David Pocock (ACT, Independent) Share this | Hansard source

Thank you, Senator Scarr, for your contribution. The only thing that could have made it better would have been the appearance of an Economics 101 textbook—but maybe later in this discussion!

You raised a number of points. For me, the overarching point you hit on is that our current economic system is not set up to deal with something like climate change, because we've set up this system to basically externalise costs. The costs that carbon in the atmosphere create are not the problem of fossil fuel companies. This is obviously a very vexed issue in Australia. You could price it with a carbon price. But we know that that is not politically possible, given the last decade of climate politics here. But I think it's something we have to think about. We are hearing arguments about just allowing our current system and markets to deal with this, without recognising that the thing that sits above all of that is this moral challenge that we face. And we potentially need to recognise that the current system that informs our decision-making, as we see today—with both major parties supporting this bill—is maybe not up to dealing with this, and that is why we need leadership. That's why we need leaders in the Pacific saying: 'We want you to sign the Port Vila declaration. We know you could continue to earn money from fossil fuels, but that's not going to mean much in 50 years when we're underwater.'

Senator Scarr made a defence of the contribution of the fossil fuel industry, and he is correct in saying that there has been tax paid. There has been petroleum resource rent tax paid for oil, and we've seen that increase by about $1 billion because of the increase in oil prices around the world over the last year. That's a good thing for Australians. But as, I think, the third largest exporter of fossil fuels in the world at the moment, we're getting dudded. We've been exporting fossil fuels for a long time now. We've been ramping up production.

Compare us to Norway, who from the beginning said: 'We've got these resources, and they belong to all of us. They belong to all of our people, so we're going to ensure that we get a return on these resources'—they're now sitting on a $1.8 trillion sovereign wealth fund—'in recognition that we're setting this aside for their future, for young people, for future generations.' Contrast that to the Australian way, where we have the passionate defence of companies that pay some tax. Yet behind the scenes we've got this very generous system of deductions and being able to compound your investment to the point that, when it comes to offshore LNG, we still haven't seen a cent paid by these gas companies.

I take exception to lumping in the petroleum resource rent tax with income tax. They are two very different things. PRRT is in recognition that that is our gas, and, once that's gone, it's gone. We should get a return on that gas. We don't let builders try and tell us a long story about how they're having to pay for bricks. We recognise that that's part of doing business. If you want to take our gas and market it, you can do that, but you pay us for our gas. Yet so far, for offshore LNG, they haven't paid us. They haven't paid us for our gas.

I just wanted to go through some of the stats released by the ATO when it comes to some of these companies that have come up in the course of this debate. Woodside paid $176 million in tax on nearly $2 billion in profit, a tax rate of less than 10 per cent. If we move on to Santos, Santos claims to have earned just $74 million in profit on $4.7 billion in revenue and ended up paying zero tax. Another four Santos holding companies earned around $1.1 billion in revenue but also paid no tax. ExxonMobil say they made only a little over $1 million of profit off $15 billion in revenue. Those are some serious deductions! If we move down the list a little bit, we have: ExxonMobil Australia Pty Ltd, which earned $15 billion of income and paid zero tax; AGL Energy earned $15 billion of income and paid zero tax; Australia Pacific LNG Pty Ltd earned $9.3 billion of income with a taxable income of $689 million but paid no tax; Ichthys LNG Pty Ltd earned $7.2 billion of income and paid zero tax; Yancoal Australia Ltd earned $5.7 billion of income with just over $18 million taxable income but paid no tax; Glencore Holdings earned $5.5 billion of income but paid no tax; and Anglo American earned just under $4 billion of income and paid no tax.

We’ve got to start getting a better return for our remaining fossil fuel reserves, because we're going to need it. We're going to need this money for the transition. We're going to need this money for adaptation. The government patted themselves on the back when they set up a fund that's delivering $200 million a year for adaptation across the country. The experts are saying we need to be spending $3 billion to $5 billion a year on adaptation or we're going to get to a point where things start to compound and spiral for communities—and we've seen that. We've seen towns go underwater four times in 12 months. We've seen towns facing fires and then floods. We've got to take this more seriously.

I welcome the contribution of Senator Scarr, but let's tell the truth about where we're at. We should be getting far more for our resources and setting ourselves up for the future. We shouldn't be here debating a bill which looks to expand the gas industry for these companies, which, according to the ATO, are not paying that much tax.