Hunt says no new loans from CEFC – ‘giant green hedge fund’

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Coalition indicates no room for compromise on the CEFC, describing it as ‘giant green hedge fund.’ Er, what about the Senate?

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The incoming Liberal National Party coalition government has praised the board of the $10 billion Clean Energy Finance Corporation for being “serious, professional people”, but has promised there will be no new loans made to what it calls a “giant green hedge fund.

The Coalition has long promised to dismantle the CEFC, which has already made around $500 million of commitments to a variety of projects, including wind energy, solar and energy efficiency.

However, at one stage during the election campaign, Tony Abbott said the CEFC would be stopped from making “non commercial” loans. Given that the Coalition requires the support of a hostile Senate to dismantle the CEFC, there was some hope that could signal that a compromise position that could be pursued in negotiations. As we wrote last week, as the legislation now stands, it is more of a question of “how” the CEFC will invest its money, not “if”.

But  climate spokesman Greg Hunt on Tuesday signalled that the Coalition would stand firm on its promise – presuming of course that it can get legislation through the Senate. Hunt insisted that no new loans would be made by the CEFC, although it is hard to work out whether the criticism of the CEFC is focused on making “hedge fund” type loans or joining with other banks – such as the NAB  and the Commonwealth Bank – in making finance available on commercial terms.

Here is the full exchange with radio 2GB’s Ross Greenwood (provided by Hunt’s office): The first bit is in response to Greenwood’s questions about the actions and quality of the CEFC board.

GREG HUNT:

Yeah, very serious, very professional people and to (chair Jillian) Broadbent’s deep and underlying credit we wrote at the commencement of the election campaign requesting that they cease and desist from any loans during what’s called the caretaker period.  They responded saying they would adopt that position and they look forward to working with an incoming Government on its priorities.

There was no games, they were very professional and I think that’s a very heartening response.  We will work with the board, they know what the mandate of the new Government is, they know what the intention of the new Government is.  I don’t anticipate there will be any difficulties.

ROSS GREENWOOD:

So in other words, just for spelling it out for people, the intention is to close it down?

GREG HUNT:

Absolutely, we’re not going to be proceeding with new loans and we’re not going to be maintaining the organisation for the simple reason, it was going to borrow $10 billion of taxpayers money to invest in speculative ventures which the taxpayer would have to fund and which the private sector would not fund.

In the end it was a giant green hedge fund.  Not the problem of the board, they didn’t set it up, it is the problem expressly of the Gillard and Rudd Governments.  Their baby and it was in the tradition of pink batts and green loans and cash for clunkers.

ROSS GREENWOOD:

So for example I see on their site, anybody can go and have a look at this, there’s an egg producer that’s turning chicken manure into energy, that was one of them.  They thought that they could do that.

There’s a beef producer cutting their costs using solar energy, there was a for example an Adelaide lighting upgrade using on bill finance whatever that means and an ice cream maker saves on energy costs.

The question here was if those ideas were so good in terms of saving costs then why wouldn’t they go and borrow the money from their bank at commercial rates?

GREG HUNT:

Exactly and perhaps the most significant one is there was a multi-million dollar figure which was borrowed by the taxpayer without the taxpayer having a say advanced to a New Zealand state owned enterprise to finance a wind farm which had already been built in Victoria.

The whole thing was meant to create new amounts of renewable energy, well that was for a wind farm that had already been built and it doesn’t matter where you stand on the renewable energy question they spend $10 billion and there’s exactly the same amount of renewable energy at the end as at the start.  It just replaces lower cost forms of renewable energy with higher costs of forms.

 

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9 Comments
  1. Keith 6 years ago

    I suppose the coalition can stay in “huff and puff” mode for a little longer, but soon the reality of due process will have to be acknowledged. Then we can get away from slogans and down to what the coalition can actually achieve if the senate is hostile to their plans.
    I love the way they are so self-righteous about their supposed mandate, when Tony Abbott spent every day for three years trying to block everything.
    I don’t believe Labor is so destructive about good governing of the country to behave in the way Abbott did, but they are going to be serious about carbon pricing and renewable energy programs, because the coalition has no regard for the country in their position (which isn’t even articulated).

    • Warwick 6 years ago

      Abbott opposed the CPRS after Labor won the 2007 election, which was one of their key election promises. He didn’t respect the “mandate” then, why exactly does he expect Labor to not reject his proposal this time around?

      • Michel Rahme 6 years ago

        It’s also interesting how Rudd’s public support seemed to turn when he announced their asylum seeker policy (by the way I was in Jaffna early in the year and it was actually quite pleasant) ……… And how ( in my opinion, although I voted Green) the Greens lost votes because of their Asylum seeker policies. That’s why I found it a bit stale when Christine Milne yesterday or the day before blamed the Greens slight decrease on Labor!

        I personally hope Tony Albanese takes up the leadership with Tanya Plibersek as deputy and by the time 2014 comes and Abbott has showed his true colours and incompetencies, they are ready for a double dissolution!

        Before the election I was sitting at a food court regularly in a bus and train station watching all the older people reading the Daily Telegraph and I was wondering how Murdoch’s children are going to influence Australian media once the old man passes away and the party is over

  2. Alistair Spong 6 years ago

    Has the Keep em stupid campaign really worked ?

    • MrMauricio 6 years ago

      Cracks are emerging already -indicated by exit polls and polls on climate change-more than 60% of voters want action to reduce it.We now have a template in Melbourne and Indi showing how to go about it.Look out Abbott you are exposed already!!!

      • wideEyedPupil 6 years ago

        Climate Institute is claiming exit polls showed carbon tax ranked least influential issue for LNC voters.

  3. Jay 6 years ago

    In that same interview Greg committed to huffing and puffing down the Department of Climate Change. Can someone please tell Ross Greenwood and Greg Hunt et al. that the Department of Climate Change was merged in to two other departments months ago!

    • Giles 6 years ago

      You are quite right Jay. Here is the excerpt from that bit:

      ROSS GREENWOOD:

      How long is it before the Department of Climate Change will be dismantled?

      GREG HUNT:

      What we’ve said is we will commence the merger as soon as the process of appointing the Ministry and swearing in the Ministry has been complete.

      To be frank, during the course of the pre-election period, when we were allowed to consult with departments. We laid out the fact that there would be a merger. We were express and clear and absolute about that and we indicated we would like it to begin right from the outset.

      I imagine that the public servants are preparing to do that, our agenda was clear and open and that is an official process through which we’ll go through as soon as possible.

      ROSS GREENWOOD:

      How many jobs will that save you imagine?

      GREG HUNT:

      Look I won’t speculate on that at this stage but we did set out savings of a considerable amount over the course of the forward estimates or the future budgets in the costings which came out last Thursday.

      (i rather fancy that doing an emissions reduction fund is going to be very labor-intensive).

  4. johnnewton 6 years ago

    And while we’re at it – what’s this mandate bullshit. From Rundle in today’s Crikey:

    “Tony Abbott has a mandate, therefore Labor and the Greens should vote up his new legislation.” Where did this come from? Abbott has a mandate to govern, and therefore to introduce proposed legislation to Parliament. The 46.5% who wanted someone else elected their people to oppose it. The idea that a mandate abolishes opposition is totalitarian by definition.

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