Australia ditches carbon cap-and-trade plans

The Australian government has ditched its controversial plans for a national carbon trading scheme in the face of mounting political and public opposition to the proposals.

According to reports in the Australian newspaper, Prime Minister Kevin Rudd has finally dropped plans for an emissions trading scheme, confirming that the proposals will not be revisited until 2013 at the earliest.

"That [delay] will provide the Australian government at the time with a better position to assess the level of global action on climate change," he said.

Rudd who has attempted to pass the legislation that would enable an emissions trading scheme on two separate occasions in the past year laid the blame for the dropping of the bill squarely at the door of the opposition Liberal party, which has repeatedly blocked the plans.

The government's proposed climate bill had proposed cutting Australia's carbon emissions five per cent by 2020, primarily through the introduction from 2011 of an emissions cap-and-trade scheme covering the 1,000 largest emitters.

But the scheme, which planned to price carbon emissions at A$10 (£6) a tonne for first year of the scheme, has twice been rejected in the upper house of Australia's parliament and faced a third defeat within weeks.

The Senate was expected to vote on the legislation again when parliament resumes sitting in May, but the government was still struggling to find the handful of opposition votes required to pass the bill.

Despite the Rudd adminstration's plans to provide some A$20bn in compensation to those polluters whose competitiveness would have been threatened by the scheme, the business community lobbied heavily against the plans and found ample support amongst the vocal climate sceptic wing of the Liberal Party.

Public support for the proposals has also slipped in recent months and Rudd is facing a serious challenge at this year's election with a recent poll showing that support for opposition leader Tony Abbott's coalition rising to 46 per cent in a recent poll, while support for the Rudd government fell two percentage points to 54 per cent.

Abbott has opposed Rudd's climate change policies vehemently in the past and is now calling for "direct action" on climate change, including a reduction fund to help the public, industry and farmers cut emissions.

Measures would include planting 20 million trees, a solar panel rebate and soil carbon storage scheme. The proposals mark quite a turn around for Abbot, who has in the past questioned the validity of climate change science and who ousted the previous Liberal Party leader Malcolm Turnbull for his support for action to tackle climate change.