Last week many people were questioning why the Victorian Premier was so keen to secure additional compensation for the impact of the Carbon Pollution Reduction Scheme (CPRS) on his state’s biggest polluters. Luckily for him, however, he has not been forced to answer a more interesting question: Why isn’t he demanding that the Commonwealth Government compensate Victoria’s public hospitals, schools and transport system for the impact of its flawed emissions trading scheme? Unfortunately for those of us who ever rely on the public health, education or transport systems the CPRS is estimated to cost state budgets more than $2.1 billion in 2013, rising to more than $5 billion per year in 2020. How do I know this? The same reason I know that every state premier knows this. It was the state premiers who commissioned Access Economics to do the modelling. Unless the state premiers successfully demand compensation from the Commonwealth to cover these costs the only options are to increase state taxes or sack teachers and nurses.