I can go first.
I would agree with the findings of that report that the existing mechanisms for protecting against carbon leakage are adequate. Those mechanisms, to be clear, are the standards, the sectorally set standards within the OBPS, below which there is no carbon price due.
If you meet the standard, you pay nothing, and if you exceed the standard, you have to pay. You still have this marginal price, this high marginal price that incentivizes you to reduce your emissions, but your average price, your average cost of carbon, is nice and low.
The existing system works well. As you go out to $170 a tonne and as you have a tightening of those standards—we've put in law a 2% tightening of those standards—you start to lose that benefit.
My recommendation and the recommendation of the carbon competitiveness commission is that for the sectors that are most at risk of leakage—and not all sectors are equally at risk of leakage—you need to maintain a high standard, a very generous output-based allocation, in those sectors.
You still have the nice high marginal price. You still have the incentive to decarbonize, but you've got to keep the average cost of carbon low in those sectors. Moreover, in the medium and long terms, you need to be thinking about something like a border carbon adjustment or GHG intensity standards at the border, for reasons that I'm happy to go into in further depth. For now, the output-based allocations work.