Interview with Greg Jennett, ABC Afternoon Briefing

GREG JENNETT: The latest round of UN climate talks in Egypt have wrapped up with a course set for developed countries to set up some kind of loss and damage fund intended to developing countries cope with the effects of climate change.  

Assistant Climate Change and Energy Minister Jenny McAllister was there and on return she's also across a deal cut in the Senate to guarantee passage of government tax breaks for people buying electric cars in this country.  

Senator McAllister joined us here in the studio a short time ago.  

Jenny McAllister, great to have you back in the studio all the way from Sharm el Sheikh and the COP meeting there. You were, I think, having a Pacific focus to your discussions which you might be able to elaborate on because that intersects with this loss and damage fund which is being held up as the signature outcome of the COP talks, and yet in Australia we sign up to it but with no dollar value determined. When can we expect that to come through?  

JENNY McALLISTER: Well, you're right that the Pacific were very interested in progressing this issue at the COP. More broadly I just make the observation that it was a really positive experience for Australia. It's really clear that we are being welcomed back into the fold as a constructive, helpful contributor to international climate discussions and it was very good to be part of that.  

In talking with Pacific counterparts, it was really clear that getting this issue about loss and damage onto the agenda at the conference was very important. They also wanted to see a clear pathway for establishing some arrangements for finance and that was one of the things that was able to be agreed.  

GREG JENNETT: So, Chris Bowen has explained recently this morning on return to this country that, you know, we'll have to wait for rules to be determined before we know exactly how much Australia might contribute. But how much is international equity important here when you consider a nation like China, for instance, classified in many fora as developing? Are you open to notions that might have us paying money into a fund that China then withdrew from?  

JENNY McALLISTER: There's some important features of the way we approach this discussion. One is that we consider that the efforts really need to be focused on the most vulnerable countries, and of course in talking about vulnerable countries we are really thinking about some of those countries who are very vulnerable to climate change but also really lack resources to respond to it independently.  

GREG JENNETT: So that wouldn't include China?  

JENNY McALLISTER: I think the details of who would be able to access the fund are yet to be worked through, but Australia's focus is really on making sure that those very vulnerable countries in our immediate neighbourhood, our Pacific family, are able to access resources and support.  

GREG JENNETT: And given our stage of industrial development, a century or more in, what would be reasonable to expect? Are we talking multiple billions of dollars? I know that globally estimates have been drawn out to $580 billion US per year that might be put into the pot. If that were correct, what might that mean for Australia?  

JENNY McALLISTER: I think one way to think about this is that we are already supporting our Pacific family to cope with these kinds of challenges. So, the Australian aid budget is already directed towards helping Pacific communities prepare for disasters, respond to disasters, build infrastructure that's resilient to a changing climate.  

We would see any contribution as part of that broader effort with the Pacific family, and one of the things that was a very significant feature of the discussions in Egypt was this thinking about how we best provide this support.  

GREG JENNETT: Right.  

JENNY McALLISTER: We know that it can be provided perhaps through a specific fund, but it's also important that this kind of thinking about preparing for a change in climate is built into our bilateral aid program, is also built into the way that the international financial institutions work with these countries.  

GREG JENNETT: Okay. So existing payments that we make, for instance, to a Pacific Island nation may well be credited across for the purposes of calculating our contribution to the global loss and damage fund, is that how it works?  

JENNY McALLISTER: Essentially parties were asked to go away and work up a proposal, but that proposal should take into account the range of ways that funding and finance might be provided to vulnerable communities to deal with changing climate.  

GREG JENNETT: And when is the follow up on this? Because the history of these COP talks is people leave feeling like they've achieved a lot and then there's backsliding, or even reversal in some cases. So what sort of momentum is going to be built on here?  

JENNY McALLISTER: So the decision was to ask parties to come back to the next COP with some proposals and recommendations. So we'd expect to see proposals and recommendations coming through over the coming year.  

GREG JENNETT: Okay. Why don't we bring it back home now, and sometime in the next fortnight it's the hope of the Albanese Government in the Senate to make good on an election commitment to grant tax concessions for electric vehicles, removing fringe benefits tax in essence and import tariffs.  

A deal's been cut with David Pocock and the Greens today to remove a particular sub category of clean car, these are your plug in hybrids, a little bit petrol, a little bit electric. What is the rationale behind trying to remove those cars from the original Labor proposal?  

JENNY McALLISTER: So, the overall goal here is to give consumers more choices. You'll know that the take up of electric vehicles and low emission vehicles in Australia is considerably lower than some of the other countries we might compare ourselves with. So, Labor's plan is essentially to reduce some of the taxes and charges that would ordinarily be payable on those vehicles to make, just pull more of them through into the system.  

We're obviously in this policy, as with everything else we bring to the Parliament, willing to work constructively with other partners on the crossbench, the Opposition, really whoever wishes to work with us. On this occasion I understand that Minister Bowen and Treasurer Chalmers have been in discussion with the crossbench about some changes that they would like to see.  

I think that there is agreement that whilst in the short term providing this kind of support for both plug in hybrid electric vehicles and fully electric vehicles is appropriate, in the medium term the subsidy really should be targeted at electric vehicles, and I understand that that's the agreement.

GREG JENNETT: And could it actually reduce, I think it might, the overall value of this tax concession when you start to wind out or remove plug in hybrids from the concession, you're actually giving away fewer benefits and sweeteners, aren't you?  

JENNY McALLISTER: We'll see what the costings produce but I think the main impetus is to make sure that we are bringing through as many electric vehicles as we can into the system, making it cheaper for consumers to access it and of course in the process reducing emissions.  

GREG JENNETT: Is that guaranteed though, because I think there's a counter argument that says because of the scarcity of full EVs around the globe, but particularly imported into Australia right now, if your family vehicle comes up for renewal or it dies suddenly in a year or so, you might have transitioned via a plug in hybrid but because of the unavailability of electric vehicles you might have to go around and buy another petrol car in a year or two. I mean it can be a bit perverse, can't it, playing with these incentives?  

JENNY McALLISTER: Look, our long term goal needs to be to make Australia an attractive destination for the manufacturers of electric vehicles. Unfortunately, under the previous government, there was so few policy settings that really incentivised consumers to buy these products that we were not a target destination for global manufacturers. We're trying to change that. That's partly through these tax concessions. It's also through investments in charging infrastructure and making sure that there are the facilities to recharge.  

I should say that an important part of the policy is incentivising fleet purchases for electric vehicles, because the consequence of that of course, because fleets turn over quite quickly, is that we'd hope that we'll start to see electric vehicles moving into the second hand vehicle market, and that will be really good news for consumers as well.

GREG JENNETT: Well, it does seem like the numbers are there for this renegotiated hybrid deal, if you like, and we'll see that pass. Jenny McAllister, great to catch up again, we'll talk again soon.  

JENNY McALLISTER: It's a pleasure.