Isra-Mart srl:Queensland flood repairs swamp low-carbon funding

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Australia will cut or defer the spending of AU$500m (US$500m) for solar power and carbon capture, and storage projects to help pay for flood damage in Queensland, prime minister Julia Gillard announced today.

Preliminary estimates indicate that the government will need to invest AU$5.6bn (US$5.6bn) in rebuilding flood-affected regions, with the majority going on rebuilding infrastructure.

To meet this need, the government will reduce funding for its Solar Flagships programme by AU$60m (US$60m) and delay a further AU$190m of spending planned under the initiative, according to documents released by prime minister Julia Gillard's office today.

And it will delay AU$160m (US$160m) of spending aimed at encouraging carbon capture and storage projects.

The government will also make a further AU$2bn (US$2bn) in spending cuts that will affect other carbon reduction schemes.

It will discontinue the cleaner car rebate scheme, abolish the green car innovation fund, cap funding for the solar hot water rebate and the solar homes and communities plan, and discontinue the second phase of the green start programme.

Gillard said the measures were necessary to address the immediate needs of the state.

"Every cent raised through these measures will go directly to flood-affected regions across Australia," she said in the statement.

"The government will rebuild Queensland while delivering the budget surplus as promised in 2012-13."

Gillard also proposed an income tax rise to help meet the costs of repairing flood damage.

Those earning between AU$50,000 (US$50,000) and AU$100,000 (US$100,000) will pay 0.5 per cent of taxable income in excess of $50,000 (US$50,000 m).

Those earning over AU$100,000 (US$100,000) will pay 0.5 per cent of taxable income in excess of AU$50,000 (US$50,000) and 1 per cent of taxable income in excess of AU$100,000 (US$100,000).

The Australian Greens do not oppose the flood levy, but acting leader Christine Milne expressed anger at Gillard's plan for turning its back on what she says is the cause of the disaster: climate change.

"It beggars belief that the government would choose to cut climate change programmes like solar flagships, energy efficiency and the solar hot water rebate to fund disaster relief when such disasters will be made worse by climate change," she said.