When he was campaigning to become PM five years ago, Anthony Albanese tweeted that “Getting tonet zero is a chance to create jobs, to bring back manufacturing, and to protect our environment.”
None of these things have happened. Since net zero, we have lost major manufacturing facilities in urea, nickel, plastics and glass. A fortnight ago, a lithium hydroxide plant (a precursor to themanufacture of batteries) shut down in Western Australia. Our environment is being run over by large scale wind and solar projects. And the jobs we were promised in hydrogen for Central Queensland remain as invisible as carbon dioxide gas itself.
Five years on from the PM’s grand statement of the benefits of net zero, the Government has effectively admitted defeat. On the day that the Liberal party changed leader, it slipped out its long hidden report on the effects of its carbon tax, what it calls the Safeguard Mechanism.
The Safeguard Mechanism applies to 219 of Australia’s largest factories, mines and transport companies. These businesses are required to reduce their emissions by 5 per cent a year, every year. If they can’t reduce emissions by this much (and most of them can’t), they have to buy carbon credits, making this program a tax.
The carbon tax applies to the coal mines of the Bowen Basin, the refineries in Gladstone, our last remaining producers of petrol and diesel, and Qantas and Virgin too.
The problem is that this tax only applies when things are made in Australia. The Safeguard Mechanism is effectively a tax on Australian made goods. The steel and cement that is imported from overseas, and competes with our businesses, faces no such tax and is given a leg up. Thanks to net zero, industrial production could just shift to other countries, sometimes with dirtier production processes and we could end up with more carbon dioxide being emitted. This is a well-known risk and is called “carbon leakage”.
So the Government commissioned a review to see if carbon leakage was a real threat to Australian jobs. The review revealed that it was and that’s why the Government tried to hide this report under thecover of a Liberal party leadership change a couple of weeks ago.
This review found that there was a “high carbon leakage risk from imports” for products like cement, steel and aluminium. Many jobs in Central Queensland rely on these industries.
To help prevent the potential loss of jobs, the review recommended that we put a “carbon tariff” on theimport of these products to Australia from countries that are not pursuing net zero.
This suggestion blows apart Labor’s rationale for net zero. Net zero was meant to make energy cheaper. It was meant to attract lots of investment, keeping interest rates down. It was meant to create lots of jobs.
But if pursuing net zero made things cheaper, why do we need to put a tax on goods from countries thatdo not pursue net zero? The review has belled the cat that going to net zero does come at a cost. And, that cost could be the loss of key manufacturing industries.
If the Government were to adopt the recommendations and impose a carbon tariff that would impose a cost on other Australians. This week the Government was complaining about Trump’s decision toincrease tariffs including on Australian goods. But how can Trump’s tariff be bad, but a carbon tariff be good?
Hopefully, the Government does not accept this review’s mad suggestion that we should use therevenue from carbon tariffs to fund “developing country capacity in emissions monitoring, verification and reporting.” Why should Australians pay a tax to send funds to other countries, the same countries that are stealing our jobs by dumping manufactured goods here?
It would be a much better idea to scrap net zero. Then we would not need to put more taxes on the Australian people that just push up the cost of living even higher.
