Allegra Spender (Wentworth, Independent) Share this | Hansard source

by leave—I move amendments (1) and (2) as circulated in my name together:

(1) Clause 2, page 2 (table item 1), omit "to 3", substitute "to 4".

(2) Page 2 (after line 11), after clause 3, insert:

4 Review of operation of amendments made by Schedule 5

(1) The Minister must cause a review to be conducted of the operation of the amendments made by Schedule 5 to this Act.

(2) Without limiting the matters that may be considered when conducting the review, the review must have regard to:

(a) the appropriate distribution of petroleum resource rents and the need to provide a fair return to the Australian community; and

(b) the appropriateness of the Petroleum Resource Rent Tax Assessment Act 1987 (as amended by Schedule 5 to this Act) and associated regulations in light of recent, and potential future, developments in industries subject to that Act; and

(c) the applicability of the review's findings to resource export industries not subject to that Act.

(3) The review must start no later than 1 July 2026.

(4) The persons who conduct the review must give the Minister a written report of the review no later than 1 January 2027.

(5) The Minister must cause a copy of the report of the review to be tabled in each House of the Parliament within 3 months after the day the Minister receives the report.

The petroleum resource rent tax is supposed to ensure that Australians get a fair return when their oil and gas resources are sold overseas, but the current system is completely broken. In the last couple of years, Australian LNG exports boomed as gas prices skyrocketed, with Climate Energy Finance estimating that gross profits of LNG exporters exceeded $63.5 billion in 2022. But, despite these profits and despite gas exporters being able to extract these resources without paying any additional royalties, the Australian people have seen little return. In the 2020-21 financial year, there were 33 projects eligible for PRRT, yet only six paid any tax. Even more shockingly, despite Australia being the second-largest LNG exporter in the world, the most recent set of budget papers noted:

… not a single LNG project has paid any PRRT and many are not expected to pay significant amounts of PRRT until the 2030s.

So the changes to the PRRT are welcome, and I appreciate the government taking action on this. It was well overdue.

But, sadly, the government has not gone far enough in these changes and reform. Whilst a few projects that would never have paid PRRT will now do so, the main impact of the bill is to bring forward a small amount of revenue a few years earlier, giving the budget bottom line a boost today at the cost of taxpayers tomorrow. It's not even as much revenue as you would think. The reforms were originally slated to bring in just $600 million a year over the forward estimates, despite gas companies bringing in an additional $20 billion in revenue in the last financial year alone, yet in the latest Mid-Year Economic and Fiscal Outlook this amount had shrunk even further.

The lack of significant reform on PRRT is not only a missed opportunity for the budget bottom line; it's a missed opportunity to fund the kind of cost-of-living relief that households desperately need right now. If the government lowered the deductions cap from 90 per cent to 80 per cent, it could fully fund a people power plan that permanently lowers power bills for nearly half a million households by turbocharging the uptake of rooftop solar, home electrification and improved home energy performance. The government has not yet taken this chance, but it must, and I hope it changes its way—at least in the Senate. I also want to put on record my deep concerns about the concessions the government are rumoured to be making to secure support in the Senate, which could result in massive expansion of the fossil fuel industry in the midst of a climate crisis. This would be a deep betrayal.

So my amendment asks the government to be open to doing things better in the future, to reviewing whether these new arrangements are delivering a fair return and to further reforming the tax if necessary. My amendment would insert a statutory review of the changes to the PRRT, to be commenced no later than 1 July 2026. This would allow two full financial years for the government changes to take effect and for it to become clear whether these reforms are delivering an equitable return to the taxpayer. Like the Callaghan review and the gas transfer pricing review, this review would examine whether the superprofits from our resources are being shared equally between the taxpayer and gas exporters. But, unlike these reviews, it would consider how learnings from reforms to the PRRT could be applied to the other resource export industries, which are increasingly important as our economy decarbonises. This is a reasonable and constructive amendment that would help deliver a fair return for Australian taxpayers in the future.

I'd like to make a further point, which is that we sent this amendment to the Treasurer's office back in November last year and I think it was only today or yesterday that we got a response or engagement on this amendment. I will constantly work with respect with members of the government on this and on any other amendments because they are made in good faith. These are challenges that I am making because I think they could be better, but I'm always open to having a conversation about these things. I was very disappointed not to get more constructive engagement from Treasurer or Assistant Treasurer on these matters, because they are really important and my community expects to understand, in a fulsome and time-appropriate way, what the government's position on this is and, if we have different views, why those are there so that we can engage constructively, perhaps to come to a middle ground.

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