Labor’s climate policy more aligned to business, says IPA

The IPA did a comparison of climate policies of the two major parties and found that Labor’s alignment has two key issues that the private sector has called for: mandatory standardised reporting that is internationally comparable and credible; and tightening the baseline emissions threshold that limits major polluters – both of which are supported by the Business Council of Australia.

“This alignment with private sector interests differentiates it from the Coalition and creates an opportunity for Labor to capture these stakeholder groups as supporters and voters,” said IPA advocacy and policy leader Vicki Stylianou. 

According to the climate policy comparison Labor has more ambitious targets – 43 per cent greenhouse gas emissions reduction by 2030 compared to the Coalition’s 28 per cent. It also highlighted the Coalition’s modus operandi of understating targets that they know will be surpassed.  

“This tactic of understating and overachieving brings the Liberals into closer alignment with Labor but their ambitions still lag quite significantly,” Ms Stylianou said. 

“At a domestic level the Morrison Government’s approach might produce more stability, allowing time to take people on the journey. At an international level, however, it puts us out of step with world leaders and could see Australia miss out on future growth opportunities and investment.”

IPA’s analysis demonstrated just how far business leaders and international policymakers’ thinking has evolved on the issue of climate change since the last election. 

“In 2019, Labor’s targets were so far out of whack with the rest of the world. Now, with the United States targeting a 50 per cent reduction in greenhouse gas emissions by 2030, Canada 40-45 per cent, and Japan 46 per cent, Labor appears more in sync with those setting the pace in the global energy transition race,” Ms Stylianou said.

However, the IPA said there is a weakness in Labor’s climate policy in its lack of modelling to support the pathway to net zero. 

“The Liberals have a clearer roadmap, although 55 per cent of the emissions reductions they are targeting rely on technological advances that are not necessarily guaranteed, such as hydrogen which is currently at peak-hype, and carbon capture and storage,” Ms Stylianou said. 

On electric vehicles, Labor favours subsidies that will primarily benefit consumers, carmakers and dealerships, while the Liberals are supporting infrastructure investment such as fast charging networks. 

The analysis was prompted by an unprecedented level of client inquiries for guidance on non-financial reporting, benchmarking, and strategic advice. 

“Our members’ clients are spending a significant portion of time and energy on non-financial environmental, social and governance issues these days. It’s not just about the financials anymore. It’s impacting them from several different angles – supply chain, recruitment and retention, financing,” Ms Stylianou said.