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Christine Milne asks a question for #EndFossilFuelSubsidies

Senator MILNE (Tasmania-Leader of the Australian Greens) (14:13): My question is to the Minister for Finance and Deregulation and Minister representing the Treasurer, Senator Wong. Given that at the G20 meeting in Pittsburgh in 2009 the then Prime Minister, Kevin Rudd, agreed to phase out and rationalise inefficient fossil fuel subsidies, of which Treasury had identified 17, and that a Global Subsidies Initiative report recently concluded that the Australian government could save at least $7.2 billion a year by phasing out measures supporting the production and consumption of fossil fuels, what is the Prime Minister reporting to the G20 on behalf of the Australian government with regard to Australia's progress in phasing out these fossil fuel subsidies?

Senator WONG (South Australia-Minister for Finance and Deregulation) (14:13): I am aware of the report to which Senator Milne refers. I am also aware that the government took a position previously with which Senator Milne was, if I may say, unhappy-did not agree with-on a range of policy measures which were not regarded as falling within the remit of the G20 agreement.

I will take on notice what additional information I can provide from the Treasurer on this issue, but I would say to the senator, given her previous public criticisms of this issue, that I doubt that the government has changed its position. You might recall that a number of the issues which would have been included in that list from the senator's perspective from her public comments were issues which the government has chosen not to alter in terms of the recent budget decisions, notwithstanding that there was some public suggestion of consideration.

As I said, I will see if I can get any further information on what has been done in the G20 context on the subsidy issue. But I would say to you, Senator, that our position has to my knowledge not changed since our previous position and that I am aware that you have previously criticised it.

Senator MILNE (Tasmania-Leader of the Australian Greens) (14:15): Mr President, I ask a supplementary question. In the face of accelerating global warming and the introduction of a price on pollution next month, isn't it inconsistent to provide $7.2 billion a year in fossil fuel subsidies such as fuel tax credits, accelerated depreciation for miners and exploration subsidies for oil and gas, massively dwarfing government assistance to renewable energy?

Senator WONG (South Australia-Minister for Finance and Deregulation) (14:15): This is an issue on which Senator Milne knows the government and the Greens party do not agree. We do believe that industries such as mining have a strong future and are important to the Australian economy. We are pleased at the increase in investment in mining which we see planned for 2012-13. It is some 2½ times what was invested in 2010, and this puts paid completely to the scare campaign from those opposite. We do believe that these sectors are important to the Australian economy, just as we also believe that a carbon price is the most effective way that we can give the incentive for greater investment in clean energy processes, clean energy technology and clean energy industries.

The senator put a proposition to me, and the answer to that question is: no, the government does not agree, and the government believes that some of the industries that she has referenced are extremely important to the Australian economy.

Senator MILNE (Tasmania-Leader of the Australian Greens) (14:16): Mr President, I ask a further supplementary question. I thank the minister for her answer, but I ask: isn't the Prime Minister's focus on economic growth while maintaining fossil fuel subsidies completely inconsistent with the World Economic Forum and G20 agenda of severing the link between economic growth and resource consumption, depletion and adverse environmental impact?

Senator WONG (South Australia-Minister for Finance and Deregulation) (14:17): The best way to separate economic growth from pollution is to put in place a broad-based carbon price, and that is what the government is doing. As the senator well knows, the reasons for that are: first, you create an incentive for businesses to pollute less; second, you create an incentive for business to move to better ways of doing business and cleaner ways of manufacturing and cleaner processes; third, you create an incentive for investors; and, fourth-and this is one of the policy consequences that is not often spoken about-a price on carbon is also a signal to investors about where to invest. We do not share the views that are behind what the senator is putting to me-that is, that the way forward for the Australian economy is to simply shut down particular industries. Those industries are important to our economy. They remain important for jobs and important for Australians.

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