Gillard promises Oz carbon tax will create more jobs

Julia Gillard will discuss trade and climate change matters on a visit to China. Photo / AP

Prime Minister Julia Gillard has promised Australia's carbon price will create more jobs, as industry leaders and unions stepped up concerns that mining and manufacturing positions will be lost.

Ahead of a trip to China where she will discuss climate change and trade issues, Gillard met in Canberra on Tuesday with the multi-party committee set up to determine how to price carbon.

Industry chiefs also met Climate Change Minister Greg Combet to raise concerns about potential job losses, especially in steel making and mining, to countries that do not have a carbon tax.

"We are willing to pay a cost when we're able to play on an even field with our competitors," OneSteel chief executive Geoff Plummer said.

Unions and the federal opposition have also raised concerns about the future of industrial towns if local companies are disadvantaged.

Visiting Western Australia's Pilbara mining region, Opposition Leader Tony Abbott said: "There isn't a state that wouldn't lose important manufacturing and industrial centres if the carbon tax goes ahead."

But Gillard said such claims were "inflammatory".

"We can certainly work with industries to transition to a clean energy economy and in that clean energy economy there will be more jobs," Gillard told ABC television.

"We are seeing in the newspapers some inflammatory claims, but out in the real world there is BHP announcing a new investment worth more than A$40 billion [$53.3 billion]. I've been to a coal-fired power station which is going to have a solar boost project, manufactured locally. When people look at those sorts of economic opportunities ... perhaps some of the fear-mongering will fall away."

Gillard said she was keen to understand how China intended to meet its emissions targets, but she was determined Australia would meet its target of a 5 per cent cut by 2020 in the cheapest way possible.

The multi-party climate change committee received reports from consultation with business and the community sector, as well as discussed household assistance to cover price rises.

Combet said the Government was proposing to protect the steel industry from about 95 per cent of its potential carbon liability, which would mean a bill of about A$2.60 a tonne of steel for manufacturers.

But he acknowledged the rising cost of raw materials and the strong Australian dollar were also affecting companies.

"The Government is listening carefully to what the industry and the unions are having to say about it," Combet said.

Greens deputy leader Christine Milne said care needed to be taken that compensation was not given on the basis of changes in profit margins.

The steel industry was trying to change the debate about its level of exposure to the strength of the Australian dollar, she said.

"We need to do this on the basis of trade exposure and that's the work that the Productivity Commission is doing," she told ABC television.

Milne said people were failing to realise the potential for job creation from the industry and the net jobs gain.

The committee was waiting on input from the Productivity Commission and other information, including Treasury modelling, before developing a price, she said.

Opposition finance spokesman Andrew Robb said the Government could do more for global emissions by boosting uranium exports for nuclear power.

Boosting uranium exports from the current 10,000 tonnes a year to 37,000 tonnes by 2030 could avoid 1.4 billion tonnes of carbon pollution a year, he said.

Meanwhile, the Government has named a new working group which will meet in early May to look at the opportunities for the land sector under a carbon price.

While agricultural emissions won't be in the carbon price mechanism, farms play a role in abatement.

- AAP