The real cost of direct action: An analysis of the Coalition’s Direct Action Plan

by Richard Denniss and Matt Grudnoff

The Coalition has committed to reducing greenhouse gas emissions by five per cent on 2000 levels by 2020. It proposes to achieve this target with a “Direct Action Plan”: a competitive grant scheme that would buy greenhouse gas reductions from businesses and farmers. Over the past decade various Australian governments have announced more than seven billion dollars of competitive grant schemes.

The Australian National Audit Office (ANAO) and the Grattan Institute have reviewed competitive grant schemes in Australia and found that they:

• Take far longer to achieve their objectives than originally planned

• Achieve much less than expected

• Cost far more than was budgeted.

This analysis finds that the Coalition’s Direct Action Plan will cost far more than is budgeted for and is unlikely to find sufficient greenhouse gas reduction projects in order to reach the Coalition’s emissions reduction target.

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