The Times Australia
The Times World News

.
The Times Real Estate

.

a budget for people, not for nature

  • Written by Timothy Neal, Senior lecturer in Economics / Institute for Climate Risk and Response, UNSW Sydney
a budget for people, not for nature

Last night’s budget is another missed opportunity to arrest the poor and deteriorating[1] state of the Australian environment.

Subsidising green industry in Labor’s Future Made in Australia policy may offer economic advantages if implemented well, but there is nothing in this budget to help address the immediate environmental crisis facing Australia.

man and woman walking at parliament house
Environment – or industry? Treasurer Jim Chalmers and finance minister Katy Gallagher ahead of the 2024 budget. Lukas Coch/AAP[2]

The story so far

After being elected in 2022, Labor made a number of good promises. The new government legislated an emissions reduction target – a 43% cut by 2030 on 2005 figures and net zero by 2050[3]. Last year, Labor reformed the Coalition’s only emissions monitoring program, the safeguard mechanism, to help deliver these reductions. (Recent research[4] has cast doubt on the integrity of the system’s carbon credits). And the government signed an international biodiversity pact[5], which commits us to protect 30% of our land (currently at 22%) and halt biodiversity loss by 2030.

But Labor also promised[6] to rewrite Australia’s main environment laws, the Environmental Protection and Biodiversity Conservation Act, which governs the protection of places and species, and approvals for significant projects. This was motivated by the horrendous bushfires in 2019–20 and a damning review[7], which found the laws were not up to the task of stopping environmental decline.

In the lead-up to tonight’s budget, Labor announced that the stronger laws had been indefinitely delayed[8]. Instead, Australia would get a national environmental protection agency, Environment Protection Australia. While a strong and independent agency would improve compliance and monitoring, it will be enforcing ineffective laws[9] until reforms are passed. Labor also shocked environmental groups by supporting a future[10] for fossil gas, including opening up new gas fields.

Made in Australia

So if we’re not getting new environment laws, what is in the budget for the environment?

A whole lot for green industries. The 2024 budget’s centrepiece is the Future Made in Australia policy, a series of initiatives costing A$23 billion over ten years that focuses on subsidies for manufacturing industries including solar panels and green hydrogen.

labor advertisement calling for more made in australia items Labor’s Future Made in Australia policy is aimed at bringing manufacturing back, especially green manufacturing. But will it prove more than a sop to its voters? Labor Party of Australia, CC BY[11][12]

Here, the Government is actively intervening in the market to push the economy towards specific ends – boosting green industries and making supply chains more resilient. As the budget papers[13] state, one goal is to make Australia “an indispensable part of global net zero supply chains.”

In recent years western governments have embraced industrial subsidies, most notably seen in the CHIPS and Science Act[14] and Inflation Reduction Act[15] in the United States.

So what’s the government planning? Included in the announced package is:

$3.2 billion over ten years in additional funding to the Australian Renewable Energy Agency. This includes $1.7 billion in grants for innovation in green metals, low carbon liquid fuels, and batteries.

$1.7 billion over 10 years for an additional round of Hydrogen Headstart. This will fund the difference between the cost to produce renewable hydrogen and the current market price for eligible firms. Also planned is an additional $2 a kilogram tax incentive for renewable hydrogen produced from 2027–28.

$7 billion over the medium term for tax incentives in critical mineral production. Firms will be eligible to rebate 10% of refining and processing costs of 31 critical minerals from 2027-28.

$1.5 billion over ten years for solar PV and battery manufacturing. This will fund grants to firms for manufacturing solar PV components at all stages of the supply chain and batteries.

Is this the right thing to do? Economists are usually pessimistic about government efforts to guide industry[16] in this way, pointing to the difficulty of picking winners and the potential for funding to flow in the direction lobbyists want rather than on merit.

Nevertheless, there’s recent evidence[17] industry policy can be effective in spurring long-term structural change to an economy – when done well. After all, targeted assistance and direction by government may have played a role in how East Asian nations such as Japan, Korea and China became manufacturing titans.

But what about the environmental outcomes of these subsidies? Will they turn Australia into a green export giant, shipping green hydrogen instead of LNG and make homegrown solar panels a reality? Will they help drive the green transition?

This is even less clear. Australia’s once-significant manufacturing sector began its sharp decline after we dropped tariffs and opened up to international competition from the 1980s.

Could Labor turn the tide? That will depend on whether the subsidies succeed in creating manufacturing sectors able to compete with international competition. It’s far from guaranteed. But it is possible.

And what about trade-offs between green industry and conservation? In the rush to secure lithium and critical minerals for the green transition, the government has invested $566 million[18] to give mining companies free data and maps. This could do further damage to the environment, if new projects are built on land home to threatened species.

workers looking at molten steel The government is pitching a future where Australia makes value-added green products such as carbon-free steel production. Dean Lewins/AAP[19]

Where’s the “Conserved in Australia” policy?

Nothing is in the budget to tackle our biodiversity and extinction crisis.

This is another missed opportunity. The postponed environment laws aside, the government could have addressed the severe lack of funding for conservation.

What about the goal of protecting 30% of land and seas by 2030? This will take funding to expand protected areas – and to actually conserve[20] species in existing protected areas. Invasive species from deer to blackberries run riot in many national parks.

How much should the government be spending and for what? To give some examples:

– $5 billion would fund the purchase[21] of private land for conservation and long-term management. Australia previously had a fund like this, which is why our protected area estate has grown so much.

– $1.7 billion a year is the expert estimate[22] for how much it would cost to bring all of Australia’s threatened species under active management and recover their numbers.

– $2 billion a year for 30 years would restore[23] 13 million hectares of degraded land, without touching farms or urban areas – about twice the size of Tasmania.

Our natural environment affects our national identity, our mental health[24], and even our future economic prosperity[25].

Yes, conservation costs money. But the costs may turn out to be very small relative to the benefits, not only for the diverse species we share Australia with but for its people too. People don’t just need manufacturing jobs – they need nature, too.

Read more: It's time to strike an environmental grand bargain between businesses, governments and conservationists – and stop doing things the hard way[26]

References

  1. ^ poor and deteriorating (soe.dcceew.gov.au)
  2. ^ Lukas Coch/AAP (photos.aap.com.au)
  3. ^ net zero by 2050 (www.pm.gov.au)
  4. ^ Recent research (theconversation.com)
  5. ^ international biodiversity pact (www.dcceew.gov.au)
  6. ^ also promised (www.dcceew.gov.au)
  7. ^ damning review (epbcactreview.environment.gov.au)
  8. ^ indefinitely delayed (theconversation.com)
  9. ^ ineffective laws (conbio.onlinelibrary.wiley.com)
  10. ^ supporting a future (theconversation.com)
  11. ^ Labor Party of Australia (alp.org.au)
  12. ^ CC BY (creativecommons.org)
  13. ^ budget papers (budget.gov.au)
  14. ^ CHIPS and Science Act (www.aaas.org)
  15. ^ Inflation Reduction Act (theconversation.com)
  16. ^ guide industry (theconversation.com)
  17. ^ recent evidence (www.annualreviews.org)
  18. ^ $566 million (www.ga.gov.au)
  19. ^ Dean Lewins/AAP (photos.aap.com.au)
  20. ^ actually conserve (theconversation.com)
  21. ^ fund the purchase (www.natureaustralia.org.au)
  22. ^ expert estimate (conbio.onlinelibrary.wiley.com)
  23. ^ would restore (besjournals.onlinelibrary.wiley.com)
  24. ^ mental health (nyaspubs.onlinelibrary.wiley.com)
  25. ^ economic prosperity (assets.publishing.service.gov.uk)
  26. ^ It's time to strike an environmental grand bargain between businesses, governments and conservationists – and stop doing things the hard way (theconversation.com)

Read more https://theconversation.com/green-industry-yes-conservation-no-a-budget-for-people-not-for-nature-229904

The Times Features

Itinerary to Maximize Your Two-Week Adventure in Vietnam and Cambodia

Two weeks may not seem like much, but it’s just the right time for travelers to explore the best of Vietnam and Cambodia. From the bustling streets of Hanoi to the magnificent te...

How to Protect Your Garden Trees from Wind Damage in Australia

In Australia's expansive landscape, garden trees hold noteworthy significance. They not only enhance the aesthetic appeal of our homes but also play an integral role in the local...

Brisbane Homeowners Warned: Non-Compliant Flexible Hoses Pose High Flood Risk

As a homeowner in Brisbane, when you think of the potential for flood damage to your home, you probably think of weather events. But you should know that there may be a tickin...

Argan Oil-Infused Moroccanoil Shampoo: Nourish and Revitalize Your Hair

Are you ready to transform your hair from dull and lifeless to vibrant and full of life? Look no further than the luxurious embrace of Argan Oil-Infused Moroccanoil Shampoo! In a...

Building A Strong Foundation For Any Structure

Building a home or commercial building can be very exciting. The possibilities are endless and the future is interesting. You can always change aspects of the building to meet the ...

The Role of a Family Dentist: Why Every Household Needs One

source A family dentist isn’t like your regular dentist who may specialise in a particular age group and whom you visit only when something goes wrong. A family dentist takes proa...

Times Magazine

"Eternal Nurture" by Cara Barilla: A Timeless Collection of Wisdom and Healing

Renowned Sydney-born author and educator Cara Barilla has released her latest book, Eternal Nurture, a profound collection of inspirational quotes designed to support mindfulness, emotional healing, and personal growth. With a deep commitment to ...

How AI-Driven SEO Enhancements Can Improve Headless CMS Content Visibility

Whereas SEO (search engine optimization) is critical in the digital landscape for making connections to content, much of it is still done manually keyword research, metatags, final tweaks at publication requiring a human element that takes extensiv...

Crypto Expert John Fenga Reveals How Blockchain is Revolutionising Charity

One of the most persistent challenges in the charity sector is trust. Donors often wonder whether their contributions are being used effectively or if overhead costs consume a significant portion. Traditional fundraising methods can be opaque, with...

Navigating Parenting Arrangements in Australia: A Legal Guide for Parents

Understanding Parenting Arrangements in Australia. Child custody disputes are often one of the most emotionally charged aspects of separation or divorce. Parents naturally want what is best for their children, but the legal process of determining ...

Blocky Adventures: A Minecraft Movie Celebration for Your Wrist

The Minecraft movie is almost here—and it’s time to get excited! With the film set to hit theaters on April 4, 2025, fans have a brand-new reason to celebrate. To honor the upcoming blockbuster, watchfaces.co has released a special Minecraft-inspir...

The Ultimate Guide to Apple Watch Faces & Trending Wallpapers

In today’s digital world, personalization is everything. Your smartwatch isn’t just a timepiece—it’s an extension of your style. Thanks to innovative third-party developers, customizing your Apple Watch has reached new heights with stunning designs...

LayBy Shopping