Australia Spends $19,686 a Minute Subsidising Fossil Fuels: Report

Australia Subsidising Fossil Fuels

 A new report is claiming that the government of Australia spends $19,686 a minute subsidising fossil fuels, with the authors pointing out those support measures outweigh that of budget allocations for the Army and Air Force. 

The numbers come from the Australia Institute, who says that subsiding the fossil fuel industry is coming at a $10.3 billion cost for state and federal budgets, or around $19,686 a minute spent subsidising fossil fuels.

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Authors of the report are quick to point out that the fossil fuels subsidies outweigh that of the $7.82 billion spent on the Army, and $7.55 billion spent on Australia’s Air Force budget for operations and infrastructure. 

Once broken down, that $10.3 billion each year amounts to $19,686 spent every minute subsidising fossil fuels.

 

“We really now need to be talking about phasing these incentives out, particularly given the US under Joe Biden is looking at removing tax perks,” says the Australia Institute’s research director, Rod Campbell. 

The Research Director says there are better uses of government funds than subsidising fossil fuels in Australia.

“It’s not just important for Australia to take action on climate change but some of this money could be going to schools, or hospitals or issues voters are really worried about,” Campbell added. 

In 2019, a report published by the International Monetary Fund found that Australia was spending more than $37.4 billion in subsidies, while the Productivity Commission has said the figure is closer to $12 billion each year worth of fossil fuel subsidies. 

The exact number is difficult to pin-point, however, the Australia Institute says it’s important to ask “what’s the most appropriate number?”

“We haven’t included damage to the environment or to human health in our report, because estimating those numbers is difficult and estimating those numbers is controversial,” Mr Campbell said. 

“What we’ve done to try and eliminate any controversy, is we’ve just added up what is in the books, state and federal budgets, and report from government-owned corporations,” he added. 

Australia Spends $19,686 a Minute Subsidising Fossil Fuels: Report

According to a report from the ABC, the Australia Institute has “calculated state governments have contributed some $1.2 billion to coal, oil and gas companies by helping to reduce the costs of exploration, improving ports, railways and power stations, while also funding research aimed at reducing emissions caused by burning fossil fuels.” 

The Northern Territory remains the biggest supporter of the natural gas industry, with $4 billion committed to offshore gas projects and another $1 billion for infrastructure laid out.

Queensland has contributed at least $744 million, while NSW has allocated $100 million for the innovation of new coal technologies, and West Australia spending millions on power plants, too. 

The ACT and Tasmania are said to be the few Australian states and territories that aren’t actively subsidising fossil fuels. 

The Federal Resources Minister, Matt Canavan has called into question the figures presented by the Australia Institute, and insisted on the need to subsidise the fossil fuel industry for the greater good of the economy. 

“Fossil fuels are our nation’s biggest export,” he said, adding that “I think [the] government should be helping encourage that.” 

“I fundamentally disagree with the assumptions,” of the report, he said. “The absence of a tax is anot a subsidy and the mining industry builds its own roads, they don’t use public ones… the scheme is also available to other industries, like agriculture,” he added. 

The Morrison government has committed to spending $1.1 billion on the research and development of “clean” and “low emissions” projects to help reduce Australia’s overall emissions figure. 

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