Since the Federal Budget dropped in late October, ACF has been busy investigating how the Albanese Government’s first budget stacks up against its election campaign commitments.
The good news is the federal budget has backed up some significant nature and climate commitments with the resources needed to deliver them. The bad news is there’s some big, missed opportunities including continuing publicly funded subsidies for gas and other fossil fuel corporations.
After a decade of savage cuts to the environment budget, we were delighted to see the tide is turning, with increased funding for environmental protection and climate action. But more is needed to ensure Australia delivers critical climate action and protects and regenerates nature at the scale required.
In the environment portfolio, the government has promised $1.8bn in what Minister Plibersek has called a ‘down payment on strong action to protect, restore and manage’ nature. The Government’s climate and environment programs were funded in part by redirecting $746.9m from programs promised by the Coalition, including $325.9m from an energy and emissions reduction program that included money for gas and Carbon Capture and Storage (CCS) projects and $89.9m that had been dedicated to the former government’s low-emissions technology investment roadmap.
Other big spending includes:
The government has committed to support the recovery of plants, animals and ecological communities that are threatened with extinction, and strengthen conservation planning to better protect species and guide on-ground action.
This will be delivered through:
Reassuringly, the government is living up to its pre-election climate commitments with significant investment in renewable energy, the grid, electric vehicles and charging infrastructure, disaster resilience and climate governance. Total climate-related spending is $25 billion over 2022-23 to 2029-30.
The budget’s headline climate change initiative was the $20 billion Rewiring the Nation fund which seeks to ‘expand and modernise Australia’s electricity grids at lowest cost, unlocking new renewables and storage capacity and driving down power prices.’ About $6bn of that was promised in recent weeks to help build the Marinus link – two new subsea transmission cables across Bass Strait – and the Kerang link between Victoria and New South Wales.
The Budget also allocated $1.3 billion which will flow directly to renewable energy and legitimate emissions reduction technologies.
Other funding includes:
The Driving the Nation Fund doubles the Commonwealth’s investment in electric vehicle charging, hydrogen refuelling infrastructure and fleets to support cheaper, cleaner transport and provide more choice for Australian drivers, with $275.4 million being invested over 6 years. This budget measure will be supported by development of Australia’s first National Electric Vehicle Strategy. Furthermore, the Government’s new electric car discount will make electric cars, hydrogen cars and plug-in hybrids below the luxury car tax threshold exempt from fringe benefits tax. It also plans to remove the 5 percent import tariff for select electric vehicles to increase the uptake of electric cars.
Unfortunately, there were plenty of missed opportunities in the budget. The budget has increased funding for environmental protection and climate action but has quietly continued the Coalition’s support for fossil fuel industries, including the Fuel Tax Credits scheme, which subsidises the diesel use of multinational mining companies and will cost taxpayers $39.4 billion over the forward estimates.
The Government has also earmarked $1.9 billion in subsidies for the Middle Arm Sustainable Development Precinct near Darwin - a petrochemicals and gas Carbon Capture and Storage hub, that will process fracked gas from future fields in the Beetaloo Basin for export. No matter where gas is burned, its pollution harms people and catastrophically damages nature.
The budget has allocated $630.4m for disaster resilience projects and initiatives by state, territory and local governments and $302.1m to support sustainable farming and land management and enhance disaster resilience. While this funding is welcome, the only way to protect Australia from extreme weather events is to end coal and gas and rapidly reduce emissions this decade.
The $1.8 billion committed for environment spending is not all it seems. That figure covers both programs and measures over the four-year forward estimates timeframe, and a further 10-year timeframe. Before the budget, the government announced a new Threatened Species Action Plan: Towards Zero Extinctions which would guide investments, including on-ground action to prevent new extinctions. The Action Plan identifies 110 priority species and 20 priority places to drive action where it is needed most, and where it would have the biggest impact. While the government has committed funding to saving threatened species in the budget, it does not appear to have aligned the budget to priorities in this action plan. Nor does this come close to the $1.69 billion per year expert analysis has shown may be needed to protect Australia’s threatened species.
The federal budget puts Australia on the right path, but this funding is still inadequate to tackle collapsing ecosystems and the extinction crisis, and to reduce the very real financial risks from climate damage and biodiversity loss. There is still a marathon ahead for Australia to invest in the transition to renewables, rapidly phase down fossil fuels and ramp up the export of clean energy to reduce emissions this decade.