Jacqui Lambie (Tasmania, Independent) Share this | Hansard source

First of all I would like to clear something up for Hansard. I have just come from the PM's office and I was in a bit of a rush. I should have been voting on this side of the floor. The reason being is I do not agree with this bill, and I am going to tell you why. When you read the two legislative purposes put forward by the government, which are to clarify the apportionment definitions of petroleum deposits and to allow the environmental management authority to refund fees paid to it by big oil and gas companies, on paper it seems simple. However, this legislation will affect hundreds of billions of dollars of capital investment in Australia's LNG export industry and many hundreds of billions of dollars in revenue for Australian taxpayers.

If our LNG industry was healthy, if the Australian taxpayer was getting a fair share of the royalties through the PRRT and if the east coast of Australia, including Tasmania, was not looking at shortages or significant increases in the cost of gas for industries and households then I would be inclined to support the government's legislation. However, there are a number of alarming signs that this government has failed to properly manage our natural resources, especially LNG and petroleum products. The government has put out mixed and contradictory messages on LNG. There are clear signs that our national energy supplies are at risk and, therefore, I do not trust this government's legislation. Until I receive more information from the government about the effects of this legislation and they take steps to ensure our gas, petroleum and other energy sources remain relatively cheap in comparison to our overseas competitors and gas supplies are secured for future generations in Tasmania, I will not support this legislation.

The Parliamentary Library research brief on this legislation states:

The Commonwealth imposes a profit-based tax, the Petroleum Resource Rent Tax (PRRT), on certain petroleum projects. Section 3 of the Petroleum Resource Rent Tax Assessment Act 1987 provides that, for the purposes of the PRRT, petroleum from a petroleum pool is taken to be recovered from different jurisdictional areas according to any apportionment agreement made under the OPGGS Act. Items 2 and 3 of Schedule 1 make minor consequential amendments to section 3 of the Petroleum Resource Rent Tax Assessment Act, to ensure that apportionment agreements under proposed subsection 54(1E) of the OPGGS Act, which are based on specified parts of the seabed, are also recognised as authoritative under the Petroleum Resource Rent Tax Assessment Act.

I would like to speak generally about how our petroleum resource rent tax, the PRRT, which is supposed to collect a fair share of the wealth this nation produces by virtue of our gas and petroleum resources. Unfortunately, it looks as if the system that Australia uses to collect taxes from the big multinationals who make lots of money mining our resources is broken profoundly. I wrote about this problem in my latest newsletter, which I recently sent to Tasmanians, where I said:

Did you know that in 2019 Australia is likely to surpass the Middle East Country of Qatar to become the world's biggest exporter of Liquid Natural Gas (LNG)?

But as one of the world's most trusted news magazines (The Economist) says in November last year, "The benefits to the (Australian) Government have not been quite as entrancing." Our Energy Minister in March last year, Mr Josh Frydenberg, forecast that Australia's LNG exports from—

the Northern Territory's—

Gorgon Project alone would be worth $440B to the National economy.

Yet The Economist reveals in its article that the petroleum resources rent tax … is forecast to fall from $1.2B in 2014-15 to $800m in 2020!

You and I, indeed all ordinary Australians - own the mineral and oil wealth that's under and in Australian soil. Our State and Federal Governments manage our natural resources on our behalf and future generations' behalf. Where's all the profit from our gas, minerals and oil going?

It is not going back into our kids. It is not going back into our health.

According to The Economist magazine and a study by the International Transport Workers' Federation suggests that "Governments of rival exporters such as QATAR, Malaysia and Nigeria, received two or three times as much revenue as Australia in 2014, as a proportion of the value for gas produced."

In the words of Donald Trump – "this is a lousy deal." Not only should our Governments collect a fairer share of the wealth generated by our natural resources – all Australians, as owners of our natural resources, should enjoy some of the cheapest natural gas, electricity, fuel and power prices in the world.

Australia's been blessed—

my goodness, haven't we been blessed!—

with enough natural resources to provide free power to all our aged pensioners. And yet as soon as the issue of budget repair comes up – politicians want to sink the boot into our aged pensioners, while ignoring the obvious places for financial reform and budget repair.

Our new energy minister, Mr Josh Frydenberg, has spoken eloquently on this legislation's debate in the other place, where he said:

These new projects combined represent around $200 billion in capital investment and will deliver significant economic and employment benefits over their multi-decade lives.

They will see Australia's LNG exports more than triple from 25 million tonnes per annum in 2014-15 to around 75.2 million tonnes per annum in 2020-21, making Australia the world's largest LNG exporter.

Before I give any support for government legislation relating to Australia's LNG exports, Minister Frydenberg has to more than just boast about making Australia the world's largest LNG exporter. He and his Liberal mates have to explain why they have allowed such generous LNG deals to be signed with big multinationals. There is no use in being the world's largest exporter when we have become the world's largest soft touch on LNG, and our grandchildren are being denied hundreds of billions in royalty and tax payments, which are instead lining the pockets of overseas corporate executives and their shareholders.

Why is it that credible studies reported in The Economist indicate that the governments of Qatar, Malaysia and Nigeria, who all have similar quantities of LNG exports, are receiving two or three times more in petroleum taxes or royalties than Australia is? Do the politicians and government bureaucrats who sign us up to those dud LNG deals do an Andrew Robb and go and get plum jobs with the people they were negotiating with, as soon as they retire from politics? Did those big multinational companies that were given sweetheart deals, most likely by both major political parties in this place, give big political donations to the Labor, Liberal and National parties? The LNG deals this country has entered into in the last two decades need close scrutiny, with the questions I have asked in mind. Perhaps it is time for a Senate committee inquiry, because I want to know why our kids are missing out on these profits, especially when you have the incredible situation of a Liberal energy minister boasting in his second reading speech:

… Australia's LNG exports more than triple from 25 million tonnes per annum in 2014-15 to around 75.2 million tonnes per annum in 2020-21, making Australia the world's largest LNG exporter.

At the same time, the ABC reported in December last year that the Liberal industry minister, Greg Hunt, will meet with Australia's energy executives to discuss a looming gas shortage credited for job losses and spiralling consumer costs. He then tries to blame the domestic shortage of gas in Australia on fracking bans that some states have placed on onshore gas mining activities—give me a break! Do you think we are a pack of idiots out there? Everyone knows it is the Liberal government's policy of selling all our gas to overseas markets, without ensuring we have enough gas for domestic use, that has caused the domestic gas shortage crisis that will cripple Australian business. Another report in The Australian, also in December last year, said:

Manufacturing Australia chairman Mark Chellew, who has called for 'urgent' action in response to the Australian Competition & Consumer Commission report into the east coast gas market released earlier this year, said the sector faced an 'alarming' set of circumstances.

'My view is that this is the greatest public policy failure since federation,' he said. 'The significant problem is that Australia has allowed its gas to be sold offshore without significant gas being available for the domestic economy. That, coupled with our renewable energy target has led to electricity prices spiking and very, very high natural gas prices.'

Mr Chellew warned the problem was set to become significantly worse, with new supply contracts potentially needing to be met by imported gas in only two years' time.

National Secretary of the Australian Workers Union Daniel Walton said the idea of a national gas shortage was 'pure garbage' and renewed calls for a domestic gas reservation policy.

'We have plenty of gas already for both our own needs and for export. The only problem is we've allowed multinational gas exporters to completely set the terms,' …

'Australia gets the world's worst deal from multinational gas exporters: no special access to our own gas and pathetic tax revenue.'

And that is where we are at.

If we are going to be serious about securing our gas security, we must put in place a domestic gas reserve policy of at least 20 per cent and possibly more. That would be another great question a Senate committee could look at when examining the state of our LNG industry—does Australia need a gas reserve policy and at what level should it be set at? We should look at the lessons from America, which made a gas reserve policy of 100 per cent after the GFC. It had the impact of driving down the cost of energy by a factor of three in America, which then threw a lifeline to the manufacturing industry. That, along with robotics and innovation, has led the resurgence in America's economy and caused a growth in its jobs and national wealth. But it all started with an American gas reserve policy of 100 per cent, which forced down energy prices following the GFC and gave conventional energy security for America.

I know that the Prime Minister and his Liberal colleagues understand why we need energy security and why we need the cheapest possible energy prices in the OECD at the very least and in the world at best. Last week I put out a public statement in which I welcomed parts of Prime Minister Turnbull's National Press Club speech, especially his prediction that electricity prices and energy security will be the defining political issues in the year ahead. That was two years and five months after I made my first Senate speech, which indicated that energy security and prices should influence all Australian political decision-making. On Wednesday, 3 September 2014, I told the Senate, in my first speech, with regard energy power:

In this place as a senator I will do my best to vote in and protect Tasmania's and Australia's best interests. In order to help determine what is in my state's and nation's best interests, I will ask this simple question: how will this legislation or proposal affect our food security, water security, energy security, national security and job security?

In a deregulated world and free-trade economic environment, if we are to create national wealth, generate more high-tech jobs and protect Australian workers' wages then the only solution is for our governments to deliver the cheapest electricity and power in the world to our pensioners, families, industry and entrepreneurs.

I am glad that Prime Minister Turnbull has, on energy at least, finally seen the light and begun to understand the strong link between Australian standards of living, business innovation, economic prosperity, job growth and energy cost security. Eventually, if he continues on this course, the PM will realise that our stupid RET system has artificially increased Australia's energy costs by $3 billion a year and wrecked our nation's energy security while destroying business innovation, economic prosperity, job growth and living standards, with no benefit to the environment. No-one in their right mind could ever say that forcing our businesses, families and pensioners to artificially pay more for their power in comparison with our international competitors will ever stop global climate change.

As I mentioned before, this bill makes amendments to the regulation of offshore petroleum. Some of the gas and oil is under the control of the states and some is under the control of the federal government. It is very easy to get confused who owns what, and the Parliamentary Library has cleared that confusion up through a report they gave me.

In closing, I note that item 3 proposes to insert subsection 688C(1)(a) to provide a clear power for the government to make regulations to provide for remittals or refunds to big business of part of the environmental plan levy. Given that the government has already given sweetheart deals to the larger energy companies that will benefit generously from extracting oil and gas from Australia's many well-endowed gas and oil basins, I have grave reservations in supporting legislation which makes it easier for the government to give more money back to the multinationals.

Indeed, I will not be agreeing to the government's legislation, which makes it easier for the government to give even more money back to the multinationals while they justify cuts to aged pensioners and family benefits and payments as so-called budget repair. It is rubbish. Those pensioners and families are also owners. We are all owners of Australia's natural resources, which this government has failed to manage wisely. As a result, it is aged pensioners and working families who are supposed to miss out on entitlements—well, not on my watch. I oppose this legislation for the reasons I have outlined, and I look forward to speaking with the government. Do you have a response?