A ten-minute animated exchange broke out between Workers’ Party member of parliament Associate Professor Jamus Lim and Grace Fu, Minister for Environment and Sustainability after the minister had delivered her closing speech during the second reading of the Carbon Pricing (Amendment) Bill on Tuesday in Parliament.
The Bill was later passed in Parliament on the same day as Singapore raised its carbon tax to $25 per tonne for greenhouse gas emissions in 2024 and 2025, and $45 per tonne for greenhouse gas emissions in 2026 and the year after.
Midway through the exchanges between the minister and the MP, Leader of Opposition Pritam Singh stood up and raised a point of order to the speaker, “I understand that when a member asks a question, the other member sits down. The question is answered and vice versa. There is some decorum between both parties.”
Assoc Prof Lim had sought clarifications on whether the government can exercise flexibility in their approach when implementing the carbon tax pricing by evaluating the economic situation on a yearly basis.
“’I’m befuddled because even now, the Government routinely alters levers or policies, such as the interest rate when there is uncertainty on a year-to-year basis about the level of interest rate. Yet, businesses continue to invest,” said Lim.
Minister Fu then stood up for a quick reply before firing back at Assoc Prof Lim and asking him to provide a clearer solution to the pricing mechanism.
“Associate Professor Lim started his speech earlier saying that we have the theory right, but we need to get the implementation right. So I would like to maybe ask him for his suggestion of how the Government should be positioning the carbon tax in his way,” asked Minister Fu.
“What will be your target? Is $100 (per tonne)? If it is long run, which year? Is it 2030 still?”
To which Assoc Prof Lim replied, “Just to be clear, the government has not also committed to a $50 to $80 (per tonne, by 2030) that is well stated.”
“We have, S$50 to S$80 (per tonne by 2030) is our range. So what is your range?” came the quick retort by Minister Fu.
“$58 to $133 (per tonne) with a midpoint,” answered the Sengkang GRC MP.
It was at this point that the Minister asked the WP MP, should he become the Minister for Sustainability and the Environment, how would he approach the companies and describe to them the glide path to these pricing.
“That was the content of my speech. I suggested that we could do it incrementally the way that the ministry suggested. But I also suggested we could allow the specific level to adjust upward and downward according to economic conditions,” explained Assoc Prof Lim.
Minister Fu was not about to give up on this argument as she remarked, “So are you then saying that we can go out to the world and say ‘Sorry, I have make the 2030 NDC (Nationally Determined Contribution) on the basis of certain economic conditions, and now that the economic conditions are bad; there is a war up there, there is high inflation and energy, my NDC don’t count because I need to glide further up?’”
It was clear that Lim was not about to back down from his initial point, making known his earlier suggestions, “I think I was clear that the adjustments upwards and downwards are the same way that business cycles go upward and downward. So you would have it lower in a given year because of economic conditions. But when things picked up, you would raise it back so that you met the original targets.”