The Coalition has demonstrated why it has no credibility on climate change with its latest scare-mongering about a carbon price.

Opposition climate action spokesperson Greg Hunt is trying to frighten workers by claiming that a carbon price will cut real wages.

This has as much credibility as Opposition leader Tony Abbott's predictions last year that the carbon price would wipe towns like Whyalla "off the map" and have an "unimaginable" impact on the cost of living.

The facts are that Treasury modelling of the Gillard Government’s clean energy future package shows that under a carbon price:

• Real wages will increase by 20 per cent by 2020 and almost 50 per cent by 2050;
• Strong economic growth will continue with gross national income projected to grow at 1.1 per cent a year to 2050;
• Incomes will grow – real income per capita is projected to increase by $9000 in today’s dollars by 2020;
• Employment will grow with 1.6 million new jobs created by 2020;
• Pollution will fall – by 2050, carbon pricing is expected to reduce Australia’s domestic carbon emissions by nearly half what they would be without a carbon price, a reduction of 485 million tonnes of carbon dioxide-equivalent;
• Price impacts will be modest with a one-off increase of 0.7 per cent in the Consumer Price Index, much less than the 2.5 per cent impact of the GST.

Mr Abbott and Mr Hunt consistently misrepresent Treasury modelling.

This puts them at odds with economists and policy experts who advise that a carbon price is the lowest cost and most efficient way to transform the economy for a clean energy future.

The Government's clean energy future plan will put a price on the pollution of the country’s 500 biggest polluters, creating economic incentives to reduce pollution and invest in clean energy.

The Government will assist households through tax cuts, increases in family tax benefits and higher pensions and allowances.

Nine out of every 10 households will receive assistance.

Almost six million households will get tax cuts or increased payments that cover their entire average price impact. Over four million households will get an extra buffer with assistance that is at least 20 per cent more than their average expected price impact.

By contrast, the Opposition's Direct Action policy of paying subsidies to polluters will be ineffective in reducing pollution and will only cost taxpayers and the economy more. Treasury analysis shows his Direct Action scheme would double the cost of cutting pollution.

That means the Coalition would have to slug households with $1300 a year in higher taxes to fund the subsidies it wants to hand over to the big polluters.