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Pricing carbon back on the agenda in Australia

08 September 2010
Pricing carbon back on the agenda in Australia

Rupert Posner, Australia Director of The Climate Group, analyzes the promising developments on climate change policies that are coming out of Australia's newly formed coalition government.

Almost three weeks after going to the polls, Australia finally knows who will form Government. And despite being the first minority Federal Government since the end of the Second World War, there is a good chance that this government will have the mandate to inject new impetus into Australia’s climate policy. Putting a price on carbon is now firmly back on the agenda, having been shelved until 2013 earlier in the year.

Australia’s electoral stalemate was finally broken as the three remaining rural independent MPs showed their hands: North Queensland’s Bob Katter announced his support for the conservative Coalition, while New South Wales MPs Tony Windsor and Rob Oakeshott declared for the incumbent Labor Government. Combined with the deals done earlier in the week between Labor and The Greens, and Labor and Tasmanian Independent Andrew Wilkie, Labor Prime Minister Julia Gillard now has the necessary 76 out of 150 seats to form government.

The intense political wrangling needed to garner the necessary support to form government has produced promising developments for climate policy in Australia.

The most significant is the establishment of a new Climate Change Committee as part of the agreement between Labor and The Greens. The Committee will be made up of cross party MPs and independent experts and its main task will be to review how best to place a price on carbon in Australia. Importantly, the Committee will only encompass MPs who are committed to tackling climate change and who acknowledge that reducing carbon pollution by 2020 will require a carbon price. The Committee will be resourced like a Cabinet Committee and its structure, membership and work plan will be finalized by the end of September 2010.

The deal also guarantees that The Greens have the ear of Prime Minster Julia Gillard, who will now hold weekly meetings with its leader Bob Brown and newly elected lower house MP Adam Bandt.

It was not just The Greens, however, that identified climate change policies as important in their decision on which party they would support to form government. When announcing their decision, both New South Wales MPs Rob Oakeshott and Tony Windsor said it was as a key factor in their eventual decision to back Labor. Windsor also underlined the point that his constituents, and the rest of regional Australia, has much to gain from taking action on climate change and investing in renewable energy.

Labor’s agreement with the independents also brings other important commitments that will help re-invigorate the debate. These include commissioning an update by Professor Ross Garnaut on his 2008 Review – something that will certainly provide a renewed platform to argue for a price on carbon.

Interestingly, an expert body will also be set up to calculate the carbon price equivalent of the action taken by China and other developing countries.

In the past year climate change has taken a heavy toll on Australian political leaders. It has played a part in claiming two opposition leaders and a Prime Minister. But it now appears that the tide may have turned and that taking bold action to address climate change may finally be rewarded.

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