Ross Garnaut handed down his final report on climate change to the government yesterday, noting that households would bear the brunt of the carbon price, although business were playing a “spoiler” role in fighting it.
Garnaut advocated for $6 billion worth of tax cuts to compensate low-to-middle-income households for the carbon price, while other measures and cuts were suggested to reimburse the cost of an emissions trading scheme to be implemented in the next decade.
He also called for an independent panel to decide Australia’s carbon-emissions cutting goal. The entire Garnaut report can be viewed here, and further outlines of all the measure proposed can be found here.
As Bernard Keane wrote in Crikey yesterday:
“Ross Garnaut has confronted Labor and the multiparty climate change committee with the reality of trying to do too many things with a limited pot of carbon price revenue, by proposing cuts to transfer payments from levels proposed under the CPRS and adjusting tax thresholds or taxation rates to ensure high income earners don’t benefit from the tax cuts he proposes.”
Here’s what the pundits are saying.
Graham Lloyd: “Gospel according to Ross Garnaut“:
“For anyone with any doubts, the Kyoto climate change accord that caused so much anguish for the Australian and global political establishment is officially dead and buried.”
Peter van Onselen: “No pain, no gain: compensation ruins carbon tax”
“Anyone who thinks the proposed carbon tax is mainly about the environment is mistaken. That may have been where the debate started. But due to political pressure on the minority government, it has morphed into an exercise in wealth redistribution, not environmental action.”
Paul Kelly: “Clash of cultures, economics and ideology”
“The updated 2011 Garnaut report on climate change affirms that Australia is heading into an ideological and political conflict of rare intensity with Gillard Labor sure to embrace the justification for pricing carbon that Ross Garnaut outlines.”
George Megalogenis: Ross Garnaut puts Tony Abbott in a spot of bother
“Nevertheless, the Garnaut advice contains a policy trap for Labor. It connects the revenue from a price on carbon to the Henry review’s goal of increasing workforce participation. But increased workforce participation was meant to be the centrepiece of last month’s budget, as well as the proposed tax summit later in the year. What will Wayne Swan have to talk about at the summit if he takes up tax reform now?”
Tim Colebatch: “Garnaut’s cry from the heart for honesty”
“Garnaut’s report is a cry from the heart to Labor and the Coalition alike: don’t let this great country turn its back on the great challenge of our time.”
Tom Arup: “We’re not pissants: Garnaut”
“Ross Garnaut has used his climate change swansong to paint the political battle over a carbon tax as a fight between an old political culture of special interests and the national interest.”
Andrew Probyn: “Garnaut paints Abbott plan into corner”
“Ross Garnaut may be primarily an economist but yesterday he proved he’s rather adept at that other inexact science, politics.”
Laura Tingle: “Business out in the cold”
“…the minority Gillard government has so far largely followed Garnaut’s script much more closely [than Rudd did]. This is a reflection of the crossbenches’ reliance on Garnaut and the fact that the government needed all the authority it could muster to justify another Gillard volte face on the issue. In a sea of political noise on the carbon price, this is what makes the Garnaut recommendations so important.”
Giles Parkinson: The devil in the climate detail
“Like many involved, Garnaut has found this “diabolical” policy dilemma to be a fascinating, stimulating, but ultimately exhausting process. … The government merely has to work up the courage to deliver a policy that, out of necessity, has to create some losers – high income earners, some trade-exposed industries, and equity holders in brown coal generators. Given the parameters of budget neutrality that it has set itself, it has no choice. “
Terry McCrann: “Carbon fantasy a $30b-a-year reality”
“There’s an old joke that neurotics build castles in the air; psychotics move into them; and psychiatrists collect the rent. Yesterday we were told the rent: $11.5 billion a year rising to $30 billion or more a year. That would be the equivalent of a 50 per cent increase in the GST.
We were told, by the ‘neurotic’ in my little fable — Ross Garnaut who has charge of building the phantasmagorical carbon tax castle. We — all 22 million of us — would be the very dumb ‘psychotics’ if we ‘moved into it.'”