The government recently announced that its emissions trading scheme (ETS) will be affordable for Australian households at $1 a day. However, it fails to accurately calculate retail price impacts on consumers. 

The Australian Retailers Association (ARA)’s executive director Richard Evans said the long-awaited ETS Treasury modelling didn’t provide answers to concerns about the price impacts on retail goods and groceries for working families.

“The retail sector accepts and understands ETS is the way forward but they also know that price impacts will be passed through the supply channel to the retail catchment point and will ultimately be borne by consumers. This means the price of all retail goods and groceries will increase for working families and consumers aren’t receiving this message.

“The message from the Rudd Government yesterday that ETS will only cost Australian households up to $7 per week for electricity and gas is deceptive and fails to answer the simple question: ‘What is the impact of ETS on a basket of retail goods and groceries?’

Evans added the Government’s ETS compromised the domestic and international competitiveness of Australia’s manufacturing sector.

“… Minister for Innovation, Industry Science and Research Kim Carr called for consumers to buy Australian made products and support local business. However, current ETS modelling will see Australian-made products become less competitive against imported goods which won’t be affected by carbon tax.

Evans said that this debate is not about the environment as retailers support carbon reduction measures. It’s about economic modelling and as yet retailers and consumers, who will wear the financial burden, are yet to be adequately considered. If the Rudd Government can’t get the economic analysis around ETS right, one has to question the accuracy of the Treasury modeling, said Evans.