Christopher Back (WA, Liberal Party) Share this | Hansard source

We have it from the executive of the Mining Association of Canada: Kevin Rudd, Australia’s Prime Minister, the mining man of the year in Canada. What a lemon of an idea that is. What lengths will this man go to to try and buy votes internationally?

I respond to the comments made by Senator Sherry in questions asked by my colleague. We see again nonsense at the mention of the concept of consultation apparently to the extent of: ‘We’re going to rob you. Which part would you like us to take first?’ He mentions the Henry review. By their own terms, the government only accepted 2½ of 138 recommendations of the Henry review—totally discredited by the government that commissioned it.

Let me advise you of a few facts associated with the mining industry: only 10 per cent of all exploration in mining in this country yields a mineable product; 90 per cent does not. By the criterion of 6.25 per cent or six per cent of the government bond rate, less than 20 per cent of all mining projects in this country historically could be regarded as having made a profit; 80 per cent have not. This government is proposing that the taxpayer will pick up a 40 per cent levy on failed mining ventures—the 80 per cent that failed.

Let us have a look at an arbiter called the banks. To what extent did the banks value at all this so-called outpouring of generosity by our Prime Minister of our money? The banks discounted it. The banks said that 40 per cent has got no value at all. Let us have a look at the level at which this tax is coming in: it is coming in at six per cent at the government bond rate. Even the petroleum resource tax comes in at about 11 per cent and more, and that has had some level of acceptance. But this tax, in contrast to the petroleum resource tax, is retrospective, so all of those decisions and investments that have already been made get picked up in it—some resource super profits tax.

What seems to have been lost in this debate is there is already a profits tax upon everybody, including miners, and that is called income tax and company tax. The difference between our side and that side over there is simply this: we believe in growing the size of the pie. If you make the pie bigger, there is more for everybody. If, on the other side, all you can do is see the size of the current pie, all you can do is keep dividing and dividing.

What a shame it is that Senator Marshall is not here. He made one accurate point: he referred to Western Australia succeeding. He is absolutely right—and thank the Lord for the rest of this country that Western Australia, Queensland and now South Australia with its current activities are succeeding. But there is no point our state seceding, because Senator Marshall would want to come with us, so we might as well stay where we are.

Senator Marshall spoke of royalties and the Australian Constitution in some way being bizarre. Quite how this Constitution is bizarre, I do not know, but let me inform him, as indeed the Western Australian Premier, the foremost Premier in this country, says so often—and I will repeat it—royalties are not taxes. A royalty is the sale price of a mineral asset to the company which wishes to buy it on behalf of the people of the state. In case Senator Marshall has a heart attack over it, we have a grants commission that makes sure that everything is balanced up so all Australians benefit. That is the reason regrettably at the moment why our state only gets 68c back in the dollar of GST revenue, and the states of Queensland, New South Wales and Victoria receive in advance of 90 per cent.

Royalties are a sale price of the asset by the people of the state. If this Prime Minister wishes to change that and call those minerals assets the ownership of the entire country then he ought to come clean and go to the Australian people with a proposal to change the referendum. Premier Barnett has indicated ably only in the last few days what true consultation is. It relates to iron ore finds, and in fact we ended up with those two companies accepting his adjudication.

Question agreed to.