Lenore Taylor, political editor theguardian.com,

Wednesday 25 September 2013

New Senate likely to wave through carbon tax repeal but minor parties are sceptical of the Coalition's Direct Action plan

Tony Abbott may be forced to make major policy concessions to win support for Direct Action. Photograph: Lukas Coch/AAP

Australia could be left without any policy to combat climate change with a new Senate likely to wave through the repeal of Labor's carbon tax but sceptical of the Coalition government's alternative $3.2bn Direct Action plan unless Tony Abbott makes major policy concessions.

Labor and the Greens remain determined to block the carbon tax repeal in the existing Senate, which sits until next July, but after that the Coalition appears likely to get the necessary six of eight independent and minor-party votes that will hold the balance of power in the new Senate.

But winning the necessary six votes in favour of Direct Action – which offers competitive government grants to reduce greenhouse emissions – could be much more difficult.

The Liberal Democratic party's David Leyonhjelm, set to win a Senate seat in NSW, told Guardian Australia he was "agnostic" about the science of global warming but "even if it is eventually confirmed government spending in Australia will not make the slightest bit of difference".

He said he would be voting for the carbon tax repeal and against Direct Action "unless the government offers some very significant concession that will make a big difference to the economy, for example lowering the company tax rate from 30% to 25%, or making a big reduction in the personal income tax rate, or possibly abandoning the alcopops tax and both of the last two increases in tobacco tax."

The government has already delayed a return to a budget surplus and any of the LDP's tax propositions would blow a large hole in government revenue.

Family First's Bob Day, set to take a seat in South Australia, said his party did not accept the science of global warming and would vote for the repeal and against Direct Action.

CClive Palmer, whose Palmer United party candidate in Tasmania, Jacqui Lambie, has been confirmed as the party's second senator – the party may win a third spot in Western Australia – said his senators would vote for the repeal but his party "needed more information" on Direct Action.

But the mining magnate, who is waiting for federal government environmental approval for his $8bn coalmine, rail and port project in Queensland's Galilee basin, added: "The evidence shows 97% of carbon emissions are natural and 3% are human so we probably need to look at what is happening in nature."

The DLP senator John Madigan has said he will vote for the repeal but he is concerned about the burden Direct Action puts on taxpayers. During the election campaign he proposed an entirely different approach.

"Instead of imposing a tax we should instead have a penalties scheme, whereby a company must, for example, reduce pollutants from 100% to, say, 75% within a defined time period, which is then broken down into yearly reduction targets," Madigan said.

"If that company fails to adhere to its annual target it must pay a financial penalty that would come straight out of its back pocket, not the consumer's."

The South Australian independent senator Nick Xenophon has said he won't vote for the carbon tax repeal until the Coalition agrees to change Direct Action to incorporate the intensity-based emissions trading scheme proposed by Frontier Economics.

The Motoring Enthusiasts party's likely Victorian senator, Ricky Muir, is declining to comment on policy until he has more information.

And if the PUP does win its third Senate seat in Western Australia, where the battle for the final Senate spot is between it, Labor and the Sport party, the prime minister will need the mining magnate's three votes to achieve the necessary six out of eight votes on every piece of legislation, unless he decides to negotiate with Labor or the Greens.

The Coalition is likely to have 33 seats in the new Senate, meaning it will need six of the likely eight crossbench votes to achieve the 39 votes needed to pass legislation in the 76-seat Senate.

Leyonhjelm said he was opposed to Abbott's planned "green army" to do environmental cleanups while working for the dole and to the carbon farming initiative – a Labor policy the Coalition intends to continue and expand – which he said was just a scheme to "pay farmers to plant trees they can't cut down for 100 years".

Abbott has said the carbon tax repeal will be his first piece of legislation when parliament resumes. He vowed to call a double dissolution election if it was blocked in the Senate.

But with a more friendly Senate just months away it is much more likely he will wait until next after July to remove Labor's tax – a move the power industry says means household power bills are unlikely to come down until July 2015.

Australia could be left with no policy on climate change | World news | theguardian.com