Thursday, July 17, 2008

Green plan comes at cost, admits Rudd

Michelle Grattan and Chris Hammer 
The Age, July 18, 2008

REDUCING carbon emissions will not be cost free for Australians, Kevin Rudd has bluntly declared, as he turns the heat on the Liberals to pass the Government's scheme in the Senate next year.

But the Prime Minister could not give a date when carbon pollution would start to turn down under the Government's plans, saying this would have to wait until it announced its targets later this year.

"I'm not going to look the Australian people in the face and say look, this is cost free. It does have a cost, let's just be upfront and honest about that," he said as he hit the airwaves yesterday to promote the blueprint.

The Government has promised to fully compensate low-income households earning up to $55,000, and to give some partial compensation to middle-income earners, although Mr Rudd won't say how much and won't nominate the cut-out point — expected to be about $150,000 — for this help.

With the scheme's fate ultimately in the Senate's hands, Mr Rudd said: "There's going to be a huge national spotlight trained on the Liberals. Are you going to be responsible partners in this country's long-term economic future or are you just going to walk away?"

But the Opposition has hit back, alleging that the Prime Minister's most powerful adviser faces a potential conflict of interest on the issue.

The Coalition says Mr Rudd's chief of staff, David Epstein, is compromised because his wife, Sandra Eccles, works for lobbying firm Government Relations Australia, which represents coal-fired electricity generators.

Mr Epstein also worked for the company before joining Mr Rudd's office before the election.

The shadow special minister of state, Michael Ronaldson, said the Rudd Government had rejected the advice of independent climate change adviser Professor Ross Garnaut by offering compensation in the form of cash or free permits to coal-fired electricity generators.

Shadow treasurer Malcolm Turnbull called for the Rudd Government to extend the time for consultations with industry on the green paper until after Treasury modelling was available in October.

"Already we are starting to see Australian business leaders scratching their heads and saying, 'How can we make a submission about this vitally important issue without knowing what it is going to cost, without seeing the Treasury numbers, without getting the economic modelling?' " he said.

But Climate Change Minister Penny Wong dismissed the claim it would be hard for business to have consultations with the Government before they had details of its proposed targets.

"This is a complex reform," she said. "It is a sensible approach for Government to do this in stages. "This stage we're looking at design issues. Modelling will come subsequently. There will be an opportunity for consultation on the modelling."

There would also be further opportunities for consultations on the white paper and draft legislation.

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