Joel Fitzgibbon (Hunter, Australian Labor Party) Share this | Link to this | Hansard source

I move:

That this House acknowledges the importance of the Minerals Resource Rent Tax for the funding of important physical infrastructure in capacity constrained mining regions.

The minerals resource rent tax is a government initiative to ensure that the great wealth which flows from this country's mineral resources is equally and evenly shared across the entire Australian community. We will take the superprofits flowing from the mining sector and redistribute them to all Australians—to the people who actually own those resources. We will do so through both the tax and the superannuation systems.

We will also be redirecting billions of dollars of that revenue back into the mining regions from which the wealth comes. I of course represent one of those regions and I am determined that many of the issues which arise out of mining are addressed in the communities of my electorate. Mining has brought great wealth to the region I represent and to regions, such as the Illawarra, represented by some of my colleagues. But it has also brought great pressures. The most obvious are the environmental effects—the impact on air and water quality. But they also include higher housing prices, higher rental prices and even higher grocery prices in areas of my electorate. The growth in mining has also brought about enormous capacity constraints—difficulty in securing child care, for example. Employers in my electorate, particularly those in the non-mining sector, are having an extraordinarily difficult time securing employees. I very much welcome the Prime Minister's announcement today and, if I get a chance, I will have something to say about that issue a bit later on.

The capacity constraints arising out of growth in the mining sector are highlighted by transport issues in my electorate. At peak hour these days, the main road through Singleton is like a car park. That is also true of Maitland and Muswellbrook and many other towns in between. And these car parks are pretty heavily potholed—roads in my region are nothing short of a disgrace. The vineyards of Hunter wine country—the jewel in the Hunter region's tourism crown—have the worst roads in the region, not because of tourism traffic but because those roads are also used by thousands of mineworkers travelling from their homes to the mining sites on a daily basis. In Scone, people travelling on the New England Highway, an extension of Scone's main street, now wait up to eight minutes at the level railway crossing while the coal trains go by. This congestion, these problems in wine country and this difficulty we are having in Scone are all directly related to the growth of the mining sector.

This is what the MRRT is all about. It is about taking money from the superprofits earned by the coalmining companies and addressing the capacity constraints directly caused by the mining sector. This will enable us to deal with issues like the Scone level railway crossing, which requires an overpass; bypasses for Muswellbrook and Singleton; traffic congestion in Maitland and elsewhere; and, very importantly for me, the really serious road quality issues we have in the Hunter wine country.

There is a threat—because this money, this new tax, will effectively offset royalties raised by the New South Wales government and other state governments. For too long, the New South Wales state government has been taking money out of the Hunter region and spending it on roads, tunnels and bridges in Sydney. That is no longer acceptable to us. Barry O'Farrell has decided that he will continue to increase the rate of royalties he is collecting at the state level. This is a great disappointment because it breaches faith with the negotiations the Commonwealth had with the state on the introduction of this tax. I remind the people of my electorate and anyone watching this issue very closely that they can have it one of two ways—they can allow us to raise taxes through the MRRT and return that money to mining regions such as my own or they can sit back and allow Barry O'Farrell to continue to increase royalties so he can spend that money on infrastructure in Sydney. (Time expired)

Steve Georganas (Hindmarsh, Australian Labor Party) Share this | Link to this | Hansard source

Is the motion seconded?

Stephen Jones (Throsby, Australian Labor Party) Share this | Link to this | Hansard source

I second the motion.

Kelly O'Dwyer (Higgins, Liberal Party) Share this | Link to this | Hansard source

For the very first time in this place, I actually rise to agree with the words of the federal Treasurer. He is 100 per cent right when he says:

… ultimately when it comes to our mining tax reforms, history will judge our actions.

It certainly will. But history can be a very harsh critic.

History will judge the mining tax, the carbon tax and the 20 new or increased taxes which have been brought about by this government. History will also judge the pink batts debacle, the waste and mismanagement of the school halls program, the green loans, cash for clunkers, the complete debacle with the live cattle trade, the set-top boxes, computers in schools, the dismantling of border protection—and the list goes on. History will in fact judge not only this Treasurer but this government. I do not have the same optimism as the Treasurer that the judgment will be in the government's favour, because the MRRT is yet another example of the shambolic way this government governs.

We should not forget that this is not the government's first version of the mining tax. Who could forget the RSPT? Depending on whose version of events you believe, the Treasurer or the former Prime Minister's, the resource super profits tax was introduced without proper consultation—a very common theme with this government—and with no chance for the industry to look at the impact it would have on industry and on investment, particularly infrastructure. It led of course to the deposing of Kevin Rudd as a one-term Prime Minister—something that is quite unheard of.

Let us make no bones about it: this legislation has been cooked up to try to quieten all the voices of discontent and all the alarm that was raised when the government said it was going to introduce this tax. In doing so, it is an admission that the original tax was inherently flawed and that the Treasurer was the architect of this flawed tax. This tax is no better.

The incompetence of this government knows no bounds. Let us understand the circumstances in which this government brought together this tax: the three biggest miners in a closed room, with no public servants, determined this new mining tax. In fact, there were reports that the mining tax was actually written on one of the miner's computers. It is no accident that there is going to be a market valuation method to determine how the tax should come about. This means that smaller miners are going to be disproportionately disadvantaged. They are going to bear the impact of this tax and it means that the investment and risk that they take, and the jobs investment as well, will be under significant threat.

The incompetence of this government knows no bounds. Only last week Bob Carr said, 'Look into our eyes, look into our eyes, there will be significant tax cuts' as a result of this great big new tax. They say, 'Look into our eyes, look into our eyes, there will be an increase in superannuation.' But at the same time that we are looking into their eyes, the Treasurer is reaching around into the back pocket of every Australian citizen and pinching their wallet. This government call this a tax reform, but it is like everything else: a great big new tax hike. Of course, this will be compounded by the carbon tax and the other 20 new or increased taxes that this government have brought about.

The government can only introduce supposed tax cuts by imposing great big new taxes first. We all know that the government are simply talk on this. The government have not delivered tax cuts. The only tax cut they have been able to deliver was the one introduced by the former government when Peter Costello was Treasurer. Since then, all they have been able to do is increase taxes. That is why we oppose this mining tax. (Time expired)

Stephen Jones (Throsby, Australian Labor Party) Share this | Link to this | Hansard source

It is my great pleasure to be seconding the motion by my colleague the member for Hunter on this important issue. Today we are engaged in two important arguments. The first is an argument with those opposite about the concept of the minerals resource rent tax. What motivates us is to ensure that we spread the benefit of the mining boom, that we spread the benefit of the resources boom beyond those mining regions and right throughout the country, that we spread it to every person in Australia who has a superannuation account, that we spread it to every small business and every large business around the country in the form of a tax cut, and that we spread it to those mining areas and elsewhere in the form of additional infrastructure—much-needed economic infrastructure—to ensure that we are able to get these commodities out of the mine heads and to the ports of our nation.

It is not surprising that those opposite oppose it, because every day they stand up with a shovel in their hands and the purpose of the shovel is to dig another few feet in their $70 billion budget black hole. Their intention is to fool the Australian people that they can fill that black hole through a commission of audit. But we know that their intention is to fill it with the jobs of public servants, manufacturing workers, auto industry workers and the like. They will simply not be able to make ends meet without drastically slashing the services and programs of this country.

By 2036, Australia's population is going to exceed around 30 million people. By then, Sydney will have a population of around six million, an increase of 1.7 million on today's figures. That takes me to the second argument and that is an argument by members such as the member for Hunter and myself to ensure that we get a fair share of the fair share—that is, that we get a fair share of that additional pool of money that will be available to fund infrastructure in this country. The growth in population in Sydney and the ensuing economic activity will bring challenges for our infrastructure. It will mean that regional Australia, in particular large regional cities like the Illawarra, Wollongong, Newcastle and the Hunter, will be taking up the slack. We need to ensure that those cities have the infrastructure that is necessary—that is, the rail capacity, the road capacity and the port capacity—to meet those increased needs and to ensure that, as Sydney and Melbourne are bursting at the seams, those regional cities are able to take up the growth capacity.

In my region we know that coalmining is undergoing a resurgence and that is because we have some of the best metallurgical coal found anywhere in the world. Despite the attempts by the Leader of the Opposition to talk down the prospects of the coal industry in my electorate and in the member for Cunningham's electorate, it is literally booming. New longwalls are going in as we speak to increase the mining capacity because if you want steel then you need the high-quality metallurgical coal that comes from the Illawarra.

We have plans to expand the ports. Some of the plans look at doubling, even tripling, the size of the ports. All this puts stress and pressure on our road network and our rail network. We already have an overly congested rail network between Wollongong and Sydney. Over 20,000 people use that road network each and every week to commute to Sydney for work. If we are to have expanding economic activity and expanding freight moving north and south along that route, we need to provide alternate freight passage. That is where the Maldon to Dombarton rail link comes in. It was cancelled by the former Greiner government because the Liberals have never supported infrastructure projects in the Illawarra. They cancelled it with only 35 kilometres left to be built. Thirty-five kilometres of standard rail gauge needs to be put in to ensure that we can link our port to the inland coalfields, wheatfields, and alternative internodal hubs of Western Sydney. I was very pleased that, when she visited the Illawarra, the Prime Minister pledged another $25 million to review planning and design work to ensure that it is up to speed. But the reality is that without the money—the revenue from the minerals resource rent tax—that rail link will not be completed. We cannot leave it to the Liberals, who have never spent a cent, not a brass razoo, on infrastructure in the Illawarra. We need this tax to pass through the House and we need our fair share in the Illawarra. (Time expired)

Jamie Briggs (Mayo, Liberal Party, Chairman of the Scrutiny of Government Waste Committee) Share this | Link to this | Hansard source

I rise to speak against this motion of the importance of the minerals resource rent tax. It disappoints me that the Chief Government Whip continues down the negative path that the Labor Party takes in this place, using all his time to talk about negative things—to talk down certain sectors of the Australian economy, rather than being positive about what is a truly magnificent performance by the Australian minerals industry at the moment with such wonderful opportunities for them due to growth in Asia. We talk much about it and we hear the Labor Party occasionally refer to it. The Labor Party's approach to that growth is to knock down the minerals industry, to go after the resources sector, to complain about entrepreneurs who do well, to complain that this industry is doing so well that 'we need to find a new way to tax it'. They are pretending that the industry is not taxed already.

The mining industry already pays a 41 per cent tax rate, which is a combination of company tax and royalties paid at the state level. Under the Australian Constitution, mining companies and resources have always been a matter which state governments have taxed outside of the company tax regime, through the royalties regime. The Labor Party feigns concern about the operation of the royalties system, but what this is really all about is another tax grab to cover over their massive budget blow-outs and expenditures, which have seen Australia with a record debt. It is a record deficit which our future generations will be trying to pay back at a time when we will be challenged by an ageing population and all the challenges that were outlined so well by the best treasurer this country has ever had, Peter Costello, in the Intergenerational reports during the 2000s.

This process has highlighted the inability of the Labor Party to govern at the federal level. Thankfully, this Saturday we will get rid of one of this nation's Labor Party governments when Queenslanders toss out a terrible 20-year government, a government that has caused so much pain in Queensland—a state that should be performing better than it is in the current environment, with such opportunities in the resource sector and Queensland such a resource-rich state. What it needs is a can-do person as the Premier of Queensland to ensure that the opportunities of the resource sector are not talked down, as the member for Hunter did for so long in his speech on this motion, and as so many people in the Australian Labor Party tend to do. What we need in Queensland is to take advantage of historic opportunities, not tax them into submission.

This government would have you believe that to make industry more successful you need to tax it more; you need to apply higher taxes to it and the industry will just adapt to that! It believes more taxes will not impact on investment decisions at all, that it will not increase the sovereign risk of investing in mining and resources exploration, which is already a risky proposition. My colleague at the table, the member for Canning, knows better than most that the great state of Western Australia—where the resources sector has gone through ups and downs throughout its history—is now taking advantage, with a very good Liberal government, of the opportunities which present in our region.

I would say to the member for Hunter: start talking positively about the resources sector. Start talking positively about the opportunities it creates for our country. Stop being so negative. Stop the campaign of personal denigration that we see day in, day out in the Queensland campaign and which we see the member for Hunter engaging in. It is really disappointing from that member in particular. I thought he was better than that.

We know the resources sector has a trickle-down effect through the economy that the Labor Party refuses to recognise. There is no better example than the one which was outlined by the Deputy Governor of the Reserve Bank, Dr Philip Lowe, who is an outstanding thinker in this area. He said in a recent speech:

The indirect effects come through a variety of channels. Day to day, they can be hard to see but they percolate through the economy. In effect, there is a chain that links the investment boom in the Pilbara and in Queensland to the increase in spending at cafes and restaurants in Melbourne and Sydney.

The member for Moreton and the member for Hunter would have us believe otherwise. They would pretend that there is no benefit from this mining boom which is having such great consequences for other industries. They would have you forget that the mining industry pays more tax. The industry already pays $23.8 billion in taxes and royalties, and it is going to be paying an extra tax with the introduction of the carbon tax this year. This government is 'tax and spend Labor'. It is taxing more to cover its massive record deficits, as it tries to engage in social engineering in the tradition of the Labor Party. This motion is a further negative complaint about a great performing sector—a sector we should encourage and not talk down as Labor Party is intent on doing. (Time expired)

Jill Hall (Shortland, Australian Labor Party) Share this | Link to this | Hansard source

It is with great pleasure and passion that I rise to speak on the motion that we have before the House this morning on the importance of the minerals resource rent tax. I congratulate the member for Hunter for bringing this very important motion to the House.

This is a motion that has an enormous importance for electorates like the one that I represent in this parliament. It is addressing the capacity constraints that exist in our area and making sure that the minerals resource rent tax is spent in areas such as the one I represent. Those on the other side of the House may not be as aware, as we on this side of the House are, of the important roles the Hunter, Central Coast, and Lake Macquarie have played in mining throughout the ages. They may not be aware of the enormous implications and capacity constraints that have arisen due to the impact of mining. For once, this is about putting some money back into areas that have given so much to Australia and have been responsible for the strength of our economy. At one stage the Shortland electorate in New South Wales had the most coalmines in the country. I ask myself and the parliament what the mining companies have put back into the electorate as a result of its enormous contribution to Australia and the contribution of its men in those mines. The answer is: not much. We still have problems with traffic in the electorate, with coal trucks travelling from the mines to the port. There are enormous capacity constraints and problems with dust and other health issues. We have given a lot more than we have received. The minerals resource rent tax is an opportunity for the companies to put something back into areas such as the Hunter and the Central Coast.

The Belmont Wetlands in my electorate have been denuded by mining, and the community has been fighting to ensure the land is rehabilitated and the area becomes available for the people of Shortland. BHP gave the wetlands back to the community, but they gave back a very denuded piece of land. It needs some major infrastructure investment so that we can allow commercial development and community access. For a long time all residents of Lake Macquarie have been arguing for the Glendale interchange.

As I have already indicated to the House, Lake Macquarie has a rich history in coalmining and it has given a lot more than it has received. The minerals resource rent tax is an opportunity to put something back into electorates such as mine and the other electorates in the Hunter. There are 50 coalmines in the Hunter and a port that is responsible for shipping coal out of Newcastle. We have constraints on coal loaders, causing delays for ships waiting to dock and load. I would argue strongly that areas such as the area I represent in this parliament need to have these infrastructure constraints addressed, and how better to address those infrastructure constraints than to implement a minerals resource rent tax?

Don Randall (Canning, Liberal Party, Shadow Parliamentary Secretary for Local Government) Share this | Link to this | Hansard source

I am pleased to speak on the motion moved by the member for Hunter, although I have to correct much of what he said. The minerals resource rent tax is a tax based on the politics of envy of those opposite. This tax was born in a tawdry backroom deal by the three big miners—Xstrata, BHP and Rio—and the Prime Minister after she had done a hatchet job on then Prime Minister Kevin Rudd. It was a tax which was bought by a $22 million campaign by the big miners, and that gave them a $60 billion break on their mining tax commitment. This is a tawdry deal that left out the mid-cap miners and left out the juniors, of which there are so many in my state of Western Australia. It is not just a bad new tax; it is a tax born out of illegitimate circumstances. We know that there was to be a resources superprofits tax, but it was headed off.

The member for Hunter talked about the MRRT being a mechanism to redistribute wealth. Have we ever heard as good an example of the left-wing agenda of those opposite as this proposal for a redistribution of wealth? The best thing you can do for the workers of this country is to give them a job, not try in some sort of Centrelink way to redistribute wealth across the nation. In an article in the West Australian on 23 February 2011 headed 'Ditch this dog's breakfast of a tax', Paul Murray says:

A drover's dog could show Julia Gillard that her cobbled together mining tax is a dud.

He goes on to point out the myth being promoted by federal Labor that these minerals are owned by all Australians. No, they are not—they are actually owned by the states. He goes on to say:

The simple truth is that the States have always owned the minerals that Ms Gillard—and Mr Rudd before her—disingenuously tell all Australians are theirs.

They are owned by the states. If you really wanted a proper mechanism which made the collection of revenues across all sectors fair, you would increase the corporate tax. That is the fairest way to go about it. The states outmanoeuvred Prime Minister Gillard on this. She and former Prime Minister Rudd did not understand how the states levied royalties. Then they had to do a reverse twist when they realised that they had to rebate any increases in state royalties. It is a sovereign risk tax.

If you want any further evidence of this, Mark Cutifani from AngloGold Ashanti has said that Australia's new mining tax is encouraging for mining investment in South Africa, Canada and Brazil, which are major competitors to Australia in the mining field. In Perth, most companies are hedging their bets and looking for alternative mine sites either in Africa or South America, or somewhere in our region, as fallbacks as a result of this increase in taxation. This government will tax anything that it can, and it believes any new tax is a good tax. My electorate has the second-highest number of fly-infly-out and drive-indrive-out workers in a metropolitan electorate in Western Australia. Those workers know how bad this tax is. They know this is a terrible tax that will hurt their jobs. This is a job-destroying tax that will gradually slowdown investment in Australian mining and exploration and eventually send it offshore.

Debate adjourned.