Monthly Archives: July 2015

Good op-ed in The Oz

Sectors should join to beat RET

A QUIET but effective lobbying campaign is under way by the Australian Aluminium Council to deflect the unnecessary economic damage being inflicted on the industry by a dramatically expanded renewable energy target.

Rather than tackle Labor’s hidden carbon tax head-on, representatives of the aluminium industry understandably are seeking to exempt themselves from the fatal toll the RET is inflicting on Australian producers of aluminium.

From a political economy perspective the strategy adopted by the sector makes sense and would appear to be an attractive option, at least as far as the aluminium industry is concerned.

However, exempting aluminium refiners and smelters alone from the RET has the effect of shifting the cost of the scheme on to other energy users. It may allow aluminium producers to save hundreds of millions of dollars in energy costs, yet it unfortunately heaps the cost burden of the scheme further sideways on to mums and dads and small-business operators at the expense of the broader community.

The likelihood that those who would be asked to bear the cost of these exemptions will provide sufficient political resistance to these proposals is limited. Small businesses are too busy keeping their heads above water to be overly engaged in policy machinations and most households are focused on putting food on the table and ensuring their kids get the best chance in life.

Similar behaviour by sectoral interests was seen around the imposition of the carbon tax. Rather than opposing bad policy outright, many focused instead through necessity on carving themselves out of the policy to minimise exposure. As a political dynamic this is one reason so many policy failures get up in the first instance. There can be only limited effective opposition to bad policy when industry sectors focus instead on narrowly targeted campaigns to moderate their own impacts.

All of which serves to highlight the importance of broad-based industry associations in the political environment as advocates for good economic policy. The Australian Chamber of Commerce and Industry represents the interests of a large base of energy users in the business community covering 300,000 businesses and acts on their behalf to ensure their views are considered in the national policy debate. The broad interests of industry in relation to the RET also happens to largely coincide with those of household energy users; both groups would benefit considerably from the scheme being phased out or scaled back.

The RET operates to drive up electricity prices for the sake of high-cost carbon abatement opportunities. Soon to be released modelling for ACCI by Deloitte Access Economics shows this will not only impose costs on energy consumers directly, it will also lead to broader economic damage to the Australian economy to the tune of $30 billion across the remaining life of the scheme. Jobs and investment will also be a casualty of the RET due to the loss of competitiveness it inflicts on Australian industry. The chief bene­ficiaries of the RET are in the wind industry, which will pocket $37bn in subsidies until 2030, or about $2.5bn a year on average.

Rather than seeking an exemption for individual sectors, ACCI is seeking wholesale reform of the RET on behalf of all energy users. Just as Palmer United Party senator Jacqui Lambie wants to see the entire state of Tasmania exempted from the scheme, ACCI believes the most appropriate exemption is one for the entire country.

Burchell Wilson is chief economist of the Australian Chamber of Commerce and Industry.

In the News…

Ex-Chamber of Commerce economist calls cops over alleged dirty tricks

Environment Editor

A FORMER Australian Chamber of Commerce and Industry chief economist has complained to the Australian Federal Police about an alleged dirty tricks campaign by a senior Clean Energy Council employee to discredit him.

Burchell Wilson left the ACCI after a complaint was made to its chief executive, Kate Carnell, and national media outlets about postings on his private Facebook site.

In a written complaint to the AFP, Mr Wilson said he believed his Facebook site had been hacked. He said a forensic examination of images taken from the site and sent to his employer had been traced to the computer of Clean Energy Council media manager Mark Bretherton.

In a statement to The Australian, Mr Bretherton admitted taking images from Mr Wilson’s Facebook page and posting them to the ACCI.

“I make no apologies for exposing the disgraceful and offensive conduct of Burchell Wilson, which was plain for all to see through his publicly accessible Facebook ­account,” Mr Bretherton said.

“Mr Wilson’s behaviour shows that Australia’s business commu­nity deserves better and more inclusive representation than what he offered as ACCI’s chief economist. I made the complaint as a priv­ate citizen without the knowledge or consent of my employer.”

Mr Wilson’s lawyer, Kyle Kut­asi, said his client was considering legal action against Mr Bretherton for breach of privacy. He said there was “also a suspicion that he illegally obtained access to Mr Wilson’s account”.

Mr Kutasi said his client believed he had been “framed by the CEC because of his advocacy against the renewable energy target”. “He sees it as a sign that he was an effective advocate that they’ve targeted him in this way, but he’s nonetheless deeply hurt by the experience.”

In the email to Mr Wilson’s employer and the media, Mr Bretherton, writing as Matthew Murdoch, said he was “quite concerned” about postings on Mr Wilson’s Facebook site.

“Your organisation obviously plays an important role in public discourse and represents small and medium businesses in particular, who are in desperate need of a voice,” the email said.

“It was therefore very disappointing to see a range of material that is nasty and derisory in general, but particularly towards minority groups and Muslims, as well as critical of one of your sister organi­sations and towards Treas­urer Joe Hockey and Fairfax Media.”

Mr Kutasi said “some of the things that Mr Wilson was report­ed as having posted on his page were untrue and others taken out of context, so he feels unfairly portrayed either way”.

The Facebook posts attributed to Mr Wilson included derisive or sneering comments about refugees, the disabled and Muslims, and a post describing Mr Hockey as a “fat bastard” whose biography was tedious.

Mr Wilson was stood down from his position at the ACCI after the email was sent to Ms Carnell.

Mr Kutasi said Mr Wilson remained on good terms with the ACCI but would not be returning to his former position.

The scandal followed the departure of Alan Moran from free-market think tank the Institute of Public Affairs after posts on Twitter linking Islam and evil.

Another former IPA identity, Aaron Lane, was forced to quit as a Liberal candidate in Victoria after making a series of homophobic comments on a microblog.