1 Enacted inertia: incumbent resistance to carbon pricing in Australia, 1989-2011 A thesis submitted to the University of Manchester for the degree of Doctor of Philosophy in the Faculty of Humanities 2018 Marc S.R. Hudson Alliance Manchester Business School 2 This page intentionally blank 3 Contents Contents 3 List of Tables 6 List of Figures and Diagrams 6 List of Abbreviations 7 Abstract 9 Declaration 10 Copyright Statement 10 Acknowledgements 11 Dedication 12 The Author 12 Chapter 1: Introduction 13 1.1 Introduction 13 1.2 Research topic 14 1.3 Importance of study 16 1.4 Research Questions 18 1.5 Audience 18 1.5 Outline of thesis 19 Chapter 2: Literature Review and Conceptual Framework 22 2.1 Introduction 22 2.2 The need for a sea-change. Sociotechnical transitions 23 2.2.1 Sustainability sociotechnical transitions 25 2.2.2 Politics and power in sociotechnical transitions 26 2.3 Public Policy Theories 28 2.3.1. Punctuated Equilibrium 29 2.3.2 Advocacy Coalition Framework 32 2.3.3. Multiple Streams Approach 36 2.3.4 Overview of public policy theories 42 2.4 Institutional entrepreneurship and institutional work 44 2.4.1 Policy entrepreneurship 45 2.4.2 Institutional entrepreneurship 46 2.4.3 Institutional work 46 2.4.4 Disruptive Institutional Work 49 2.4.5 Relational institutional work 50 2.5 Research questions and conceptual framework 50 2.6 Conclusion 53 Chapter 3: Methodology 55 3.1 Introduction 55 3.2 Discussion of case study 56 3.2.1 Sequential/nested case study justification 58 3.3 Sources and analysis 60 3.3.1 Types of sources 61 3.4 Data analysis 66 3.5 Presentation of results 67 3.6 Conclusion 69 Chapter 4: “Formative Battles.” Channelling the floodwaters: incumbents learn 70 to control the direction of flow in the 1998-92 policy window 4.1 Introduction 70 4.2 The Streams 73 4 4.3 Coupling 77 4.4 Policy Window 78 4.4.1 Before hostilities commenced (April - August 1990) 79 4.4.2 The first battle: Ecologically Sustainable Development (April-August 81 1990) 4.4.3. The second battle: International commitment? The Toronto target 83 4.4.4 The third battle: Within and alongside the ESD process 84 4.4.5 The fourth battle: taxes and Rio 89 4.4.6 The fifth battle: Toronto revisited 95 4.5 Post-window events 98 Chapter 5: “Winning the rematch”: the 1994/5 Carbon Tax Battle, in which 100 incumbents defend their gains with superior firepower 5.1 Introduction 100 5.2 The Streams 103 5.3 Coupling 106 5.4 Policy Window 107 5.4.1 Phase 1: September – November: issue minimisation, cost emphasising, 108 disruptors attempt to cohere 5.4.2. Phase 2: December 1994- January 1995: a flood of reports and a spill- 111 over danger 5.4.3 Phase 3: February 1995: the roundtables 116 5.5 Window closure and aftermath (March 1995- 2006) 120 Chapter 6: “Subverting rather than averting”: Incumbent activity changes 123 climate change from perfect storm to perfect disaster (2006-2009) 6.1 Introduction 123 6.2 The Streams 126 6.3 Coupling 129 6.4 Policy Window 132 6.4.1 The Shergold Report and the 2007 Federal election 132 6.4.2 2008 - the year of intensive lobbying 135 6.4.3 2009 – consolidating the gains 140 6.5 Post -window events 145 Chapter 7: “The full court press”: incumbents turn to the public(s) to win policy 146 battles (2010-2011) 7.1 Introduction 146 7.2 The Streams 149 7.3 Coupling 153 7.4 Policy Window 154 7.5 Post-window events 164 Chapter 8: Discussion 165 8.1 Introduction 165 8.2 Twenty-two years of policy battles: analysis of the four windows 166 8.2.1 Pressures which built within the streams prior to couplings 167 8.2.2 The differing styles of coupling 169 8.2.3 The characteristics of the four windows (not merely their length, but the 172 fierceness of the battles, the types of window) 8.2.4 The “closure of the windows and the residues that flowed from it. 174 8.3 Incumbent resistance strategies – maintaining and defending the regime 181 through institutional work (Research Question 1) 8.3.1 Incumbent institutional work and how it changed over time 181 5 8.3.2 Persistent and episodic institutional work 183 8.3.2.1 Across all four windows (persistent institutional work) 185 8.3.2.2. Work found only in particular windows (episodic institutional work) 185 8.4 Forms of relational institutional work undertaken by incumbents to initiate, 186 maintain and defend their positions in response to changing patterns of disruptive behaviour (Research Question 2) 8.4.1 Lobbying of politicians 187 8.4.2 Building new organisations 188 8.4.3 Message discipline 190 8.4.4 Tactical incorporation 191 8.4.5 Control of opposition organisations 192 8.5 Transitions and regime resistance 195 8.6 Conclusion 197 Chapter 9: Conclusion 199 9.1 Introduction 199 9.2 Contributions 199 9.3 Limitations of the study and further work 201 Appendix 1: Interviews 204 References 205 Final word count: 73,118 words 6 List of Tables Table 2.1. Summary of strengths and weaknesses of public policy theories. 43 Table 4. 1 Tasman reports pertaining to Greenhouse policy in the period 1990-1992. 80 Table 4.2 Tasman seminars doubting climate science 89 Table 4.3 Anti-carbon tax economic modelling reports, 1991-1992. 90 Table 5.1 Industry reports challenging proposed carbon levy, Sept 1994 - Dec 1994. 112 Table 6.1 Economic modelling by government, incumbents and disruptors 142 Table 8.1 Pressures in the streams 168 Table 8.2 Coupling compared 169 Table 8.3 Couplers, the pressures they were under/exploited and their motivations 171 Table 8.4 Comparison of window characteristics 173 Table 8.5 Types of policy window 174 Table 8.6 Comparison of window closure 176 Table 8.7 Summary of types of incumbent action in chronological categorisation 183 Table 8.8 Forms of symbolic and material institutional work 186 Table 8.9 Summary of types of incumbent action based on types of institutional work 193 List of Figures Figure 2.1 Graphic representation of punctuated equilibrium. 30 Figure 2.2 Equilibrium and punctuation in relation to a policy’s image. 31 Figure 2.3 Advocacy Coalition Framework 33 Figure 2.4 Multiple Streams Approach. 36 Figure 2.5 MSA from temporal perspective 36 Figure 2.6 Five stream framework 42 Figure 2.7 Institutional work into a policy window and its precursors. 52 Figure 2.8 Learning between windows 53 Figure 4. 1: overview of the chapter’s policy window 72 Figure 4.2 Advert in Business Council Bulletin 87 Figure 5.1 1994-5 Policy Window 102 Figure 5.2. Sydney Morning Herald 12 December 1994 114 Figure 5.3 Front page of the Melbourne Age, 9 February 1995 119 Figure 6.1 2006-2009 Policy Window 125 Figure 6.2 Screengrab of cutemissionsnotjobs.com.au video 144 Figure 7.1 2010-2011 policy window 148 Figure 7.2 Abbott, (with microphone), at 23rd March rally 156 Figure 8.1 Schematic representation of longitudinal study 167 7 List of Abbreviations AAC Australian Aluminium Council AAS Australian Academy of Science ABARE Australian Bureau of Agriculture and Resource Economics ABC Australian Broadcasting Corporation ABS Australian Bureau of Statistics ACA Australian Coal Association ACARP Australian Coal Association Research Programme ACF Australian Conservation Foundation ACF Advocacy Coalition Framework ACTU Australian Council of Trade Unions AEMO Australian Energy Market Operator AGA Australian Gas Association AGO Australian Greenhouse Office AIGN Australian Industry Greenhouse Network AGW Anthropogenic Global Warming ALP Australian Labor Party AMEC Association of Mining and Exploration Companies AMEEF Australian Minerals and Energy Environment Foundation AMIC Australian Mining Industry Council (became MCA in 1995) APP Asia-Pacific Partnership on Clean Development and Climate APPEA Australian Petroleum Exploration Association ATIA Australian Trade and Industry Alliance BCA Business Council of Australia BOM Bureau of Meteorology CCS Carbon Capture and Storage CEDA Committee for Economic Development of Australia CEF Clean Energy Future (legislative package) CFF Commission for the Future CFMEU Construction Forestry Mining Energy Union CIS Centre for Independent Studies C02 Carbon Dioxide COAG Council of Australian Governments COP Conference of the Parties (UNFCCC annual conferences) CPRS Carbon Pollution Reduction Scheme CRC Cooperative Research Centres CSIRO Commonwealth Science and Industrial Research Organisation EITE Emissions Intensive Trade Exposed ESD Ecologically Sustainable Development EUETS European Emissions Trading Scheme IE Institutional Work INC Intergovernmental Negotiating Committee IPA Institute for Public Affairs IPCC Intergovernmental Panel on Climate Change IPT Interim Planning Target LE London Economics MCA Minerals Council of Australia MPCCC Multi Party Committee on Climate Change MRET Mandatory Renewable Energy Target 8 MSA Multiple Streams Approach NERDCC National Energy Research and Development Council NETT National Emissions Trading Taskforce NGAP National Greenhouse Advisory Panel NGGI National Greenhouse Gas Inventory NGAP National Greenhouse Advisory Panel NGRC National Greenhouse Response Committee NGRS National Greenhouse Response Strategy NIEIR National Institute of Economic and Industry Research NGO Non-governmental Organisation NGRS National Greenhouse Response Strategy NSW New South Wales NSWCA New South Wales Coal Association NSWMC New South Wales Minerals Council OECD Organisation of Economic Co-operation and Development ppm parts per million QRC Queensland Resources Council PE Punctuated Equilibrium RET Renewables Energy Target ST Sustainability Transitions TWS The Wilderness Society UNCED United Nations Conference on Environment and Development UNEP United Nations Environment Program UNFCCC United Nations Framework Convention on Climate Change 9 Abstract This thesis examines the behaviour of incumbents when faced with persistent advocacy of a policy that would potentially undercut their position.