Abbott government presses new crossbench senators to 'axe the tax' within two weeks of taking their seats

Clive Palmer appears set to demand legislative guarantees that the carbon tax repeal will flow through to lower household power bills, as the government presses new senators to “axe the tax” within two weeks of taking their seats to avoid enormous commercial uncertainty.



The Abbott government is counting on the Palmer United party and two other crossbench senators to provide the necessary votes to finally repeal the carbon tax soon after the new Senate sits on 7 July, but PUP now appears likely to place conditions on its support.

Palmer, whose policy was to back the repeal, says he will unveil his party’s “final position” on Wednesday. He has previously said his senators will demand “the full savings power companies receive under a repeal are handed on to everyday Australians”.

The government believes this is already ensured by the powers it has given the Australian Competition and Consumer Commission to monitor price changes after repeal, but a spokesman for Palmer told Guardian Australia the ACCC powers in the government’s bill were “definitely not sufficient”.

As well as amendments or assurances on pricing, Palmer may also ask for another parliamentary inquiry into aspects of the repeal. Any delay would cause commercial complications.

And further complicating this first item of business for the new Senate, sources said the Motoring Enthusiast Party senator Ricky Muir had not been consulted about Wednesday’s announcement and could also consider alternative amendments being proposed by independent senator Nick Xenophon.

The government is assured of the votes of Liberal Democrat senator David Leyonhelm and Family First senator Bob Day, but needs four more, which means one vote in addition to the three PUP senators.

The prime minister, Tony Abbott, reintroduced the carbon tax repeal bills into the House of Representatives on Monday, in preparation for them to be considered as soon as the new Senate sits.

“It will be dealt with urgently by the new Senate after 1 July and I expect this carbon tax – this toxic tax – to be gone ... every crossbench member of the Senate has stated opposition to the carbon tax, which is why I think the public are entitled to be confident that the carbon tax will be gone – will be gone after the first of July,” Abbott said.

The chairman of the ACCC said he believed his organisation “has all the power it needs”.

“The law says you can’t have a carbon component in your pricing … it says companies have to show they will take the carbon component out of their pricing and if they don’t we have the power to act,” he said.

The government has decreed that the repeal takes effect from 1 July, and power companies have agreed to take it out of their contracts from that date, but only for two weeks. If the existing law continues after that fortnight they will revert to passing on the cost of the $24.50 carbon price until it is actually repealed under law.

As well as complicating power pricing, a delayed repeal opens the possibility that emissions intensive industries could reap a windfall from receiving free permits and then selling them back to the clean energy regulator.

Guardian Australia reported this would be a potential windfall of $9m for Palmer’s wholly-owned Queensland Nickel.



Reintroducing the carbon tax repeal bills, which have already been voted down once by the Senate, Abbott said: “The Australian people have already voted on this bill … the people have spoken and now it is up to this parliament to show that it has listened.



“The ACCC will be ready to ensure these price reductions will be passed on to businesses … but families and pensioners will keep the tax cuts and benefit increases already provided.”



The environment minister, Greg Hunt, said anything other than a rapid repeal of the carbon tax bills would be “an act of legislative vandalism”.



The positioning ahead of the Senate vote comes as a new poll for the Climate Institute found that for the first time more people support carbon pricing than oppose it. According to the poll, 34% back the carbon pricing laws, up 6% on 2012. Public opposition to carbon pricing has collapsed by 22% since 2012, when the Coalition was repeatedly attacking the then Labor government over the policy, the poll found.

