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Labor Senator Mark Arbib has told a Senate estimates hearing the money needed to be distributed quickly and there was not time to exclude people in certain categories.
“Speed was of the essence, we needed to get the money into the community as quickly as possible, and after both sides of the Parliament and Labor senators voted for those payments, obviously money needed to get into the community,” he said.
Hon. Martin Parkinson
Secretary
Department of Climate Change
Government of Australia
Dear Secretary Parkinson:
Thank you for your letter of 6 April, in which you provided reasoning behind the Carbon Pollution Reduction Scheme (CPRS) announced in your Government’s White Paper,1 including the emissions trading program to be implemented 1 July 2010.
The White Paper is forthright about the “need for action on climate change”. The first section pulls no punches, stating:
Carbon pollution is causing the world’s climate to change, resulting in extreme weather, higher temperatures, more droughts, and rising sea levels.
Eleven of the past 12 years rank among the 12 warmest years since records began and Australia had warmer-than-average mean annual temperatures for 16 of the past 18 years.
As one of the hottest and driest continents on earth, Australia will be one of the nations it hardest and fastest by climate change if we don’t act now.
This kind of straight talk is admirable, as is the statement in your 6 April letter that “We strongly agree with you that climate change requires urgent and significant changes in human activity.”
I am also encouraged by the policy proposed in the White Paper to return 100 percent of revenue from permit auctions to Australian households and businesses. Unless the tax is fully returned to the public, in a transparent fashion, they will not permit the carbon fee to rise to the needed level.
However, despite these laudable aspects, it must be pointed out that the emission targets outlined in your letter and the White Paper are inadequate to stabilize climate. Moreover, the plan to base the CPRS on a cap-and-trade approach is unlikely to meet even the goals that are stated.
Below I critique Australia’s targets – but let me assure you that I am equally frank about plans of other nations, including my own. I also point out flaws of cap-and-trade below. I hope you will reconsider your plan – we cannot lose another decade to such a disastrously ineffectual approach.
You note that the Australian Government has committed to reducing 2020 greenhouse gas emissions by 5-15% from 2000 levels, which would be as much as a 41% reduction in per capita emission from 1990 levels. However, your assertion that these reductions are “on par with those countries that have also adopted or proposed long-term targets” is misleading.
Authoritative data show that Australia’s per capita emissions of carbon dioxide from fossil fuel combustion, although comparable to those in the United States and Canada, are twice as high as per capita emissions in Western Europe. Here is a snapshot for 2005, the most recent year for
this specific data compilation:
| CO2 Emissions from Fossil-Fuel Burning | |
| Country | Tonnes per capita (2005) |
| Australia | 4.95 |
| Germany | 2.60 |
| France | 1.69 |
| Denmark | 2.32 |
| Spain | 2.16 |
| Source: National CO2 Emissions from Fossil-Fuel Burning, Cement Manufacture, and Gas Flaring: 1751- 2005, downloaded from http://cdiac.ornl.gov/ftp/trends/emissions/aus.dat (for Australia). For other countries shown, replace “aus” in link with “ger”, “fra”, “den” and “spa”. Figures exclude bunker fuel (ocean-going ships) |
|
These countries span a wide range of climate conditions, potential wind and solar resources, and use of nuclear energy. They all have robust per-capita incomes, high life expectancies, and
desirable quality of life. The fact that per capita emissions in each country are roughly half of Australia’s suggests that Australia’s emission targets could be considerably more ambitious.
Moreover, none of the various nations’ emission targets take into account the precipitous drop in economic activity, energy use, and GHG emissions from the deep worldwide recession.
Available estimates suggest that the recession may eradicate about three years’ emissions growth. Emission levels that had been expected in, say, 2010 won’t be reached until 2013. That fact cries out for bettering prevailing targets.
Obviously, there is room for Australia to cut its emissions much more than planned. How? With policies similar to those being promoted elsewhere: mileage efficiency standards for vehicles; power-usage standards for appliances and electronics; retrofitting of residential and commercial
buildings for efficient heating and cooling; urban revitalization promoting walkable and bikeable communities; land-use policies encouraging proximity over sprawl; and wholesale conversion of the electricity energy source from fossil fuels to carbon-free sources – including Australia’s massive solar and wind resources.
All of these measures will penetrate deeper, wider, and faster with carbon emissions pricing, as your letter recognizes. Indeed, if the carbon price is sufficient, the public will move rapidly to replace fossil habits and fossil infrastructure – once the tipping point is passed. With economic incentives, change will occur far more rapidly than is possible with mandated “goals” or “caps”.
A rising carbon price is needed to transform consumer and life style choices, to make renewable energy and energy efficiency cheaper than fossil fuels, to spur business investment, innovation and associated economic activity, and to move the nation to the cleaner environment beyond the
fossil fuel era. The carbon price will need to be significant, and the public and businesses must understand that it will increase in the future. It should be applied to all fossil fuels – oil, gas and coal – uniformly at the source (the first sale at the mine or port of entry).
Will the public accept a rising carbon fee. You bet – if the revenue is distributed 100% to the public. More than half of the public (those who do better than average in limiting their direct and indirect carbon emissions) will receive a dividend larger than the amount they pay in carbon
fee via higher energy prices. The revenue should NOT go to the government to send to favored industries – in general governments are lousy investors.
Will the public just turn around and spend the dividend on the same inefficient vehicle, etc.? No, not if there are better alternatives and if the public knows the carbon price will continue to rise.
And there will be plenty of innovators developing alternatives. Objections will come mainly from special interests, those benefitting from business-as-usual – you will recognize their lobbyists from their alligator shoes.
As a U.S. citizen, I am well aware that implementing such policies is easier said than done. My country’s per capita CO2 emissions stood at 5.32 tonnes in 2005,3 about 10% greater than yours.
Marshaling public opinion and political will is a tremendous task, given the forces aligned for business-as-usual. In Washington there are four energy lobbyists for every Congress-person.
Political leadership is desperately needed. It is easiest to give in to business-as-usual. That was the approach to the automobile industry by politicians in the United States, giving in to industry lobbyists. It cost our country world leadership in that industry. That industry is a pittance, compared with the stakes with global climate. We must recognize our fiduciary responsibility, if not our moral obligation, to our children and grandchildren. And humans are but one of millions of species that will be affected by our choice to take, or not to take, needed actions.
I’m gratified to read in your letter that “The Australian Government agrees that a rising forward arbon price is an essential part of effective and efficient national and global responses to climate hange.” But you go on to state: We do not accept … that a carbon tax will be the best mechanism to deliver such a price… [W]e consider that a cap and trade scheme [and] well designed quantity-based approaches have some significant advantages over price-based approaches.
First, let us level the terminology. If “fee and dividend” is to be called “tax and dividend”, then the pseudonym “cap and trade” must be replaced by “tax and trade”. One is no more a tax than the other – they both raise the price of energy for the consumer.
The consumer does not directly pay any tax or fee in the “fee and dividend” – the fee is paid at the fossil fuel mine or port of entry. It is transparent, uniform, honest, and fair. It is a single number per tonne of carbon. No large bureaucracy is needed, no traders, speculators, gamblers.
Please let me address specific points you raise, which in fact strongly disfavor cap-and-trade:
On Certainty. You note that “robust quantity-based approaches can achieve specified emissions reductions with a high degree of certainty” and “quantity of emissions reduction will be uncertain under price-based approaches.” These points beg the questions: “Is year-to-year
quantity uncertainty intolerable?” and “Will cap and trade be robust?”
In fact, uncertainty is inevitable with either approach. Moreover, our scientific knowledge and our political wisdom will likely improve over the next 40 years. So adaptability of present law is actually desirable.
Cap and trade is not robust. It has a great number of flaws, which I am sure you will agree should not be ignored in our analyses.
The view that we will have a “robust” cap is an illusion based on looking at rules for an ideal cap instead of the politics of real caps. Problem #4 above will cause trouble, e.g., because permit trading has characteristics that will likely provoke popular backlash. For example:
1. Consumers may discover, as they did in Europe, that they are charged for “free permits.”
2. Some permit traders will become millionaires by speculating on carbon prices – this
money does not come out of thin air – it comes out of consumer pockets.
3. An effective cap will eventually cause a high implicit tax rate. As Nordhaus (see below) notes, volatility of this tax may become “extremely unpopular with market participants.”
Such problems would cause repeated changes, or abandonment, of a global cap-and-trade system. If that system attains only limited coverage, as is now the case, worse problems will arise in the global offset markets. For these reasons, and because they believe a cap-and-trade
approach will continue to stymie international negotiations, some of our top economist from across the political spectrum vigorously oppose cap and trade. Notable among these are William D. Nordhaus, Joseph E. Stiglitz (Making Globalization Work, Chp. 6), and N. Gregory Mankiw.
On Permit Price Volatility. I am surprised by your first point about prices. You say, [Emission permits] “will generally provide greater security and improved risk management for firms and market participants than a tax or administratively set prices.”
Actually, volatile permit prices are almost universally considered to be the chief deficiency of cap and trade relative to a carbon tax. Nordhaus, in A Question of Balance (2008), examines the volatility of SO2 permit prices in the United States and finds they have been twice as volatile as the S&P 500 index and nearly as volatile as oil prices. He then concludes (p. 155):
Such rapid fluctuations are costly and undesirable, particularly for an input such as carbon whose aggregate costs might be as great as those of petroleum in the coming decades. An interesting analogue occurred in the United States during the monetarist experiment of 1979-1982, when the Federal Reserve targeted quantities (monetary aggregates) rather than prices (interest rates). During that period, interest rates were extremely volatile. In part because of this increased volatility, the Fed changed back to a price-type approach after a short period of experimentation. This experience suggests that a regime of strict quantity limits might have major disruptive effects on energy markets and on investment
planning, as well as on distribution of income across countries, inflation rates, energy prices, and import and export values. Quantity limits might consequently become extremely unpopular with market participants and economic policy makers.
We now have data on EAU futures that were unavailable to Nordhaus when he made his study of volatility. Using futures with settlement date December 2012, which now have nearly a four year time series, we find they are 3.5 times as volatile as the S&P 500, with the phase II period
(starting Jan. 1, 2008) being slightly more volatile than the earlier period.
On Price Discovery. The hope that futures and options markets will “reveal” future carbon prices under a cap and trade system is a case of whistling past the graveyard – with the gravestones bearing names like “securitization,” “derivatives,” and “credit-default swaps” that have brought the global economy to the brink of ruin. It would be less than prudent to give license to institutions in Australia and elsewhere to construct new, potentially toxic financial instruments, particularly ones that will help decide the fate of essential investment in zero- and low-carbon technologies.4 I also have to question the capacity of millions of Australian households and small-business owners to employ price discovery to guide their decisions to purchase low-carbon cars and houses and to move generally to climate-sustainable lifestyles. Why not just give them the future carbon price straight-up?
On Progressively Rising Tax Rates. You note that you are “unaware of instances where countries have committed to, and delivered, a program of progressively rising tax rates.”
Pollution taxes have rarely been tried under the traditional mindset favoring command-andcontrol regulations. But two examples of progressively rising pollution taxes come to mind: the tax on chlorofluorocarbons and other ozone-destroying chemicals implemented by the United States beginning on Jan. 1, 1990 to support the Montreal Protocol5; and the carbon tax that took effect in British Columbia, Canada’s third largest province and roughly the same population as your state of Victoria, last July 1.6 Your concern that “a price-based approach [such as a carbon tax] may not be capable of achieving the political mandate required to deliver the ambitious emissions reductions called for by the science, over the long run,” surely depends upon whether 100% of the carbon fee is returned to the public. Certainly, the nation should and will have the option of deciding whether the carbon fee will continue and how fast it will rise. My guess is that, as they see the benefits and consequences, and as many receive more in dividends than they pay in increased fossil energy cost, they will encourage continuation of this simple, honest, transparent system. On the contrary, with cap and trade (tax and trade) the first time that problems associated with “securitization,” “derivatives,” “credit-default swaps”, and speculator millionaires hits the media, the politicians in office will be running for the hills as fast as their legs can carry them.
On implementation. The carbon tax in British Columbia took only months from announcement, in February 2008, to implementation, in June 2008. Cap and trade schemes have taken an order of magnitude longer to craft and introduce.7 The difference arises from the complexity of cap and trade vs. the simplicity of a carbon tax or fee. It is this contrast that helps account for the shift in opinion that has become palpable in the U.S. business community, the political commentariat and, now, in the U.S. Congress.
The dividend, which you presumably would choose to give to all adult legal residents, can be implemented just as quickly, delivered electronically to bank accounts every month. It could be added to debit cards of anybody who does not have a bank account.
In closing, I note the recent comment of New York Times columnist Thomas L. Friedman: [S]simplicity matters. Americans will be willing to pay a tax for their children to be less threatened, breathe cleaner air and live in a more sustainable world with a stronger America. They are much less likely to support a firm in London trading offsets from an electric bill in Boston with a derivatives firm in New York in order to help fund an aluminum smelter in Beijing, which is what cap-and-trade is all about. People won’t support what they can’t explain
I believe Friedman is right about Americans and that the same applies to Australians. People are hungry not just for a sustainable climate, and cleaner air and water, but for political openness and honesty. They want their leaders to level with them. I am confident, given the recent leadership of the Australian Government’s on climate issues, that you will do precisely that in the next steps of adopting suitable targets and selecting an optimal path to achieve them.
Thank you for your openness to my information and point of view. I look forward to your reply and your continuing leadership.
Sincerely,
James E. Hansen
The council’s chief executive, Katie Lahey, said NSW was too big a part of the economy to let it drift. “I think right now NSW needs more fundamental support than just a bucket of money. These are different times now. I think different solutions are needed and perhaps something a bit more radical, a bit out of left field, needs to be brought to bear in NSW.”
An official report card on the economy on Wednesday is expect to confirm Australia is in recession. But a Herald analysis has found NSW has been slipping as a share of the national economy ever since it hosted the Olympic games in September 2000.
NSW now contributes less than 32 per cent of the country’s economic production, down from nearly 34.5 per cent just after the Games. An exodus of people interstate has also led NSW’s population share to shrink by 1 percentage point to 32.5 per cent.
Even more remarkable has been the slump in NSW’s share of new business investment and new home building activity. Of every dollar businesses spend investing in new equipment and buildings, NSW accounts for just 23 cents, down from 35 cents in late 2000.
And despite being home to one-third of Australia’s population, only 15 per cent of all new home-building takes place in NSW. The state approved just 1558 new homes in March, behind Victoria (4023) and Queensland (2052).
NSW’s jobless rate remains consistently one of the highest in the country and the traditional wage premium NSW workers enjoyed over other states has all but evaporated. In late 2005 NSW employees earned $3500 more a year than the national average. Now it is just $500.
Ms Lahey said NSW’s sub-standard performance was a common topic of conversation among the top 100 companies. “They talk about the fact that under normal circumstances NSW is the power house of the economy; it is about a third of the economy and it is the face of Australia internationally and there is a lot of concern about the capacity of the Government here to be able to deliver and support a growth platform.”
Many in the business community see the NSW Government’s failure to secure funding for major Sydney transport projects in the recent federal budget as a turning point for NSW-federal relations.
Of $8.5 billion in transport spending announced in the federal budget on May 12, Sydney received just $91 million for a study on the West Metro, compared to $3.2 billion for a Melbourne rail project.
The chief executive of the NSW Business Chamber, Patricia Forsythe, said: “A decade ago NSW was No.1 for infrastructure. Victoria has now claimed that mantle.”
But two members of the Rudd Government’s Infrastructure Australia advisory board have suggested to the Herald that NSW needs to lift its game in developing its infrastructure proposals.
A board member and a professor of sustainability at Curtin University, Peter Newman, said NSW needed a more co-ordinated approach to planning. “I would say the key thing is that people start talking to each other from across the silos. That process … requires leadership.”
Fellow board member and the chairman of Industry Funds Management, Gary Weaven, questioned whether Sydney would always be Australia’s premier city, pointing out that other eastern seaboard cities, foremost of them Melbourne, could also fit the bill. “NSW is the biggest state and it is the most populous state and it has the biggest city. Maybe that won’t be forever.”
NSW’s persistent under-performance is a headache for the Rudd Government, keen to distance itself in voters’ minds from its crisis-prone state counterpart before next year’s federal election.
However, several federal cabinet members are understood to be highly concerned about NSW’s performance.
The Prime Minister, Kevin Rudd, has floated the idea of creating a new body, much like the Sydney Organising Committee for the Olympic Games, to help plan Sydney’s infrastructure and the Treasurer, Wayne Swan, last month described Sydney as his “second home”.
The appointment of the NSW Labor powerbroker Mark Arbib to manage reports from individual states on their progress spending billions of dollars of stimulus money on schools and public housing has been interpreted by some as a way for the Government to keep a closer eye on NSW.
The underlying problem is that business adjusts the problem of climate change to neoliberal economics, which judges value according to financial cost rather than environmental sustainability or social justice. This manifests itself in a promise to massively expand carbon markets [emissions trading background guide]. The idea is that governments give out a limited number of permits to pollute; the scarcity of these permits should encourage their price to rise; and the resulting additional cost to industry and power producers should encourage them to pollute less.
Jos Delbeke, deputy director-general for the environment at the European commission, was in Copenhagen claiming that this is how the EU Emissions Trading Scheme (ETS) is now working. Yet his department’s own data for 2008 shows more international “offset” credits circulating than the level of claimed reductions, while lobbying pressure has resulted in a twin-track system from which every business wins.
On one side, heavy industry like the steel sector has more credits than would be needed to reduce its emissions, so it sells them. Delbeke shared a panel on carbon markets with a representative of ArcelorMittal, which alone gained an estimated subsidy of more than €1bn between 2005 and 2008 by this means.
On the other side, power companies pay less for pollution permits than the cost they pass on to consumers, generating windfall profits that could reach up to around €70bn by 2012. The circulation of these permits does nothing to help new investment in renewables.
Other measures to avoid business obligations displace the problem of tackling climate change on to developing countries. The Summit’s final Copenhagen Call talks of a crucial role for forest protection in developing countries, and that such measures should represent around half of the action needed to limit climate change by 2020.
These figures are taken directly from Project Catalyst, an initiative bringing together “climate negotiatiors, senior government officials… and business executives”, whose presentation (marked confidential) more straightforwardly emphasises the “the size of the prize for business”. It also speaks of the opportunities for “companies in forest management, pulp and paper, or construction” to access a “€20-30bn value chain” in developing countries.
Strikingly similar assumptions have found their way into negotiating texts on Reducing Emissions from Deforestation and Degradation (REDD), which will be discussed when UN climate negotiations resume in Bonn next week. Yet the whole idea that deforestation can be stopped by simply putting a price on forests is flawed, with forest communities and indigenous peoples warning that it will encourage further land grabs by large companies. They point to evidence that the real drivers of deforestation are the major construction, mining, logging and plantation developments whose owners stand to be rewarded by REDD funds.
These are the voices that the world should be listening to as it seeks to tackle climate change. Even the self-proclaimed “progressives” of big business seem to be putting profit margins above environmental need. Without a more fundamental re-examination, to paraphrase one panellist, they look set to remain on the back end of a horse that is galloping in the wrong direction.
• Oscar Reyes is a researcher with Carbon Trade Watch, a project of the Transnational Institute, and environment editor of Red Pepper magazine.
The shift disrupts ocean chemistry and attacks the “building blocks needed by many marine organisms, such as corals and shellfish, to produce their skeletons, shells and other hard structures”, they said.
On some projections, levels of acidification in 80 per cent of Arctic seas would be corrosive to clams that are vital to the food web by 2060, it said.
And “coral reefs may be dissolving globally” if atmospheric levels of carbon dioxide were to rise to 550 parts per million (ppm) from a current 387 ppm
Corals are home to many species of fish.
“These changes in ocean chemistry are irreversible for many thousands of years and the biological consequences could last much longer,” they said.
Martin Rees, president of the Royal Society, the British science academy, said there may be an “underwater catastrophe”.
“The effects will be seen worldwide, threatening food security, reducing coastal protection and damaging the local economies that may be least able to tolerate it,” he said.
The academies said that if current rates of carbon emissions continue until 2050, computer models indicate “the oceans will be more acidic than they have been for tens of millions of years”.
(d) the assessment of the impact of even a moderate sea level rise in Australia remains inadequate for adaptation planning;
(e) assessing the vulnerability of low coastal and estuarine regions requires not only mapping height above sea level but must take into account factors such as coastal morphology, susceptibility to long-shore erosion, near shore bathymetry and storm surge frequency;
(f) delaying analysis of the risk of sea level rise exacerbates the likelihood that such information may affect property values and investment through disclosure of increased hazards and possible reduced or more expensive insurance cover; and
(g) an early response to the threat of a rise in sea level may include avoiding investment in long-lived infrastructure in high risk areas.
(2) That the following matter be referred to the Environment, Communications, Information Technology and the Arts Committee for inquiry and report by 20 September 2007:
An assessment of the risks associated with projected rises in sea levels around Australia, including an appraisal of:
(a) ecological, social and economic impacts;
(b) adaptation and mitigation strategies;
(c) knowledge gaps and research needs; and
(d) options to communicate risks and vulnerabilities to the Australian community.
Yesterday in Australia we heard from Sir Nicholas Stern, one of the world’s most eminent speakers on the economic impacts of climate change, pointing out that whatever it costs to take action now will be nothing compared with what it will cost if we do not take action. I am asking the Senate to agree to a motion to look at the assessment of the risks associated with sea level rise in Australia, including an appraisal of recent science relating to sea level rise projections, the ecological, social and economic impacts of the full range of projections, adaptation and mitigation strategies, knowledge gaps and research needs, and options to communicate risks and vulnerabilities to the Australian community.
This is an urgent matter; it is an urgent matter because the science is telling us that we can expect not only the current amount of global warming that is locked in because of the levels of CO concentrations in the atmosphere but that we will see accelerating global warming as the concentrations of CO rise. We have to make deep cuts. But, regardless of the deep cuts that we make in the next 10 or 15 years, the sea level rise is going to continue. We have had the Intergovernmental Panel on Climate Change fourth assessment report published in February telling us that the sea level will rise by between 0.18 metres and 0.59 metres by the end of the century. More concerning than that is recent evidence from scientists such as Dr Barrie Pittock, formerly of CSIRO. He says that we have an increase in the outflow of the glaciers from Greenland and parts of Antarctica-increasing to such an extent that the latest papers are suggesting a rise by 2100 of between 50 centimetres and 1½ metres. That is the range that the latest science is demonstrating by 2100. If you take into account the rule of thumb that for every metre in sea level rise the coast will retreat and go inland by 100 metres-so for every metre you can expect that impact of 100 metres-and you consider how many people live in the coastal zone around Australia, we have to be concerned.
Only a couple of weeks ago in Cairns we had a meeting of the Planning Institute of Australia. They talked about the impacts of sea level rise, and we also had the insurance industry there. Both the Planning Institute of Australia and the Insurance Council of Australia are saying that we are reaching a situation where some people will no longer be able to get insurance because of where they are in relation to the coast. Furthermore, they are saying that, in the future, local government in particular will be sued because they have given planning approval for development in coastal zones where it was already known there would be sea level rise. So we have a situation where people are moving to the coast and local government is not taking adequate note of the likely impacts of sea level rise.
Looking at their website today, I was alarmed to see that the Greenhouse Office has not published anything since 2004 on updated impact assessment of sea level rise around Australia. No doubt I am going to hear from the government that they have a Greenhouse Office and that that is the answer to climate change-that you set up the office. It is what the office actually does that is of concern to me.
At that recent Planning Institute conference in Queensland they said that in the Northern Territory nearly 900 coastal buildings, mainly in Darwin, are at risk. Along the Tasmanian coastline more than 17,000 addresses are considered vulnerable-as are more than 60,000 in South Australia, mostly around Adelaide, and over 80,000 along the Victorian coast, mainly around Melbourne. In Western Australia 94,000 buildings have been identified as vulnerable around Perth. But the biggest concern is along the eastern seaboard where more than 200,000 buildings are considered vulnerable on the New South Wales coast, including Sydney. Queensland faces the largest risk with almost 250,000 buildings under threat stretching from the Gold Coast to the Sunshine Coast. So this is not something 50 or 100 years hence-although, as I am saying, we are likely to see increasing rates of sea level rise; these are buildings that have been identified as vulnerable right now because of sea level rise. Add to that the issue of storm surge and you will see that we are facing major disaster around Australia, and we need to spend money right now dealing with it.
In the UK the Thames Barrier in the mouth of the Thames River has been there for a long time to try and stop storm surge influencing the city of London to the extent that it did previously as a result of that coastal flooding and storm surge. At a recent meeting of the conference of the parties to the United Nations Framework Convention on Climate Change, there was a discussion about what we know as the Low Countries-and that includes, of course, the Netherlands-considering putting out a tender for a new coastline. It is a concept that is very difficult to even imagine in terms of the costs of actually considering that you might have to build a new coastline. Already in the Netherlands they are actively moving people from areas that are clearly going to be vulnerable to flooding. They face not only the risk of sea level rise but also, with heavier rainfall events, they are going to have flooding coming down the rivers-the two will meet and there will be massive flooding. Certainly Europe is focused on this because of the density of population in what we know as those Low Countries.
In Australia we also have issues with areas like Kakadu and our national parks, coastal wetlands, protected areas and so on. We are going to see sea level rise have a considerable impact as a result of saltwater incursion into our wetlands. I was appalled when I heard earlier this year the federal Minister for the Environment and Water Resources, the Hon. Malcolm Turnbull, saying:
There’s a lot of very exaggerated claims and you have to bear in mind that most of our coastal population lives on the east coast of Australia and because of the geology or the typography-
I presume he meant topography-
of the east coast, you know, much of that is adequately elevated to deal with a one-metre sea rise.
That demonstrates the complete ignorance of the government about what a one-metre sea level rise would mean for coastal Australia. It would be absolutely devastating to infrastructure and to millions of people. But consider for a moment what it would mean for our Pacific neighbours. We already recognise that a large number of people will be dislocated and will have to move from the islands where they live. Not only will their lives and their culture be disrupted but they will need somewhere to go-and Australia, of course, is resisting even the definition of an ‘environmental refugee’ in the refugee convention, let alone agreeing to have future arrangements and treaties whereby Australia would take some of those people, even though Tuvalu and the New Zealand government have had an understanding that New Zealand will absorb a number of people from Tuvalu because of sea level rise and saltwater incursion into fresh water supplies.
Returning to Australia, a recent report by the Risk Frontiers Natural Hazards Research Centre at Macquarie University talked about the wider Sydney region, including the central and south coasts. It said that there are almost 13,000 dwellings below two metres above mean sea level and over 140,000 dwellings below six metres above mean sea level. It noted that, during spring tides, sea level is almost a metre above mean sea level in Sydney. Another study found that, for a given sea level rise of 20 centimetres by 2050, coastal erosion of up to 22 metres is projected for the Collaroy-Narrabeen beach, rising to 110 metres given a one-in-50-year storm surge, with associated economic losses of $230 million.
Also, an interesting rumour has been handed down from generation to generation of public servants in New South Wales that, as long ago as under the Wran government, the planning department there did an assessment on sea level rise impacts on Sydney and coastal New South Wales. When those planning people delivered that to the Wran government, they were told to bury it-and it has been buried ever since-because of the devastating impact it would have had on coastal property prices at that particular time. No doubt that is why people do not want to have this kind of assessment into the future impacts of sea level rise and storms and storm surge on coastal Australia associated with global warming, because not only will it have a significant impact on future infrastructure planning-and it is absolutely appropriate that it should have-but also it will place a lot of councils and state governments in all sorts of quandaries about what they will do about protecting existing infrastructure.
Of course, that has to be done in conjunction with the insurance industry, which will be moving rapidly to take away people’s insurance cover. I am glad that the Insurance Council of Australia has come out with a plan that says we have to deal with this matter as soon as possible. In Tasmania, I pointed out that Lauderdale, which is not far from Hobart, is probably one of Tasmania’s most vulnerable communities to sea level rise. That was identified in a coastal vulnerability analysis done for the state government. The population of Lauderdale are already suffering a rise in the watertable as the sea level rises and they are vulnerable to overwash. However, the insurance institute representative in Tasmania said that it was not a problem as far as the insurance industry was concerned. I think that was a serious misleading of the local population about the likely impacts on people in that area being able to continue to maintain insurance cover.
However, all this goes to the point that, in Australia, we need a proper assessment, as has been done in the UK and in countries like the Netherlands. In the UK, they have gone along its southern coast and have identified communities that will be saved by infrastructure-new groynes, seawalls, new port facilities and so on. They have identified other coastal areas for what they call ‘managed retreat’. That has not even come onto the agenda in Australia. However, huge conflict is being caused on the southern coast of the UK, with the government there announcing that they will start identifying communities to be saved and others for managed retreat. Unfortunately, one of the main considerations for many of those communities is the extent to which they are well-known tourist locations. So a place like Lyme Regis, where TheFrench Lieutenant’s Woman was filmed and which is a major tourist attraction, has been identified as a town that has to be saved, with millions of pounds being spent on groynes and seawalls. However, other communities nearby, which local people would say are more reflective of the culture of southern England and so on, have been identified for managed retreat.
That is how seriously the UK government is taking the figures on sea level rise. The Netherlands government is considering such measures and I have mentioned the Thames Barrier. It will require vast amounts of money in adapting to existing projections of sea level rise, not to mention that sea level rise will become unmanageable unless we act soon to mitigate further concentrations of CO that will make the matter worse. So we have to adapt to what we know is coming and reduce greenhouse gases to make sure that the situation does not get worse.
That is why I am calling for the Senate to support an inquiry into this issue of sea level rise. It is not complicated. We know what the situation with global warming is. We know the projections for sea level rise. We need to look at Australia’s coastal vulnerability to sea level rise, because we need to consider infrastructure into the future. I hope that the Senate will support this reference. I referred a matter last year to the rural and regional affairs committee relating to Australia’s future oil supplies and that was an extremely successful Senate inquiry. I take these Senate inquiries seriously. If this reference gets up, I will be at all the hearings and I will work hard in this context so that we get a collaborative approach and, hopefully, a majority report-because I think it makes an important contribution and raises awareness of the issues in local communities.
I urge the government, the opposition and the Democrats to support this reference. It has been circulated to members of the committee. As I said, it is not a complex idea that we would move to look at the science on sea level rise projections, the likely impacts for the full range of projections and scenarios, the adaptation of mitigation strategies, the knowledge gaps and the research that we need to undertake, and our options to communicate those risks and vulnerabilities to the Australian community.
I recommend this reference to the Senate. I will be interested to hear the response of my colleagues and hope that we can get this up and make a serious contribution to stopping what will be major disasters if we just pretend it is not going to happen.
Question negatived.