Barnaby Joyce (Queensland, National Party) Share this | Hansard source

And the railway line will not work, and all these sorts of things fall down around it. That is why this legislation has inspired serious questioning. The issue has been growing in Queensland and in other areas. To talk about the sentiment that was there in the past as being the same as the sentiment that is there now is, I think, not right, because the resentment against these types of schemes is building all the time. The latest thing is the fear that water rights will also go the same way as everything else, and we tie up water rights. In this legislation, that would be completely applicable. Under section 40-10 I would certainly get an up-front deduction for the purchase of water rights if I say that it is part of the capital deduction of the place.

The questions that I will be asking the minister are quite simple. For example, Xstrata Coal and Rio Tinto have buckets of money—far greater than what we would anticipate an MIS would have. These companies can literally have hundreds of millions or billions of dollars at times of a tax liability, and so they can have billions of dollars to spend to fix it up. What do they get for it? They get an asset. Not only do they get an asset, they get an appreciating asset. They get an asset that, over time, with the use of carbon credits, gets better and better. Let us go right back down to the town and see what the fundamentals of that means. It means that you drive past an area where a certain coal company has an asset—wholesale ownership of prime agricultural land—and the town has gone and the farmers have gone, but the company gets an income stream from that asset. They get an income stream from it for what? It is for the increase in the tonnage of the carbon that is positioned in the structure of the trees on that land. It is a peculiar form of economy where you can make money without actually producing something and, in doing so, take out farmers who produce vegetables, livestock and a whole range of other things. If you start going down that path you are going to come unstuck, because you cannot feed people trees. It is stating the obvious, but people have to understand this. If the market is there for trees then let it be done in the free marketplace, like everything else.

Let us say that I take advantage of this legislation. I chop down the trees that I would not utilise—but of course I would utilise them if I chopped them down. The price for green woodchips at the moment is $92 a tonne or something like that. One thing that I can absolutely assure you of is that the price of woodchips and timber will always be in excess of the price of carbon credits; otherwise, why would you sell woodchips when you have a bigger asset in carbon credits? There will always be a demand for them. So, as with anything that is utilised, there will be the impetus to put it towards timber and milling.

Obviously, we see some serious questions in this legislation. I think there is general agreement amongst everyone that they want to assist farmers on marginal land to make an income stream from something from which they have never made an income stream before. There is no argument about that. If farmers do it planting trees, all the better. If they do it by planting trees that are suited to the environment, that is even better. However, that is not prescribed in this legislation. We are told that the market will work that out. If you believe in the market then you do not believe in this legislation. You cannot believe in it. It is completely oxymoronic to believe in the market. It is like saying, ‘I believe in the market but I’m going to give a complete advantage to one person and the person next door doesn’t get the same advantage.’ You cannot do it. You cannot have it both ways.

These are some of the serious issues that have to be dealt with. So let us put them clearly on the table: Minister, if I were to spend—and I will make a number up—$1 billion in buying agricultural land, for instance, in the Tully region, for the purpose of creating a carbon sink, would I get a tax deduction? What do you think the effects would be on the local economy if that were to happen?