The budget suggests that the Rudd Government still does not understand the seriousness of climate change. This is not because of the modesty of the greenhouse program allocation in the budget. In a way the absence of new spending is a good sign ─ the Howard Government for years bragged about its “$2.3 billion greenhouse program”, which was no more than a veil for concealing its inaction.
The proof of the Government’s commitment will become apparent only when it delivers on its promise of an emissions trading system and, crucially, the target it sets in the medium term.
However, we will know the magnitude of the task has truly sunk in when every major government decision is taken only after consideration of its greenhouse implications. This is not happening.
In one of the more dismaying signs that the Howard Government refused to understand the issue, Peter Costello was genuinely mystified when it was suggested that his GST package ─ which cut the price of diesel, reduced taxes on cars and increased the cost of public transport ─ should have anything to do with the environment.
Despite its obsession with getting petrol prices down, the Rudd Government is not so blind. Nevertheless, the large increase in the migration program announced in the budget, to take the number of permanent migrants to a record high of 190,300 in 2008-09, will make the Government’s greenhouse gas reduction commitments substantially more expensive and difficult to achieve.
There is a direct and strong relationship between population growth and growth in Australia’s greenhouse gas emissions. In contrast to most other OECD countries, population growth in Australia has in the past been one of main factors driving growth in emissions.
The greenhouse gases of the average immigrant in Australia are about double those that would have been generated had that person not migrated. This is no surprise when we recognise that per person Australians have the highest greenhouse gas emissions in the industrialised world.
Modelling analysis a few years ago showed that, compared to a policy of zero net immigration, high immigration (set at 140,000 per annum) would see our emissions increase by an additional 16 per cent or 65 million tonnes by 2020. Since then, rates of immigration have increased to 177,000 this year and they are now set to grow even more.
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Continued high rates of immigration will make it substantially more difficult for Australia to meet its medium and long-term emissions reduction target, the latter set by the Rudd Government at a 60 per cent reduction by 2050.
To meet our international obligations we will be required to meet an absolute emissions target. With a bigger population, this allocated level of total emissions will need to be spread across more people, thereby reducing the amount each of us will be able to emit. In other words, we will all have to do more; and with continued high immigration levels, we will have to do a lot more.
Yet as the Government looks down the barrel of major emission cuts between now and 2020, and even bigger cuts beyond that, population growth is the great unmentionable. No one will officially concede that there is a downside to high immigration.
In his interim report on climate change policy Ross Garnaut acknowledged the fact that population growth, in both fast-growing developing countries like China and mature economies like Australia, will mean higher rates of growth of greenhouse gas emissions. This will require more stringent, and more costly, programs to reduce emissions to the absolute levels required to minimize the chances of dangerous climate change.
However, Garnaut seems to accept that the rate of population growth cannot be one of the policy levers to be pulled to reduce emissions. I suspect he thinks it is simply not politically palatable so there is no point in talking about it.
If ever there were a policy problem that demanded a whole-of-government approach, climate change is the one. We are still a long way from it.