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Australia kills off carbon tax


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Business as usual: the Australian government’s Direct Action policy is voluntary and puts no overall cap on carbon emissions. Photograph: Joe Castro/AAP


Powered by Guardian.co.ukThis article titled “Australia kills off carbon tax” was written by Lenore Taylor, political editor, for theguardian.com on Thursday 17th July 2014 01.51 UTC

Australia’s carbon price has been repealed, leaving the nation with no legislated policy to achieve even the minimum 5% greenhouse gas emissions reduction target it has inscribed in international agreements.

After eight years of bitter political debate, during which climate policy dominated three election campaigns and contributed to the demise of two prime ministers, after last week’s Senate drama in which the repeal was again defeated and this week’s lengthy last gasp debate, the Senate has now finally voted to make good Tony Abbott’s “pledge in blood” to “axe the tax”.

The government was backed by seven of the new crossbench senators, including the three Palmer United Party senators, Liberal Democrat senator David Leyonhjelm, Family First senator Bob Day, Motoring Enthusiast senator Ricky Muir, DLP senator John Madigan. Independent senator Nick Xenophon was unwell.

Only the Australian Labor party and the Greens voted against repealing the carbon pricing scheme they introduced, which came into effect two years ago.

Leader of the government in the Senate and former climate change minister Penny Wong said repealing the bills meant “this nation will have walked away from a credible and efficient response to climate change”.

Wong said the prime minister Tony Abbott had “staked his political career … on fear-mongering and scare-mongering and that is what this debate has been about for years”.

“I think future generations will look back on these bills and they will be appalled … at the short-sighted, opportunistic selfish politics of those opposite and Mr Abbott will go down as one of the most short-sighted, selfish and small people ever to occupy the office of prime minister.”

Government backbencher Ian Macdonald accused opposition parties of being hypocrites for refusing to accept the will of the voters and said that while he had “an open mind”, he would like to point out that Brisbane had recently had its coldest day in 113 years.

Greens leader Christine Milne said it was “a vote for failure” amid interjections from government backbenchers that she should “get over it” because the parliament was “respecting the will of the Australian people”.

Senate vote on carbon tax.

The bills passed 39:32. There was none of the jubilation that accompanied their passage in the lower house, but the leader of the government in the Senate, Eric Abetz, shook hands with backbench senator Cory Bernardi, who led the revolt against Malcolm Turnbull when, as leader of the opposition, he backed Labor’s carbon pricing scheme.

The tax was $25.40 a tonne and was scheduled to move to the floating and lower international price in 12 months.

The repeal will cost the budget around $7bn over the next four years as around 350 businesses, mainly electricity generators and big manufacturers, no longer have to pay the tax.

The government argues the carbon pricing scheme has been ineffective, but national emissions have actually fallen by 0.8% in the first calendar year of its operation, the largest fall in 24 years of records. Since the tax began, emissions from the east coast electricity market have fallen 11%, but emissions from other sources – especially coal and gas mining have increased.

The government also says households will be better off by an average $550 – the amount treasury estimated prices would rise when the tax was introduced – but supermarkets and airlines are now saying consumers should not expect price reductions.

The Australian Competition and Consumer Commission’s special powers are to monitor and enforce only electricity and gas price reductions. Electricity bills will rise, but by an estimated 9% less than they otherwise would. Gas bills will rise by an estimated 7% less than they would have with the tax still in place.

The Abbott government says it will now achieve the target of a 5% reduction in Australian emissions compared with 2000 levels by 2020 with its Direct Action policy, which will offer $2.5bn in competitive grants over the next four years to companies and organisations voluntarily reducing emissions.


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