Carbon Credits and Other Legislation Amendment (Integrity and Transparency) Bill 2026

Ms MASCARENHAS (Swan) (17:54): This bill amends the laws behind the Australian Carbon Credit Unit Scheme. The scheme has delivered more than 190 million tonnes of abatement from more than 2,600 projects since 2011. This is a value of more than $4 billion.

Two separate independent reviews, the Chubb review in 2022 and the Climate Change Authority's review in 2023, have reached the same conclusion: the scheme is working. The Climate Change Authority's most recent review found that it remains fundamentally sound and important to Australia's climate change policy framework. In my home state of Western Australia, on Wanjina‐Wunggurr country in the Kimberley, fire has been used to care for and protect the land for thousands of years, guarded by lore and knowledge passed down through generations.

Traditional owners have always known about how to read this country and how to look after it the right way at the right time of the year. What they learned through generations of careful observation is the same science that we now rely on. It hasn't been replaced by modern research; it's been confirmed by it.

Under the Australian Carbon Credit Unit Scheme, landholders, businesses and Indigenous corporations run projects that avoid emissions or store carbon, earning one credit for every tonne of carbon dioxide equivalent that they abate. Those credits can be sold to the Commonwealth directly, to companies meeting obligations under the safeguard mechanism or to businesses who voluntarily offset emissions.

In 2021, Wilinggin Fire Project was awarded the 100-millionth carbon credit issued under the scheme nationally. It's run by Wanjina‐Wunggurr Aboriginal Corporation on country in the north of Kimberley. Two ranger groups, Wunggurr Rangers and Nyaliga Rangers, carry out this work.

They burn early in the dry season deliberately and carefully to stop the far more destructive wildfires that come later. The income this generates funds ranger jobs. It funds the protection of threatened species and also sacred sites.

It funds the passing on of this knowledge to the next generation because every year older traditional owners walk younger ones through country and teach them to burn the right way. A peer-reviewed study covering Kimberley traditional owner groups Balanggarra, Dambimangari, Wilinggin and Wunambal Gaambera found some remarkable things. Here's a super fun fact: measured per person, nobody in this country is pulling more weight on reducing greenhouse gas emissions than the traditional owners of the North Kimberley.

This is the exact kind of community that this bill is designed to protect. It makes sure that the next Wilinggin, that next community doing this work on their own country, has a genuine legal right to consent before a project goes ahead, not just a promise that consent will eventually follow. For the first time, registered native title claimants will have a formal legal right to consent before a carbon project can be even registered on their land.

Under the existing law, a project can be conditionally registered and run for up to five years before consent from traditional owners is actually required. The project exists first, then the negotiation happens after, with the bargaining power sitting on the wrong side of the table. Under this bill, consent comes first.

It introduces a genuine two-stage process: upfront consent before an application can proceed, and a second, separate consent on exactly how the project will be carried out before a single credit is issued. It brings the ACCU scheme into line with the same standards already applied under the government's nature repair scheme, and it reflects the principle of free, prior and informed consent that traditional owners have been asking to be honoured for years.

This bill also replaces the old Emissions Reduction Assurance Committee with a new Carbon Abatement Integrity committee for the first time. That committee will be legally required to include at least one Aboriginal or Torres Strait Islander person. This is the body responsible for overseeing the integrity of every method used across the entire national scheme, and communities who have been doing this work longest will now have a guaranteed seat at the table.

The Indigenous Land and Sea Corporation and the Indigenous Carbon Industry Network have both welcomed these changes. Native title was first recognised in this country in 1993. This bill applies the same principle to the modern carbon market—a real say for traditional owners over their country.

This bill also strengthens the integrity of the scheme more broadly. It gives the minister a new power to require a project to transition off a method if it's found to pose a genuine risk to the scheme's integrity, with safeguards built in, consultation, advice from the committee and the regulator, and enough time for proponents to move to an alternative method rather than losing income literally overnight.

It moves the responsibility for purchasing ACCUs to the department, with a new mandate to weigh value for money rather than lowest cost alone so factors like First Nations cultural benefit and regional economic impact can actually count in the government's decision making, not just price. It also allows a single project to credit both sequestration and emission avoidance activities together, supporting the kind of integrated farm management methods our agricultural sector has been asking for.

It strengthens transparency under the National Greenhouse and Energy Reporting Act so that the public has better visibility of corporate emissions data. It fixes a technical timing issue in the New Vehicle Efficiency Standard. All of this rests on one thing continuing to exist, and that is the safeguard mechanism.

It's fascinating because the safeguard mechanism is a policy that was introduced under a coalition government. It was introduced with the whole point of safeguarding emissions increases across the economy. What's fascinating is that the Leader of the Opposition has committed to abolishing the safeguard mechanism.

The safeguard mechanism is what requires Australia's largest industrial polluters, more than 200 of the country's biggest facilities, to buy carbon credits when they exceed their legislative emissions baselines. It is the single biggest source of demand for Australian carbon credit units. It is what has taken this scheme from one where the government was the main buyer, propping up a market with taxpayer money between 2014 and 2023, to one now driven by genuine private compliance demand.

I know this firsthand. Before I worked in the federal parliament, I worked in decarbonisation, helping companies set their emissions baselines under this very mechanism. Under the coalition, those baselines were so generous that I'm going to say that the safeguard mechanism had no teeth at all.

It was not safeguarding anything whatsoever. It's interesting because the point of the safeguard mechanism is to make sure that we don't see increases in the economy. I also worked on projects where we saw fantastic greenhouse gas reductions.

This included CBSP's nitric acid plant in Western Australia, where a new catalyst bed was used to reduce their nitrous oxide emissions., one of the most potent greenhouse gases there is. I have to say that there were many companies in Western Australia that were leading the way to reduce greenhouse gas emissions. I also worked in mining operations where we were looking at replacing diesel powered plants with gas and renewable energy such as solar and wind turbines.

They were doing this because it is the cheapest form of electricity available to these mines. I'm proud to be part of a government that accepts the science on climate change. To achieve our greenhouse gas reduction goals, it's not good enough for some companies to lead the way.

What we actually need to do is see the whole economy decarbonise. To mitigate greenhouse gas emissions, that's what we need to do, and do you know what? Climate change is happening now, whether it's seeing floods in Queensland, bushfires in Victoria or the recent floods in Nepal.

We really need to make sure that this has a direct contribution to the lives of people in not only Australia but also the world more broadly. Markets also have a role to play. Global frameworks like the Task Force on Climate-Related Financial Disclosures are pushing listed companies to disclose their climate risks so that investors can make better decisions.

This was introduced through the global stability board. Basically, the goal of that board is to make sure that financial markets are stable, so what it showed was that, by disclosing risks, investors can understand those risks in a much more detailed way and fundamentally make better investment decisions. But this only works if companies are listed on the stock exchange.

It doesn't reach every polluter and it doesn't replace every legislative compliance obligation. Most companies won't reduce emissions if they don't have to, and that's why the government still has a job to do here. This government reformed the safeguard mechanism in 2023, which turned it into a genuine declining baseline compliance system.

That is when it actually started driving demand and putting money behind carbon abatement. In his budget reply this year, the Leader of the Opposition called it a carbon tax and pledged to tear it down altogether, which is ridiculous because it was a policy that they introduced. If you take away the safeguard mechanism, you remove the reason a polluter has to buy a credit from a Kimberley ranger program, a Wheatbelt farmer or anyone else that's doing this work.

You take away the markets these communities now rely on and you replace it with nothing. We can't forget the substantive issue at the heart of so much of what this government is doing. Too many Australians are locked out of opportunity, whether it's the housing market or a fair share in the economic transition this country is going through.

This bill is part of making sure that the transition includes everyone—not just the polluters, who've always had a seat at the table, but the traditional owners, who have been managing this land for tens of thousands of years, and the farmers and landholders across Western Australia and Australia who are just beginning to see what this scheme can do for them.

The United Nations Environment Programme released a report last month that confirmed what scientists have been warning for years. On current trajectories, the world is likely to breach the 1.5 degree threshold at the heart of the Paris Agreement in the next few years, not the next decade. That is exactly why the mechanisms in this bill and the broader task of decarbonisation cannot be treated as settled and left alone.

Policy has to keep up with the pace of science. A scheme built in 2011 needed this update in 2026, and this government has a responsibility to keep reviewing and strengthening these mechanisms. This bill strengthens a scheme that already works.

It gives traditional owners a genuine legal say over what happens on their country. It guarantees Indigenous representation on the board that policies the whole scheme's integrity. It protects the market that pays for ranger jobs, cultural knowledge and real emissions reductions.

I commend this bill to the House.