House of Representatives

Second Reading Speech

(Circulated by the authority of the Minister for the Environment, the Hon Greg Hunt MP and the Treasurer, the Hon J.B. Hockey MP)

Today the Government introduces the

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the Clean Energy Legislation (Carbon Tax Repeal) Bill 2014;

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the Ozone Protection and Synthetic Greenhouse Gas (Import Levy) Amendment (Carbon Tax Repeal) Bill 2014;

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the Ozone Protection and Synthetic Greenhouse Gas (Manufacture Levy) Amendment (Carbon Tax Repeal) Bill 2014;

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the True Up Shortfall Levy (General) (Carbon Tax Repeal) Bill 2014;

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the True Up Shortfall Levy (Excise) (Carbon Tax Repeal) Bill 2014;

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the Customs Tariff Amendment (Carbon Tax Repeal) Bill 2014;

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the Excise Tariff Amendment (Carbon Tax Repeal) Bill 2014; and

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the Ozone Protection and Synthetic Greenhouse Gas (Import Levy) (Transitional Provisions) Bill 2014.

The Australian people have already debated the carbon tax and they decided ten months ago on 7 September 2013 that they did not want:

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higher electricity prices;

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higher gas prices;

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higher travel costs; or

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higher food costs.

The Australian people said they did not want the carbon tax.

The carbon tax increased the costs of everything it touched.

It punishes households, business, schools, hospitals, nursing homes, charities, churches, council swimming pools and community centres.

It hits each and every group and individual who use energy - and that was always its goal: to make electricity and gas more expensive.

And that's why the Australian people voted to get rid of it.

The bills honour the Coalition's commitment to the Australian people to scrap this toxic tax.

It is now up to this Parliament to show that it has listened to the Australian people.

The bills today ensure that all elements of the carbon tax are abolished.

The main bill removes the carbon tax, and implements new powers for the Australian Competition and Consumer Commission to ensure that cost savings are passed on.

The other bills remove the imposition of the carbon tax on liquid fuels and synthetic greenhouse gases.

The bills also provide for the transitional arrangements to ensure a smooth transition out of the carbon tax in all its forms, and give the Clean Energy Regulator, the Australian Taxation Office, the Australian Customs and Border Protection Service and the Department of the Environment the powers they need to do this.

A cornerstone of the Government's plan for a stronger economy built on lower taxes, less regulation and stronger businesses is the repeal of the carbon tax.

The first impact of the repeal of the carbon tax will be on households whose overall costs will fall around $550 a year on average.

Electricity bills will be around $200 lower this financial year without the carbon tax.

Gas bills will be around $70 lower this financial year without the carbon tax.

These are real savings that will help family budgets.

Only last week, we heard from a number of new Senators on the impact of the carbon tax on pensioners, on the cost of heating homes, on farmers' incomes and small business costs.

The people who voted for those Senators expect them to act.

It is disappointing that families and small businesses are still paying $11 million a day in higher electricity prices due to the carbon tax.

Once the carbon tax is repealed, there will be savings to the family budgets with lower electricity and gas prices.

And these savings are confirmed.

In Queensland, the Queensland Competition Authority has said that typical household electricity bills are expected to fall by 8.5 per cent.

In NSW, the Independent Pricing and Regulatory Tribunal has said that gas prices will be up to 9.2 per cent lower without the carbon tax.

In Tasmania, the Office of the Tasmanian Economic Regulator has said that electricity prices will be 7.8 per cent lower with the removal of the carbon tax.

In the ACT, the Independent Competition and Regulatory Commission has said that electricity prices will fall by 11.6 per cent without the carbon tax

Prices for groceries, for household items and for services will also fall because the price of power is embedded in every price in our economy.

The carbon tax will go, but the carbon tax compensation will stay so that every Australian should be better off.

The Australian Competition and Consumer Commission has a wideranging arsenal of compliance powers to ensure businesses do not mislead their customers about the impacts of the carbon tax repeal.

It has received $10 million in additional funding to take necessary enforcement action, and also to inform businesses about their obligations and customers about their rights.

Under the original version of the repeal bills penalties of up to $1.1 million for corporations and $220,000 for individuals will apply.

These are retained.

The ACCC has already issued over 560 requests for information from companies across the economy including from electricity and gas, refrigerants and aviation.

As agreed with the Palmer United Party, I foreshadow and I will move amendments to supplement the Commission's ability to ensure that consumers benefit from the repeal of the carbon tax. The changes included in the bills:

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Ensure suppliers of regulated goods- electricity, natural gas and synthetic greenhouse gases- must pass on all cost savings.

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Impose a penalty on electricity and natural gas suppliers equal to 250 per cent of any cost savings they do not pass on.

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Require electricity and natural gas retailers and bulk importers of synthetic greenhouse gases to inform the ACCC and customers about how they are passing on cost savings amount of the savings.

The changes to the main repeal bill balance new compliance obligations with the need to ensure that household and business customers benefit.

Businesses should be able to explain to customers how changes in their costs are flowing through to changes in their prices.

For the purpose of the Acts Interpretation Act 1901 I confirm that the definition of electricity retailer is limited to electricity retailers and electricity producers selling electricity into a wholesale electricity markets or to a retailer.

The cost of synthetic greenhouse gases was significantly impacted by the carbon tax. Bulk importers of synthetic greenhouse gas defined under s13A(2)(c) ofthe Ozone Protection and Synthetic Greenhouse Gas Management Act 1989 are covered by the new requirements. To minimise the cost of compliance small imports of synthetic greenhouse gases such as imports of synthetic greenhouse gas contained in equipment such as fridges, cars and air-conditioners are not covered.

The new provisions are confined to those sectors. The bill already provides flexibility for the ACCC to expand the range of sectors covered, should significant concerns arise.

The Government is confident that all businesses will do the right thing and pass on all the savings relating to carbon tax repeal.

The Government is aware that major electricity and gas retailers are already committed to providing this information to households and businesses on bills, inserts and through websites anyway.

The carbon tax has been a $15 billion hit on the economy over two years.

It is a $15 billion hit on jobs, a $15 billion burden on investment and a $15 billion slug to families that we just don't need.

These bills get rid of it.

Repealing the Carbon Tax will reduce the cost of living, make jobs more secure and improve the competitive position of our country.

The Australian people have already voted on this carbon tax repeal bill.

They are now waiting for the Members and Senators to honour their commitments to abolish the tax and get the budget back into surplus.

As the Prime Minister has said previously to the House 'these bills are the Government's bill to reduce the Australian people's bills' and so the Government commends these bills to Parliament.