One of the arguments the government has been using to promote its carbon tax is that Australia is not moving ahead of the rest of the world and we’re falling behind China. That they have been able to maintain this argument even after the Productivity Commission reported is quite astonishing.
… no country currently imposes an economy-wide tax on greenhouse gas emissions or has in place an economy-wide ETS. Of the study countries, the United Kingdom, Germany, some parts of the United States and New Zealand have emissions trading schemes operating — but these apply only to particular sectors, such as electricity generation.
Now we discover a larger deceit. On March 9, 2011 Greg Combet was saying things like this.
GREG COMBET: Well, according to this report by Vivid Economics, the effective carbon price in sectors of the Chinese economy was $14 a tonne compared to $1.68 in Australia. This is why the Government has commissioned the Productivity Commission to do an independent study of the effective carbon prices in the economies of our major trading partners.
Let’s shine the light on a few facts so that we can have a little bit more informed debate about this in Australia, because it is certainly not the case that we are the only ones doing something or endeavouring to do something about climate change. There is a range of things going on in the economies of our trading partners and we need to be well-informed about it.
That is a very strange set of numbers and a bit of cherry-picking. Tim Wilson picks up the story in The Australian.
When the report was released it was promoted by Climate Change Minister Greg Combet as demonstrating “China [has] effective carbon prices well in excess of Australia’s so the myth that Australia is acting ahead of the world is just that – a myth”.
What the government didn’t disclose at the time is that they knew their argument was bunk.
Documents released under Freedom of Information show that departmental feedback on a draft to the report’s commissioners, the Climate Institute, queried if the method for calculating China’s carbon tax rate was the “the correct approach”.
Here is an extract from an internal email dated October 6, 2010
Unfortunately it isn’t clear from the email trail what happened next.
Vivid Economics didn’t include the departmental feedback in its final report and went ahead with the higher Chinese number while acknowledging discreetly the non-comparability of the implicit carbon tax rates in a way that is only obvious with the released FoI documents and hindsight.
Even without the correction it was clear there were other issues. Former Keating government minister Gary Johns wrote on these pages “the Chinese must think Gillard a fool[, Vivid] wildly overstate China’s and wildly understate Australia’s implicit carbon price”.
But it wasn’t until the Productivity Commission published its carbon emissions in key economies report showing China lagged Australia’s emissions reduction efforts and that “no country currently imposes an economy-wide tax” that the government’s case was punctured.
But the government knew it all along, stayed mum and perpetuated the idea it was otherwise.
I think full and frank disclosure is required – at face value it looks like the government has deliberately set out to mislead the public. Any private sector organisation in a similar would be facing investigation and its directors would be under threat of legal action including life-time bans.