by Ben Eltham and Marcus Westbury

Policy context

In early 2010, more than 15,000 people gathered on Bourke Street in front of Victoria’s Parliament building to register their protest against an unpopular government decision.¹  The colourful crowd chanted and marched, sported placards and banners, and listened to speeches by local identities.

What were they protesting about? Climate change? Refugees? The war in Afghanistan?

No, they were protesting about a decision by Liquor Licensing Victoria to enforce onerous security requirements on live music venues in Melbourne. The new regulations had led to the closure of one of Melbourne’s best-loved rock venues, a Collingwood pub named The Tote. Many other venues were threatened with the same fate.

This was a protest about cultural policy.

“Cultural policy” is not often thought of as an important topic of public affairs. That’s odd when you consider that culture touches on many of the things that Australians do, see, hear and engage with everyday. Watching television, reading a newspaper, playing a computer game, updating your Facebook status, sending a tweet, going to a bar to see comedy, even things like gardening and cooking: all of these activities are explicitly cultural.

“Culture”, as English critic Raymond Williams once pointed out, “is one of the two or three most complicated words in the English language.”² Culture in Australia is no exception. It’s simultaneously broad, diverse and multi-faceted. It ranges from the oldest continuous cultural traditions in the world, to be found in the art and culture of Australia’s Aboriginal and Torres Strait Islander peoples, to the newest digital forms of cutting-edge expression. It includes the highly trained professionals in our nation’s orchestras, operas and dance companies, as well as the “weekend warriors” who dust off their guitars for a weekly neighborhood jam session. It encompasses some of the most popular types of entertainment media, to be seen on top-rating TV shows like Masterchef or So You Think You Can Dance, as well as obscure community arts projects and folk crafts. Culture is about learning a foreign language, sharing thoughts, words and images with a friend on Facebook and listening to your iPod on the way to work.

But all too often, when we discuss government policies towards “culture”, what we actually mean is “the arts” – and only a small subset of the arts at that. Indeed, when we think about cultural policy in Australia, we often think simply of grants to artists, or government cultural agencies such as the Australia Council, as though these are the principal aspects of government policy towards culture.

In fact, cultural policy cuts across many government portfolios and encompasses a vast swathe of everyday life. It’s as much about the rock band at your local pub as it is about the Sydney Opera House, as much about popcorn during the movie as chardonnay after the ballet. Cultural policy is about what you can and can’t watch on free-to-air TV or view on the internet, whether you can exhibit photos of naked children in an art gallery, or when and where a band is allowed to play.

The size and scope of culture

Culture is all around us. Millions of Australians engage in cultural expressions for their own pleasure every day. For every Hugh Jackman, there are tens of thousands of unknown but passionate artists in hundreds of different artforms, all grappling with the age-old challenges of making art that someone, somewhere will want to experience and engage with. In comparison with this vast cultural universe, the kinds of activities supported by the Australia Council – and by extension that are within the policy brief of government – are a small and dusty room.

One way of taking in the size and scope of culture in Australia is to examine the size of the so-called “cultural” or “creative” industries. These are a far bigger share of our economy than many people realise. The Australian Bureau of Statistics tells us that there are nearly 300,000 Australians working in a cultural occupation as their main job; more than car manufacturing and mining combined.³ In June 2006, there were more than 77,000 registered cultural businesses contributing a total cultural output approaching $41 billion.⁴  In 2003-04, Australian households spent $14.6 billion on cultural items like books, CDs and pay TV. Culture is also a big part of our daily lives: watching television is Australians’ most important leisure activity, and the movies are our most popular destination when we go out. More than three-quarters of Australians read for pleasure, while nearly 14 million of us attend a cultural venue or event at least once a year.⁵ More importantly, the impact of culture is beyond economics. It’s at the heart of our identity and way of life.

So it’s quite a surprise when you realise Australia has no formal cultural policy, and hasn’t since Paul Keating’s Creative Nation policy of the 1990s. Cultural policy has evolved as an ad hoc series of decisions by governments of all levels. The result is that there is no coherent set of principles to underpin the way our governments at all levels support and regulate culture. Rather, a set of de facto policies has evolved, often haphazardly, which are inconsistent and contradictory.⁶

One of the biggest problems is that the current framework views cultural policy almost exclusively in terms of arts funding, rather than the much bigger area of cultural regulation. Things such as copyright laws, media regulation and censorship, urban planning and public liability laws that impact upon the viability and diversity of cultural expression are beyond the reach of the current paradigm. Though they have a far greater impact on cultural life than the funding of any individual company or initiative, they are beyond the scope and responsibility of our cultural agencies.

When you look at Australian culture in all its richness, the inconsistency of policy responses reveals the ad hoc nature of the current approach.

For instance, the Australian taxpayer spends hundreds of millions a year supporting Australian films, but not Australian computer games. We enforce some of the most stringent and punitive copyright laws in the world, without examining the costs of these special industry protections to consumers, schools, libraries and the public sphere. State governments promote contemporary music policies (“Victoria Rocks”) at the same time as imposing crippling regulations on the live venues that support that contemporary music (such as the laws that shut down The Tote). We create powerful economic incentives to replace live venues with poker machines without any evaluation of cultural consequences. We create regulations such as building codes, zoning and planning approaches without regard to the capital constrained nature of cultural practice. We maintain inconsistent and incoherent approaches to media regulation that means adults can watch an R-rated movie, but not experience similar material in video games, and perhaps soon, not on the internet either.

Another consequence of these inconsistencies is a sustained lack of funding and support of Australia’s indigenous cultural expressions. In cultural funding terms, the “great Australian silence” towards the richness and diversity of Aboriginal and Torres Strait Islander cultures, first criticised by anthrolopologist W.E.H. Stanner in 1968, still continues today.⁷ While some of the oldest living forms of music in the world slowly die out in central Australia, the Australia Council gives more than five times more money to Opera Australia than it does to its entire Aboriginal and Torres Strait Islander Arts Board.⁸ Opera is a valuable part of the western tradition. But Australia’s indigenous cultures are a unique, rich and valuable set of traditions that are both vulnerable and potently powerful symbols of Australia around the world.

But our cultural policy debate rarely discusses these issues.

Where do we weigh the balance between expanding the choices and options for media consumers and small producers, rather than the industry protections of media proprietors? Where in debating copyright frameworks do we balance the rights of copyright holders (generally big media companies) with copyright users (generally consumers and public institutions like schools and libraries) in line with the realities of contemporary cultural practice? Where do we weigh the merits of supporting living artists making original new work against the heritage artforms and traditional European genres that we overwhelmingly fund?

The Rudd-Gillard Government’s cultural policies

While the Rudd-Gillard Government under Minister Garrett has begun the important task of developing a National Cultural Policy, in practice very little has changed since the Howard era – continuing a lineage of ad hoc policies and evolving misallocations that stretch largely unbroken back to the Whitlam era.

In developing a national cultural policy and in taking submissions about what it should be, there has been a notable step forward. The Howard Government did no such thing in 11 years in office. However, whether the need to engage comprehensively with the policies that affect culture can be reconciled with a powerful inertia pushing towards a policy that is purely about funding for the arts remains to be seen.

In calling for submissions on a new national cultural policy, Peter Garrett at the very least encouraged us to examine the way things actually work – or fail to work – already. Arts and cultural debates in Australia often devolve into a contest between those opposing government funding, and those seeking to increase it. Cultural regulations are generally ignored. By focusing debate on our current policy settings, we now have a chance to advance some much-needed options for reform.

Meanwhile, in the absence of a coherent cultural policy framework, much of the cultural policy action has taken place outside the Arts portfolio. In the Communications portfolio, the development of a National Broadband Network promises the largest cultural infrastructure project in the nation’s history – despite rarely being described and evaluated as such. Indeed, there appears to be little if any discussion of the cultural impact of the regulatory, technical, economic rules that will govern such a network.

Equally, the proposal to censor the internet through an unworkable mandatory filter is a decision with profound cultural consequences. This $125 million effort must count as one of the strangest policies of the Rudd-Gillard Government. While the filters are unlikely to prevent predators and pornography, they will have major consequences for freedom of speech and expression. The policy abandons our Western liberal tradition to follow a precedent established by totalitarian countries such as Iran and China. It’s hard to think of a more counter-productive policy for Australian culture.

Why the Australia Council needs to be reformed The Australia Council for the Arts is the Australian Government’s dedicated arts policy and advisory agency, so it’s a good place to start when we examine cultural policy. The Australia Council was formed in 1973 by Gough Whitlam’s government. It introduced meaningful support for artists and organisations working in artforms such as theatre, dance, visual arts and literature for the first time.9 Unfortunately, the Australia Council’s structure and artistic focus has changed little since the 1970s. In this time, driven by new technologies such as the internet, art and culture has changed radically. The result is that the Australia Council is increasingly irrelevant to culture today. The act under which it operates defines both what culture is and how it should be administered in ways that are hopelessly out of date. For example, the Australia Council has had little meaningful engagement with digital and new media arts, social networking, or gaming. In a decision driven by internal bureaucratic politics, the Australia Council abolished its New Media Arts Board in 2005.10 In a tale familiar to students of public policy in other spheres, the Australia Council has also been “captured” by the arts organisations it funds. Although it contributes small but significant amounts of funding to smaller companies and individual artists, the Australia Council now exists largely as a conduit to funnel money to a small number of large, privileged arts organisations. Its supposedly important functions of peer-review, advocacy and arms-length policy analysis have withered away to almost nothing. In monetary terms, the majority of the grant dollars it distributes are not peer-reviewed at all. The Australia Council is the cultural equivalent of the National Trust. For instance, while the Australia Council devotes approximately $90 million to music funding, only two per cent of this goes to jazz, rock, pop and other contemporary forms of music.11 The heritage aspect of the current Australia Council’s role is an important function. But it should not be at the centre of cultural policy. We desperately need a planning and development agency whose primary concern is contemporary cultural dynamics, opportunities and developments, and not merely heritage preservation.

The problem: the need for a holistic approach to culture

We are a long way from a joined-up approach to culture across and within Australian governments. In fact, Australia’s cultural policy is hopelessly fragmented across many agencies, leaving great gaps.

A glance at the way screen and broadcasting policy is handled in Australia illustrates this point. Australia’s federal Arts portfolio under Peter Garrett includes Screen Australia, the national film and television development agency. But Screen Australia plays no role in screen and broadcasting regulation, which is governed by the Australian Communications and Media Authority, part of the Department of Broadband, Communications and the Digital Economy. Copyright law and the Australian Classification Board are the province of the Attorney-General’s department. Digital content innovation and R&D is under the purview of a fourth department, the Department of Innovation, Industry, Science and Research. University film schools such as the Victorian College of the Arts are the responsibility of the Education Department. Film festivals are generally funded by state governments. The permits and regulations for film-makers wanting to shoot in a particular location are imposed by local governments. There is no national screen policy that seeks to join up all these dots.¹² Indeed, as film and video production becomes more decentralised, many screen-based practitioners are working in areas such as online video, gaming, and non-broadcast based media that have little or no engagement with, nor are consulted, by any of these agencies.

Australia’s cultural agencies were largely devised when the number of places in which cultural production and distribution took place was small and relatively fixed. At their core they are still rooted to the idea that a small number of elite artists produce and present large-scale culture through major institutions based on a classical European model or – in the case of film – major commercial producers and distributors.

In contrast, society is becoming more culturally diverse. Immigration, demographic change and new technologies and communications media have transformed the spectrum of cultural choices available.¹³ The large-scale infrastructure and mass subscription model that underpins the logic of many funded arts organisations is poorly equipped to respond to the plethora of new artists, artforms, audiences, genres, and sub-cultures emerging in a rapidly changing cultural dynamic.

The lack of engagement with cultural regulation in the music industry illustrates the counter-productive consequences of this disconnect. In Victoria, the state government has a specific policy for supporting contemporary music called “Victoria Rocks”, administered by Arts Victoria. Contemporary music is largely performed in small, commercial venues such as pubs, clubs and bars – and the proliferation of niche genres, markets and audiences is creating even greater demand for smaller venues. Yet these same venues are closing in response to tighter regulations from another part of the Victorian government that deals with liquor licensing. Nationally, the need to create viable small scale cultural venues – for music and other creative forms – is clashing with policies that are fostering denser urban planning, expanding numbers of gambling venues and poker machines, and requiring capital intensive building codes. Despite the Australia Council’s own research¹⁴ demonstrating that contemporary music is much more valued than the orchestras and opera companies that it overwhelmingly funds and focuses on, neither Arts Victoria nor the Australia Council have engaged substantially in these debates.

Our funding-centric approach to culture largely ignores these issues, yet federal issues such as tax, social security compliance, copyright and media policy, state issues like liquor licensing and public liability law, and local government issues like noise laws and urban planning are key cultural policy questions. There has been little or no effort by the Commonwealth or the states to try and adopt whole-of-government policies towards culture. As a result, much government cultural funding is wasted, and the practical needs of most artists, small organisations and even entire cultural industries (such as the design industry) are falling through the cracks.

Case study: Creating space for artists to be creative One of the biggest problems for artists, who typically have low incomes, is finding affordable space from which they can create, distribute and present their work. While a prolonged property bubble has driven up rents and exacerbated this problem, there are still many spaces within Australian cities that sit empty. In late 2008, the Renew Newcastle scheme was established in the regional New South Wales city of Newcastle to take some of the 150 otherwise vacant commercial spaces in that city and make them available to artists, creative enterprises and community groups. To date, the initiative has placed more than 50 artists in shops, offices, studios, and galleries. In doing so, it has revitalised a once emptying city centre and seeded a series of creative initiatives, both commercial and not-for-profit. It is a model for facilitating low-cost decentralised cultural production that other cities such as Cairns, Townsville, Adelaide and Geelong have begun to emulate. While the scheme has been a success, it is also a case study in the lack of responsibility for cultural regulation at a national level. The very presence of empty spaces in many cities is a product of both market failure and government regulation: many buildings sit vacant due to complex tax laws and planning regulations that provide strong incentives to owners to leave buildings vacant. As a result, flexible access to these spaces for artists and creators is essentially a policy setting – even if it is not an artform-specific funding issue. Unfortunately, under the current model, there is no capacity for meaningful engagement with the Federal Government around these issues. The Australia Council’s ambit to fund or support culture is defined in the dated, art-form specific cultural responsibilities defined by its 1970s era legislation, and cultural practitioners who work in ways that don’t fit into this model have no place in such a structure. Further, because the Australia Council is also the national cultural policy advisory agency, these artists and their issues are not represented in the Australia Council’s policy advice.

Iconic institutions or starving artists?

Spare a thought for the people who make Australian culture happen: the artists. The debate about Australian culture often ignores the great achievements of the individuals who create it.

In 2003, economist David Throsby released an in-depth report into Australian artists’ incomes. The title of the report, Don’t Give Up Your Day Job, says it all. The report found that the mean creative income for an independent artist working in Australia was only $17,000 per annum (the average annual wage in Australia in 2003 was about $52,300). But in that year, the Australia Council distributed just 6.3 per cent of its grant funding to independent artists. The remaining 93 per cent went to organisations.¹⁵ A recent, comprehensive survey of Australian arts funding commissioned by Arts Queensland found that “grants to individual artists to make work are estimated to be fewer than five per cent of all arts funding.”¹⁶

As folk wisdom suggests, choosing the arts as a career can still mean a short road to relative impoverishment. Most artists and creative workers take a huge pay cut just to work in their chosen field of employment, and as Throsby found, nearly all of them need an extra part-time job or two just to survive. Of course there is not necessarily anything wrong with this: people like nurses and teachers choose professions that reward them in non-financial ways all the time.

But the huge imbalance of funding between artists and organisations is the result of a long-term decline in direct funding for Australian artists and creative workers that has damaging consequences for the Australian creative economy. In the absence of direct public sector funding for artists undertaking primarily creative work, the balance of arts funding goes towards administrative positions within funded organisations. The unquestioned assumption that large companies and fixed institutions are at the centre of cultural life has placed the management and maintenance of such organisations at the centre of cultural policy concerns and government expenditure.

In this era, such an approach is neither effective nor efficient. Despite their bohemian reputation, individual artists can often be highly efficient, as they are excellent at leveraging and making the most of scarce resources. They can also be flexible and capable of building appropriate structures and mechanisms to create, present and promote individual shows or projects. Their way of operating allows for small-scale experimentation, innovation and risk taking. Individually and collectively, they are highly responsive to technological change, changes in audience dynamics, and the decentralised environment of cultural creation and consumption. They require little in the way of expensive infrastructure. By contrast, the highly-centralised structures in which we invest most of our cultural resources have high overheads and are often conservative, risk-averse and place comparatively little value on experimentation or the creation of new work.

Individual artists (especially non-famous ones) are the forgotten voice in the Australian cultural debate, even while they provide the bulk of the workforce for our cultural endeavours. It’s high time Australia re-balanced its cultural investments and regulations away from big buildings and big corporations, and towards the creative human capital of the cultural sector. At stake is not the future of artistic achievement in Australia — for artists will always create, no matter their economic circumstances — but the ability of Australian creators to tell their own stories, and create for their own communities.

A new cultural agency for contemporary Australian culture? The reliance on the Australia Council as the primary agency for cultural policy is inherently unsustainable. Australia needs a new government cultural agency with a contemporary brief: to ensure that we are a nation that is a creator and not merely a consumer of culture, and that Australians are active and enabled participants in the increasingly globalised cultural pool. The brief should be primarily cultural, not economic – but must recognise that culture has an economic component. Culture is ethereal and beautiful, but it is also subject to market forces, and can bring great economic benefits. Such an agency needs to work beyond the funding paradigm, to ensure the tax system, intellectual property law, social security regulations, compliance costs in the built environment and other policy areas take into account the needs of contemporary cultural production. It needs to ensure that contemporary Australian culture is funded and resourced at least as well as heritage arts, and that these policy priorities are elevated to at least the same level. The key policy goal should be primarily concerned with the creation and promotion of contemporary Australian culture – in all its diverse forms. To do this, we must recognise that most Australian artists and creators do not work for or in large funded arts companies, and that therefore we need to promote policies that support and respect this reality. One of the ambits of this agency should be to review and make recommendations on Australian industry and market regulations for the cultural industries, from a cultural as well as an economic perspective. The design of cultural markets, the rules and regulations that govern them and the incentives that they provide are often created by government, and have profound cultural consequences that no agency is currently charged with addressing. This role should not necessarily lead to public subsidy for commercial markets or protectionism, but it should recognise that the market fails to support many artforms – not just orchestras and arts centres.

The false divide between “high art” and “popular culture” Cultural policy has long been bedeviled by a false distinction between what is sometimes called “art for art’s sake”, and for-profit cultural products created by the entertainment industries. Public funding for the so-called “high arts” is often justified by the artistic merit of artforms such as literature, theatre or orchestral music, and by the supposed inability of these arts to exist if left to the workings of the free market. In this world view, government support for popular culture is often frowned upon as a “dumbing down” of standards, and in any case unnecessary, because the market already provides these products.17 In the real world, this is a false divide. The “high arts” can often be boring, unoriginal and pretentious, while so-called “popular culture” can display high standards of creativity, originality and artistic craft – and vice-versa. Similarly, heritage artforms such as Wagnerian opera or Shakespearean theatre can be immensely popular and highly remunerative, while many types of popular culture can be very unpopular indeed. In developing a new cultural policy, the age-old dialectic of “high arts” versus “popular culture” should be abandoned. Artworks are not good or bad just because they are popular or unpopular, and valid and original work can be found in every artform and genre.

Five policy solutions:

1. Recognise that “cultural policy” is about more than funding for the arts. It’s about policy frameworks across government including media policy, education, copyright and censorship law, tax, urban planning, liquor licensing and R+D.

2. Abandon the false divide between high art and popular culture. Art and culture of all different genres and types can be popular or unpopular, and good or bad. Cultural policy should not be based on preconceptions about which artforms are “worthy” of public support, but on cultural values that can manifest themselves in many ways, across many forms and genres.

3. Create a new cultural agency for contemporary Australian culture. Australia needs a new government cultural agency with a contemporary brief: to ensure that we are a nation that is a creator and not merely a consumer of culture, and that Australians are active and enabled participants in the global cultural pool. The Australia Council is not an organisation capable of this, or of becoming this.

4. Cut the red-tape that affects culture. Many artists and cultural organisations are constrained by access to appropriate infrastructure, like venues and work  space, as well as capital. The ability to put in place policy settings that allow them to perform, present and produce with limited capital is more important (and effective) in ensuring their success than direct subsidies.

5. Fund artists and production, not institutions. Ordinary working artists are the forgotten people of Australia’s cultural policy debate. Their average income is well below median Australian wages. Yet individual creators and artists are the life-blood of Australian culture. Where new funding is created, it should be directed towards individuals and small companies – not large institutions. And because so many artists are so poor, small amounts of funding can go a long way.

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Photo Credit:  Angelica Jellibat, http://www.flickr.com/photos/andricongirl/4381199933/

Endnotes

AUTHORS(S): Ben Eltham and Marcus Westbury

Australia’s abundant energy and opportunities for future wealth and health

by Fiona Armstrong

Introduction

Unlike many other countries, Australia has no significant climate policy. Efforts to introduce a lacklustre emissions trading scheme have failed, and apart from some minor policies, Australia has no significant policy agenda to contribute to the global effort of stemming our relentless rise in greenhouse gas emissions, or to draw down our legacy of excess carbon dioxide (CO₂), as we are warned we must.¹

Australia’s history is closely linked with a reliance on natural resources. We have been encouraged to think that the ‘lucky country’ is dependent on its natural assets for wealth and prosperity and that their exploitation is our only key to a stable economy and flourishing society. The bad news is that the way we are using some of those resources is damaging not only the ecosystems on which we depend, but also our economic security and our nation’s reputation as a good global citizen.

The good news is that our abundant natural resources can continue to dominate Australia’s future. But we must begin to transform our economy now to capitalise on this continent’s natural advantages of sun, wind, and soil and the opportunities they afford for a secure future.

The fossil fuel lobby’s claims that renewable energy can’t do the job, or that cutting emissions will harm Australian’s job prospects, are simply unfounded – in fact the reverse is true.² Wind and solar data tells us that we have massive energy resources available and technology exists to provide us with renewable energy day and night.³ Detailed reports indicate there is huge potential for the creation of jobs in constructing and operating new renewable energy infrastructure.⁴ Further studies suggest that a failure to engage with new global markets that are being created by action on climate change means Australia is missing out on opportunities to develop innovative intellectual property and on growth in profitable new industries.⁵

Unless Australia supports the development of an economy powered by renewable energy sources, we risk a loss of competitiveness internationally. Our reliance on coal looks increasingly reckless economically as well environmentally as other countries begin to look at imposing border taxes on carbon intensive imports.⁶ We need to begin our clean energy transformation now, or Australia will lose out on the jobs and economic benefits from what is predicted to be the ‘biggest high technology market of the 21st Century’.⁷

It is time to link climate with policy across the sectors (energy, transport and agriculture in particular) and to develop strategies to ensure Australia is able to meet its fair share of the global obligation to reduce greenhouse gas emissions and reduce atmospheric CO₂ to a safe level. This will require a considerable shift away from the current focus on propping up ‘sunset industries’ in the face of inevitable change.

The scale of transition is enormous, but as Sir Nicolas Stern, Professor Garnaut and others have identified, the costs of not acting far outweigh the costs of action.⁸

Repositioning Australia now to capitalise on its natural advantages by building industries based on sustainable resources will enable us to lower our emissions and draw down carbon dioxide – with the additional benefits of more jobs (and more secure jobs), cleaner air, economic prosperity and energy security.

Addressing climate change is both a matter of domestic policy and international obligation. Australia cannot have any credibility in global discussions on climate change if it takes no effective action itself. Effective international action depends on emission reductions being undertaken by industrialised nations, not just promised. It is the implementation of effective policies to reduce each nation’s emissions that is the key to international agreements, not the other way around.

The development of a comprehensive policy suite to address the challenge of climate change for Australia is well overdue. Action is needed to reduce emissions, draw down excess carbon dioxide from the atmosphere, and to adapt and prepare for further changes to the climate. This will not only assist in eliciting cooperation from other global partners in the task of restoring a safe climate, it will also:

• help position Australia in the increasingly competitive global marketplace of clean, sustainable industries
• improve our energy and national security, and
• provide considerable health and social benefits.

The story so far

During the past decade, Australian governments have been slow to respond to the global effort to reduce emissions and act on climate change. This reflected the scepticism (and later, denial) on the part of some of the senior members of the Howard government on the scientific evidence on global warming. Concerns about Australia’s reliance on fossil fuels (for electricity generation, transport and export revenue) led to that government’s refusal to ratify the Kyoto Protocol (an international agreement effective since 1997 between 190 countries) despite being only one of two industrialised countries not to do so.

Under pressure from shifting popular opinion however, Prime Minister Howard pledged to develop an emissions trading scheme to reduce green house gas emissions in 2006, and commitments were made by the then Rudd Opposition to address the issue. Elected on a wave of popular support and desire for change, the Rudd Government adopted the Howard policy of emissions trading in 2007, and during 2007-08, developed a ‘cap and trade’ model, known as the Carbon Pollution Reduction Scheme (CPRS). The Opposition changed position (and leadership) on the issue, and the legislation was rejected twice in the Senate, amid widespread criticism of the scheme.

With growing community concern about its inadequate targets, excessive use of offsetting, unnecessary compensation to polluters, and the setting of both a ‘cap’ and a ‘floor’ beyond which emissions reductions could not fall or rise, by early 2010 the CPRS had become a liability for the Government, and it was shelved (to be reconsidered, we are told, in 2013).

This decision offers a fresh opportunity to look at climate policy options in Australia and provides an open space for the development of innovative and effective policy ideas. Such ideas must necessarily reflect actions being taken globally as well as position Australia for leadership in the global effort to address the challenge of climate change.

Why does climate policy matter?

Climate change poses profound threats to the natural ecosystems and biodiversity on which humans depend, and is altering the previously stable climatic conditions that have existed over the past 10,000 years – allowing human civilisation to flourish. Overwhelming scientific evidence over several decades demonstrates human activity (in particular, the burning of fossil fuels for power, heat and transport as well as widespread deforestation) has led to an accumulation of carbon dioxide and other greenhouse gases in the Earth’s atmosphere above pre-industrial levels. This is causing increases in average global temperature, changes to the Earth’s climate, and severely compromising the ability of the Earth’s oceans to absorb carbon dioxide. Ocean acidification is threatening the viability of marine ecosystems, ⁹ with significant implications for food production for millions of people. ¹⁰

The most recent scientific evidence confirms these effects and demonstrates a rapid increase in the rate of warming due to dramatic increases in global emissions. The timeframe for effective action to reduce emissions and prevent the collapse of major ecosystems (and thus our food chain, among other things) is very short – global emissions must peak within this decade and then rapidly decline.¹¹

Carbon dioxide isn’t the only problem

Climate change is only one of three ‘planetary boundaries’ (identified by Earth system scientists as quantified boundaries within which humanity can safely exist) that have already been transgressed. The others are the nitrogen cycle and biodiversity. Nitrous oxide requires special attention, as it is a significant climate forcing agent, with a global warming factor 300 times that of CO_2.¹² The profligate use of nitrogen by humans (mainly in agricultural fertilisers) is also responsible for the pollution of waterways and damage to marine ecosystems,¹³ and is implicated in outdated fossil fuel energy production.¹⁴

Biodiversity is often overlooked in policy discussions and efforts to reduce emissions. However there are compelling reasons to act to prevent further global warming on biodiversity grounds alone, and to place a value on the services afforded to us by the ecosystem. We need to recognise the vital connection between the choices we make on resource use, the status of the ecological system and the wellbeing of people.¹⁵ There are profound economic consequences for failing to do so: from a total of over $US 33 trillion (the 1997 estimated annual value of global ecosystem services), conservative estimates put the annual global loss of land based ecosystem services at €50 billion, and potentially equivalent to seven per cent of GDP by 2050.¹⁶

Protecting nature’s grey matterProtecting biodiversity means maintaining the irreplaceable intellectual property that is created by millions of years of evolutionary design – as memorably put by Ian McBurney from live·ecological: “We could also be losing the chance to study nature’s 3.8 billion years of design perfection and find cures for diseases or bio-mimetic glues, organic solar cells, structural designs, super fast computer hardware, self cleaning paints, truly biodegradable packaging, ‘photosynthetic’ hydrogen splitting for fuel cells, stronger and self assembling ceramics, more effective trains and aeroplanes, colour through shape, rather than pigments, bacteria that mine metals from waste streams, collision avoidance circuitry from locusts and lots more.”17

A diverse ecosystem is a resilient one, but the capacity of biodiversity to cope with climate change is not infinite: as the 2009 Australian Government report on biodiversity and climate change stated:

“Australia’s biodiversity has only so much capacity to adapt to climate change, and we are approaching that limit. Therefore, strong emissions mitigation action globally and in Australia is vital – but this must be carried out in ways that deliver both adaptation and mitigation benefits.” ¹⁸ Prompt and effective action on climate change is therefore an essential act of risk management.¹⁹ This action will also confer many more immediate benefits to Australia’s health, wellbeing, and national and economic security.

There is good news for jobs: studies show there are significant opportunities for ‘green’ jobs growth, since the renewable energy industry creates more jobs per unit of energy generated than the fossil fuel industry.²⁰ It is also a safer industry: the risk of death or injury from workplace hazards is greatly reduced in the renewables sector compared with those working in coal mining and fossil fuel extraction.²¹

And there is good news for health: improvements to the transport system and powering it with clean renewable energy will reduce air pollution and (if carefully planned, promoted and maintained) stimulate greater physical activity, reducing the risks of some chronic diseases, such as respiratory disease, obesity, diabetes, and cardiovascular disease.²² Modifying our food choices away from high emissions livestock production can reduce cardiovascular disease,²³ and reducing our dependence on industrial scale farming practices will improve soil and water quality.²⁴

Shifting from the burning of fossils fuels, such as coal, for our energy supply will bring significant benefits for those living and working nearby, with developmental disorders, cancers, heart disease and respiratory problems all implicated in proximity to the mining, transportation and burning of coal.²⁵

Fast facts The annual health costs of coal-fired power generation in Australia are estimated at $2.6 billion.26 Coupled with costs from traffic pollution (a 2003 estimate put annual health costs at $3.3 billion), the health costs to the Australian community from burning fossil fuels is around $6 billion annually.27

Fast facts If the currently externalised total climate and health costs for Australian power stations were accounted for, the costs of energy generated by fossil fuels would be considerably higher. If total climate and health costs were included, costs are estimated at: $A19/MWh for natural gas, $A42/MWh for black coal and $A52/MWh for brown coal.28 In contrast, wind power installations are around $A1.50/MWh, while solar thermal and solar PV are equivalent to around $A5/MWh.29

Values and principles

There are both self-interested and moral reasons to act on climate change. We should act to protect ourselves from current and future risks, and we should act to prevent others being affected. Fundamentally, however, the principle that overwhelmingly demands a shift in our approach to economics, our use of natural resources, and our response to climate change, is simply the principle of the ‘interconnectedness’ of ecology and human society. Too little understood by economists, policymakers and overwhelmingly urbanised global populations, the awareness that we are intrinsically part of and totally reliant on a complex interconnected ecological system (whose equilibrium is currently disrupted and increasingly threatened by our current activities) is what should drive our responses to climate and environmental challenges. There are other important issues that should also underpin our response, such as our obligation to intergenerational equity (we don’t leave a mess behind for our kids), global justice (we don’t further damage the wellbeing of people in poorer nations by selfishly insisting we have a right to pollute, and alter the climate), and finally the precautionary principle – because reducing the risk of dangerous climate change is the most profound act of risk management that we can take.

Fear of these risks and consequences may not be what drives us. Psychological studies reveal that, influenced by those with vested interests in the status quo, humans have demonstrated an extraordinary ability to deny the evidence on climate change and its imperative for action.³⁰ A new national ‘narrative’ is needed that will enable people to feel optimistic about the future, confident in the solutions, and convinced that change will not only address current and future risk, but will actively contribute to the establishment of future societies that are better for all of us. As many organisations are beginning to appreciate, changing the way we do business is necessary to ensure that we continue to have access to the ecosystem services on which we depend. Shifting Australia’s economy from one that depends on exploitation of finite natural resources to one that is underpinned by infinite and clean resources is both a challenge and an opportunity. But the emerging evidence is that, not only is it possible, it will bring with it unparalleled economic gains – with the creation of jobs and industries that will make us internationally competitive and economically secure, with better health and more connected communities.³¹

How do we do it? Transforming energy, transport and land use to make Australia cleaner, healthier, safer, wealthier and more responsible

There is a great need to considerably broaden the policy discussion in Australia on climate change. To date, policies and programs have been developed that are inadequate in scale (Solar Flagships); ill-conceived (the Renewable Energy Target, otherwise known as RET and net feed-in tariff); fail to take account of the science (low emissions reduction targets); illogical (inclusion of native forest biomass and coal mine waste gas as eligible renewable energy sources in the RET); and poorly administered (insulation). Other policies, also insufficient in magnitude but nonetheless effective (Remote Renewables Program), have been abandoned.

Many of these policies have been developed in isolation from one another, when in reality, comprehensive, whole-of-government (let’s face it, whole-of-society) responses are needed.

There are three main strategies necessary to effectively address climate change. These are:

• reducing the production and emission of greenhouse gases from all sources – starting our New Industrial Revolution
• removing excess CO₂ from the atmosphere – restoring the balance for land, air and sea, and
• providing for the review and monitoring of a range of techniques for direct cooling of the climate – ensuring safety in climate interventions.

Starting our New Industrial Revolution. Reducing emissions and removing CO₂ from the atmosphere requires moving away from the use of fossil fuels in the energy and transport sectors. The changes needed are technically possible, economically feasible and will lead to significant long-term reductions in future energy costs, improvements to population health, and increased agricultural productivity. This will bring about substantial changes to the way we use natural resources but we will be healthier, safer, and facing a more secure economic and foreign policy future as a result. Policy options must include strategies that will achieve a rapid transition to zero emissions technologies, reduction in energy demand and reduced emissions from non-energy related sources.³²

Restoring the balance – for land, air and sea. The drawing down of legacy emissions (those already in the atmosphere) is also needed to restore a safe climate zone of atmospheric CO2. At present the main option for this is that of biosequestration. Australia has enormous potential to sequester large quantities (potentially billions of tonnes) of CO2 in soils and forests.³³ We need to begin to account for our ‘natural capital’ and stop cutting down our native forests, degrading our waterways and, mindful of the need to secure quality land for food production, increase the use of biochar and undertake substantial reafforestation of our ‘wide brown’ land. Where possible, policy makers must take into account the value of ecosystem services and reflect that value in the establishment of price signals and regulatory measures.³⁴

Ensuring safety in planned climate interventions. Providing for the review and monitoring of a range of techniques for direct cooling of the climate in legislation is necessary to ensure that Australia is aware of, and remains engaged in developing governance frameworks for any technologies being explored to directly alter global or regional climates. This approach acknowledges that while the utmost priority should be placed on eliminating emissions and drawing down excess, should the Earth’s climate suddenly deteriorate, it may be necessary to consider a range of options to protect the Earth’s systems while natural safe climate conditions are restored.

The Policy ToolboxAustralia’s next term climate policy goal: Smarter, greener, fairer, healthier Implementation of the strategies above requires the development of broad national climate change legislation encompassing a suite of policy responses35 to reduce emissions, draw down carbon and ensure sound governance of climate cooling techniques. This should be accompanied by commitments at the COAG level for state and territory legislation that supports and assists the goals of national initiatives. The legislation must include the following key elements: Specific targets for emissions reductions and draw down of emissions – these must have a timeframe attached for regular review (e.g. annually, according to advice from an expert climate scientific advisory committee) Meaningful financial incentives e.g. a price on carbon that is set at a level that will prevent financing of any new coal fired power generation (unless it can safely capture and store 100 per cent of its GHG emissions) and make clean renewable energy cost competitive with fossil fuels Energy efficiency standards, fuel consumption standards and greenhouse gas emissions standards that encourage significant reductions in energy use (of fossil fuels in particular) and create disincentives for inefficient energy use in building, transport, and appliance technologies 36 Programs and incentives to discourage deforestation, encourage reafforestation and improve land use to deliver emissions reductions and promote biosequestration 37 Investment in: national energy transmission infrastructure, zero emissions energy technology development and deployment, and zero emissions transport infrastructure 38 and Removal of the perverse incentives that exist in current policy, such as the current subsidies to fossil fuel industries.39 The legislation must make use of these top climate tools: Carbon tax - the revenue from which should be used to offset the increase in energy costs for low income and disadvantaged households, assist workers who are disadvantaged during the transition, and to fund the renewable energy transformation Gross feed-in tariff, for a guaranteed period and tiered according to technology – this is needed to expand renewable energy technologies that are not currently cost competitive under the RET e.g. solar thermal with storage, wave, geothermal; it should be established initially to operate alongside the RET but over time the RET should be phased out Mandatory standards for emissions and energy efficiency – to drive emissions abatement and to reduce energy use Progressive taxation policies that encourage the rapid deployment of zero emissions technologies and conservation of natural capital – e.g. tax relief for renewable energy technologies through accelerated depreciation rates; tax breaks and other incentives for landholders/communities to undertake reafforestation projects/reduce deforestation and improve biosequestration Public financing to upgrade and expand national energy transmission and public transport infrastructure; Funding to support capital investment for renewable energy technology and the development and deployment of technologies for biosequestration and improving soil quality e.g. biochar – through the provision of low interest loans or loan guarantees Removal of subsidies for those industries that cause us harm e.g. fossil fuels and intensive agriculture – these should then be applied to renewables and organic farming Transition and adaptation support for communities – undertaking comprehensive regional climate risk assessments that evaluate economic, health, social and environmental risk and developing action plans to address risk; Comprehensive education programs to improve climate literacy in all communities; Investing in research – this is needed to monitor climate change in order to respond effectively; for further development of zero emissions technologies; to improve our understanding and capability for drawdown and transition strategies; and to improve our understanding of climate cooling techniques Investment in education and training of the skilled workforce needed to manufacture, install, operate and maintain new technologies; and retraining of workers in high emissions industries to enable them to participate in the new green economy, and A sustainable population policy – recognising the environmental impact of our high per capita emissions and the effect of the human population on our fragile ecosystem.

Why choose these tools?

Tax

In his landmark report on the economics of climate change back in 2006, Sir Nicholas Stern identified a price on carbon as a key element to cutting emissions. Nothing has changed; only the urgency of its application has increased. A carbon tax provides a better choice than emissions trading because it:

• creates an economy-wide incentive to reduce emissions ⁴⁰
• is simpler and more transparent than emissions trading ⁴¹
• provides a reward for more long-term (and higher cost) structural changes, while an ETS just encourages low-cost reductions ⁴²
• provides a steady flow of revenue for governments to direct towards emissions abatement ⁴³
• provides more price certainty for business than the volatile market of emissions trading ⁴⁴
• can be adjusted according to a jurisdiction’s emissions profile ⁴⁵
• sets no upper limit on emissions, unlike an ETS, which creates a ceiling (beyond which emissions will not occur) and a floor for emissions reductions ⁴⁶
• doesn’t discourage voluntary action ⁴⁷ and
• since there are no “rights to pollute” with a carbon tax, it is less likely to generate the compensation claims and buyback costs associated with an emissions trading scheme.⁴⁸

And a tax will be more efficient economically. A 2008 study from the US Congressional Budget Office found that on economic efficiency measures, the net benefits of a tax were roughly five times that of a cap-and-trade (emissions trading scheme), with reductions achieved at a fraction of the cost.⁴⁹

Feed-in tariffs

The choice to implement net, rather than gross, feed-in tariffs in some Australian jurisdictions has been a mistake; the rewards for net feed-in tariffs are minimal and quite insufficient to drive investment in large scale renewable energy technology.⁵⁰ In contrast, a gross feed-in tariff has been used effectively in Germany, where it provides investment security, has created hundreds of thousands of jobs and saved billions of Euros in avoided expenditure on fossil fuels.⁵¹

The story is similar in Spain where, in addition to an EU renewable energy target of 20 per cent by 2020, a gross feed-in tariff is responsible for delivering the Government’s 2010 target of 20 GW of installed wind capacity,⁵² and driving a surge in investment in the cheapest form of solar power – concentrated solar thermal (CST).⁵³ A guaranteed long term tariff rate at a high enough level to cover costs, coupled with a specific target for CST is responsible for Spain currently boasting the largest global share of solar thermal projects under construction.⁵⁴

Standards and targets

It’s time to move beyond voluntary standards – these have been in place in some jurisdictions for decades and emissions have continued to rise. Relentless increases in energy consumption in Australia (predicted to rise 35 per cent by 2030),⁵⁵ need to be addressed through aggressive and continually improving mandatory standards and targets for energy efficiency to reduce energy demand. There is huge potential for emissions reductions from improving energy efficiency: according to a 2008 McKinsey and Co report, about 25 per cent of potential emission reductions could be achieved through energy efficiency measures alone, and what’s more, they are cost-positive (i.e. they save money). To make these standards effective, it is also vital to increase the incentive for emissions reductions by electricity and gas utilities through decoupling the link between revenue and volume of energy sold – in other words, to shift from the current incentive to sell more energy, to less.⁵⁶ Australian transport emission standards also require considerable strengthening if the health costs (see above) and emissions abatement needed are to be achieved. The transition away from fossil fuels will also require direct investment in the production of clean renewable energy powered vehicles.

Infrastructure

Immediate and major investment in zero emissions public transport is necessary to encourage a shift away from private cars to public transport and bicycles in metropolitan areas, increased use of and investment in electrified rail to replace much of the heavy haulage of road transport, and development of a national fast electric rail network to reduce emissions from domestic aviation. To facilitate the contribution of decentralised renewable power generation, a nationally integrated ‘intelligent’ grid for electricity distribution is needed – for which public investment is required.

Removal of fossil fuel subsidies

Achieving effective emissions reductions requires the removal of existing perverse incentives that work in opposition to this goal. Around $10 billion is currently provided in public subsidies to the fossil fuel industries in Australia every year via a range of state, territory and federal programs.⁵⁷ Decarbonising the economy requires that these subsidies are instead applied to the development and deployment of zero emission technologies.

These policies and others listed above are not an exhaustive list of all the options available for inclusion in a comprehensive climate ‘policy suite’, but are certainly some of the key ingredients. Other important options include, for example, the establishment of a national climate change commission to oversee, monitor and report on the implementation of policy. It is clear, however, in the time remaining to effectively act on climate change, no single policy will be enough, and a range of options must be urgently employed.

What is the evidence that the New Industrial Revolution is possible?

It is not only possible – it can be achieved in relatively short time frames, as the technology is already available and resources are abundant. All that is missing is political will.

A new report from Melbourne consultancy Beyond Zero Emissions (BZE) supports the findings of international studies which demonstrate that the world’s energy requirements could be met from renewables within 10-30 years – with aggressive policy action.⁵⁸ The BZE report (released July 2010) suggests it is possible for Australia to undergo an energy transformation and move to 100 per cent renewable energy for its stationary energy supply by 2020. This could be achieved using fully scaled commercially available technology (wind and solar thermal power with storage) to provide 24 hour dispatchable power from geographically dispersed energy-rich sites across the country.⁵⁹

The use of these two technologies directly addresses the claims of naysayers who assert that renewable technology is not yet up to the task of large-scale national power generation. The distribution of generating systems overcomes the variability of wind and, combined with the availability of power storage with solar thermal (up to 16 hours), also lays waste to the argument that only fossil fuel and nuclear sources can provide baseload power. Combined with energy efficiency gains, the use of biofuels from agricultural waste, and upgrades to transmission infrastructure, the rollout of these two technologies could achieve massive emissions reductions from the single largest source of greenhouse gas emissions in Australia – fossil fuel power generation. It would also generate 75,000 jobs during construction and 80,000 ongoing jobs in operations, maintenance and manufacturing – well in excess of those currently employed in the fossil fuel energy supply workforce.⁶⁰ The required investment for the implementation of this plan is estimated at around 3-3.5 per cent of gross domestic product over 10 years, or AU$35-40 billion per year for 10 years. When the loss of irreplaceable natural capital (i.e. currently unaccounted for ‘externalities’) is accounted for, this may seem like a very prudent investment indeed.

Other recent modelling supports these predictions of national jobs growth from strong policy action through investments in renewable energy, with regional areas in particular set to gain from an energy transformation.⁶¹ The National Institute of Economic and Industry Research estimates 770,000 extra jobs could be created by 2030 across Australia if a suite of policy measures to reduce emissions is implemented.⁶² As well as contributing to Australia’s competitive advantages by creating a strong and resilient domestic renewable energy industry, this type of action will also help to reduce our long term energy costs, build national capital and improve health outcomes.⁶³

The renewable energy revolution is not only possible – it’s happening already. Investment in renewable energy is generating more jobs per dollar invested and more jobs per megawatt hour than fossil fuel generation.⁶⁴ Global employment in renewable energy is already outstripping direct employment in the oil and gas industries.⁶⁵ Since 2005, global investment in renewable energy has increased 230 per cent,⁶⁶ and is expected to total A$185 billion in 2010.⁶⁷ And, far from being a laggard, China is leading the world, with investments in renewable energy of $US34 billion in 2009.⁶⁸

Conclusion

It is both possible and necessary for Australia to develop effective climate policy to contribute its fair share to the global task of emissions reduction and to ensure its own secure economic future, while protecting the wellbeing of its citizens.

Policy makers must realise that by taking responsibility for effective action, Australian leadership and action would send a strong signal and influence the response of other nations. As a ‘middle power’, the most effective act of diplomacy open to us is to prove by our own example that it’s possible to go from heavy polluter to climate problem-solver. Australia urgently needs other countries to believe in that possibility, because as a ‘land of droughts and flooding rains’ we have more to lose from climate change than most.

To build public support for effective policy, it is vital that policy makers communicate the scale and urgency of the problem to the community. Voters cannot be expected to support policies they don’t understand or comprehend the need for. The demonstrable disrespect for science that has pervaded political discussions in Australia threatens us all. It is time our political leaders defended climate scientists and made it clear that we do face grave risks, and that it is therefore necessary to develop policies that reflect the scientific evidence. It is also important that the benefits of taking action are made clear to ensure there is a sense of optimism about the future and to encourage innovation in the development of solutions. Overcoming domestic resistance by those with vested interests requires that governments enlist the support of the ordinary citizens – by communicating the benefits of actions as well as the risks. Many people may be unaware that effective mitigation is possible – and entreating the community to join in a national exercise that offers optimism and hope for the future may just be a successful political act.

Ultimately, whether or not we respond effectively will be a test of democracy that will determine our future as a species. Right now, it’s not going so well. Major corporations have greater sovereign power (and bigger balance sheets in some cases) than many nations – and this is reflected in global, and in particular Australian, responses to climate change. At present it is those who have a vested interest in the status quo who are dictating policy. If, as citizens, we choose to deny them this influence, we will need to make our voices much, much louder than they are at present. The time is ripe for a revitalisation of democracy to ensure our political leaders respond. This may be the most important project we can ever undertake.

The risks of not acting are enormous, but the benefits, if we are successful, may be profound. As Al Gore said: “We have at our fingertips all of the tools we need to solve the climate crisis.” Here in Australia we have abundant energy sources, relative wealth, an educated population, and a history of good global citizenry. It’s time we applied all these to a new national project – addressing climate change.

Photo Credit, Michael Gorey, http://www.flickr.com/photos/gorey/2579760026/

Endnotes

AUTHORS(S): Fiona Armstrong