Martin Ferguson (Batman, Australian Labor Party, Minister for Resources and Energy) Share this | Hansard source

I thank the member for Isaacs for his question. On behalf of the Australian community last year I had the privilege of being one of the signatories witnessing the biggest ever investment in Australia’s history in a single project, the Gorgon LNG project, which is now bringing benefits to many businesses in Australia and opportunities for employment and training to thousands of Australians. That investment decision proved that taking on a fight 25 years ago, in terms of putting in place a tax regime for the petroleum industry, meant that we actually got the balance right. It is in that context I can say that no-one can deny that the resources sector is a key part of Australia’s future. The current debate is about getting the balance right. The difference between the government and the opposition is that we actually believe the Australian community at the moment is not getting a fair share with respect to its return on the development of its national resources from a non-renewable sector point of view. I simply say that the government is absolutely committed to ongoing engagement for the resources sector for the purposes of getting the balance which not only means we continue to attract investment but also guarantees that the Australian community gets a fair return for the development of its resources that can also be used to invest in our future, invest in company tax cuts, invest in infrastructure and invest in skills, to name a few opportunities.

Let us go to some of the scare campaigns at the moment with respect to the supposed impact on the Australian economy of what the government has announced to date. I start by going to the Treasury’s independent modelling by KPMG Econtech—I might say, the preferred economic modeller of the previous government. Let us deal with a few facts with respect to their modelling. I go to that modelling which says that cutting the company tax rate to 28 per cent and introducing the resources superprofits tax, combined with the removal of the impact of royalties, would actually expand mining output by 6.6 per cent in the long run. It also goes on to say:

All other industries are expected to expand by 0.3 per cent in the long run.

The report further says that the combined effect of introducing the resources superprofits tax and cutting the company tax rate by 2 percentage points will add 0.7 per cent to Australia’s GDP over the next five to 10 years. That independent modelling clearly indicates that this reform will strengthen the Australian economy as a whole.

That is no different, I might say, to the history of the petroleum resource rent tax, which tells the same story: the industry has flourished as a result of the tough tax debate we took on 25 years ago. I appreciate that, from the government’s point of view, this is going to be a long, tough tax debate. That is because our government is absolutely committed to getting the balance right—not only ensuring appropriate investment for Australia that creates jobs and prosperity but also correctly ensuring, unlike the opposition leader, who finds economics boring, and actually guaranteeing the Australian community a fair return for the development of its resources.

We as a government stand in support of the Australian community’s right for a fair return for the development of their resources. The opposition, unlike the Western Australian Premier, currently believes that the resources sector should not pay higher tax for the opportunity to develop our resources. I am pleased to say this government stands in support of the Australian community in ensuring they get a fair return for the development of their resources. The opposition leader should hang his head in shame. He is more concerned about corporate donations than the proper return on the development of Australia’s resources.

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