CPRS progress update

The political posturing regarding the Carbon Pollution Reduction Scheme (CPRS) has continued over the weekend. While an agreement between the government and Opposition and then ultimate passage of the CPRS this year, may be possible it is looking increasingly time pressured.

Prior to the weekend the indications were an agreement between the government and Opposition on the CPRS design could be reached on the weekend.¹ For further information on the Coalition’s proposed amendments see our article ‘Coalition’s proposed changes to CPRS’.²
However, the position now is that the government will present a final offer to the Opposition on Tuesday morning (24 November) for the first time.

The Coalition will then only have a limited period of time to consider that offer prior to a final Senate vote on Thursday 26 November,³ the last Senate sitting day this year. The Senate is next listed to sit on 2 February 2009.⁴

The information available indicates that this timeline was agreed to by the Opposition’s emissions trading spokesman Ian Macfarlane, which has drawn some ire for Mr Macfarlane and leader Mr Turnbull from their Coalition colleagues.⁵

This extremely tight timetable raises the probability that the Senate will not have time this sitting year to consider and vote on the CPRS legislation.⁶ High Court authority suggests that this outcome would not be sufficient to provide the government with a double dissolution election trigger. The government has stated that if this occurs then the government’s offer to meet the Coalitions demand’s will be withdrawn.⁷ In this circumstance Senate consideration of the legislation would continue in February 2010 which may lead to a full rejection and then a double dissolution election. However, conjecture remains as to whether the government is prepared to call a double dissolution election. For further information on the possible double dissolution scenarios see our article ‘The Senate and the CPRS’.⁸

Therefore considerable uncertainty remains as to:

• whether the CPRS will be passed now or later 
• if passed, the final detail of the CPRS, or 
• otherwise, whether a double dissolution election will result.

Regardless, the indications remain that some form of carbon pricing regime is inevitable in Australia sooner rather than much later and in one form or another.

This article was written by John Taberner, Consultant, Sydney, and Michael Voros, Senior Associate, Perth.

Endnotes

1. ABC News article, ‘Wong coy on more carbon compensation’ and Audio clip, ‘Govt hopes to wrap up ETS negotiation before next week’
2. Freehills article, ‘Coalition’s proposed changes to CPRS’  
3. ABC News article, ‘Emissions debate gets personal’ 
4. House of Representatives Scheduled Sittings for 2010
5. ABC News article, ‘Backbench anger as carbon trade deal nears’
   ABC News article, ‘Wong tightens climate vote deadline’
6. ABC News article, ‘Wong tightens climate vote deadline’ 
7. ABC News article, ‘Backbench anger as carbon trade deal nears’ 
8. Freehills article, ‘The Senate and the CPRS’ 

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