Statement on CPRS (emissions trading)

*No compromise with Rudd’s flawed scheme. More than ever the CPRS is worse than useless*

Recent developments around the Rudd government’s Carbon Pollution Reduction Scheme (CPRS) highlight the need for the climate movement to clearly oppose and mobilise against the scheme in its entirety.

The CPRS has always been an attempt to shore up the interests of major polluting industries in the face of growing calls for action against Climate change. From the beginning, the Rudd government has sought to
create an “emissions trading scheme” (ETS), rather than directly regulate pollution and invest in green infrastructure. An ETS will create a new speculative market in pollution permits, privatising the
atmosphere and elevating pollution to the status of a property right. Like the European scheme, it will fail to reduce emissions while simultaneously increasing the cost of electricity for the working
class and the poor.

But there has been confusion within the ruling class about the merits of the CPRS. This has included elements of the Liberal Party who still deny the existence of climate change, sections of the Liberal
leadership interested in destabilising Labor and some in industry who have squeezed the government for even greater levels of subsidy.

In an attempt to break through the impasse and win Liberal and greater industry support for the CPRS, Rudd yesterday announced increases in the amount of cash and free permits that will be handed directly to
the biggest polluting industries. He also shifted the start date of the scheme from 2010 to 2011.

Prior to the announcement, the CPRS had included provisions to ensure that some of Australia’s biggest polluters, classified as “Emissions Intensive Trade Exposed Industries” (EITE), would receive 90% of their
permits free. A second tier of polluters would receive 60% for free, amounting to $7.4 billion in compensation for the first two years.

These figures have gone up to 95% and 66% of free permits respectively. And the government has said it will hold the price of carbon, already trading at $23 per tonne, to $10 for the first year of the scheme.

The CPRS includes a “Climate Change Action Fund”, which is set to provide $2.25 billion in direct cash payments, mostly to coal-fired power stations, no strings attached. This fund was also bolstered $200
million by Rudd yesterday. In total, Rudd’s changes will amount to $2.2 billion in new subsidies for polluters.

The changes were immediately supported all major industry lobby groups. An Australian Industry Group statement said, “For some time AI Group has argued for a delay in the start date; an initial period of
modest impact that gives business time to adjust; and improvements in the arrangements for trade exposed businesses through both the allocation of permits and the Climate Change Action Fund”.

Disgracefully, three major “environmentalist” lobby groups, ACF, WWF and the Climate Institute came out in support of the scheme. Their joint statement was co-signed by the ACTU and the Australian Council
of Social Services.

The rationale for this support is another announcement made by Rudd: that his government would consider an emissions reduction target of 25% if this figure was endorsed by the upcoming international summit
on climate change in Copenhagen.

But the government itself had said previously that such an agreement is practically impossible. There has been no change to the government’s only concrete commitment—the original 5% reduction target. As with the myth of ‘clean coal’ (now openly supported by WWF and the Climate Institute) these conservative organisations have been pulled into providing green cover for the government. Their unwillingness to take on Rudd’s business-as-usual approach to dealing with climate change has now led them to accept false solutions.

*Movement demands*

The need for a movement that clearly rejects the CPRS has never been more pressing. A strong message must come from the environment movement—we need massive government investment targeted at creating
the green infrastructure needed to transition to a low carbon economy. No market mechanism can deliver this kind of change.

The Greens have rightly condemned Rudd’s announcement, saying “this makes Rudd’s ‘worse than useless’ scheme even worse… (with an) irrelevant green distraction of a hypothetical 25% target to undermine

However, the Greens themselves have been equivocal on the CPRS, offering to vote for the legislation if Rudd cements his target to 25% as a minimum. In a letter to supporters asking for help in pressuring
the government to “green-up” the scheme, the Green senators call for “an ETS which protects the environment, not polluters” and argue “we are closer than ever before to real climate action, but we are not
there yet”.

In an attempt to be a part of Rudd’s seriously flawed proposal, The Greens have seemingly dropped criticisms of the disasters waiting to be caused by carbon trading—such as the ability companies will be
given to convert credits from ‘offset’ projects overseas into Australian permits, leaving open the possibility for no reductions to be made in Australia at all.

The main political question has never been this or that “target”. It’s the useless market mechanisms – carbon trading along with domestic and international offsets – being proposed by government to tackle climate change that needs to be opposed. To achieve serious reduction in carbon emissions, we need direct regulation of carbon polluters and investment in green jobs.

Rudd has dubbed his changes to the CPRS a “recession buffer”. But serious government investment in green technology could create the hundreds of thousands of jobs desperately needed to counter
unemployment. As long as The Greens and others continue to sow illusions that an ETS could drive change, they will be hamstrung in putting forward demands for the real action needed to protect the interests of both the environment and ordinary workers.

The demand for green jobs is crucial to building support among the rank-and-file of the trade union movement and creating a situation where the ACTU leadership does not simply act as cover for Rudd, but
will be pushed into a campaign for real change.

In February this year a 500-strong ‘Climate Summit’ – with representatives from environment and climate action groups across the country – made clear demands for the scrapping of the CPRS and investment in green jobs, for a transition to 100% renewables by 2020.

Rudd’s commitment to action on climate change is increasingly little more than lip service. However, there is widespread public support for action on the question of climate change.

Climate activists need to build a grassroots movement to fight for the demands of the Climate Summit. It is imperative that those demands are the focus of the World Environment Day rallies planned in every capital city in June.

Lobbying for small changes to the CPRS and trying to cut deals in Parliament has only served to bolster its legitimacy. We need to fight to derail this legislation and demand the immediate creation of masses of jobs to carry through the green transformation urgently needed.



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