Independent Senator Nick Xenophon has expressed “shock” that Australia’s Treasury has not done modelling on the conservative Liberal-National government’s Direct Action carbon plan.
Senator Xenophon expressed his surprise and a Senate inquiry saying he expected Treasury would have examined if taxpayer dollars would be better spent reducing high greenhouse gas emissions activity or boosting clean energy generation.
AAP Newsagency reports that is what he told the Senate inquiry that was investigating laws to repeal Australia’s carbon price, the Climate Change Authority and the Clean Energy Finance Corporation (CEFC).
The Senate inquiry was set up after the Liberal-National government used its numbers to pass the package of repeal bills in the lower House of Representatives.
The government insists it can meet Australia’s emissions reductions target with Direct Action, which promises to cut emissions by paying for activities such as planting trees and improving soil carbon, rather than the current Emissions Trading Scheme, which uses a fixed price before reverting to a market based system in 2015.
Speaking via telephone, Senator Xenophon asked Treasury officials at the inquiry what modelling they had done on the abatement costs of spending money to reduce high-emissions activity or increasing cleaner generation activity.
“Does Treasury consider that they would have a different effect on electricity pricing and on outcomes in terms of abatement?” he asked.
“Presumably one would be more efficient than the other in terms of abatement, particularly in the context of the direct action scheme.”
AAP reports a Treasury official said the department had not undertaken an analysis of the effectiveness of different programs for delivering abatement and its impact on prices, but would do so if the government asked.
The senator then asked if Treasury would advise the government it would be prudent to model those costs?
The official replied: “We will make our usual comments to government through the process around the consideration of the emissions-reduction fund in the normal course.”
Senator Xenophon told the inquiry chairman he was surprised the modelling had not been done.
“I must say, chair, I am quite surprised, shocked in fact, that the treasury hasn’t taken any modelling in respect of this,” Senator Xenophon added.
