Only the best, unless I'm wrong, says Ross Garnaut

Professor Garnaut, who compiled his original Climate Change Review in 2008 and an updated version last November, said much of the media and public discussion on climate change was crude and distorted.

He described reaction to some of his conclusions as "somewhat rabid" and chided the media for misrepresenting US climate change policy.

Prof Garnaut also warned of the worst result of a rejection of carbon pricing would send Australia into a political retreat.

"If carbon pricing were defeated this time around it would open the way to myriad regulatory interventions," Prof Garnaut told a Melbourne conference.

"These would raise costs directly, there would be no opportunity to introduce productivity-raising tax cuts as a form of compensation to low and middle income earners.

The effects of climate change will be one of the reasons to expect higher food prices and higher agricultural prices in the 21st century . . . The question will be what parts of the world will retain a capacity to make use of those better markets," Professor Garnaut said.

He said farmers would also benefit if carbon pricing saw a slowing of growth in the coal and mining sector. "If the huge growth of coal and gas is a bit slower, if the mining industry is right, that will lead to a lower real exchange rate and a huge benefit to the rural sector."

Professor Garnaut conceded he was interested in seeing the final package to come out of the climate pricing negotiations. But he was cautious about passing judgment on the likely overcompensation of low-income earners through a 20 per cent "battler's buffer".

"We don't want the scheme to make lower- or middle-income Australians poorer, but I thought the job was done by just making sure we didn't make them poorer," he told The Australian.

Professor Garnaut said it was optimal for Australia to have a fixed price for three years to allow a comfortable transition to an emissions trading scheme and avoid extreme fluctuations "while the politics settles down".

But he acknowledged a cost of such an approach was that fluctuations in international prices, such as the EU emissions trading scheme, could "get out of step" with the Australian price.

"I recommended three years because it was the best. I only recommend the best for Australia," he said with a smile. "Unless I make a mistake, in which case I am very honest about correcting it.