JOURNALIST: Lenore Taylor from The Australian, Prime Minister. Obviously feelings are running pretty high about the target that you announced today. I was wondering if you could explain three things. First, what are the characteristics or criteria of an international agreement under which Australia would cut its emissions by 15 per cent by 2020? How are they different from an agreement where we cut our emissions by 10 per cent? And why have you not quantified what our full part would be in an ambitious 450 parts per million agreement? Do you no longer believe the 25 per cent as outlined in Professor Garnaut's report is right?
PM: The first thing I would say in response to that Lenore is that we are in a negotiation. If you look at the sorts of discussions the minister had most recently at Poznan, we have a long, long way to go on the road between now and Copenhagen, and possibly beyond that as well.
That is the first point.
Secondly, consistent with a number, but not all other nation states, we have indicated what will be our unilateral course of action, that is, irrespective of whether there is an agreement or not, because we believe we have a responsibility to turn the corner, to get to a stage where Australia can stand up and say, ‘we have actually in year X begun to reduce greenhouse gas emissions'.
Thirdly, on the question of our criteria which we would apply to moving towards 15, we have said and said repeatedly that we will want to see robust commitments from developed and developing countries in the context of global negotiations.
Those negotiations continue and this will be the usual process of international argy bargy that we have seen in the past and there is a long, long way to go in the process.
Finally, on 450 parts per million, can I say this: we have taken Professor Garnaut's conclusions on this and the observations contained in the international panel's conclusions on this most seriously.
That is why we believe that this must remain part, a core part of the future negotiations. It follows, as I have said as a matter of logic, that if you are to embrace 450 parts per million as a long term objective for Australia and for the world, in our case that would mean an adjustment beyond 2020 for our target, it would also mean adjusting our long term target from 60 per cent overall reduction to a higher figure.
However, given I have made a commitment to the Australian people about it being 60 per cent reduction by 2050 against 2000 levels, and that would bring about a change, I am not prepared to embark upon that course of action until I have obtained a further and separate mandate from the people on it.
But the fact that we have dealt with this so deliberately, both in my remarks today and as outlined also in the White Paper, reflects how seriously we take the environmental challenge, the need to stabilise. And Australia, in the negotiations, will be ambitious and working hard to bring about a maximalist agreement. But a maximalist agreement which brings all economies on board.
That has got to be the objective and we are going to be in a process of significant global haggle in order to bring that about.
JOURNALIST: Prime Minister, Karen Middleton from SBS TV. At the target you have set for 2020, environmental analysts tell us that the Barrier Reef and the Murray Darling river system could well be gone by 2020. Do you dispute their analysis about that?
And given what you have said about the difficulties for the economy in reaching targets beyond where you are today, what are you saying to Australians about the prospects of saving the Barrier Reef and the Murray Darling in the medium term and do we have to give up on them?
PM: I believe and it reflects the comments I have just made, that we must remain ambitious for a long term target for the planet of 450 parts per million because that is relevant to Australia, it is relevant to the reef, it is relevant to Kakadu. It is relevant to the entire enterprise in which we are engaged.
We are not engaged in this business of a climate change debate because it is an interesting policy frolic. It proceeds from the science. That is why we are doing it. Secondly, the challenge then lies in calibrating that with the economics. It lies in calibrating with where we are, given the challenges we now face with the global financial crisis and calibrating with where other national economies are moving.
We are bringing into being, one of the most comprehensive emissions trading schemes anywhere in the world - 75 per cent coverage of the economy, 75 per coverage of total emissions. This is significant.
Secondly, we are taking these targets which we intend to deliver, entrenching them in the legislation and making it happen. These are not aspirational targets and the reason we are also keeping alive the prospect of a more ambitious long term future is because we take the science seriously.
It is calibrating the scientific reality with a negotiating reality with other states, with the economic adjustment process. This is a very difficult public policy process, both at home, within our own constraints and calibrating that without global negotiations.
But the Minister and I will remain globally active and ambitious on that, which is why so much treatment has been given to the 450 part per million target, in my remarks and in what is contained in the White Paper.
JOURNALIST: Michelle Grattan at The Age. Mr Rudd will this now be translated immediately and directly into your legislation or are you willing to entertain any more representations from industry? And would you be looking first to the opposition or to the minor players as Senate partners to get this through? And finally will you be personally attending Copenhagen?
PM: What are you doing next Christmas Michelle? Wonderful wonderful - I won't try and sing the song. Danny Kaye wasn't it? (laughter) At least someone remembers down there. Sorry, I haven't lost my complete train of thought. Copenhagen, open question, it is supposed to be a meeting of Ministerial parties and it is unusual for heads of Government to attend. So we'll leave that simply open.
The other part to your question was, are we translating this through into legislation? On the question of, well actually you said two things, are you putting this into legislation and will you take further representation. The purpose of the white paper is to outline what the policy agenda and direction is, the drafting task is to put that into the black and white letter of the law. We have said here in the document that we will then circulate an exposure draft of legislation so that industry and others can comment on the extent to which the policy outline contained within the White Paper is translated into the legislative process.
That is the right way to proceed, that is the rational way to proceed, that is what we intend to do. So that is the sort of commentary that would invite and respond to.
Just one other thing which is about the other parties. I got lost in the Copenhagen song. Can I just say to all Australians who are engaged in the political process, whether it is from the Greens or whether it is from the Liberals, that there is a national interest at stake here. None of this is easy. It is real hard. And secondly, it is like turning around the Queen Mary, it is turning around the Queen Mary.
The status we now find ourselves in as Australia, as I said before, is that we are the highest emitters per capita now in the OECD. That is where we have been left. How do you turn this enormous ship around? It is very hard.
What we have tried to do through our efforts this year, and I believe have succeeded in doing, is get the balance right. Our target range, five to 15, together with keeping alive our 450 parts per million, ambitious future.
That is the right course of action. And the necessary adjustments, three of them, for industry, to assist them in adjustment process and for households, so that there are social justice attached to this as well so that the burden just doesn't flow through to those who can afford to pay the cost of climate change impost on goods and services least. It is a reasonable package. Therefore I would appeal to all Australians engaged in the political process to get behind it.
There is going to be, as there should be in a democracy, arguments from both sides about whether it has gone too far or whether it goes far enough. I accept that. I respect that.
That's why we have a democracy.
But you know, what I would say to the Liberal in particular is this. I said it before in other contexts like WorkChoices. Time for the real Malcolm Turnbull to stand up. Is it the Malcolm Turnbull who was supposed to be gung ho about this 12 months ago? Or is it the Malcolm Turnbull of today seeking some short term political advantage?
12 years we've wasted. Let's not waste another 12. Let's get on with the business. That's what we're doing. We're ambitious for the future.
JOURNALIST: Emily Rice, Network Ten, Prime Minister. If you're giving householders help to cope with higher energy costs and fuel costs, what are the incentives for everyday Australians to actually change their behaviour?
PM: Well, you will find that we have of course built into the scheme the necessary incentives for those who produce goods and services which are consumed by households to change over time.
We spoken about those who are going to give the allocated administrative (inaudible), what I call I suppose concessional permits at are either 60 per cent or 90 per cent, those who will be allocated free permits.
But across the entire spectrum of the economy there is a huge built incentive for people now to switch to more energy efficient production and to produce therefore more energy efficient goods.
Secondly, on the individual consumption side, it is plain if you look carefully at what the White Paper says, that we're of course have been very mindful of low income earners and have properly compensated them to ensure that the costs which flows through from this scheme is more than off-set by the compensation package provided.
We do not make the same provision in the White Paper for all income earners.
And we've offered help in terms of middle income earners and we've provided a substantial degree of help, but there is enough by way of price signalling there for people to begin to adjust over time as well.
There's a final thing as well. We have a lot more to do in terms of other measures within Government to encourage and to support actively energy efficiency review homes and within businesses across Australia.
And this Government continues to have a bold and vigorous agenda on that.
Three arms to this Government's climate change policy: One, for the first time in the history of Australia, having a carbon price set for the country.
Two, actively supporting on the supply side, renewable energy and clean coal; and three on the demand side, an active agenda further to be developed on energy efficiency.
These are the three arms of policy. We'll be vigorous in the prosecution of each.
JOURNALIST: Hello Mr Rudd. Cathy Alexander from AAP.
PM: Hello Cathy.
JOURNALIST: Hi. Just a further question on targets. We've heard from some young people during your speech who seem to think that what you've announced today is not good enough and doesn't go far enough.
And I note, that I think Professor Garnaut said the Government should leave option, open the option of a 25 per cent cut in emissions by 2020, in the context of a strong international boom, which he thought was unlikely, but his recommendation was of that be kept open.
What you've done today is you've said it is a 15 per cent absolute maximum and you've also revealed that you'll be willing to change the 2050 target and to look at pursuing that 450 parts per million, perhaps in the longer term.
My question asked in a rather roundabout fashion is why not do it sooner? Why do you have to wait till after 2020 to pursue that kind of a climate pact?
PM: Well it begs the question of what's the magical difference therefore is between 2020 and the period beginning in 2021.
Let's look at the overall scheme as outlined in this plan of ours.
Firstly what we've said in laying out our targets for the period ahead that we, when the scheme comes in as of 2010, we'll have annual targets produced for five years subsequent to that - each of the five years subsequent. That that takes you out to about 2015.
We've also said that beyond 2015 for a further decade, we then outline what will be a gateway, that is a range of, say likely maximum and minimum targets for the decade following.
What's all that about? In order to produce some certainty for business.
Therefore you're going to have those real and indicative targets going out 15 years, taking us from the time this scheme is introduced in 2010 out to 2025.
Therefore if in the meantime we, and I'm talking about in the years ahead, are able to realise our ambition and this Government's ambition as well for 450 parts per million outcome, then it follows the capacity to begin to reflect that into the scheme, post 2020, is there.
The reason we have kept it alive as I said in my response to the earlier questions, because we take the science seriously. But right now, the prospect of realising that are limited.
That's just a call of political reality. And we're in the midst of a negotiation. Therefore we believe this is the right course of action.
Can I just say one other point on this question of targets as well.
It's time people began to translate through these targets into the per capita impact for this country.
As I said in my remarks, this country's population grows.
This country's population will grow by 45 per cent from 1990 through to 2020.
Europe's remains static.
If you were to achieve the quantitative reductions in total Australian emissions that we're suggesting, even if the most modest end of the spectrum, five per cent, then the per capita impact from that is about as substantial as what the Europeans are proposing through there externally more ambitious sounding target.
If the Europeans were to embrace the same per capita obligations that we're about to embrace, then we'll be seeing European reductions in the vicinity of 30 per cent.
So there is a headline effect here in terms of (inaudible) quantitative economy wide undertaking, but there is also a real comparison to be made in terms of the substantive comparative efforts per capita in countries like this.
Quite apart from the minor challenge of turning the Queen Mary around.
JOURNALIST: Hi Prime Minister. Alison Rehn from The Daily Telegraph newspaper. Prime Minister, single parents earning $80,000 a year are more than compensated by the Government to adjust to the emissions trading scheme.
In fact, they receive an extra $500 a year or so in government help. But at the same time, the single person earning $80,000 a year has to pay $640 to adjust to the scheme.
Prime Minister, I'm just wondering why do you have vent against childless people?
PM: Well we don't at all. And guess what, any scheme of compensation support is not going to be perfect to all players.
Let's just acknowledge that up front, accept that. What we have tried to do is provide to robust undertakings out there.
One is that when it comes to low income earners and those least able to afford the adjustments necessary that they are more than compensated.
And that's why we've been most concerned about low income earners with or without kids in ensuring that the outcome is delivered for them.
For middle income earners, obviously the spread is somewhat different.
We're particularly concerned about the additional burdens which flow to households which have additional mouths to feed as well, and that means additional impost when it comes to energy consumption, given that energy consumption is a large part of the CPI effect which flows from this.
So Alison, this ain't perfect. But I'll tell you what, our social justice imperative is to make sure that low income earners are not going to be penalised by this scheme.
And that when it comes to middle income earners, using the normal definition through the family tax benefit system, that we are delivering reasonable help, substantial help, for those who those who need it through the adjustment period.
Ultimately there's going to be price signals which flow through the economy for this.
And the objective, as I indicated into response to an earlier question, is that for businesses and for those with more disposable income over time, to begin to make the adjustments necessary both in production patterns and in consumption patterns, because the objective is to bring down global greenhouse gas emissions.
This country needs to bring down its total level of emissions. We've got to actually turn the corner here. It's tough and it's hard. But this is the best way forward that the Government's identified.
JOURNALIST: David Alexander, Canberra Times. Prime Minister, I'm just wondering if the inter-governmental panel on climate change were to revise its temperature estimates, would the Government revise its targets?
And secondly, if you've accepted as you seem to -
PM: Under the standing orders that's usually regarded as a hypothetical question. Given you're long standing observation of standing orders perhaps you could reflect on that as well.
JOURNALIST: (inaudible) if you accept that Australia faces graver threats from climate change than any other industrialised country and if you accept, as you seem to, that the economic modelling says that the impact on our economy will be minimal. Why have you settled on targets that are comparable to other countries like the UK, rather than pushing harder diplomatically for higher targets to share the burden?
PM: Well firstly, on the first part of your question. Our job David is actually to respond to what global science says to us and I've said to global leaders, when we've convened on these matters recently, I mean the international panel of climate change scientists aren't a bunch of ‘funsters'
These are folks who have come to meetings, wearing white coats, essentially humourless and tried to deliver the science.
And that is as it should be. They are in the measurement game. They're there to give us the bad news and the worst news. That is what they're for. Almost as bad as the (inaudible) science.
But we are therefore required to respond to the data as given. That's why in response to so many earlier questions I said that 450 parts per million must remain core to Australia's ambitions for the future because it affects us most.
Secondly, you implied in the second part of your question that we were pursuing a less than ambitious diplomatic strategy. Quite the reverse David, quite the reverse.
This country's national interests are served by us securing the most ambitious global outcome possible. But it must be a global outcome, which involves all major emitters.
That's why we have taken significant unilateral action, which in per capita terms is comparable or in excess of various European norms I have spoken of before.
Secondly, outlined a further ambitious proposal in the event (inaudible) we have major commitments from developed and developing economies at the conclusion of this process.
And at the same time saying that if the global community rises to the challenge of 450 parts per million, which we will be arguing that they should, then it's time to adjust of course our longer term targets and work accordingly.
That is what our diplomatic strategy is. It is consistent with everything I've said today and what the Minister has been saying most recently in Poznan as well.
JOURNALIST: Simon Grosse from ScienceMedia.com.au. You mentioned in your speech that you're looking for a robust commitment from other countries.
When Ross Garnaut was last in this room he said, he was optimistic about China joining an international deal on emissions and he told us what he thought, would be the best deal we could get from China.
And that would not be that China would reduce its emissions but China would aim to limit the growth of its emissions at half the rate of its economic growth.
Assuming China achieves its goal of eight per cent growth economically, that's four percent growth a year starting from about seven billion tonnes this year. On that rate it would add a billion tonnes every four years.
So by 2020 China will be emitting 10 billion tonnes, at the same time that you think Australia would have reduced its emissions by about 100 million. Is that the kind of commitment from China that you see as robust?
PM: You know I'm glad Ross is confident about what China might deliver because I am less confident in terms of being predictive at all about what China will deliver at this stage.
I think it's fair to say that in China the body politic over the last 18 months has shifted its view on climate change because they see the immediate intersection with this and its real growth rate in the long term future. And there is a battle, obviously, as it would be in any country in resolving the best way forward for them.
Secondly, what has happened since then is that, and you would have seen in the television news reports last night of the trilateral summit between the ROK, Japan and China, is that these economies are now wrestling with unprecedented financial and economic challenges coming off the back of the financial crisis.
Therefore the contest within China's policy debate on the climate change imperative and the financial and economic growth imperative will be acute and sharp as unemployment rises in the coastal provinces and the factories depending on US markets for access.
So this is going to be a very tough year. But again I go back to answers to earlier questions about what is sensible and smart for Australia to do unilaterally as opposed to a broader strategy over time, part of a negotiation which has a conditionality attached which brings other economies along with it.
Our job, in Australia in the 12 months ahead, will be to strain every muscle, to exert every effort, to try as hard as we can to fashion an arrangement which would involve the Chinese and other major emitters from the developing world and to see what we can do to have that pass muster with the new administration in Washington as well.
What America does in terms of medium term targets is of critical importance - bearing in mind that the Obama administration is currently committed to zero per cent growth in emissions against 1990 levels by 2020.
We are promising to go backwards five and conceivably 15. So there you have the American position under the Obama administration, not withstanding they've got an ambitious long term target of 80 per cent. And the Chinese as you know are with no formal position in terms of numbers.
What has Australia got to do as a job? We have a huge interest in getting these two huge emitters to agree. And the task of Australian diplomacy this year will be to exert every effort to get a substantive agreement from those major emitters.
What they do is hugely consequential for what happens here in this country.
JOURNALIST: Prime Minister, Damian Smith from the Seven Network. You have told us what Jason from Ballina is doing to reduce his carbon footprint, I wonder if you could share with us what Kevin from The Lodge and Kirribilli is doing to reduce his?
PM: Nice question. Our modest decision some time ago was to obviously go to a hybrid car and that is in terms of the car which Therese uses. I get driven around in a different blunder bus for reasons which I think you in the press gallery would be familiar with. That is a decision we took quite some time ago because it is a personal choice about what sort of car you drive and I think that is the right thing to do, at least for us.
And an extension of that of course has been the activity which I have been engaged and the Industry Minister, if he is here, Kim Carr have been engaged in securing agreement from Toyota towards supporting hybrid car manufacture in Australia as well.
So you want a practical example, it is going for the hybrid, and learning from that, trying to make hybrid production possible in Australia, because Australians still at the end of the day like to support Australian made cars.
And we are trying to bring those two worlds together.
JOURNALIST: Laura Tingle from the Financial Review, Prime Minister. I would like to take you to policy positions 12.10 through to 12.12
PM: I knew you would ask a question like this Laura.
JOURNALIST: Yeah I am sure you, I thought you would probably have committed them to memory. (Inaudible) Essentially they are about the Emissions Intensive Trade Exposed Sector and the assistance they get. The change, one of the changes you have made since the Green Paper is that you have increased the free permits that some groups can get, and you have, they are not going to disappear quite so quickly over time.
My question goes to fiscal sustainability. On your forecasts you are conceding that this sector may end up with 35 per cent of permits. If that sector grows faster than the rest of the economy, it could easily go up beyond 50 per cent. What are the risks that, given the extensive compensation you are offering, this scheme will not be self funding within 10 years or beyond and do you see, have you had any advice about whether there is a prospect you would have to dip into the deficit?
PM: No, we have discussed this considerably internally and we are confident that the scheme can remain self funding. And the reason for that is that you would have seen I think the allocations under, or the dollar equivalent of EITES concessional permit allocation is something in the order of about $3.1 billion a year. And with I think a reasonable reduction rate over time. But also allowing for the entry of new participants into the market and as you said quite rightly, us foreshadowing an increase in the total proportion of permits issued to Energy Intensive Trade Exposed industries rising from 25 to 35 per cent over time.
It follows also though if you look at the other adjustment packages that we have identified and there are two others within the scheme, that over time it is proposed that they be time limited. We have been upfront about that and we have indicated that and therefore if intensity continues vis-à-vis the fiscal impact, or should I say the dollar impact of issuing permits at a concessional rate to Energy Intensive Trade Exposed industries, then there are other elements of the package which will reduce over time, and that is what we have had in mind in terms of sustaining the financial self contained nature of the overall regime.
JOURNALIST: Hi Mr Rudd, Phil Coorey from the Sydney Morning Herald. Just, can I just take you off the topic of climate change for a sec to another one (inaudible) another one of your largish election commitments was the broadband network and we have learned this morning that Telstra has been punted out of the bidding process because it didn't measure up. Are you confident that the broadband project can be delivered more or less on time and as promised without Telstra's participation?
PM: The answer is yes because our commitment as you know prior to the election was not conditional on any particular industry participant. We regarded this as a necessary investment in the nation's infrastructure and we would do so on the basis of a competitive tender process. That panel that has been at work has been fully at arms length from Government and has reached its own conclusions and though I've been pre-occupied with other things this morning, they have as I understand reflected their response to the Telstra submission.
So in answer to your question, we're determined to implement our pre-election commitment.
And we'll do so consistent with the process that we've initiated, and the recommendations of the panel.
You know why, because it's the right thing for the country, and we're going to get it done.
JOURNALIST: Lucy Skuthorp from Rural Press. Mr Rudd, how hard will your Government push for changes during the negotiations over international accounting rules, so that carbon storage, not just emissions, can be measured to provide some abatement options for the farm sector when it joins the scheme?
PM: This is a really complex part of the negotiations. I'm glad you raised the question.
One of the great complexities associated with the inclusion of agriculture within the scheme is of course the multiplicity of the actual producers of emissions within that sector.
Remember, for those not familiar with this debate, for the 75 per cent of emissions that we're talking about which fall within the coverage of the scheme, that covers about 1,000 firms across the economy. And we've got literally millions of businesses in this economy. It's 1,000 firms that we're focused on.
Which is why in the process for developing this scheme, Penny and other ministers have achieved significant progress in dealing with many of these firms directly, often confidentially, in making sure we have adjustment mechanisms in the three industry adjustment schemes as right as possible.
Agriculture is phenomenally complex because of the multiplicity of the actual producers of emissions which are contained within it.
Therefore we have a lot of work to do.
That's the truth of it - between now and a 2015 decision about agriculture's conclusions, the terms of its conclusions, the consequential implications which flow from that in the international negotiations.
Wish I had a neater, easier answer for you than that, but every time I've sat down and gone through this one, frankly the head spins and it does for most people because it is so phenomenally complex.
But because it represents a significant slice of emissions we intend to work as hard on it.
You'll be familiar with the provisions of the White Paper, both on avoided deforestation and on the capacity for planted forests for possible inclusion within the scheme's overall architecture.
That's been done deliberately and consciously based on the best advice. We have a lot of more work to do on agriculture.