Julia, Bob and Jillian’s $10b boondoggle

Terry McCrann
April 19, 2012
Herald Sun

FIRST Julia Gillard and Bob Brown are hitting you with the world’s highest and most comprehensive carbon tax.

Unlike the GST, there are no exceptions. The carbon tax will increase the price of not just electricity, but everything – fresh food, going to the doctor, getting on a bus or train, going to hospital, to school.

Everything.

And again, very differently to the GST, the cost will continue to increase every year. Indeed if Brown’s successor, Christine Milne, had her wish, the cost would leap exponentially.

Then to rub salt into the wound, Gillard and Brown are taking $10 billion of your hard-earned to chase “alternative energy” moonbeams. Put more precisely, they are setting out to throw it away.

Actually, someone called Jillian will have carriage of the actual throwing. She’s the former investment banker and current Reserve Bank director Jillian Broadbent, who will chair the $10 billion Clean Energy Finance Corporation.

It is intended that $2 billion of taxpayer money will be injected into the CEFC each year, for five years, starting from 2013-14 to “invest (sic) in clean (sic) energy (sic)”.

First though, she chaired a three-member “Expert Review Panel” to advise on the “design” of the CEFC. The fruits of its labour were released by the Government on Tuesday.

Now there are two ways to look at what Broadbent and her two financial services industry colleagues came up with.

The first is that they constructed an edifice and proposed operational parameters that would force some rigour into what would otherwise be an exercise in flushing $10 billion straight down an environmentally touchy-feely toilet.

On the surface there’s some hope of that. Broadbent & Co propose that the money be broadly split 50/50 between renewable energy projects and low-emissions technology and energy efficiency.

They also propose the CEFC adopts a “commercial approach” – to seek to achieve a minimum target return, to have an “appropriate” trade-off between risk and return. While also aggressively seeking to partner with “other lenders and investors”.

This unfortunately is a mirage. It is quite clear that the informed common sense, which has made Broadbent a very effective member of the Reserve Bank board, has deserted her.

She has been seduced by the all-too-tempting combination of saving the planet, and being able to do so with clever financial engineering, using a dedicated pot of (someone else’s – your) money.

This was made all too disturbingly clear by her gushing statement that her panel was now even more convinced that the CEFC could help in a “cleaner energy future, tackling climate change, lowering carbon emissions and transforming Australia’s energy sector”.
Followed by the totally incoherent statement that it was “important for Australia to have the lowest possible cost of energy as we move to a carbon-constrained world”.

Incoherent, that is, unless you buy the “carbon-constrained world” bit. For we are walking away from the world’s cheapest energy – coal – while China (and India) happily gallop towards it.

The rest of her covering letter was all of the same flavour. It could have been written by Milne or Brown.

Or indeed Ross Garnaut – our own unique downunder climate alarmist, with his quixotic mix of Britain’s Nicholas Stern and his dodgy economics, and the US’s Al Gore with his dodgy, well, dodgy everything.

Indeed, perhaps he did write at least some of it. As Garnaut was noted by Broadbent as having provided “valuable comments” in the later stages of preparing the report.

It’s hard to know which is more dangerous. Starry-eyed green groups who see the $10 billion as an Aladdin’s cave to be plundered for every – well, at least many – useless alternative energy boondoggle.

More accurately described as alternative to energy.

Or financial mainchancers, who couldn’t give two hoots about saving the planet; but can see big pots of gold through the thickest rock and have the precise skills for fashioning various forms of “open sesame” to get at them.

Actually, what is really dangerous, is when you put them together. And boy, did Broadbent succeed in doing that.

The 151 names on the CEFC website, of those that made public submissions, is as good a list as you could get of the players in the industry that has grown to suck on the climate-change money teat.

And you are just about to throw them another $10 billion, while you struggle with the reality of the increased costs the insanity is going to impose.