Tackling the threat of climate change is “mission critical” for Australia. Our economic performance and living standards depend on how well we respond to this challenge today, and over the coming years.

The Productivity Commission has for many years emphasised the importance of climate change policy. As our chairwoman Danielle Wood wrote in these pages only a couple of months ago, the commission has been encouraging governments to use market mechanisms as the best way to reduce carbon emissions since before we were known as the Productivity Commission.