Labor may not back NEG until after Victorian election

It would be easy to simply see the current stand-off over energy and climate change policy as what the late and legendary rugby league commentator Rex Mossop would have called “deja vu all over again”.

At one end of the spectrum, the Greens reject the government proposal for a set of policy levers that potentially put the climate wars of the past decade to bed.

You will recall that in 2009 the Greens’ insisted the Rudd government’s emissions reduction plans were not ambitious enough, giving Labor no option but to negotiate with the Coalition, then led by Malcolm Turnbull. Turnbull did negotiate, compromises were made.

At the other end of the spectrum is Tony Abbott, the bloke who killed the 2009 deal and, with it, the leadership of Malcolm Turnbull.

Victorians go to the polls on November 24 and, with a number of seats under threat from the Greens, the Andrews ...
Victorians go to the polls on November 24 and, with a number of seats under threat from the Greens, the Andrews government has been taking a much harder line than other states on the NEG.

David Rowe

In the middle is the “everybody else” camp, not in any way in agreement with each other, but trying to muddle through a compromise.

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And there is the dawning reality that the government of the day may ultimately have to rely on the opposition to get the federal legislation involved in this latest policy manifestation passed.

The differences between now and 2009 say much about how the politics of these issues have morphed and also says much about how our politics has changed.

If you feel confused about just where everyone stands on the National Energy Guarantee as the week ends, you are not the only one.

Even some of those involved aren’t really sure at the moment exactly what is driving some of the other people in the process.

Where are we now?

So despite the various hearty expressions of optimism from the government that all will be well, no one is entirely sure how this will all play out.

Until Friday, most of the focus had been on the states – and whether they would agree to setting up mechanisms to regulate the energy market in a way that would require energy retailers to meet new supply reliability and emissions targets.

But the states’ demand that they should not be forced to sign up to an arrangement, which might get torpedoed by the party room, has inevitably started to shift attention to not just what happens in the Coalition party room next Tuesday, but what happens in Parliament, too.

The party room – and the federal Parliament – will be asked to sign up to the emissions reduction part of the National Energy Guarantee. Setting an emissions reduction target remains the preserve of the federal government, rather than the states.

It seems reasonable at this point to think the legislation will actually get the majority of the Coalition party room’s support.

The question is how many Coalition MPs might cross the floor against the legislation?

Tony Abbott has apparently been telling colleagues that he will cross the floor if and when legislation comes to Parliament. The government is nervous about Barnaby Joyce. There might be a prospect of a couple of others moving – Craig Kelly and Keith Pitt have been mentioned.

It is never a good look when members cross the floor on your legislation. But it is not lethal, no matter how much drama is sucked out of such an event on the day, and in the lead up.

Abbott does not have the authority he once had in his party. It is likely his colleagues would simply shrug their shoulders and get on with things if he, and a couple of others, crossed the floor.

With the possibility of some floor crossers around, the government would need several of the lower house cross-benchers to support its position, and it probably doesn’t have enough of them. But they only come into play if Labor decided to block the legislation in the House.

The signs are, however, that Labor will let it go through the House, helping deprive the Coalition floor crossers of oxygen, but would seek to amend it in the Senate.

Labor has a much higher emissions reduction target of 45 per cent – compared to the Coalition’s 26 per cent – and it would, no doubt, seek to have that higher target included in legislation.

In this era of minor party brinksmanship, no one talks too much about Labor holding the trump card on policy. But this is a case where it almost certainly will end up doing so.

However, unlike Abbott in 2009, Labor has not been playing a game of “destroy at all costs” in this area of policy. It has a great self-interest in the National Energy Guarantee being implemented and has acknowledged that there is a lot to be said for the policy – other than its lack of emissions reduction ambition.

The whole “early election” scenario has also faded post July 28 so the sense of urgency around politics has also faded a little.

That just leaves the complexities of politics at the state level.

Labor disconnect

There is something of a disconnect between federal Labor and some of its state counterparts in this policy space, particularly with Victoria.

The Victorians go to the polls on November 24 and, with a number of seats under threat from the Greens, the Andrews government has been taking a much harder line than other states on the NEG.

And of course it is not only trying to force a higher emissions reduction target, and more regular target reviews on Canberra, but an acceptance of state renewable energy schemes, too.

But the Victorian government is also under intense pressure from business groups south of the Murray to sign up to the NEG.

The Victorians surprised almost everyone when Environment Minister Lily D’Ambrosio emerged a day before state energy ministers were due to meet with federal counterpart Josh Frydenberg and laid out a number of hard-line positions.

It wasn’t that Victoria was killing off the NEG, she said, just reserving the (hard-line) position until the Coalition party room had dealt with the federal legislation.

With signs that the negotiations between federal and state governments are now likely to be postponed for another four weeks, it raises some obvious questions.

Will the state government be in a better position to negotiate and be flexible when the state election is only two months away instead of three? One thinks not.

Second, what happens to the passage of the federal legislation in the meantime? Does the federal Parliament – via one or other of the parties in it – effectively insist on waiting for a deal with the states to be sorted, or simply plough ahead?

You have to wonder whether those hoping for an end to the climate wars may have to wait until after November 24 to see an armistice.

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