Malcolm Turnbull says the need for the Clean Energy Finance Corporation remains an “open question” and has dismissed emissions trading schemes as simply another “piece of economic plumbing”, as Labor attacked the credibility of the Coalition’s climate policies.



Turnbull lost the Liberal leadership in 2009 over his backing for the former Rudd government’s emissions trading scheme, and was forced to pledge to retain the current Direct Action climate plan in order to win support from conservative and climate-sceptic colleagues before becoming prime minister, despite having once described it as “bullshit” and a “recipe for fiscal recklessness on a grand scale.”

Under Tony Abbott, the coalition unsuccessfully tried to abolish the corporation, which the former prime minister derided as the “Bob Brown bank”.



The CEFC lends to clean energy projects on commercial terms and has so far lent $1.4bn, which will reduce emissions by 4.2m tonnes annually and also achieve a positive return on the commonwealth’s investments.

Under Turnbull the CEFC has been transferred to the environment department and the government has apparently dropped plans to hobble its mandate by banning investments in wind farms and small scale solar and has suggested it plays an important role in its climate plans.

But despite this, during question time on Tuesday, Turnbull refused to say he backed the institution – instead hedging his answer and pointing out the government had been unable to get the Senate to agree to the CEFC’s abolition.

“The CEFC certainly has been making some investments in this area and in that respect has been assisting in supporting the reduction in emissions, but it is a fair question to ask whether it is necessary as an institution, and indeed it was the government’s policy to abolish it,” Turnbull said.

“We do not support government banks performing roles that can be performed by the private sector ... yes it has done some good work, the question is whether it is an appropriate use of government money,” he said, refusing to concede it played a “crucial” part in Australia’s emissions reduction.

Turnbull also insisted the Coalition’s Direct Action plan could meet the target Australia will take to the United Nations conference in Paris in December – to reduce emissions by between 26% and 28% of 2005 levels by 2030.

He said an ETS “used to be Coalition policy but it is not any more”, saying an ETS was “no more than one mechanism to reduce emissions, it is a means to an end ... a piece of economic plumbing.”

Turnbull said he was sure Direct Action could meet the 2030 target. The coalition envisages a range of policies to meet the target – including buying abatement through the emissions reduction fund and as-yet vague plans to regulate vehicle emissions standards and improve energy efficiency.

The environment minister, Greg Hunt, has said his so-called “safeguards mechanism” will reduce emissions by 200m tonnes by 2030, even though it is currently not designed to force any emission reductions from industrial emitters.

“We will review our measures in 2017 and if they need adjustment, they will be adjusted ... [Labor] needs to get used to the fact that we are committed to cutting emissions,” Turnbull said.