The costs of an emissions trading scheme on Australian households are exaggerated, the federal government's chief climate change adviser says.
Professor Ross Garnaut addressed a public forum in Brisbane today on a national tour to discuss his draft climate change report, which recommends an emissions trading scheme be phased in by 2010.
He rejected claims the transport industry would be forced to pass on the increased costs of an emission trading scheme.
"There will be some increases in prices, they will be modest in dimension compared with a lot of the changes that have been happening as a result, for example, of the increase in oil prices," he told reporters.
"I think there's a lot of exaggeration going on and the important thing is (that) if and when the prices of some goods and services rise there's adequate compensation ... for low income Australian households (from governments)."
Prof Garnaut said Queensland would be a big loser if no action was taken.
"There are serious risks to the Great Barrier Reef, the drying and warming of southern Australia will have its effects through the Darling Downs and the rest of the Queensland end of the Murray-Darling system," he said.
"The warming of a state that's already a warm state is going to have significant health impacts."
The government will release its response to professor Garnaut's climate change report next Wednesday, which could include a proposed emissions trading scheme model.
