Australia’s political leaders are “wilfully blind” to the challenge of climate change, with the country at risk from an “economically reckless” reliance upon fossil fuels, the former head of the National Australia Bank has warned.



Cameron Clyne, who was chief executive of NAB from 2009 until he stood down last year, said he doesn’t “think any of us have grasped quite how revolutionary” the emergence of renewable energy will be, warning that Australia cannot continue to be wedded to carbon-heavy fuels such as coal.

“The truth is that Australia’s lack of diversification is economically reckless,” Clyne wrote in Fairfax newspapers. “Most of our electricity generation is reliant on coal; an overwhelming majority of our transport and a very large percentage of our export industries are reliant on fossil fuels.

“When you look at this, you would be blind to not see a myriad of looming business risks.”

Clyne wrote that falling global oil and coal prices, a dip in Chinese coal consumption owing to air pollution concerns, pressure on fossil fuel subsidies that have been estimated at $10m a minute and competition from solar and wind are leaving Australia’s fossil fuel assets at risk of being “stranded”.

“So you can be as angry as you like with environmentalists and “environmentalism” but from an economic point of view, it still wouldn’t make sense to be so heavily addicted to this polluting business as Australia is,” Clyne said.

“We know from history what happens when a business or a government sets its face against a change that is coming anyway. It’s usually not the politicians or the chief executives who end up at the unemployment office.

“Leadership mistakes are worn by people who are least at fault for the bad decisions: the workers, their families and the communities that depend on them.

“It’s everyday Australians who bear the brunt, cop the hit and pay for the wilful ignorance and blindness of political leaders – and some in the business community – to the very real and very rapid changes that are all around us.”

Clyne wrote that ignoring the problem of climate change would not make it go away, adding: “It seems some in Australia are wilfully blind to these problems and the problems this poses for our nation and its economic and social fabric.”

The Abbott government was “not leading Australia in the direction that’s needed”, Clyne wrote, but upcoming climate talks in Paris to set new greenhouse gas reduction targets represented a new opportunity for leadership.

The federal government is set to unveil its post-2020 emissions reduction target this month. Environmental groups have voiced concern about the level of Australia’s ambition after Greg Hunt, the environment minister, described the Climate Change Authority recommendation of a 40% to 60% emissions cut by 2030 as “staggering” and far beyond what other nations are doing.

Under the Coalition, Australia became the first country to scrap a carbon pricing system and cut its renewable energy target by a quarter after a lengthy period of political wrangling that saw investment in the sector slump by 90%.

Australia’s emissions have risen since the repeal of the carbon price, with economists and foreign governments questioning whether the replacement policy, the $2.5bn Direct Action plan, will be capable of facilitating emissions cuts beyond 2020.

Under Clyne’s leadership, NAB supported the implementation of carbon pricing, although he has denied the decision was a pro-Labor one. The Coalition has attacked Labor for committing to introducing an emissions trading scheme, dubbing it an electricity tax scheme that will push up power bills and be indistinguishable from the previous carbon tax.