The Business Council of Australia today welcomed the Prime Minister’s announcement that the federal government will move ahead with key elements to reduce emissions outlined in last week’s report of the Task Group on Emissions Trading.

Mr Howard announced today that the government agreed to the development of a cap-and-trade emissions trading scheme, setting long-term emissions targets by 2008 and trading by no later 2012.

BCA Chief Executive Katie Lahey said the announcement essentially adopted key features identified by the task group necessary to provide the basis for a smooth eventual transition to a low-emissions economy.

“This will create greater levels of certainty for business so it can continue to plan investment and management decisions in response to the challenges of climate change,” Ms Lahey said.

Ms Lahey said the major challenge for Australia in any domestic response to climate change ahead of a global agreement to reduce emissions was to contribute to emissions reduction while ensuring our long-term economic prosperity.

“Business believes it will be the strength of the Australian economy in the future – not its diminution – that will make sure Australia can address the potential risks associated with climate change,” Ms Lahey said.

With this announcement the BCA has called on the states, territories and federal government to replace the current range of federal and state-based emissions reduction schemes that are inconsistent with the national approach flagged today.

“This announcement means Australia now has the capacity to link sensible and credible emissions reduction targets to a long-term, well designed national emissions trading scheme,” Ms Lahey said.