Landcare and farming under the Coalition

LANDCARE AND CARBON FARMING
UNDER THE COALITION

Introduction

I am delighted to be here in Dubbo tonight at the 6th Annual Carbon Farming Conference to set out the vision and directions for landscape management and carbon farming under a Coalition Government.

I am particularly delighted to do this in the electorate of Mark Coulton, the Member for Parkes, with whom I have visited a number of local farms. Together we have been literally elbow deep in manure, soil carbon and compost. There are photos to prove it!

Let me begin with a brief but powerful statement which David Walker, the National Landcare Network Chair, shared with me recently. In discussing the potential uptake of carbon and the role of farmers and landcarers, David simply said that:

“The paddock is a living thing.”

The paddock is a living thing. And from such a simple statement comes both our responsibility and our opportunity.

The responsibility is to maintain and improve the health of the land so each succeeding generation has the capacity to grow equal or improved volumes of food and fibre.

The opportunity comes from the fact that it is the land that has historically been the store of so much of the world’s carbon. It is in replenishing those stores that we can not only reduce our national emissions footprint, but enhance soil health, vegetation management and productivity.

Tonight I want to put forward a simple thesis: the ALP has forgotten the farmer. It has risked rural production and regional communities with (among other things) the carbon tax, its poor design of a potentially very good program in terms of the Carbon Farming Initiative, and ever more bureaucratic versions of Caring for Country.

There is a much better way forward based on incentive schemes that are simple and that work with, rather than against, farmers.

In that respect I want to proceed in three steps.

First, to discuss the Coalition’s blueprint for a better Australia based on 5 national plans for a Stronger Economy, a Stronger Community, a Cleaner Environment, National Infrastructure and Safer Borders & National Security.

Second, to outline the current Government’s failure of leadership on the environment and, in particular, the impact of the Carbon Tax on electricity prices – and its lack of effect on emissions.

And third, I want to set out our Plan for a Cleaner Environment with a particular focus on Landcare, the Green Army and how farmers can benefit under our Emissions Reduction Fund.

1. The National Vision and Plan

In this context, what would a Coalition Government look like? How would it operate?

These are, of course, the same questions that were asked in 1995 when it was said by critics that a potential Howard administration lacked the vision, the plan and the personnel to form a lasting government. Indeed it was said, amidst the darkest of accusations that an incoming Liberal government couldn’t work with Asia.

In the end not only did the Howard Government work rather well with Asia but most importantly Australia became a leaner more efficient athlete, which allowed us to survive the Asian Financial Crisis, the Tech Wreck, the post September 11 crash, the SARS fallout and to prepare ourselves for the Global Financial crisis by having a full, rather than an empty, national piggy bank. It saw real wages rise by 22 per cent and over three million jobs created.

All of this came about because of a clear plan to focus on spending control, debt repayment, enhancing productivity and supporting local communities.

The same elements are vital today and in that context I want to outline the vision and the plan for a future Coalition Government.

The vision for a future government is simple: it is about building a great society based on millions of acts of individual responsibility and self-fulfillment, rewarding risk and restoring a culture of personal responsibility and, above all else, living within our means.

A great society is not defined by a big government, it is in fact enabled by a light-handed government. Our guiding principle therefore is to consciously reduce the reach of the State into both individual lives and business as far as possible. That means a deep and abiding project to radically reduce the layers of bureaucracy and range of rules that are stifling freedom and choking productivity. It means consciously simplifying government.

But the vision of a great society, based on the elevated pillars of individual freedom and fulfilment, requires a careful plan to achieve this once-in-a-generation project to simplify government. Working together, the Coalition has built a framework of five great national objectives aimed at simplifying and focussing government and enabling individual fulfilment:

1. Our Plan for a Stronger Economy,
2. Our Plan for a Stronger Community,
3. Our Plan for a Cleaner Environment,
4. Our Plan for Safer Borders and National Security, and
5. Our Plan for National Infrastructure.

The first of these is our National Economic Recovery Plan. This involves living within our means, driven by debt repayment, lower taxation and measures for greater productivity. We must not lose sight of the fact that this government is now spending $100 billion more per year compared to when it came to office. That is almost 40 per cent more than it was previously. By contrast, inflation has risen 13.2 per cent over the same period. So yes, we can legitimately cut waste. Yes, the Carbon and Mining taxes will be abolished. And yes we can and must be more competitive in our productivity.

Cutting wasteful spending such as we saw in the Home Insulation Program, ending taxes that deter investment and slashing bureaucratic hurdles are not just possible but are essential if we are to be our best selves.

Above all else a Coalition government will back our nation’s strengths, not set out to deliberately undermine them. Mining and resources, agriculture, education and medical research are things we as a nation do as well as any and better than most.

On infrastructure, the Coalition will task Infrastructure Australia with preparing a rolling 15-year national infrastructure plan with designated priorities based on published cost-benefit analyses. There will be a published cost benefit analysis for any infrastructure project to which a Coalition government commits $100 million or more.

In addition, the Productivity Commission will examine ways of encouraging more private funding of high-priority infrastructure projects and ensure that existing funding is better directed.

Our Safer Borders and National Security Plan includes increasing working visas to improve skills in Australia. The Coalition has always been pro-immigration but it’s crucial that the immigration program be run in our national interest and that we stop the dreadful loss of life at sea from people smuggling.

Provided they are paid the same wages and there aren’t Australians who could readily fill particular jobs, businesses should be able to bring in the workers they need to keep growing. Therefore under a Coalition government, 457 visas will be a mainstay of our immigration program.

A strong and non-discriminatory skilled immigration intake should help Australia to take advantage of the coming “Asian century”.

Schools and hospitals are at the heart of many of our communities. Therefore, as part of our Plan for a Stronger Community, the next Coalition government will work closely with the states to ensure that public schools and public hospitals are locally-run rather than controlled by distant bureaucrats.

Hospitals will be funded on the basis of what they do and local hospital boards will appoint CEOs. The board and CEO will determine how a hospital’s budget is spent and hospitals will be able to keep funds raised through community and private donations without Government then deducting those funds. It would be a similar approach with public schools. Empowered principals and school communities will have more capacity to invest in and retain the best professional staff.

A Coalition government will also renew reconciliation by providing incentive and opportunity for Aboriginal people to participate in the mainstream economy.

Before I move on to outline in more detail the vision and the plan for my own environment portfolio, I’d like to take a moment to focus on the Government’s record in the environmental field. If nothing else, it makes for a sobering lesson on the disastrous consequences of bad leadership.

2. Labor’s Catastrophic Leadership Failure: 37 Failed Climate Change Programs

Lack of Vision:
Labor’s lack of vision in the climate change portfolio is highlighted by its lack of honesty – particularly in relation to the carbon tax, its failure to deliver on policy objectives and its constant chopping and changing on climate change policy.

The carbon tax, as we all know, was a broken promise. We can all remember Julia Gillard’s words: “There will be no carbon tax under the Government I lead.” And yet we have one.

What’s more it doesn’t work. Australia’s emissions will actually rise from 578 million tonnes in 2010 to 621 million tonnes in 2020. Last week, the Government even tried to claim that the carbon tax had caused a reduction in coal fired generation as a consequence of the carbon tax despite the fact that the collapse in generation had started 24 days before the tax in a few short hours which had seen production at Yallourn Power Station drop from 4 to 1 generator units. Of course the real reason for the collapse was the flooding of the Yallourn Power Station on 6 June 2012. Lest there be any doubt, the original diagram posted by the Australian Energy Market Operator actually circles and highlights the collapse in generation referring to the Yallourn flood.

In addition, we will have to buy almost 100 million tonnes of emissions reduction from overseas at a cost of about $3.5 billion each year by 2020, rising to $57 billion a year by 2050.

So we have the world’s biggest carbon tax, which is driving up electricity prices as we speak, saddling future generations with debt and it’s not actually reducing emissions. This is Labor’s vision.

There has also been a lot of policy on the run. We have already seen eight major changes to the carbon tax package in the first 100 days, including the scrapping of the $2 billion Contract for Closure program, which I will speak about shortly.

This chop and change is not confined to the carbon tax. It is endemic throughout the climate change portfolio area.

Last week I released analysis showing that there have been at least eight programs that were announced with great fanfare and then scrapped before they even started. Cash for Clunkers is perhaps the most memorable but there was also the Citizens’ Assembly and, more recently, the $1 billion Tax Breaks for Green Buildings initiative.
Labor’s lack of vision is also evident in the high level of funding diversions. Twenty-two of Labor’s failed programs – almost 60 per cent – had funding diverted to other initiatives.
New promises are often funded by taking money out of existing programs. Cash for Clunkers, for example, was funded by taking $520 million out of the Renewable Energy Bonus Scheme, the Solar Flagships Program and the Carbon Capture and Storage Flagships Program. And then Cash for Clunkers itself was scrapped.
The $652 million Renewable Energy Future Fund was supposed to support the commercialisation of renewable technologies. Instead, it became a 2010 election slush fund. It provided funding for:

• Tax breaks for businesses and landlords to improve the energy efficiency of commercial buildings – which never eventuated
• Citizens’ Assembly on climate change – which never eventuated
• The Connecting Renewables Initiative – a $1 billion 2010 election promise which has disappeared
• Ethanol import protections – a post-election deal with Tony Windsor
• Establishment of the Climate Commission – a body that duplicates existing functions
• Local council street lighting – which does not commercialise renewable technology
• The Emerging Renewables Program – which itself is currently being revised

This policy on the run and lack of clear vision has led to a high rate of program failure within the climate change portfolio area. We can document at least 37 failed climate change programs. Some of these are multi-billion initiatives.

Let us look over the 37 failed programs. Of these, at least 15 or 40% – including the carbon tax, the Global Carbon Capture and Storage Institute and the Solar Flagships Program – have wholly or largely failed to achieve their objectives.

At least 38% or 14 of the 37 programs have been scrapped early, replaced, reduced or frozen. This has in many cases been due to major program failure and includes the Home Insulation Program and the Green Loans Program.

Then there are the 22%, or 8 of 37 programs, that never even started. This famously includes the Citizen’s Assembly, the $1billion Tax Breaks for Green Buildings, the Green Start Program, the Contract for Closures Program and the appropriately named Cash for Clunkers Program.

Need for Simplicity:
As these examples would suggest, Labor’s approach to climate change is far from simple. The Labor Government has created a sprawling climate change bureaucracy, with more than 100 agencies and programs established over the past five years. That’s one every two and a half weeks.

This can only create complexity, confusion and duplication – and, ultimately, systemic policy failure.

Perhaps the most notable example of this can be found in the Government’s approach to brown coal-fired power stations. On the one hand it has the $5.5 billion Energy Security Fund to keep the power stations open and on the other hand it had a $2 billion Contract for Closure program to shut them down. Instead, it is the Contract for Closure Program which has been shut down.

The carbon tax package created 35 new programs in addition to the multitude already in existence. The unwieldy bureaucracy Labor has built means there are simply too many programs to manage efficiently. Decisions are simply bounced from one department to another, funding is siphoned from one program to another and spending is frozen or reduced having been grandly announced.

The latest example of the “announce and then freeze” cycle is the Clean Technology Investment Grant program which was grandly announced and then quietly frozen 6 weeks ago. Yesterday’s mid year economic figures include provision for over $140m in deferred or reduced grants without even identifying them – although it is a fair bet that up to $120m of this may be from the Clean Tech program. The Government however won’t even say which programs are covered by the grant reductions and deferrals!

This merry-go-round of funding and bureaucracy also imposes a significant cost burden on Australian households and business. Indeed, The Strategic Review of Australian Government Programs on Climate Change in 2009 noted there were too many programs in Australia and that “many are ad hoc or badly targeted”. And that was before the carbon tax was introduced.

Lack of Judgement:
This brings me to the issue of judgement. Time and again, the Labor Government has leapt to a policy decision with little regard for the real world consequences.
The Home Insulation Program, which has been linked to four tragic losses of life, 224 home fires and 70,000 repairs at a total program cost to the taxpayer of more than $2.1 billion, is a metaphor for climate change policy under this Government. It was a policy executed too quickly, to tragic effect.

Green Loans was designed to help households install solar, water and energy-efficient products. Three independent reports into the program found extensive mismanagement across the program.
The Low Emission Plan for Renters allocated $787 million to insulate rental properties. It spent just 2.4 per cent of its budgeted funding because of a much lower than expected take-up before it was scrapped.
Two billion dollars was allocated to the Carbon Capture and Storage Flagships Program before the technology had been proven to a reasonable level of certainty. Nothing has been delivered and much of that money has been reallocated.
And, of course, there is the carbon tax itself, which imposes the world’s biggest carbon tax on Australian households and businesses while Australia’s carbon emissions increase.
The Government’s lack of judgement means large amounts of funding are being allocated to the wrong initiatives – and it is the taxpayer who ends up footing the bill.

3. A Plan for a Cleaner Environment

Turning to the Coalition’s Environment portfolio I want to explain some of the sources of my own personal thinking.

I grew up on the Mornington Peninsula in Victoria, and gained an appreciation of the importance of caring for our environment, our natural bushland, our beaches and our bay. Indeed, I literally grew up playing in the rock pools of Fisherman’s Beach and searching for fossils a few kilometres down the coast.

And now as a father myself, with two young children, I am even more acutely aware of this responsibility in developing and implementing policies which will protect and improve our environment for future generations.

At its core, Liberalism is about protecting and maintaining what is best from our past, while preparing the way for a better future through giving people the freedom to be their best selves.

It is those principles that have shaped environmental policy by centre right governments in Australia.

And it is those principles that guide and shape the development of the Coalition’s policy as we ready ourselves for the next election.

As Tony Abbott noted, in the United States Teddy Roosevelt was perhaps the founder of practical modern environmentalism. He declared some of the first great national parks in the United States. He also convened the first Conference of Governors in May 1908 at which he gave his famous speech “Conservation as a National Duty”. He was both a man of action and of practical environmentalism.

In Australia, the Liberal Party has been the party of practical environmentalism.

It was the Coalition that established Stage 1 of Kakadu National Park.

It was the Coalition that ended whaling in Australia.

It was the Coalition that put the Great Barrier Reef on a long term sustainable footing a decade ago.

And it was the Coalition that established the Natural Heritage Trust and its successor the Envirofund.
Today, our Environment Plan rests on four pillars:

• First, The Direct Action Plan with its Emissions Reduction Fund, 1 million Roofs Solar Policy and 20 million urban trees to help green our cities. The heart of this policy is our Emissions Reduction Fund, which will use a reverse auction of lowest cost abatement to ensure that we have practical measures to cut Australia’s emissions by 5 per cent by 2020, rather than an electricity tax which sees emissions rise.
• Second, our Clean Land policy based on the Green Army, which has already been announced, Landcare reform, which is about a return to practical community-based environmental work, and approvals simplification and cutting green tape, which I will discuss further.
• Third, there is the Clean Water policy which includes our Murray Darling, Water Security and Reef 2050 plans which will be released in further detail as we approach the election. It also encompasses the work we are doing with our Clean Up the Bay campaign, instigated after the closure of so many of Melbourne’s beaches over the last summer.
• And fourth our Heritage policy, based on both community and heritage icons programs to be detailed later.
Let me return to the issue of green tape and the issue of environmental approvals and put forward a simple proposition.

Protecting our environment does not have to come at the expense of careful community development. A healthy economy will ultimately be the basis for a well managed environment and will provide the financial resources to protect and manage our icons and scarce natural resources.

Unfortunately, over the last five years we have seen an industry develop in bureaucratic delays and duplication between the States and the Commonwealth in Environmental decision making.

Indeed, the Business Council recently submitted to the Federal Government that the environmental approvals for one project alone cost $25 million. This is an absurd amount of money and resulted in a 12,000 page report.

I wonder if anyone ever read that report.

Could the same or better outcomes have been achieved in a simpler, more cost-efficient way?

In particular, was the focus on real environmental priorities or on the process of meetings, hearings and submissions?

This duplication of Federal, State and local environmental approvals has added enormous complexity, cost and uncertainty to project approvals. Economic investment has been delayed and in many cases entirely deferred, not through rejection of projects but through multiple layers of bureaucratic inertia in the approvals process.
This is not a debate about standards. It is a debate about national productivity.

We have already held talks with Coalition State and Territory parties with very positive feedback.

The States are receptive because they are also frustrated by the delays in decision-making and the lack of clarity over process.

And I would like to reiterate at this point, that in creating a One-Stop-Shop we are maintaining the same level of environmental standards.

The assessments would be done in a single, holistic process to streamline the decision-making, whether it be an approval or a rejection. But at least people will know where they stand and not be left in limbo for years.

A simpler environmental approvals process with a single entry point across jurisdictions could become a national competitive advantage for Australia.

While the One-Stop-Shop for environmental approvals is already policy, my broader personal goal, and this is not policy yet, is to move as close as we can to a single one stop shop for all federal and state business approvals. It is a task that will take us to 2020, but one which could make a profound productivity difference to Australia and actually allow us to focus on real environmental protection, rather than bureaucracy for its own end.

Landcare

This brings me to our Landcare reforms, which we have been proposing for more than three years now. The Coalition will implement an immediate refocussing of the Landcare and Caring for Our Country programs to reflect local and regional priorities.

Our broad goal is to bring Landcare and Caring for Our Country into a single National Landcare program. This would be based on three core principles, which have come from working with farmers and environment groups frustrated by the current bureaucracy imposed on farmers and community groups:

• Local – Our goal is to ensure that the vast bulk of funding is focussed on local Landcare and environmental projects, not siphoned off into bureaucracies. .
• Simple – There will be a dramatic simplification of the grant application and reporting process.
• Long Term – Emphasis will be given to triennial funding to allow for continuity of funding and projects.

We set up and believe in the regional natural resource management model. The principle here is that, other than in the case of large grants, project funding should be determined at the local NRM level, with representation from Landcare. Canberra’s role should be to set policy and to approve large grants, while testing and auditing for quality and compliance.

Given its success, I would envisage that the Working on Country program originally funded by the Howard government should continue as a separate program.

I would be happy to further discuss these and other principles with all interested parties.

Coalition Green Army

While a national Landcare program is aimed at supporting volunteer work, the Coalition will also implement a formal training and environmental work program for young Australians.

A Coalition Government will therefore establish a Green Army. This standing environmental workforce will grow to 15,000 strong and is a key part of our environmental plan for Australia.

How It Works

The Green Army will deliver real benefits to local communities. Its activities will include, but will not be restricted to:

• Mangrove planting
• Riverbed and creek re-vegetation
• Boardwalk and walking track preparation to protect local wildlife
• Re-vegetation and regeneration of local parks or degraded bushland
• Delivery of salt recovery programs through appropriate revegetation

Local Green Army groups will comprise up to 10 members and may undertake the project on their own or together with a local environment or community group.

The local Green Army projects will run for approximately 6 months and are designed to deliver both training for young people and practical environmental work for the community.

A key consideration in approving grants will be the ability to demonstrate co-operation and partnerships with local councils, Landcare groups or community groups.

This then brings us to the opportunities for farmers and other land managers to participate in our Emissions Reduction Fund.

Direct Action through an Emissions Reduction Fund
The Coalition is committed to meaningful action on climate change.

But rather than punishing industry, farmers and families for production and employment, Australia needs a scheme that will provide the incentive for firms to reduce their carbon emissions and, at the same time, minimise the costs to industry and the Australian economy.

It is vital that any approach to climate change does not hurt the competitiveness of Australian businesses and industry by simply sending jobs and emissions to China, India and Indonesia.

Any scheme that adds unnecessary costs, or which does not result in meaningful reductions in CO2 emissions, will simply raise prices for families and put Australian jobs at risk.
That is why for nearly three years now the Coalition has pledged to establish an Emissions Reduction Fund to directly support CO2 emissions reduction activity by business and industry. Over the same time the ALP has had four different climate polices and has made 8 major changes in the first 100 days alone of the Carbon Tax.
By directly supporting action to reduce emissions to this target level, the Fund will ensure that every dollar of expenditure goes towards actually reducing CO2 emissions rather than a complex churn of money and new bureaucratic activity.

The Fund will have an initial allocation of $300 million, increasing to $500 million in Year 2 and $750 million in Year 3.

We recognise that many industries face substantial capital expenditure costs in reducing their CO2 emissions.

Our Emissions Reduction Fund will provide the capacity for short and long term industry action, allowing firms and farmers to better manage their transition to lower CO2 emissions.
By providing incentives, rather than imposing massive balance sheet liabilities, the capital will be available for businesses to conduct emissions reduction activities without the need for a massive injection of compensation raised through a great big new tax on everything.

Our model is a very simple one. We will hold a reverse auction to purchase the lowest cost abatement. This is exactly how the government buys water. It is a genuine market mechanism which focuses solely on the task of reducing emissions, rather than relying on an electricity tax which has an enormous cost per tonne of abatement.
Indeed, the cost of domestic abatement under the carbon tax is over $160 a tonne using the Government’s own figures. This comes from the fact that of the 160 million tonnes the Government wants to reduce by 2020, compared with business as usual, only 60 million tonnes comes domestically. If the last year of carbon tax revenue under the Forward Estimates is projected out to 2020, without any increase in cost, then we will face over $9.6bn a year of carbon tax. This is more than $160 per tonne of abatement in Australia. If however the actual 2020 carbon tax revenue is the $14bn a year projected by the Minerals Council then the abatement cost for the carbon tax soars to over $230. All of this is before we even factor in the additional $3.5bn to be spent on foreign carbon credits each year by 2020.

By contrast, rather than taxing the entire electricity sector, we only focus on direct emissions reduction. That allows us to be source blind as to the type of abatement. We will simply focus on the lowest cost abatement be it energy efficiency, cleaning up rather than closing down power stations, land sector abatement or activities such as cleaning up waste coal mine or waste landfill gas.

Land sector management, whether it is through soil carbon replenishment, revegetation, reafforestation or other forms of agricultural abatement is an enormous opportunity for both farmers and Australia to reduce emissions.

This once in a century replenishment of our soils also offers the potential to improve soil quality, farm productivity and water efficiency, and should be a national goal regardless of the additional CO2 abatement benefits.

Conclusion
Ultimately, if we are to protect the land and support our farmers, we must have a vision supported by a simple, clear plan of action.

A simple plan gives us the best chance of remaining constant to the vision. It minimises the temptation to be diverted from the objective and provides the focus to achieve the outcome.

And finally, there is the judgement, which comes from honest reflection. In this way you can objectively consider the challenges you face and make decisions that are true to your principles and your vision.

In our view, the right vision is to focus on reducing rather than creating bureaucracy. The plan is about incentives for targeted action rather than an electricity tax intended to force economic pain and therefore indirect action. And the judgement is the willingness to trust farmers to do what they do best: to manage the land with our support to achieve the best community outcomes.