels, to name a few.
The $1.5 billion Solar Flagships Program is supporting the development of very large scale solar generation plants, right here in Australia.
Interest in the program has been strong, with 52 projects applying for Stage One.
We have already announced a shortlist of eight projects with sites across Australia. If re-elected we will announce the two successful applicants for Round One funding in the first half of next year.
Together with our investment in the Australian Solar Institute, the Solar Flagships program will develop Australia’s potential to become a world leader in powering our homes and businesses through solar energy.
We have also delivered on our promise to increase the Renewable Energy Target, increasing it by at least four times so that 20 per cent of Australia’s electricity comes from renewable sources by 2020.
This will help drive nearly $19 billion of investment in clean renewable energy.
And it will reduce carbon pollution by around 39 million tons by 2020. That’s the equivalent of taking almost 10 million cars off the road.
But I will go further.
We need more steps to accelerate the development of renewable energy and its availability for businesses and consumers.
Today I announce that, if elected, the Australian Government will contribute up to $1 billion over 10 years to the investment needed to connect our electricity grid to new sources of renewable energy.
From solar power in north Queensland to geothermal in South Australia and wind and wave technologies in Western Australia.
I want the whole country, from the north-east coast to the south-west, involved in creating these renewable solutions for our future.
These investments will be made through a commitment to an efficient and strongly regulated national electricity market.
The market rules and the regulation that supports them will remain the basis for assessing investment decisions.
But if a proposal does not win support through those rules, and there is a clear case based on reducing carbon emissions for it to be examined, then funding will potentially be available through this fund.
This is a transitional step, towards a National Energy Market which fully factors in the long term costs of carbon pollution that are now widely expected.
Recent amendments to the network rules address some of the challenges associated with connecting new technologies to the National Grid, but there is still more to do.
Our commitment to a competitive, regulated market remains as strong as ever.
And so is our commitment to a clean and efficient energy sector in this country.
These major commitments will be accompanied by further action to support the development of renewable technologies.
We will invest $100m to support market-based projects developing renewable technologies through ACRE, the Australian Centre for Renewable Energy.
Today I have outlined the framework through which a Labor Government will pursue climate change solutions if it is re-elected.
The policy announcements I have made today are major changes in important sectors of our economy.
But there are actions that all of us need to take.
Actions at home, at work, in our travel from place to place.
I will have more to say in the coming days about these actions and how the Australian Government will support them.
But for now, let me conclude with these thoughts.
Australia has faced big challenges before.
And Australians have risen to those challenges time after time.
Governments cannot take away responsibility from the community for meeting these challenges, daunting they may be.
Australians do not want that responsibility taken away.
Neither do they want Government to hide its head in the sand and hope that the issue will somehow go away.
I believe that Australians want to look forwards with confidence and optimism and then to work together – and do their bit - to get the work done that they recognise is needed.
We are more than capable of rising to that challenge.
We can make these important changes. We can get this done.
Australians know this issue is real.
So they want to see actions that make a difference.
And leadership that builds deep and lasting consensus.
If we face up to this challenge, if we work carefully and methodically, and if we give support to Australians to make the changes that are necessary, then I am confident that we can move forward together.