Make Big Polluters Pay

Money from the levy could be redistributed to the most climate-impacted communities, to those on the frontlines of the climate crisis, and towards a fair energy transition.
Specifically, we can use funds from a levy to:

• Protect people’s health: Fund emergency services to help people during climate disasters.

• Prioritise fairness: Ensure communities most impacted and least responsible for the climate crisis are supported and can self-determine how they prepare for and recover from impacts. This includes funds for First Nations and Pacific peoples.

• Equip first responders: Provide the tools and resources needed to respond to escalating bushfires, floods and heatwaves.

• Make homes and infrastructure resilient: Strengthen homes and city infrastructure – roads, rail and utilities – to better withstand extreme weather.

• Provide a financial safety net: Ensure disaster relief and rebuilding efforts are funded so families aren’t left paying the bill.

• Compensate for losses and damages related to extreme weather events – even though many losses cannot be replaced by money. Particularly, providing funds to Pacific communities who are most impacted and least responsible for climate change.

• Fund a just transition: Support the transition to renewable energy and ensure the communities and workers most impacted by this change have the support they need.

• Household energy efficiency initiatives: Support households to implement energy efficiency upgrades and move towards low emissions technology, e.g. small batteries for households and community facilities.

It is a core priority to ensure a Climate Pollution Levy would be designed with proper guardrails so that big polluters couldn’t do this.

Examples of safeguards that could be implemented include:

• Price controls to respond to increases in electricity prices to ensure costs aren’t passed on to everyday consumers.

• Governments could prohibit and apply sanctions to companies that pass on the cost of the levy onto consumers, as was done by Italy in implementing its windfall profits tax on banks in 2023.

• The government can redivert money from the compensation fund to ensure those most impacted by an increase in prices, e.g. low-income households, are given cost relief and compensated for any potential immediate rise in costs

At its core, climate change is a justice issue. We know that those least responsible for the crisis are the most impacted by it. For example, Pacific island nations are experiencing the worst of climate change while contributing less than 0.03% of historical greenhouse gas emissions (which is what’s driving climate change).

Australia has benefited from fossil fuel extraction for decades, and big polluting corporations have knowingly continued to worsen climate change. Australia is also one of the largest producers and exporters of fossil fuels in the world, and has a responsibility to support nations impacted by its actions. This is particularly true for our closest neighbours, who have close ties with Australia, and who cannot afford to tackle climate change alone.