Bill Shorten has come out swinging against “propaganda” modelling of the cost of his climate change policies, likening its author to doctors shilling for tobacco giants.
In a report for BA Economics, former federal government economist Brian Fisher estimates Labor’s carbon reduction targets could wipe up to $542 billion from the nation’s growing economy.
“This fellow and his report remind me of the doctors that big tobacco companies used to roll out in the ’70s and ’80s to say that smoking was healthy for you,” Mr Shorten said in Tasmania on Thursday.
“We will file this report under ‘P’ for propaganda.”
Dr Fisher estimates Labor’s plan to cut carbon emissions by 45 per cent by 2030 could shrink economic growth by 0.8 per cent over the decade.
“It’s not disastrous, but it is a drop-off,” he told ABC Radio on Thursday.
His report came as the Opposition Leader – who has repeatedly refused to say how much Labor’s climate policy would cost – promised $75 million towards building Australia’s renewable energy sector, which he says will create 70,000 jobs.
The ALP wants a 45 per cent reduction in emissions by 2030 compared to the Coalition’s Paris Agreement commitment of 26 to 28 per cent by 2030 (relative to 2005).
Labor would also restrict trade in international emissions permits to 25 per cent of abatement while protecting Emission Intensive Trade Exposed Industries.
Dr Fisher’s report found that restricting international permits would drive up the cost of electricity and cause greater losses to gross national product.
“Greater policy flexibility, achieved through allowing a higher
share of international permits to meet the abatement target, significantly ameliorates the economic impacts of Labor’s climate policy,” the report claimed.
“Labor’s plan results in a cumulative GNP loss over the period from 2021-30 that is over three times larger than that occurring under the Coalition policy.”
Dr Fisher said he believed allowing heavy polluters to offset more of their emissions using international credits would slash the negative impacts in half.
Labor’s climate change spokesman Mark Butler rubbished the “dodgy” modelling.
“This is a complete crock of rubbish, this modelling, by a fellow who has spent 20 years building a career fighting every single climate policy,” he said.
Labor has said it will consult with business about what level of international permits would be allowed.
Under the Gillard government’s carbon price, polluters were allowed to offset 12.5 per cent of their emissions with credits from overseas.
Energy Minister Angus Taylor said the new modelling provided a clear picture of Labor’s “aggressive” climate targets, arguing they go “way beyond” what is required to restrict global warming.
“What’s clear in all of these scenarios is very big impacts, and intuitively that makes sense,” he told ABC Radio National.
“If you want to take 45 per cent of the emissions out of the economy in just over 10 years, it is going to have very significant costs.”
The Coalition government wants to reduce carbon emissions by 26 per cent by 2030, although its plans to use credits from exceeding Australia’s Kyoto commitments drops this to about 15 per cent.
Dr Fisher’s modelling does not factor in the economic cost of climate inaction.
“If we leave the problem of climate change any longer, it’s going to cost more to fix,” Mr Shorten said.
He said tens of thousands of jobs would be created through his target of 50 per cent renewable energy by 2030.
“Renewable energy means more jobs, more investment, cheaper energy and lower pollution,” he said.
Labor will put $45 million towards apprenticeship incentives through which employers could get up to $8000 for taking on a trainee.
The apprentices themselves would get $2000 to help with education costs.