New Pollution Tax Could Result In Job Loss For Australians

by Mary Swire, Tax-News.com, Hong Kong

27 May 2009

The adverse employment impact of the Australian government's Carbon Pollution Reduction Scheme (CPRS)has been confirmed by the first sector-wide economic modelling of the CPRS.

The Concept Economics Modelling shows that 23,510 direct jobs will be lost across Australia's minerals industry by 2020, and 66,480 by 2030. The 2020 figure represents an 11% drop in overall employment in the minerals sector, while the 2030 result is a 24% decrease.

The study was conducted by Dr Brian Fisher, the former Executive Director of the Australia Bureau of Agriculture and Resource Economics, and is the first detailed analysis of the impact of the emissions scheme on employment in the Australian minerals sector.

"The proposed CPRS is out of step with the global efforts to reduce emissions, other international trading schemes and the development of the low emissions technologies needed to reduce emissions. It will impose the highest carbon costs in the world on Australian mineral importers," Minerals Council of Australia Chief Executive Mitchell Hook said.

"We share the government's commitment to reducing emissions, but this modelling shows the CPRS is fundamentally flawed. By imposing the highest carbon costs in the world on Australia's mineral exporters, it will eliminate jobs while failing to materially reduce global greenhouse gas levels," Hook continued, adding:

"One simple change to the CPRS would deliver a cap-and-trade emissions reductions scheme without the job destroying impact of the current design. It should include a phased approach to emissions trading - with the number of carbon permits auctioned increasing over time."

"Such a simple change would deliver a scheme with good outcomes for the environment and save thousands of jobs. Other schemes around the world have adopted a phased approach - it is hard to understand why it has been ruled out in Australia," Hook concluded.

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