The Claim
“Tried to scrap the $10 billion Clean Energy Finance Corp, even though it provides $110 million per year in net revenue to the government.”
Original Sources Provided
✅ FACTUAL VERIFICATION
The core facts of this claim are accurate. The Abbott Coalition government did attempt to abolish the $10 billion Clean Energy Finance Corporation (CEFC) through the Clean Energy Finance Corporation (Abolition) Bill 2013 [1].
The CEFC was established by the Gillard Labor government in 2012 as part of its climate change policies [2]. The Coalition, while in opposition, dubbed the CEFC a "giant green hedge fund" and made abolishing it an election promise, along with scrapping the carbon price [3].
Regarding the $110 million figure, the original SMH article states: "Scrapping the $10 billion Clean Energy Finance Corp will strip between $110 million and $171 million a year from the federal budget rather than save the government money" [3]. This figure came from the CEFC's own submission to a Senate inquiry in November 2013 [3].
The CEFC's business model involved raising funds at the government borrowing rate (approximately 3.5%) and lending under commercial terms at approximately 7%, generating a "reasonable return" for taxpayers [4].
Missing Context
The claim omits several critical pieces of context:
Senate Opposition Prevented Abolition: While the Coalition government introduced the abolition bill multiple times, it was consistently rejected by the Senate [1]. The Greens, Labor, and Palmer United Party all opposed the abolition, meaning the CEFC continued operating throughout the Coalition's term [4]. The bill was rejected again on June 18, 2014 [1].
The $110M Figure Was Projected, Not Actual: The figure cited was a projection based on assumptions that only half of the investment base ($5 billion) would be deployed [3]. The CEFC stated: "The costs to the budget's cash balance of abolishing the fund are based on assumptions that only half of its investment base – or $5 billion – is deployed" [3].
Coalition's Policy Rationale: The Coalition's opposition to the CEFC was rooted in ideological differences about government intervention in markets. They viewed the CEFC as "crowding out" private investment, though the CEFC countered this by demonstrating it achieved "private sector leverage of $2.90 for every $1 the CEFC has invested" [3].
Irony of Coalition Government Later Using CEFC: In August 2014, Prime Minister Tony Abbott himself advised the Tasmanian government to seek funding from the CEFC for irrigation projects [4], demonstrating the practical value of the institution his government was simultaneously trying to abolish.
Source Credibility Assessment
The original source is the Sydney Morning Herald, a mainstream Australian newspaper owned by Fairfax Media (now Nine Entertainment). It is generally considered a reputable, center-left publication with established journalistic standards [3].
The article cites the CEFC's own submission to a Senate inquiry, which is a primary source. Author Peter Hannam was an environment reporter for the SMH, not an opinion columnist, indicating this was factual reporting rather than opinion [3].
The SMH, like most Fairfax publications, has generally been considered center-left in its editorial stance, which could influence framing but does not necessarily affect factual accuracy in news reporting.
Labor Comparison
Did Labor do something similar?
Search conducted: "Labor government Gillard Rudd Clean Energy Finance Corporation CEFC policy climate"
Finding: No equivalent - the CEFC was actually created by Labor, not abolished by them. The Gillard Labor government established the CEFC in 2012 as part of its Clean Energy Future package, which included the carbon price mechanism [2].
However, for comparative context:
- Both parties engaged in climate policy reversals: Labor's carbon price was itself abolished by the Coalition (with Labor/Greens opposition in Senate failing to prevent it), demonstrating that dismantling the previous government's climate policies is common in Australian politics regardless of party.
- Ideological consistency: Labor maintained the CEFC and other climate institutions; the Coalition sought to dismantle them. This represents genuine policy differences rather than hypocrisy on either side.
Balanced Perspective
The claim presents the Coalition's attempt to scrap the CEFC as fiscally irrational given its revenue-generating potential. While factually accurate about the attempt and the revenue projections, this framing obscures important context.
The Coalition's Position: The Abbott government viewed the CEFC as inappropriate government intervention in markets that should be left to private finance. They believed the "green bank" concept distorted markets by having government compete with private lenders. This was a legitimate ideological position, not merely fiscal irrationality.
Budget Impact Complexity: While the CEFC projected revenue, the actual budgetary impact involved complex accounting around government borrowing, commercial lending rates, and long-term asset valuation. The projected $110 million figure was based on specific assumptions about deployment rates that may not have materialized.
Senate Checks and Balances: The fact that the CEFC survived demonstrates Australia's parliamentary system working as designed. The Coalition's attempt to fulfill an election promise was thwarted by the Senate, and the institution continued operating - making the claim's implication that the Coalition "tried" and thereby somehow failed fiscal responsibility somewhat misleading, since the attempt was unsuccessful.
Subsequent History: The CEFC has gone on to become highly successful, investing billions in clean energy projects and generating returns. The Coalition's attempt to abolish it appears, in retrospect, to have been poor policy - but at the time, it reflected genuine ideological differences about the appropriate role of government in financing markets.
Key context: This is unique to the Coalition - no Labor government attempted to abolish a revenue-generating green investment vehicle because Labor created this particular institution. However, both parties have engaged in dismantling predecessor climate policies when in power.
TRUE
7.0
out of 10
The core claim is factually accurate: the Coalition government did attempt to abolish the $10 billion CEFC, and the CEFC itself projected it would generate $110-171 million annually for the budget [3]. However, the claim presents this as simple fiscal irrationality while omitting: (1) the ideological basis for the Coalition's opposition to government-backed investment vehicles, (2) the fact that the Senate rejected the abolition and the CEFC continued operating, (3) that the $110 million figure was a projection based on partial deployment assumptions, and (4) that Prime Minister Abbott himself later advised using CEFC funding for Tasmanian projects [4]. The claim is true but presents a complex policy disagreement as straightforward fiscal incompetence.
Final Score
7.0
OUT OF 10
TRUE
The core claim is factually accurate: the Coalition government did attempt to abolish the $10 billion CEFC, and the CEFC itself projected it would generate $110-171 million annually for the budget [3]. However, the claim presents this as simple fiscal irrationality while omitting: (1) the ideological basis for the Coalition's opposition to government-backed investment vehicles, (2) the fact that the Senate rejected the abolition and the CEFC continued operating, (3) that the $110 million figure was a projection based on partial deployment assumptions, and (4) that Prime Minister Abbott himself later advised using CEFC funding for Tasmanian projects [4]. The claim is true but presents a complex policy disagreement as straightforward fiscal incompetence.
📚 SOURCES & CITATIONS (5)
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1
aph.gov.au
Helpful information Text of bill First reading: Text of the bill as introduced into the Parliament Third reading: Prepared if the bill is amended by the house in which it was introduced. This version of the bill is then considered by the second house. As passed by
Aph Gov -
2
treasury.gov.au
Section 1: Agency overview and resources 1.1 Strategic direction statement
Treasury Gov -
3
smh.com.au
Scrapping the $10 billion Clean Energy Finance Corp will strip between $110 million and $171 million a year from the federal budget rather than save the government money, the fund will tell a Senate inquiry today.
The Sydney Morning Herald -
4
theguardian.com
Despite Abbott government instruction, the ‘green bank’ says it is legally obliged to continue operating until legislated not to
the Guardian -
5
cefc.com.au
The Clean Energy Finance Corporation (Abolition) Bill 2013 (the Abolition Bill) was again rejected by the Senate on 18 June 2014.
Clean Energy Finance Corporation
Rating Scale Methodology
1-3: FALSE
Factually incorrect or malicious fabrication.
4-6: PARTIAL
Some truth but context is missing or skewed.
7-9: MOSTLY TRUE
Minor technicalities or phrasing issues.
10: ACCURATE
Perfectly verified and contextually fair.
Methodology: Ratings are determined through cross-referencing official government records, independent fact-checking organizations, and primary source documents.