Senator Eric Abetz

Leon Compton: Senator good morning to you.

Senator Abetz: Good morning Leon, good to be on the program.

Leon Compton: Thanks for talking with us. The Labor Party urging calm at the moment and just a chance to sit back and have a look at what impact this Tax has, why is that a bad idea?

Senator Abetz: The Labor Party wants to forget about the Carbon Tax for one simple reason; they promised there would be no Carbon Tax if they were re-elected. They have broken their promise, they lied to the Australian people and that is why the Government advertising surrounding this new Tax doesn’t talk about the environment, doesn’t talk about carbon. In fact the letters that go out to people are headed “cash for you” and it’s not about doing anything for the environment. So Labor is scrambling around trying to deny that which they have done and they’ve done it in complete contrast to that which they promised at the last election.

Leon Compton: Notwithstanding they argue that treasury modelling shows there won’t be a substantive impact on the broader community. So from a position of Opposition why not sit back now and see if that comes to pass and just spend a little time waiting to see how it washes through the economy?

Senator Abetz: There are some fundamental problems with treasury modelling. First of all one of the inputs, and lets not forget, with modelling it’s what you put into the model that determines what comes out the other end, one of the fundamental flaws of treasury modelling is that there will be world wide action on a Carbon Tax in all comparable type economies. Now we know Japan, South Korea, France, the United States and New Zealand are all winding back, they are not moving forward that which they have done. They are winding back and that seems to be the approach right round the world. So the treasury modelling is fundamentally flawed in that regard. And that is why the impact of the world’s biggest Carbon Tax on Australian agriculture, manufacturing and tourism is going to be very severe. And that is why in fact; look Australians know that, Ms Gillard knew that. That is why six days before the last election she said there would be no Carbon Tax. When we said don’t believe her the Treasurer Wayne Swan said the Liberals are now becoming hysterical, of course there won’t be. The fact is rather than being hysterical we were in fact now proven to be historical because it’s now history that Labor lied.

Leon Compton: Well indeed. But the question is what about the cost impost that you have promised will be coming, what if they don’t? There was Wayne Swan, you would have seen the pictures yesterday holding up a lamb roast asking how much has this actually increased in value, the answer not in too much as this stage. So what if the impact of the Carbon Tax doesn’t prove to be as bad as you promised, given your policy is to repeal it?

Senator Abetz: I think most Australians would have been very disappointed seeing their Federal Treasurer pulling such a silly childish stunt on TV. Of course the lamb roast would not have gone up overnight because of the Carbon Tax. But we do know for example that fertiliser is very energy intensive to make, we need fertilizer to grow meat. We also know that with meat you need refrigerates, you need coolant and you need a lot of energy. There is no doubt that the price of lamb will go up in relation to the fertiliser that’s needed to grow lamb, the coolant and the refrigeration for transport. This will be a cascading Tax at every single level of production, right up to when you take it home to cook it, the electricity you use will be subject to the Carbon Tax as well.

Leon Compton: Does the Liberal Party have a challenge at the moment because the people don’t take credibly their claims that they will unwind this Tax? That they will take back or do something about the compensation being passed through to pensioners and lower income households? That they will readjust the marginal tax brackets that have changed as of today? That whey will take away from or do something with the compensation imposts that have been put on businesses large and small? That’s a large omelette to unscramble.

Senator Abetz: The Australian people know that Tony Abbott and the Coalition are absolutely committed to the repeal of the Carbon Tax. Now what our total tax policy will be will be announced before the next election. But we may well have another Federal Labor Budget before the next election and in those circumstances we’d have to wait and see what the actual financial situation is. Having said all that, we are absolutely committed to repealing the Carbon Tax because it is such a destructive and corrosive Tax, not only to jobs, not only to our cost of living, but in a very, very perverse way to the world environment as well. Because what we will see - and that was the experience in Europe - that relatively clean for example aluminium smelters closed down in Europe and went to Africa to produce. And do you honestly believe that Africa has tighter environmental standards than Europe? Similarly we had the example of Coogee Chemicals in Australia. They were going to set up a plant in Australia but because of the Carbon Tax they have decided to move that to China, where in China that plant will have four times the carbon footprint than it would have had in a pre-Carbon Tax Australia. So that is why the Carbon Tax will not only be destructive to our jobs, wealth creation and our cost of living, it will actually be destructive to the environment as well. And that is why Labor doesn’t want to talk about the environment any more because they know that those that are serious in this space have foreseen the environmental damage this Tax will also do.

Leon Compton: It will be interesting to see if it comes to pass, good to talk to you this morning.

Senator Abetz: Thanks a lot.