Carbon tax will lead to job losses: Ridout

Australian Industry Group (Ai Group) chief executive, Heather Ridout, says the carbon tax will be responsible for a number of job losses in the manufacturing sector, and claims union secretary Paul Howes with have them "hung around his neck".

Speaking to Steve Price on Melbourne Talk Radio yesterday, Ridout claimed Treasury modelling already indicates 16% of Australia’s manufacturing jobs – or 170,000 positions – will be lost over the next decade, regardless of a carbon tax.

Once the tax starts, on 1 July 2012, manufacturers will be under further market pressure, added to the high Australian dollar, rising energy prices and increasing competition from China.

“Well, the Treasury modelling already predicts, that putting this reform aside we’re going to lose 16 per cent, or 170,000 jobs out of manufacturing over the next decade.  Now that’s a lot of jobs, that’s more jobs than we’ve lost out of manufacturing over the last two decades,” she said.  

“So this is all because of the dollar, that, you know, the structural reform, that’s going to drive in the Australian economy and the rise of China, et cetera, so that’s their view.

“And then on top of this, we have this reform, which is going to push up energy prices, put a price on emissions, so you’ve tossed into an already very, very uncertain and sort of rather scary scenario, a big reform like carbon pricing.”

Ridout responds to Australian Workers Union (AWU) national secretary Howes’ comments that companies that sack workers because of the carbon tax will be ‘named and shamed’.

A report in The Telegraph yesterday quoted Howes claiming he approves of the carbon tax as long as it doesn’t lead to job losses.

"If they do try and lay off AWU members under this tax … we will name and shame them," he said.

According to Ridout, Howes is adding fuel to the fire, as unions and government should be working with industry, rather than alienating them.

“But Paul Howes is not helping the situation, going around saying, we’ll name and shame companies, we really need to work together on this thing, otherwise there will be job losses, and some of them will be hung around his neck,” she said.

Ridout claims the $23-a-tonne price, set to begin when the tax is rolled-out, is too high for industry – especially when they are under so many external cost pressures already.

“I think it’s too high, for several reasons. We don’t know, we haven’t had this reform before, so we don’t know how the blood’s going to flow through the veins, what the impact’s going to be on the economy,” she said.

“The second issue, we have what we were just talking about, quite a difficult and uncertain and, you know, new chartered waters environment for business, and the third thing is, the Productivity Commission identified this, we already have a carbon price in Australia because of all these regulations that exist at the State and Federal level, 237 of them, and that amounts to a carbon price, but there’s no plan to get rid of that stuff, so we’re putting our $23, which is already above the world’s price, which is $17 at the moment, on top of an already existing carbon price, so it is a high price, and we urged the Government to put in a $10 price, you know, if they did this at all, that’s been ignored, but unfortunately I think it is a high price, Steve.”

Ridout claims political arguments about the issue are confusing an already difficult time.

“Oh, it worries me terribly, I mean this whole reform, you sort of forget what’s meant to be happening here, we’re meant to be making a transition to a, you know, a less carbon-intensive environment, it’s a big reform, and all we’ve got is, you know, fighting in politics between both sides,” she said.

“Frankly, from a business perspective, we would much rather do a deal with the conservatives, with the Coalition, like happened last time, than have this Green Labor Coalition on this issue, which has made it very hard for business. We now have State Governments wading in, I think business gets caught right between a rock and a hard place, frankly.”

Read the full interview here.



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