Businesses Hit for $25 Billion Under Labor’s Climate Plan

It’s all well and fine to promise voters the moon.

But at the end of the day you’re going to have to explain your plans to pay for it.

Labor Leader Bill Shorten has no problems with the first bit…making big promises on emission reductions and climate change. But when it comes to the paying part, he’s done little but waffle.

However, according to the Coalition, Labor’s plans on climate change would see Aussie businesses forced to pay $25 billion in the decade to come.

The government argues that the cost would come from businesses having to buy international offsets when their emission reduction targets through productivity changes aren’t met, AAP reports.

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Labor sets high target

Finance Minister Mathias Cormnann has drummed up the numbers as Shorten continues to be under stress to give further clarity regarding the economic impact of Labor’s climate plans.

It is the best available estimate given what Labor is willing to put out into the public domain,’ Senator Cormann told ABC Radio National on Thursday.

Labor’s projected target sees emissions cut by 45% by 2030. Juxtaposed to 2005 levels, this allows businesses to purchase international offsets if need be.

The Coalition has set their target to a 26% decrease.

After refusing to respond to queries about the economic impacts of his climate and energy policies on Tuesday, the Labor leader said on Wednesday that it ‘won’t cost the economy’, instead it’ll aid in its growth.

He backed up his statement by using the findings of ANU economic Warwick McKibbin that found that under both climate targets (Labor and Coalition), Australia will increase economic growth by 23% through the 2020s.

Our economy is going to grow, I don’t accept the characterisation that it’s a cost,’ he told reporters in Perth.

A costly plan

BAEconomics has predicted that the policy could cost the economy upwards of $427 billion, however, Shorten stated that he can’t see the cost of international offsets to be ‘anywhere in that dimension’.

The estimate of $25 billion made by the Coalition regarding the cost of companies purchasing offsets is based on a number of assumptions, which include that offsets would only cost roughly $50 a tonne.

AAP reports that ‘Senator Cormann says it has worked within the policy settings Labor has put forward.’

The senator stated:

Given that they are not properly answering questions, we’ve got to come up with the best possible estimates based on the information that is out there.’

Senior Labor frontbencher Anthony Albanese said businesses would be at an advantage due to his party’s policies because they would gain certainty after years of changing climate suggestions under the Coalition.

Business will tell you that what we need is certainty. That’s what Labor will provide,’ he told Sky News on Thursday.

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The Australian Tribune Editorial

The Australian Tribune Editorial

The Australian Tribune is an unorthodox news service. Your Australian Tribune editorial team deliver the unfiltered stories that could impact your daily life — political and economic stories you’re unlikely to get anywhere else. And we’re not afraid to step on some toes to do it. We are honest, conservative and never dull. We are an independent service, meaning we don’t answer to shareholders or outside advertisers. This helps avoid conflicts of interest that inhibit mainstream sources, which keeps our voice independent. The Australian Tribune is owned and operated by Port Phillip Publishing.
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