Jul 23, 2006

Address to Earth Dialogues Brisbane 2006 – Building Sustainability

Address to Earth Dialogues Brisbane 2006

A World Forum on Resource Management and Sustainable Development

Building Sustainability: New tools and Techniques

Sunday 23rd July

Main Auditorium of City Hall, Brisbane

** Check against delivery **

I am honoured to be representing the Australian Labor Party at this World Forum and congratulate the organisers, particularly President Mikhail Gorbachev, Green Cross International and Premier Peter Beattie.

The challenge of the global community is to ensure that sustainability is at the core of economic and social policy. At the core of sustainability is meeting the challenge of climate change.

Climate change is not just an environmental issue. It is a health issue, a social justice issue, a moral issue. If we do not avoid dangerous climate change, it will bring profound social, economic and security challenges. If we do not avoid dangerous climate change, life as we know it will not be sustainable.

To avoid dangerous climate change requires prudent and responsible action from individuals, communities, businesses and nations to reduce their ecological footprints and to manage the transformation towards carbon constrained economies. For that to occur it is clear that new investment tools and techniques will be required.

The challenge of climate change fundamentally changes the paradigm in which environmental polices have been considered.

Climate change demands that environmental issues can no longer be at the margin. Climate change is a profound economic and social issue because it threatens to destroy much of our food supply and severely reduce access to clean water.

As Nobel Peace Prize Laureate, Wangari Maathai has said, “if we did a better job of managing our resources sustainably, conflicts over them would be reduced. So, protecting the global environment is directly related to securing peace.”

Considerable progress has been made in understanding that human activity must be in harmony with our natural resources, rather than being seen as autonomous and without consequences.

The first wave of environmentalism was very much about conservation. Campaigns were run to protect our natural heritage – saving old growth forests, protecting rivers.

We cherish the natural treasures that have been saved by those campaigns, and massive tourism industries such as those in Far North Queensland flourish as a result of the Great Barrier Reef being protected. Sadly, the Reef is already threatened by climate change.

Conservation then progressed to government regulation to stop pollution and regulate behaviour of individuals and corporations in the interest of agreed environmental objectives.

Important gains were made through regulation, but climate change has brought forward the need to go beyond protection and regulation.

The third wave of environmental policies is the integration of sustainable environmental concerns across the behaviour of individuals, corporations, communities and through government policies. Economic tools are required to promote investment in sustainability.

We need economic structures which encourage investment in projects that reduce our ecological impacts. Significant investment in sustainable industries and technologies is the key.

Solutions now lie in significant investment. We need proactive interventions and structures which will reduce ecological impacts.

To do that we need to harness the power of the market to accelerate the pace of change.

Part of the solution is pricing our natural resources in an appropriate way.

The Hawke/Keating Labor Government got the price of capital right by deregulating the financial system, removing artificial barriers by floating the exchange rate and transforming the economy into the global financial system. The Hawke/Keating Labor Government got the price of labour right through enterprise bargaining.

The next Labor Government can achieve substantial reform by getting the price of our natural resources and environment right.

If we promote market based solutions with pricing that reflects the finite nature of our natural resources then significant gains can be made. Once pricing reflects externalities and the full cost of a product over the full life cycle, much more rational decisions result with substantial environmental benefits. The nuclear fuel cycle is an example of a process which is uneconomic once a proper full costing of waste disposal and decommissioning is taken into account.

Governments have a critical role in intervening to ensure equity in the outcomes that these structures produce.

The next round of significant economic productivity growth can come from a sustainability dividend. Equity is a critical component of ensuring active public support and participation in structural reforms.

The experience of companies which have instituted emissions trading regimes has been one of substantial profit growth, increased employment and significant environmental benefit.

Emissions trading is increasingly being used as an environmental policy tool for pollution control. Global firms such as BP and Shell established these internal carbon trading systems as the last century came to a close.

In 2001 BP announced that it had already met its 2010 target of cutting greenhouse gases to 10 per cent below its 1990 level. BP reduced its energy bills by $650 million over the decade.

Five other major firms, including IBM, Alcan, Bayer and British Telecom, have reduced their greenhouse pollution by 60 per cent since the early 1990s and saved another $2 billion. While increasing production by nearly 30 per cent, Du Pont has cut its greenhouse gas pollution by over 70 per cent in recent years, saving more than $2 billion in the process.

The Climate Group, a UK based non-profit organisation, recently reported that 43 companies had significantly reduced their greenhouse gas emissions and saved a total of $15 billion.

This shows that energy efficiency is good for the environment but most importantly it is also good for the economy.

Economic tools can also be used to facilitate individuals reducing their ecological footprint.

Under the NSW Government’s Greenhouse Gas abatement scheme, free Easy Being Green Climate Change Packs are being distributed which include 6 compact fluorescent light globes and 1 AAA rated showerhead. Once installed, they save $150 on your power bills, 1 tonne of greenhouse gases and up to 21,000 litres of water every year.

Energy and water efficiency is easy and responsible. It saves money and helps avoid dangerous climate change.

As well as understanding the immediate and long-term threat of climate change, the most important thing to understand about dangerous climate change is that it can be avoided.

The issue of sustainability and climate change is the ultimate intergenerational equity issue.

Our response will determine the quality of life of our children and grandchildren. If as has been said “coming events cast their shadow before”, we have dark shadows gathering around us indeed.

We can and should act now to address the problem. Investing in sustainability is the key, and if we do that we will bury once and for all the false debate that pits economics against the environment.

That debate is a relic of the last century, and we should leave it there.