Page 14 - Luce 2021

P oint of View

A Climate of Change

The role I had with the CEFC has led operated strictly to this and held its
me towards my current role at Sentient ground with a fully independent board.
Impact Group where I am establishing It was also illegal under our act for any
a large impact investment group that public servant to sit on the board, so
will be like the CEFC – we will finance the government could not do what they
projects that reduce emissions but we did to the Climate Change Authority or
will also fund projects that protect what they keep doing to the Northern
biodiversity and create greater social Australia Infrastructure Facility.
equality. For too long investors have
measured their return in terms of We also took precautionary action.
percentage earned. It is time for people The way the government basically
to realise that you can achieve the same abolished the Climate Change Authority
return but also, by being thoughtful was to place a public servant (who
about how the capital is applied, you is indemnified by the government
can generate positive externalities rather should they fail to meet their statutory
than negative externalities. I am keen obligation) in the role of CEO and get
that people learn to expect that every them to slash all the staff so it basically
Recently Dr Powell interviewed investment they make must improve can’t operate. The government also
removed all the funding, so it did not
the environment and create greater
Oliver Yates (1985) about his equality – or understand that it is a dud have the capital to keep running.
thoughts on the environment. investment because the return they get They could not do that with the CEFC
As former Head of the Clean does damage and therefore is not a as, before the Liberal government
Energy Finance Corporation (and real return. came into office, we called over
now CEO of the Sentient Impact What were the biggest challenges of $1 billion in capital so they could
not defund the organisation and, as
Group), Mr Yates here offers a the role at CEFC, and did you find any I have explained, they could not get
distinctive perspective. unlikely allies? an indemnified public servant on the
board or in employment at the CEFC.
In your previous role as Head of the The biggest challenge I had was the It is quite extraordinary the methods
CEFC, you worked at the coal face (no persistent attacks from the Liberal a government will use to cripple a
pun intended) of political, economic, government of the day that tried statutory authority that it doesn’t
and technological activity responding almost every trick in the book to like, including actively constructing
to our changing climate. Did the damage and abolish the organisation. arrangements that enable the Authority
experience leave you optimistic or It attempted twice to destroy the CEFC to ignore its statutory responsibility by
pessimistic about Australia’s response? by passing legislation in the House of inserting an indemnified public servant
Representatives to see it abolished, but to do the deed.
It left me optimistic that a government each time it failed to pass in the Senate
could create and structure an agency that where Independents and small parties If you were to provide the guidelines
was able to achieve significant public like the Palmer United party voted for Australian climate policy over the
policy outcomes without costing the against the government to stop the next decade, what would it look like?
taxpayer money. abolition occurring.
Far too often we see massive public I would restore funding to the Climate
waste as grants programs are used instead Many would think that Clive Palmer Change Authority and have it work
of loan programs. A grant is effectively was an unlikely ally, but he is actually with the Productivity Commission to
a 100% immediately written-off loan a sensible businessman and he could develop a climate policy that is safe
and most of the time that does not drive see that the CEFC was creating positive and economically sensible. Unlike
change. Grants distort the market. In the change at no cost and was actually the current policy of the government,
case of clean energy, grants can actually making money. Clive supported the it would involve a national carbon
hamper investment and the transition to a concept of development banks as a way budget. I would also support the
clean energy future. to accelerate business investment. imposition of a carbon border
adjustment, so that Australian firms
If you look across all programs of One of the best features of the CEFC remain competitive in international
government internationally and was the structure by which it was markets. This adjustment would impose
domestically, the CEFC stands out as established which made ministerial charges on imports from countries
a clear leading example of how to intervention into decision-making illegal, that are not being carbon responsible
accelerate the investment in renewables except through mandate changes. Any and give credits on export if we are
efficiently and effectively. Currently, mandate changes had to be consistent exporting to a country that is not
the CEFC is the largest Green Bank in with the Act and our statutory obligation carbon responsible.
operation. Historically, Australia had both as statutory officers which was to
national and state-based development invest to reduce emissions. Unlike far
banks. They were all closed for various too many Authorities today, the CEFC
reasons.
14 LUCE Number 20 2021