Federal Budget 2015 – environment experts react

Environmental and energy issues did not feature heavily in the Budget, although there was a A$400 million total package of assistance for drought-stricken farmers (particularly relevant in the week that the Bureau of Meteorology called an El Niño), as well as an extra A$100 million in funding for the Reef Trust, aimed at safeguarding the Great Barrier Reef.

Below, our experts react to the budget’s environmental and energy measures.

Ian Lowe, Emeritus Professor, School of Science at Griffith University

The 2015-16 Budget is very disappointing in the broad area of environmental protection. Last year’s cuts to important bodies like Environmental Defenders Offices have not been reversed. Even the funding of a core Coalition initiative, the “Green Army”, has been cut by A$73 million over four years.

While there is an extra A$100 million over four years for measures to protect the Great Barrier Reef, the cuts to Landcare and the continued promotion of the export coal industry put the reef under increased pressure. There is no new money for the Clean Energy Finance Corporation, which has been making a real difference.

Critically, the Budget shows no sign of the government taking seriously our responsibility to curb greenhouse gas emissions. The allocation for the Emissions Reduction Fund will not meet even the present inadequate target, let alone the sort of goal Australia will be expected to take to the Paris talks later this year. There is no funding for urban public transport, but they will spend billions on roads; the Budget even retains A$3 billion for the cancelled East-West Link road project.

It is the Budget of a government that still thinks that the integrity of our environment is an optional extra. Have they perhaps been advised by Maurice Newman?

Tony Wood, Energy Program Director, Grattan Institute

There were few, if any, expectations of initiatives for the energy sector in the Budget – and those expectations were met. Energy policy levers, where they have been pulled, are covered in the recent Energy White Paper even as that document failed to provide a long-term vision for energy policy in Australia.

There were also no new initiatives regarding climate change. Environment minister Greg Hunt has previously made it clear there would be no increase in the budget allocation to the Emissions Reduction Fund and it remains to be seen whether his optimism regarding achieving our current 2020 target is justified.

Finally, the prospects for future negative impacts on export revenue that could arise if the world turns against fossil fuels remain ignored, but anyway are beyond the time horizon of federal budget considerations.

Frank Jotzo, Director, Centre for Climate Economics and Policy, Australian National University

The government is planning to spend around A$400 million per year paying some businesses for projects that are presumed to reduce emissions. If we had emissions trading, it would bring money into the budget, in the order of A$2 billion per year.

That is twice the most recent aid cut. And it would provide an economy-wide incentive to cut emissions, not piecemeal subsidies.

The Climate Change Authority gets funding until the end of 2016. It has an important role to fulfil in advising on policy settings. To what extent government listens to its advice on a post-2020 emissions target will be revealed by July. Greg Hunt has stated that “the speed limit has been lifted” on Australia’s climate action. But it is not clear how greater ambition could be delivered. The government is not likely to heed the advice on an emissions trading scheme that the Climate Change Authority will deliver next year.

David Pannell, Director, Centre for Environmental Economics and Policy, University of Western Australia

After many cuts and a number of questionable changes to environmental programs in 2014, the 2015 environment budget includes few initiatives or significant cuts. One substantial new cut is a 10% reduction in funding for the Green Army – an initiative that many in the environment sector have reservations about in any case. And it still has funding of A$700 million over the next four years.

On the other hand, there is an additional A$100 million over four years for the Reef Trust, on top of the A$40 million that had already been committed. While the increase is welcome, this level of funding is still leaves overall budget for the Great Barrier Reef well short of the level that would be needed to achieve the sorts of improvements in water quality that the community expects.

There is a reduction of A$22.7 million over two years for water buybacks, although this is a modest cut in the context of this large program. Other cuts for environment in this budget are small.

In an interview with the ABC, The National Irrigators’ Council chief executive Tom Chesson was critical of the government’s failure to commit to funding for the Commonwealth Environmental Water Holder (CEWH) beyond 2016-17. The CEWH is actually Australia’s largest owner of water rights, so there needs to be significant ongoing investment in an organisation that is responsible for allocating and managing the environmental water that the government owns on behalf of all Australians. There is time to fill the current funding gap before the existing funding commitment runs out.

In the agriculture portfolio, there is about A$330 million of new funding for drought assistance to farmers and drought-affected communities. An interesting question is whether this could be considered to be a response to climate change. Perhaps, although it is not explicitly flagged as such in the budget papers.

Ian Lowe is a past president of the Australian Conservation Foundation.

David Pannell receives research funding from the Australian Government.

Frank Jotzo receives research funding from the Australian government.

Tony Wood owns shares in several energy and esources companies through his superannuation fund..