Statement 1: Budget Overview (Continued)
Climate change — moving to a clean energy future
Australia produces more carbon pollution per head than any other advanced economy — 27 tonnes per person compared to a world average of almost six tonnes per person.
To reduce Australia's carbon pollution and drive investment in clean energy technologies, the Government will introduce a carbon price to commence on 1 July 2012.
There is broad consensus among economists that a market mechanism is the best way to reduce emissions at least cost and to create the incentives for new investment. The carbon price will work by putting a price on every tonne of pollution produced. Less than 1000 companies — the biggest polluters in our economy — will be required to pay.
Australia will cut carbon pollution while maintaining an economy that grows strongly, expands job opportunities and continues to deliver long‑term growth in real wages.
The Government will use every cent raised from the carbon price to assist households, support jobs in the most affected industries, and to encourage the transition to a clean energy future. More than 50 per cent of the revenue will be used to assist households.
The Government is considering the details of the carbon pricing mechanism. All revenue raised by this scheme will be returned to assist households and businesses and fund climate programs and will be broadly budget neutral. Consistent with the Charter of Budget Honesty Act 1998 the full budgetary impacts will be included in the first economic and fiscal update after the scheme's design has been determined.
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