Why net zero could be ground zero for Sussan Ley

Sussan Ley is hurtling towards a political showdown over Australia’s net zero target that could make, or end, her leadership. After three years of an utterly supine party room under Peter Dutton, the Liberal Party leader presides over a much-diminished and divided opposition.

The Coalition is paying the price for three years of policy inertia (Dutton’s nuclear power policy, which lacked critical detail, doesn’t count) and it is to Ley’s credit that she has initiated a proper review process on climate policy.

But the review was also designed to buy Ley some time, allowing frayed nerves to settle after the quickie trial separation and reconciliation of the Coalition parties this year.

The problem is that the climate-sceptic Nationals – led by Senator Matt Canavan with former leaders Barnaby Joyce and Michael McCormack – don’t want to give Ley that time. And the conservative right flank of the Liberal Party, led by Tony Pasin, Alex Antic and others, don’t want to either.

Canavan, a veteran senator at just 45 and a long-term critic of net zero, tells me that there is a path to party room peace for Ley. But there are caveats.

“We haven’t had a vote in the party room yet on what would be the most radical economic transformation plan in Australian history. A big reason for the net zero troubles is because people are frustrated that they haven’t been able to have their say in the party room,” he says. “I am not going to change my view, but if the party room decides to stick with it [net zero] I will accept that that is the policy we have. I will lay down my guns, but I won’t change my position.”

Canavan says he has never been against an emissions reduction policy and that “I supported policies we had until we reached for the stars with net zero. When you set such a stretch emissions target like net zero, you prioritise emission reduction over all other goals, and I believe the priority for Australia should be to deliver the lowest energy prices for the Australian people, then other things can be factored in after that”.

The problem with this offer is that Canavan is putting forward a deal that Ley, who supports net zero, probably can’t accept.

The group of conservative Liberals opposed to net zero are still smarting over Ley’s narrow victory over Angus Taylor for the leadership this year. They helped derail Tuesday’s party room meetings and their sniping over climate policy must also be seen through the prism of leadership instability.

The Nationals and conservative Liberals want a full-blown joint party room meeting devoted solely to Australia’s 2035 interim climate target and net zero by 2050, much as Tony Abbott allowed a no-holds-barred debate on same-sex marriage in the party room in 2015.

That’s because those two groups are confident that, in a vote of the joint party room, they have the numbers to dump support for net zero as the Coalition’s official policy.

In a vote of just the Liberal Party room, however, the result would be close. Plenty of moderate Liberals support the net zero policy and believe that it is the price of entry they must pay to have any chance of winning back voters in the major cities, who deserted the Coalition at the past two elections.

The Resolve Political Monitor, published by this masthead, showed that 44 per cent of voters supported an ambitious emissions reduction target of 65 to 75 per cent by 2035. Just 18 per cent of people opposed this target, and 38 per cent were unsure or undecided. In voters’ minds, the issue is settled.

Ley faced questions from the Canberra Press Gallery this week – something Dutton rarely did – and told me her leadership was “absolutely” secure because “I know my party room and I know the party room that I lead … we do need to reflect on the result of the last election. We do need to do that with humility.”

She also addressed the disunity over net zero in the party room, but stopped short of committing to the meeting that Canavan and co want.

But it’s hard to see how Ley can avoid that showdown because in the next couple of weeks, the Climate Change Authority will release its recommendations for Australia’s interim 2035 target. The inside mail is that the authority will recommend reductions of 65 to 75 per cent, but the Albanese government is expected to take time to consider the advice before making a decision on whether to adopt this target.

That leaves Ley in an awful predicament: go with a policy that most Australians support or go with the party’s branch members (who recently voted to abandon the policy at state conferences in Queensland and Western Australia) and consign the Coalition to another term of irrelevancy.

Sixteen years ago, Canavan’s former boss and political mentor Barnaby Joyce helped kick-start the climate wars in Australian politics when he campaigned against Kevin Rudd’s carbon pollution reduction scheme and the infamous “$100 lamb roasts” he claimed it would bring to kitchen tables across the country.

It looked like a fool’s errand. But in a matter of months, Malcolm Turnbull was torn down as leader by Tony Abbott over the issue; seven months later, Rudd was torn down by Julia Gillard, again in part over climate policy.

Turnbull reclaimed the leadership but was bedevilled by climate rebels throughout his three years and eventually was forced out and replaced by Scott Morrison as prime minister, who managed to land an emissions reduction target – but was booted out of office by voters, in part over a lack of ambition over climate policy.

Ley is no fool. She knows the Coalition needs to remain committed to net zero to have any chance of winning back city seats.

The messy debate in the party room is coming, and it will test her leadership like never before. Ley may come to wish that the Coalition split had remained in place.

James Massola is chief political commentator.

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