Matt Canavan says Australia doesn’t subsidise the fossil fuel industry, an expert says it does


Jeremy Moss, UNSW

Queensland Nationals Senator Matt Canavan on Monday night denied suggestions the government subsidises Australia’s fossil fuel industry. The comments prompted a swift response from some social media users, who cited evidence to the contrary.

Canavan was responding to a viewer question on ABC’s Q&A program. The questioner cited an International Monetary Fund (IMF) working paper from May last year that said Australia spends US$29 billion (A$47 billion) a year to prop up fossil fuel extraction and energy production.

The questioner also referred to media reports last year that Australia subsidised renewable energy to the tune of A$2.8 billion. He questioned the equity of the subsidy system.

Canavan disputed the figures and said there was “no subsidisation of Australia’s fossil fuel industries”. You can listen here:

Senator Matt Canavan on ABC Q&A.
ABC Q&A1.59 MB (download)

So let’s take a look at what the Australian government contributes to the fossil fuel industry, and whether this makes financial sense.

Do fossil fuels need government support more than renewable sources of energy?
Justin McKinney/Shutterstock

What does Australia contribute to the fossil fuel industry?

Canavan said the figures cited by the questioner didn’t accord with the view of the Productivity Commission.

The commission’s latest Trade and Assistance Review doesn’t specifically mention federal subsidies. But it describes “combined assistance” for petroleum, coal and chemicals in mining of about A$385 million for 2018-19.

Subsidies to fossil fuel companies and other products can be difficult to categorise. Often there is disagreement as to what counts and what doesn’t.

For example, the IMF paper includes subsidising the costs of fuels used to extract resources, accelerated depreciation for assets and funding for fossil fuel export projects.




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Estimates by other organisations of the annual federal subsidies for the fossil fuel industry range from A$5 billion to A$12 billion a year.

So despite the disparities, it’s clear the fossil fuel industry receives substantial federal government subsidies. Earlier this month a leaked draft report by a taskforce advising the government’s own COVID-19 commission recommends support to a gas industry expansion.

Importantly, these subsidies benefit the fossil fuel industry relative to its competitors in the renewable sector.

Do these payments make sense?

The subsidies are also aimed at a sinking industry.

As Tim Buckley, of the Institute for Energy Economics and Financial Analysis, notes, COVID-19 and the falling cost of renewables are delivering a hit to the export fossil fuel industry in Australia from which it may never recover.

Fossil fuel companies such as Santos are also under extreme pressure from some super funds to adopt strict emissions targets.

Moreover, these subsidies produce very few direct jobs in fossil fuel extraction.

According to the Australian Bureau of Statistics, coal, oil and gas extraction create just 64,300 direct jobs. Only around 10% of coal industry employees are women.

If we divide the IMF subsidy figure by the number of direct jobs, the governments of Australia spend A$730,000 each year for every direct job in the coal, oil and gas industry. That equates to A$1,832 for every Australian.

Where are the profits?

Setting aside the madness of this support for fossil fuels given the climate crisis, the subsidies make no financial sense.

With so much government support, you’d think the industry would be full of profitable companies filling the government’s coffers with taxes. But this is not the case.

Australian Taxation Office data for 2016-17 show eight of the ten largest fossil fuel producers in Australia paid no tax. That’s despite nine of these companies having revenue of about A$45 billion for that period.

Not all of these benefits go to these big producers, but many of them do.

If Prime Minister Scott Morrison really wants to lessen the impact of the coronavirus on Australians and save jobs, then this gross level of subsidies must be phased out.

Given the scale of the climate crisis, the Morrison government’s fossil fuel subsidies don’t make sense.
AAP

Money needed elsewhere

Subsidies paid each year to the fossil fuel industry could be used far better elsewhere.

It could help retrain or provide generous redundancy packages for the relatively small number of workers in fossil fuel industries and their communities.




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The subsidies are unconscionable when you consider the resources so desperately needed now for health and the broader economy. The coronavirus must force us as a country to re-evaluate how we distribute taxpayer funds.

As International Energy Agency head Fatih Birol notes, we now have an “historic opportunity” to use stimulus to transition to clean energy.

Directing funds to companies that have had 30 years to prepare for their demise is simply throwing away public money. It could be put to so much better use.The Conversation

Jeremy Moss, Professor of Political Philosophy, UNSW

This article is republished from The Conversation under a Creative Commons license. Read the original article.

The High Court sticks to the letter of the law on the ‘citizenship seven’


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The High Court has ruled Scott Ludlam, Larissa Waters, Fiona Nash, Barnaby Joyce and Malcolm Roberts ineligible to have stood for parliament at the 2016 election.
AAP/Shutterstock/The Conversation, CC BY-ND

Gabrielle Appleby, UNSW

Today, the High Court announced the fate of the “citizenship seven”, with only senators Nick Xenophon and Matt Canavan surviving the legal ordeal. (Although the victory will be of limited relevance to Xenophon, who has in the meantime announced his resignation from the Senate to return to state politics in South Australia).

In the case, the High Court, acting as the Court of Disputed Returns, found that four of the six senators referred to it, and the only member of the House of Representatives (Barnaby Joyce), were disqualified under Section 44 of the Constitution. With the exception of Xenophon and Canavan, it was found that the MPs had never been validly elected.

The court has declared all five seats vacant. The senators will be replaced through a recount from the 2016 election. The House of Representative seat of New England will go to a byelection on December 2, which Joyce will contest.

In the meantime, Labor has refused to offer the Coalition a pair for Joyce’s absence, and the Coalition will maintain government on a knife-edge, with 74 seats plus the support of the crossbench, and, if necessary, the Speaker’s casting vote.

Leaving to one side the immediate political consequences of the decision, what did the High Court say about the interpretation of the restriction on foreign citizens running for parliament in Section 44? And is this the last time we will have to think about the matter?

The possible interpretations of Section 44

The crux of the constitutional case was the interpretation of Section 44 of the Constitution – specifically sub-section (i). That, relevantly, provides:

Any person who … is a subject or a citizen or entitled to the rights or privileges of a subject or a citizen of a foreign power shall be incapable of being chosen or of sitting as a senator or a member of the House of Representatives.

Importantly, if a person is found to be in breach of Section 44 at the time they nominated for election, they will never have been validly elected.

The High Court has held that if a person has never been validly elected, their parliamentary votes during the time they purported to sit would still be valid.

However, questions have been raised as to the validity of the decisions of ministers who were not validly elected. This means there are possibly further unresolved issues around the validity of decisions made by Joyce and Fiona Nash, who, unlike Canavan, did not step down from their ministerial posts while the High Court made its determination.

Another important point that the court has previously clarified is that foreign citizenship is determined according to the law of the foreign state concerned.

None of the interpretations that were urged by the parties on the High Court were strictly literal readings of the words “citizen of a foreign power”. All the parties accepted that there had to be some level of flexibility, allowing a person who was technically a foreign citizen to nonetheless be able to run for parliament.

The real argument in the case, then, was how much flexibility could be read into the section.

The reason all the parties accepted that there had to be some flexibility in the words, was that the High Court had held as much in a 1992 decision of Sykes v Cleary. Relevantly, this case did not concern people who were unaware of their foreign citizenship, and so did not directly address the main point that was in issue for the citizenship seven.

Rather, the case stood for the proposition that a person may be a dual citizen and not disqualified under Section 44 if that person has taken “reasonable steps to renounce” their foreign nationality.

In the course of his dissenting judgment, however, Justice Deane made a comment that the provision should really only apply to cases “where the relevant status, rights or privileges have been sought, accepted, asserted or acquiesced in by the person concerned”. In this way, Deane suggested there was a mental element to being in breach of the provision.

Many of the interpretations urged on the court drew on this idea. They ranged from requiring voluntary retention or acquisition of citizenship or requiring actual knowledge of foreign citizenship, to a test of whether a person was on sufficient “notice” to check their citizenship status, to a need for the person to have real allegiance to the foreign power.

The High Court opts for certainty

The High Court opted for an interpretation of the Constitution that promotes certainty for future cases.

In a (rare) unanimous decision, it adopted a reading that, as far as possible, adhered to the ordinary and natural meaning of the words. It accepted that the literal meaning would be adopted, with the only exceptions those that had been established in Sykes v Cleary.

The court refused to read further exceptions into the provision based on knowledge, notice or actual allegiance. It said to do so would import a worrying element of uncertainty into the provision, which would be “apt to undermine stable representative government”.

The application to the ‘citizenship seven’

Once the High Court resolved the interpretation of Section 44, it had to apply this interpretation to each of the citizenship seven. The only two MPs who they found not to have fallen foul of this strict reading were Xenophon and Canavan.

Xenophon had what was referred to as “British overseas citizenship”. This had been inherited through his father, who migrated from Cyprus while it was still a British territory. The court accepted that Xenophon, while technically a type of British “citizen”, held no right of entry or right of abode, and thus he did not have “citizenship” for the purposes of Section 44.

Canavan’s facts were more complicated. His alleged citizenship turned on a change in Italian citizenship law that occurred because of a decision of the Italian Constitutional Court when he was two. The court received expert evidence on the Italian legal position, and it ultimately accepted that they could not be satisfied that Canavan was, in fact, a citizen of Italy.

Each of the other senators and Joyce accepted that there were, technically, citizens of a foreign country at the time of their nomination. But they argued they had not known of this when they nominated for parliament. The court’s strict interpretation of Section 44 offered them no comfort.

Is this the end of the parliament’s Section 44 dramas?

In the immediate aftermath of the High Court’s decision, the government has announced it will refer the decision to the Joint Standing Committee on Electoral Matters to discuss, among other things, possible amendments to Section 44.

The issue, it would seem, is no longer the uncertainty around whether a person is or is not disqualified. Because of the strictness of the High Court’s interpretation, all potential parliamentarians are on notice to check thoroughly their citizenship status. Part of the referral to the committee is to investigate ways to “minimise the risk of candidates being in breach of Section 44”.

Rather, the more fundamental issue is now whether this is a desirable state of affairs given the large numbers of Australian citizens who are dual nationals, and who may not wish to renounce their citizenship to run for parliament. Thus, we as a nation stand to lose potential parliamentarians by excluding a pool of people that is likely to grow, not diminish.

Further, there is another question as to whether Section 44, when interpreted in this way, is apt to achieve its purpose. The High Court accepted that the purpose of Section 44 was to ensure that MPs do not have a split allegiance or loyalty.

The ConversationMany might argue that this purpose is still an important one. Even if that is accepted, it would seem that denial of eligibility to a dual national is a particularly blunt instrument to achieve it. On the one hand, it captures many people who do not even know they are dual citizens. On the other hand, the relatively easy step (in most cases) of renouncement means that those people who do have a split allegiance, but who want to run for parliament, have only to fulfil these formalities to do so.

Gabrielle Appleby, Associate Professor, UNSW Law School, UNSW

This article was originally published on The Conversation. Read the original article.

High stakes for Turnbull government as High Court hears MPs’ citizenship cases


Michelle Grattan, University of Canberra

Barnaby Joyce is on tenterhooks. Despite Malcolm Turnbull’s confidence that the High Court will find for him, Joyce’s parliamentary eligibility is a key to how the government finishes the year.

From Tuesday to Thursday, the court will consider what is surely one of the most extraordinary set of cases to come before it – the constitutional position of seven current and former MPs who were dual citizens.

All but Joyce are or were senators, which means that the only potential byelection that could be caused is for Joyce’s seat of New England. Three are Nationals: Joyce, Fiona Nash and Matt Canavan. Canavan quit the ministry (but not the parliament) when his issue arose; Joyce and Nash remain on the frontbench.

The two Greens, Scott Ludlam and Larissa Waters, resigned from parliament when they discovered their dual nationality. It was Ludlam’s departure that started the dominoes falling, as others checked their positions. Both Greens argue they were ineligible to sit – although the Commonwealth is actually saying Waters was eligible.

The remaining two are One Nation’s Malcolm Roberts, and Nick Xenophon.

Roberts, Ludlam and Waters were born overseas. The rest had foreign citizenship by descent. Joyce and Ludlam were New Zealanders; Nash, Xenophon and Roberts had British citizenship; Waters found herself a Canadian because she was born there during her parents’ brief stay; Canavan was Italian.

There have been some bizarre twists. Canavan said initially his mother had signed him up to Italian citizenship without his knowledge; later it was found she hadn’t had to – he already had it.

This latter fact is important for the Commonwealth’s legal argument. It is contending the constitutional provision about citizenship was only intended to exclude those who acted positively to obtain foreign citizenship or knowingly kept it. If Canavan’s Italian citizenship was gained by positive action, he wouldn’t be protected by that argument, as he would be if he were Italian by descent.

Xenophon had a very weak form of British citizenship, via his father, who had emigrated from Cyprus, which was a British territory.

The court has already declared that Roberts, who sent questions about his status to defunct email addresses, was a British citizen when elected, although it has not yet ruled on his eligibility.

Section 44 (i) of the Constitution reads clearly enough, on the face of it.

A person cannot be chosen for or sit in federal parliament if he or she:

… is under any acknowledgement of allegiance, obedience, or adherence to a foreign power, or is a subject or a citizen or entitled to the rights or privileges of a subject or citizen of a foreign power.

To clear themselves of this potential problem, an aspiring parliamentarian has to take proper steps to renounce a foreign citizenship.

It’s notable the major parties, which have good vetting, aren’t caught up in this case, although there have been allegations against some of their MPs.

The government is arguing that if the MP was Australian at birth (whether born here, or abroad to Australian parents) and wasn’t aware of their dual citizenship, they should not be found ineligible – in other words, that ignorance is a defence.

But if the MP was born overseas and later naturalised, the government argues, they were on notice about potentially being a foreign citizen, regardless of what they thought was the case. In this instance, according to the government’s argument, ignorance is not a defence.

If the court clears most of the MPs, it would be an effective rewrite, through interpretation, of the literal wording of this section.

The potential implications of the court’s decisions are wide and varied.

With Ludlam and Waters already out of parliament, the issue is just how they are replaced. If the court agrees with their own assessments that they were ineligible, their replacements will be the next candidates on the Greens 2016 tickets in Western Australia and Queensland, respectively Jordon Steele-John and Andrew Bartlett (a one-time Australian Democrats senator and leader).

If the court upheld the eligibility of one or both, the replacement or replacements would be chosen by the party. Ludlam has indicated he would not seek nomination; Waters, anxious to return to parliament, would be expected to do so.

It’s always possible, incidentally, for someone elected via a countback to then resign, leaving the way for the party to choose the replacement.

If Roberts is knocked out, the next on the One Nation ticket is Fraser Anning, who recently avoided another constitutional impediment: bankruptcy.

Disqualification of Xenophon would see Tim Storer of the Nick Xenophon Team (NXT) installed. But if Xenophon’s eligibility is upheld, he will leave the Senate anyway, to contest the South Australian election. In that circumstance, his party would choose who followed him.

The disqualification of Nash and Canavan would lead to candidates down their respective 2016 New South Wales and Queensland tickets replacing them. That would create some internal complications regarding the numbers between the Coalition parties.

Professor Anne Twomey, from the University of Sydney Law School, noted that if Nash were disqualified and a recount held, she would most likely by replaced by the Liberal who was next on the joint ticket. She said:

Even if that Liberal then resigned in an effort to pass the seat back to the Nationals, the constitution requires that the person who fills the seat is a member of the same party as the senator who was ‘chosen by the people’.

This would not have been Nash, as she was disqualified, and therefore never validly chosen. It would be the Liberal who won the seat on the recount. This would mean that she would have to be replaced by a Liberal, upsetting the balance in the Coalition.

The loss of one or both National senators would also mean a reshuffle of portfolios. This would fit with Turnbull’s desire for an end-of-year reshuffle, but test the Nationals’ talent pool. (Canavan is out of the ministry but Joyce is acting in his roles.)

But it is the finding on Joyce that has the big implications. If he were forced to a byelection, it would rock the government – even though he would almost certainly retain his seat.

The first issue would be whether he stood down from the ministry.

Twomey noted that while the constitution allows a person to be a minister for three months without holding a seat, the problem would be that Joyce had not validly held a seat since July last year – “which suggests that his three-month grace period is well and truly over. On that basis he would have to stop acting as a minister immediately.”

With Joyce out of parliament, the government would lose its majority on the floor of the House of Representatives. The result of particular votes would depend on the issue, the crossbenchers and – if it came to that – the Speaker’s casting vote.

Fighting a byelection would be distracting and disruptive for a government struggling in the polls.

The former independent member for New England, Tony Windsor, who is maintaining in the High Court that Joyce should be disqualified, has not ruled out running in a byelection. One Nation could be in the field, as could the Shooters, Fishers and Farmers Party, whose support will be tested in the NSW byelections this weekend.

The Newspoll quarterly breakdown, published this week, has found the government under pressure in regional areas. But a ReachTEL poll done last month for the Australia Institute found the Nationals polling 44.6% in New England, Windsor 26.5% and One Nation 9.8%, Labor 8.4%, and the Greens 2.4%.

The Queensland election, expected to be announced very soon, would be another dynamic in a byelection situation.

If, on the other hand, Joyce’s eligibility is upheld, Turnbull’s end-of-year reshuffle becomes much easier, especially with a strong win for the “yes” case now expected in the marriage ballot.

That still leaves the challenge of energy policy. Energy Minister Josh Frydenberg on Monday signalled the government was turning its back on a clean energy target, a reflection of the strength of the conservative voices within Coalition ranks – a combination of right-wing Liberals and the Nationals.

On the present timetable, the government is likely to take the broad outlines of its energy policy to the Coalition partyroom when parliament resumes next week.

The ConversationBut the situation is fluid, with the outcome in the High Court the known unknown. While the timing isn’t precise, the court is expected to be quick with its decision. It is obviously not driven by politics, but it is alert to the need to provide political certainly as soon as possible.

Michelle Grattan, Professorial Fellow, University of Canberra

This article was originally published on The Conversation. Read the original article.

Nationals’ Matt Canavan quits as resources minister in latest citizenship blow



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Matt Canavan told a news conference he had been informed he is an Italian citizen.
Sonia Kohlbacher/AAP

Michelle Grattan, University of Canberra

Queensland LNP senator Matt Canavan has resigned as the minister for resources and northern Australia after being told by the Italian embassy that he is an Italian citizen.

But unlike two Greens senators who immediately quit parliament after discovering their dual citizenship, he is not resigning from the Senate but waiting for the High Court to make a judgment about his status.

Canavan told a news conference called late on Tuesday he had become aware “that according to the Italian government, I am a citizen of Italy”.

But Attorney-General George Brandis said it was the federal government’s preliminary view that Canavan was not in breach of Section 44 of the Constitution – which bans dual citizens standing for parliament – because the registration of Italian citizenship was obtained without his knowledge or consent.

In the latest – and most bizarre yet – twist in the citizenship imbroglio, Canavan, 36, who was born in Queensland, said that in 2006 his mother, born in Australia of Italian parents, lodged documents with the Italian consulate in Brisbane to become an Italian citizen.

“In doing so it would appear that she made an application for me to become an Italian citizen as well. I was 25-years-old at the time.”

While he knew his mother had become an Italian citizen, “I had no knowledge that I, myself, had become an Italian citizen – nor had I requested to become an Italian citizen”.

He said that after Scott Ludlam and Larissa Waters resigned over their dual citizenship his mother on Tuesday evening a week ago raised with him the possibility that he was an Italian citizen.

“I have since then taken steps to check my citizenship status with the Italian authorities and that has confirmed that I was registered as an Italian citizen in January 2007.

“The Italian authorities have confirmed that the application for Italian citizenship was not signed by me. To my knowledge, until this week, I have not received any correspondence from the Italian authorities about my citizenship status, and they have not been able to provide any such records.” He has never been to Italy.

Canavan said that while he didn’t intend to resign from the Senate, given the uncertainty around his status he would stand aside until the matter was resolved and resign as minister.

Brandis, appearing with Canavan at a joint news conference at which they did not take questions, said the government had taken advice from the solicitor-general and was in the process of taking advice from experts in Italian citizenship law.

“It is the government’s preliminary view that, because the registration was obtained without senator Canavan’s knowledge or consent, that he is not in breach of Section 44 of the Constitution.

“Nevertheless, in view of the legal uncertainty concerning the matter, when the Senate convenes on Tuesday week, the government will move to refer the matter for determination by the High Court,” Brandis said.

Malcolm Turnbull said Deputy Prime Minister Barnaby Joyce would be acting resources and northern Australia minister until Canavan’s status was resolved.

Waters, who quit parliament a week ago after finding she was a citizen of Canada, which she left as a baby, tweeted:

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The ConversationLudlam resigned after finding he was a citizen of New Zealand, which he left as a child.

Michelle Grattan, Professorial Fellow, University of Canberra

This article was originally published on The Conversation. Read the original article.