Tony Windsor (New England, Independent) Share this | Hansard source

I am delighted to be able to speak on this MPI, parts of which go to economic performance and productivity. I would like to speak, if I could, on the economic messages that are being given regarding three separate issues. I also want to implore the government to look at sending out consistent messages regarding a few areas. Renewable fuels is the first area from which I believe a mixed message is being sent. In the last six months, we have seen a conversion, in a sense, to the belief that the world does have some emissions problems and some global warming problems and that we have to look at what we are doing about fine particle emissions in our cities in terms of our fuel system.

However, we have a rather ridiculous system of taxing oil based products, currently at the rate of 39c a litre, on top of which there is the application of the GST. If we believe the rhetoric, we now have a government supposedly—I do not think it is doing it terribly much in a practical sense because I think it is very much governed by the fuel companies—encouraging industry to attempt to address some of these particular issues. But we still have a taxation structure that in 2011 will actually tax renewable fuels.

Argument has been had in this parliament that we should not subsidise renewable fuels—and I just cannot believe that, particularly given what is happening in other parts of the world—but to go one step worse than that is to leave in place a taxation regime while in the same breath saying to industry, ‘We are trying to encourage you to go to renewable energy for a whole range of good reasons.’ That is the first message. Obviously, ethanol and biofuels industries can promote enormous productivity in regional communities through investment, job creation, grain prices, various health aspects et cetera. So there are real economic benefits as well as other benefits to be gained by sending the correct messages in relation to renewable fuels.

Small business is the second area from which I believe mixed messages are being sent. We have just had a speaker talking about unfair dismissal, but we have an extraordinary set of the circumstances out there where the definition of ‘small business’ depends on which policy area we are talking about. I was a great supporter of unfair dismissal when the government talked about ‘small business’ being defined by ‘up to 20’ employees. I think on 40 occasions or whatever it was over the years it remained at 20 but, with the new legislation, it shifted and the government extended it to 100. That is fair enough. The government had the numbers to do that. But when exceptional circumstance arrangements were put in place, all of a sudden the definition of ‘small business’ was reduced to 20 employees. I think we have to have some consistency in messages that are given. Is a small business 100 or 20 employees, or does it vary from day-to-day depending on whether the budgetary outlays are suitable or the agenda that the government is trying to embrace is the correct one?

The third area from where some dreadful mixed messages are coming particularly concerns the Prime Minister’s 10-point plan in which he is trying to remove the problems of state boundaries from the water reform process. As part of that process, $3 billion is being allocated to the overallocation issue. Apparently, there has been an overallocation of 3,000 gigalitres—no-one has actually explained how that spend goes—in the system, and the government is going to use some of that money to reacquire overallocation. We have an extraordinary example of inconsistency at the New South Wales level in the groundwater area, where the government has gone through that process, embracing the states and embracing the irrigators while still operating a system where it will tax the compensation paid to those people who voluntarily relinquish part of their allocation; it will tax it as income in the year of receipt rather than treat it as the loss of a capital asset.

I make those three points. There has to be some consistency in those areas. If we are serious about economic performance and sending the right messages about productivity, real things need to happen on the ground. Those real things must be based around the consistency of the message; otherwise, we just get a politicised economic policy that comes and goes and has no consistency for those who are trying to operate their businesses under those platforms. (Time expired)

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