Media - Nick Xenophon - Independent Senator for South Australia

Treasury has made basic errors in its analysis of the Frontier Economics alternative model for an emissions trading scheme, leading to bizarre, unfounded claims the scheme is under-costed by $3.2 billion dollars.

"Treasury has put two and two together and come up with total confusion on their part," Senator Xenophon said following claims overnight the Frontier scheme did not compensate households and small businesses at the same levels as the Federal Government's proposed scheme.

"This shows that neither the Government, nor Treasury has bothered to understand how the Frontier scheme works," Nick said. "The Frontier scheme doesn't need to provide the same level of compensation as the Government scheme, because the Frontier scheme doesn't damage the economy like the Government's scheme does."

Frontier Economics Managing Director Danny Price has offered to sit down with Treasury officials in any public forum and demonstrate how these claims of a supposed black-hole are demonstrably false.

"Frontier has always offered to answer any questions Treasury may have about its proposed scheme," Nick said. "The smart thing would have been for Treasury to pick up the phone and seek clarification before sending Wayne Swan out to make these ridiculous, fanciful false claims."

"My challenge to Treasury is simple," Nick said. "Rather than misinforming the media, why don't we sit down in an open forum and debate these claims and debate the merits of all the ETS models – the Frontier model, the Government's model and the Green's model."

"Let's have the open, constructive, informed debate we should have had 18 months ago," Nick said. "After a year and a half Treasury should at least understand the basic structure of alternative models," Nick said.

"Once again the government's motives seem political, not economic of environmental," Nick said.