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AAP
AAP
Politics
Andrew Brown

Businesses urge support for safeguard mechanism

Ai chief Innes Willox says hundreds of facilities need clarity as soon as possible on the new rules. (Mick Tsikas/AAP PHOTOS) (AAP)

Business groups have renewed calls for federal parliament to pass safeguard mechanism reforms, as the contentious climate policy stalls.

Talks on the safeguard mechanism will be centre stage when MPs return to Canberra for the last sitting week before the federal budget in May.

The government is seeking to pass the mechanism bill through parliament this week so the reforms can be in place by July.

Labor needs the support of the Greens plus two crossbenchers to get the bill through the Senate, with the coalition opposing it.

The Greens are calling for the government to stop all new coal and gas projects in return for their support for the bill.

AI Group chief executive Innes Willox said parliament needed to come to a workable agreement on the safeguard as soon as possible to ensure its success.

"The net zero emissions marathon has much further to run, but we won't get to the finish line by staying in the changing rooms," he said.

"Hundreds of facilities need clarity as soon as possible on the new rules that will apply to them from July 1."

The safeguard mechanism will apply to the country's 215 biggest emitters and force them to reduce their emissions by 4.9 per cent each year.

Companies that aren't able to meet the targets would be able to purchase carbon credits.

The policy is considered essential to achieving the climate target of 43 per cent emission reduction by 2030.

Mr Willox, whose network represents the interests of more than 60,000 businesses, said while the scheme could be improved later on, there was a need for the bill to pass now to ensure certainty for investors.

"There is also going to need to be longer-term evolution of the safeguard and supporting policies to ensure industry can achieve its net zero emissions future right here in Australia," he said.

"But none of that would be brought closer by the parliament failing to pass the safeguard reform legislation."

Greens leader Adam Bandt has insisted the calls for the government to stop new coal and gas projects were not an ultimatum.

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