Coalition expected to drop refrigerant gases from carbon tax repeal laws

Refrigerant gases have apparently been struck out of the carbon tax repeal bill’s legal requirement for price cuts to be passed on to consumers, even though they were at the centre of the Abbott opposition’s dire warnings about price hikes.

As opposition leader, Tony Abbott repeatedly warned that big increases in the cost of refrigerant gases would flow straight through to the price of food and other goods.

“It is a hit on their refrigerant costs. Refrigerant gases are going up almost five times under the carbon tax and every supermarket, every refrigerated manufacturer and processor is going to be hit that way,” Abbott said in July 2012, as he travelled the country on his anti-carbon tax campaign.

In May 2012, he visited a Canberra food wholesaler, Frozpak, and said the business was facing a triple whammy, because “the carbon tax hits their power costs; it hits their transport costs and it hits their refrigerant costs, and that’s why so much of the staples of our daily life are going to be significantly more expensive under the tax.”

At the same event, the then shadow environment minister, Greg Hunt, said the business was “living proof that it’s not big businesses but it is small, family businesses that are going to pay the carbon tax”.

“The cost of their refrigerant alone is almost going to triple. It’s not a small increase; the cost of the good itself is almost going to triple under the carbon tax. The costs for Frozpak are likely to be in the vicinity of $60,000 a year extra.”

Also in May 2012, Abbott visited food distributors PFD Food Services and said: “First of all, power costs will go up by an estimated 20% and then, of course, there’s the carbon tax that’s coming in on transport in 2014 if this government is re-elected and, finally, there’s the massive carbon tax on refrigerants, which are vital to a business such as this.”

But after a backlash by business to the Palmer United party’s amendments to the carbon tax repeal bills, it appears that refrigerant gases (or so-called synthetic gases) are to be removed from the list of regulated supply goods – namely, goods for which suppliers are required, by law, to pass through cost savings and who are subject to hefty penalties if they do not. Only electricity and gas producers are now left on the list.

Synthetic gases now apparently join other goods, like food and airline tickets, over which the Australian Competition and Consumer Commission (ACCC) only has the power to act if a company makes a “false and misleading statement” about the effect of the carbon tax on its prices. It does not have the power to force companies to show how savings from the carbon tax repeal have been passed on, and to fine them if they have not been passed on.

The chaotic scenes in the Senate on Thursday occurred after the PUP leader, Clive Palmer, made last-minute changes to an amendment to the repeal bills, significantly tightening the requirements and penalties for suppliers of electricity, gas and synthetic gases.

Business lobbyists such as the Australian Industry Group warned the changes placed overly onerous requirements on those supplying and selling refrigerant gases.

On Sunday, Hunt said he was confident he had reached a deal with the PUP on the amendment that would mean the repeal bills would pass both houses of parliament this week.

However, he has also indicated that he will call PUP’s bluff and bring on a vote if there are any more last-minute hiccups, given the government’s severe embarrassment and Palmer’s changes last week.

Abbott’s campaign as opposition leader also claimed that the carbon tax would add about 5% to the cost of food. Supermarkets like Woolworths are now saying that because very few prices actually went up when the tax was introduced, few would now be coming down.

Speaking on Adelaide radio on Friday, Hunt claimed supermarkets and airlines could be fined by the ACCC if they did not remove a carbon tax impost from their prices when the tax is repealed.

“The law is, if a company had added the price of the carbon tax then they have to take it off, or the ACCC will come after them with $1.1m fines, and that includes supermarkets, airlines; that includes landfill operators, not to mention electricity and gas,” he said.

A partner with the multinational law firm Norton Rose Fulbright in Melbourne, Elisa de Wit, told Guardian Australia the statement was “erroneous”.

“Companies such as supermarkets, airlines … [and] landfill operators are presently under absolutely no legal obligation to take off the price of carbon, if and when the existing legislation is repealed,” she said. “They merely need to ensure that they do not engage in misleading or deceptive conduct, or make any false or misleading statements about their prices.”