Garnaut Report Has Rudd Cooling On Warming

The Age

Wednesday July 2, 2008

Mathew Murphy

ROSS Garnaut could be heading for a "Gary Banks moment".

The Government's climate change adviser's draft report into one of the biggest economic reforms in this country's history is expected to be brutal in its assessment of the policy directions needed to combat climate change. His interim report has given an indication of how brutal, saying Australia needs to go beyond Prime Minister Kevin Rudd's target of a 60% reduction in emissions by 2050.

The Government has since changed its effusive response to the Garnaut report, which it now describes as an "input".

"Of course, we will also be looking at other inputs," Climate Change Minister Penny Wong said after Garnaut's interim report was released in February.

As the Government moves to distance itself from Garnaut, the economist has a kindred spirit in Productivity Commission chairman Gary Banks, whose power and influence has been somewhat eclipsed.

Banks and the commission have been bypassed on several key reviews on innovation, the car industry and the textile industry.

Rudd appointed Garnaut knowing he would tell it like it is. Garnaut's work as an adviser to the Hawke government drove the radical, and largely unpopular, reforms of the 1980s and '90s, liberalising trade barriers and transforming Australia's introverted economy into an internationally competitive player.

But it is unlikely that Rudd expected Garnaut to give him a political black eye.

Garnaut has correctly stated that excluding petrol from an emissions trading scheme would increase the difficulty of moving to a low-emissions economy.

Including petrol, though, would increase prices at the bowser and give the Opposition further traction against Rudd on the one issue where it has been able to land blows.

John Connor, chief executive of independent research group The Climate Institute, says the Rudd Government needs to show leadership, much as Labor did during the Hawke and Keating years. A Banks-style freeze-out would be to its detriment.

"I think Professor Garnaut has surprised just above everyone ... with the depth and sophistication which he has been putting into his research," Connor said.

"I don't think the Government were fully expecting that, but they do know this guy. I have never anticipated that his report would be accepted holus-bolus but they will deviate from those recommendations at peril to their own credibility."

© 2008 The Age

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