<b>Insight / letter from Australia:</b> Going green will cost jobs

WINTER has brought the customary chill to Canberra. The lights have dimmed, as Parliament goes on winter recess and politicians take leave with staffers and the lobbyists from the national seat of government. There will be no respite, though, for Prime Minister Kevin Rudd and his ministers and staffers.

The worst sentiment in two decades has added to the impetus of a prime minister whose work ethic has been the subject of health concerns over work-life balance -- for Rudd, his staff, and the bureaucracy.

"He will be spending the time working hard and travelling extensively all over the country... and he won't be taking a break," a spokeswoman told The Sunday Age.

And Rudd tomorrow leaves for Japan, his second visit within a month, to attend the Group of Eight leaders' meeting of industrial nations, to which he has been invited as a guest.

Public sentiment has been pressing on household budgets. Rudd and his ministers will be spending time selling the benefits of the government's first budget handed down in May, delivering among them an extra A$20 (RM60) a week in tax cuts to most workers.

In the first by-election since Rudd came into government last November -- caused by the resignation of a member of parliament from the opposition National Party -- Rudd's Labor suffered a swing against it beyond the average for a government in its first term. Talk of an end to the honeymoon for a prime minister enjoying near-record popularity had been in the air for some time.

The Gippsland by-election last week in country Victoria came at a time when public confidence about their standard of living is at its lowest in close to 25 years.

The cost of petrol and rising prices brought on by the global oil shock and fears about the stability of international financial markets dominate.

The stock market is at its worst since 1982, eroding confidence in retirement income since much of the funds in superannuation are invested in shares. And there are fears of worse to come as the government unveils details of its election pledge to cut back on greenhouse gas emissions, which will come at a cost to business and households.

Surveys show the people are critical of short-term thinking by government, yet pinches on the pocket turn the public against the government when big-picture policies come at a cost. Balancing immediate household concerns and longer-term reforms will occupy Rudd and his ministers in the eight weeks they are spared sittings in Parliament.

Not least among the ministers working through the break will be Kota Kinabalu-born Minister for Climate Change and Water, Penny Wong, as climate change adviser Professor Ross Garnaut unveils his final draft report on an emissions trading scheme to be implemented by 2020. The plan to cut greenhouse gases by putting a price on carbon emissions is feared to add pressure on petrol prices and other energy costs, and cost jobs beyond those in the coal industry.

Garnaut launched his report at the National Press Club on Friday. Wong will present a green paper on the plan later this month before Garnaut releases his final report by Sept 30.

Business has warned that costs will be passed down to households. Rudd has pledged he will not flinch from having to make tough decisions, in the face of further tests ahead.

Another by-election looms, after Alexander Downer, foreign minister in the government of John Howard, on Thursday announced he would leave Parliament on July 14.

As the Gippsland by-election has shown, whatever the local issues at Downer's seat in the Adelaide Hills in South Australia, the result will be seen as a referendum on Rudd.

Climate change will impact on more than just the environment. Cutting carbon emissions will change the way Australians work and play, in an economy built on its abundant and cheap extraction of resources.

Business accepts the reality of climate change. The question is over the sharing of the cost, in Australia and globally, and the extent to which the people and the economy is prepared to shoulder that burden.

It will entail transforming Australia's industrial structure, and the abandoning of energy-intensive industries that have given Australia a comparative advantage.

Wong, though, is looking at emissions trading as just one "input" in dealing with climate change. Over the week, she revealed a blueprint to generate 20 per cent of power by 2020 from renewable sources -- solar, wind, hydro and geothermal.

Rudd may be encouraged by a survey that shows voters want a return of big-picture issues to government that he campaigned on at the election, climate change among them. This was the finding of a snapshot of the nation in an Ipsos Mackay mind and mood report.

Yet at the same time, a poll published in The Australian sends signals that will test Rudd's nerve. Newspoll shows that in the past six months, the percentage of people who fear their living conditions will get worse has more than doubled.

The 43 per cent who feel conditions have got worse -- up from 18 per cent -- represents the biggest jump in the 23-year history of Newspoll's survey on standards of living.

In Australian National University economics professor Garnaut, though, at the helm of climate change, Rudd has an adviser who guided his Labor predecessors before him -- Bob Hawke and Paul Keating -- to largely unpopular reforms of the 1980s and 1990s.

The float of the dollar in 1983 laid the basis for the deregulation of the financial markets, liberalising trade barriers and transforming the economy, which has had an unbroken run of growth over the past 17 years.

Rudd can take comfort in the latest Newspoll showing Labor ahead of the opposition by 55 per cent to 45 per cent and with him remaining preferred prime minister (64 per cent) to the opposition's Brendan Nelson (15 per cent).

Insight / letter from Australia: Going green will cost jobs