Chris Ellison (WA, Liberal Party, Manager of Opposition Business in the Senate) Share this | Hansard source

I wish to take note of the answer given by Senator Carr to the very good question from Senator Cash in relation to the tax grab on the North West Shelf joint venture project. At the outset, when Senator Carr attempted to rewrite history, we should note what the CEO of Woodside said. Mr Don Voelte said in an announcement:

This is not a loophole which is being closed, or a free ride which has come to an end. This is a negotiated fiscal arrangement which formed the basis of Australia’s largest resource development ...

Over 31 years there has been a regime in place where royalties, excise and taxes have been paid quite properly. This government has without notice moved those goalposts and said to the industry, ‘You now have a $2.5 billion tax.’ One can only imagine how that affected potential investors in LNG, oil and other resource projects in Australia. There is a projected increase of 83 per cent in demand for LNG in the Pacific basin. Right in the middle of that, we are well placed to provide those resources. But we will not be able to if people think that Australia has a government that will change the goalposts. Indeed, APPEA, the Australian Petroleum Production and Exploration Association, in evidence likened that to an act more in line with those of the governments of Venezuela and Trinidad. So at the outset we sent a clear message to people: do not invest in Australia.

More important is the fact that this will be passed on to the consumer and it will increase gas prices in Western Australia. Gas, of course, is used for the generation of electricity. We will see electricity costs rising across the board and average Western Australians will be affected by this cost for essential power. We only have to think of pensioners and those who are least able to afford this increase to realise the impact that it will have on the community in Western Australia.

The question by Senator Cash related to the statement by the spokesman for the Minister for Resources and Energy, Mr Ferguson. That statement was reported today as saying that any price increase by the North West Shelf venture partners to offset the loss of the condensate subsidy could justify an ACCC action. That is an outrageous attempt to stand over a group of companies that have brought wealth and employment to this country and have given Australia the sound economic base which we enjoy today.

We have to ask: is the minister threatening an ACCC investigation if the joint venture partners pass on an increase in their costs? He is part of a government which has just imposed $2.5 billion of tax on them. Is he now saying that he will send them off to the ACCC to investigate that passing on of the cost? Mr Ferguson himself has said that the North West Shelf partners jointly market between 60 and 70 per cent of WA’s domestic gas. Presumably he is alleging that the decision to pass on the cost of the loss of the subsidy somehow amounts to a price-fixing arrangement. Is he saying that under section 45A(2) of the Trade Practices Act this is a matter which requires investigation? Similarly, is he saying that the decision to pass on the costs of the tax being imposed on industry is something else which should be investigated?

If this is not what he is suggesting, he must clarify what issues he would be asking the ACCC to investigate and he has to outline exactly to the resources industry of this country whether this government is pro development of resources for the benefit of all Australians or whether it is about imposing on the resources industry a tax which will not only be inflationary but impede further important investment in this country.

Question agreed to.