Ian Macdonald (Queensland, Liberal Party, Shadow Parliamentary Secretary for Northern Australia) Share this | Link to this | Hansard source

As my leader, Senator Minchin, has mentioned, the opposition will be supporting the Uranium Royalty (Northern Territory) Bill 2008 and I am pleased to say that the bill is actually a completion of work started by my Queensland Liberal colleague the Hon. Ian Macfarlane MP, when he was the Minister for Industry, Tourism and Resources. This particular bill before us today is a result of the processes started by Mr Macfarlane some years ago. We are pleased in the coalition to see the bill finally receiving parliamentary approval.

Australia is the world’s second biggest producer of uranium, which generated something like $658 million in export revenue in the 2006-07 year. It provided jobs for some 800 Australians, mainly in remote Australia, and there are opportunities for considerably more employment in the uranium industry particularly in Northern Australia. This leads me to inquire of the Australian Labor Party just what their position is in relation to uranium exports and uranium mining. As I have mentioned, there are already a considerable number of jobs created and supported by this industry. But I am confused, as I think are most Australians, as to what is the government’s position in relation to uranium mining.

I thought that, rather than wait for an answer in this chamber, I should have a look at the website of the minister who I guess would be responsible, the Minister for Infrastructure, Transport, Regional Development and Local Government, who is the Leader of the House and the member for Grayndler. On his website is a statement entitled ‘Labor Party policy: uranium’. As I read down it I saw that, at paragraph 68, it says:

In relation to mining and milling, Labor will:

prevent, on return to government, the development of any new uranium mines …

I thought this, perhaps, might be out of date, but it is off the current website of the minister. I heard Senator Farrell’s speech on this and he was saying that the Labor party no longer has a three-mine policy. It is now, as I understand it, a four-mine policy. I am always very curious as to why there is a three- or a four-mine policy in place. Is uranium from three mines good uranium while uranium from a fourth or fifth mine is bad uranium? I simply cannot understand why a party, which now, regrettably, is in government in both Australia and in most of the states, will allow mining of uranium from some areas but not from other areas.

In reading the Labor Party policy on uranium, which, as I say, I extracted this morning from Mr Albanese’s website, I am even more confused. The Labor Party policy goes on to say, at paragraph 69:

In relation to exports, Labor will:

allow the export of uranium only from those mines existing on Labor’s return to government …

As I understood it, when Labor returned to government, they increased the number of mines that could be exporting uranium. The environment minister, Mr Garrett, who spent a lifetime opposing uranium and uranium mining, and singing songs about it, making millions of dollars from songs that he sang about how awful uranium was, just recently actually approved an additional uranium mine. I am not sure what South Australia has over Queensland, but it does seem to me that there is a bit of favouritism from the Labor Party when it comes to uranium mines. They are quite valuable, Senator Conroy, are they not? They create a lot of jobs as I indicated. Am I wrong, Senator Conroy? You are shaking your head.

Stephen Conroy (Victoria, Australian Labor Party, Deputy Leader of the Government in the Senate) Share this | Link to this | Hansard source

Senator Conroy interjecting—

Gavin Marshall (Victoria, Australian Labor Party) Share this | Link to this | Hansard source

Order! Senator Macdonald, please address your remarks through the chair.

Ian Macdonald (Queensland, Liberal Party, Shadow Parliamentary Secretary for Northern Australia) Share this | Link to this | Hansard source

I am interested in Senator Conroy’s formal interjection, but why, Senator Conroy, is this Labor Party policy on uranium on Mr Albanese’s website as of this morning? It seems rather curious.

The Labor Party is one and indivisible, as I understand it. I am told there are no factions, there are no different branches; it is just one indivisible party. Why is it then that the Labor Party, in its South Australian configuration, approves uranium mining and yet, in my own state of Queensland, the Labor Party refuses to allow uranium mining? This is in spite of, and flies in the face of, calls by the Labor member for the state seat of Mount Isa, Ms Betty Kiernan, to allow uranium mining. It also flies in the face of calls by the former Labor Party minister for mines, Mr Tony McGrady—who is now a lobbyist, as I understand it, for the uranium industry—for an extension of uranium mining in Queensland, and therefore in Australia.

I draw the Senate’s attention to a report in the North West Star of 7 May 2009, when all of the mayors representing the shires between Mount Isa and Townsville met in a group, which is called the Mount Isa to Townsville Economic Zone, MITEZ—they are part of that economic development zone. They all called for the Queensland Labor government to allow for uranium mining in Queensland, because, as those mayors rightly pointed out—and they would know, because they are the leaders of these shires—there is a considerable amount of uranium in North Queensland, and they would like to share in the prosperity that South Australians get in being able to mine uranium in the state of South Australia.

I am entirely confused. The head of our nation at the moment is Mr Kevin Rudd and the Treasurer is Mr Wayne Swan. Both of them come from Queensland, and I would assume that they are members of the Labor Party in Queensland that seems to be totally opposed to the mining of uranium. Yet Mr Rudd is the leader of a government which has just allowed another mine to operate in South Australia. You can understand, Mr Acting Deputy President, the cause for my confusion on just what the Labor Party policy is. I would indeed hope that someone might be able to explain it later in the debate.

I notice that Senator Farrell, in his contribution to this bill before us, did say that the opposition had misrepresented the Labor Party’s view and that they had changed their position. And yesterday in an interjection the government leader, Senator Evans, indicated to me that when he was the shadow minister, because he was a good shadow minister, he had changed the policy too. Why then is the Labor Party policy on uranium, which I extracted from no less than Mr Albanese’s website this morning, so different from what we are hearing? And why is Mr Garrett, who we all know has been a lifelong opponent of uranium, suddenly signing approvals for increased uranium mining and export from Australia?

I agree with the mayors in the north and north-west of Queensland that, if it is good enough for South Australia and the Northern Territory to mine uranium, why not Queensland? Senators may recall many years ago that Australia’s first uranium mine was at Mary Kathleen, up in the north-west mineral province of Queensland. It provided a lot of jobs for a lot people and a lot of wealth for the state. It eventually shut down because it ran out of resources, but since then a lot of companies have done a lot of exploration work. I should indicate here, although I do so in my senators’ interests, that I have some shares—not very valuable ones, I regret to say—in companies that are exploring for mining, but I do not want the thought that I might profit from any expansion of mining to be relevant. One might say that the companies I have shares in are much underrated. Notwithstanding that, it is a valuable resource and it is plentiful in Australia.

I understand from evidence given to the Senate inquiry into this particular bill that there is an ability to increase Australia’s uranium production from its current level of around 10,000 tonnes per year to some 30,000 to 40,000 tonnes per year by 2030. Will the Labor government permit that, or will they not? Will the Labor Party, in their iteration as a Queensland government, of which Mr Rudd and Mr Swan are two members, allow that or will they oppose that? Where does the Labor member for Mount Isa stand? Her electorate contains many potential sources of uranium for mining, production and export. I know the old Labor Party provision that if you cross the party line you are out on your ear. One wonders what Ms Kiernan’s future is in supporting that. Or perhaps she only just did that before the state election, when she knew that a lot of the unions, miners and workers out in her electorate did in fact think that it was a pretty good idea to have a look at more uranium mining because it meant real jobs for Australians and it meant real wealth for that part of the country.

I would hope that someone might be able to assist me in just indicating where we are going in Australia with the uranium industry, particularly whilst this government is in charge. I can understand why the Queensland government is distracted and at odds and sods over its uranium policy. I suspect the Queensland government is perhaps more focused at the present time on some of the issues, which some call graft and corruption, happening in Queensland at the moment. We are all aware that a loyal member of the Labor Party, Mr Gordon Nuttall, was recently jailed for bribery offences. But I am horrified to see in today’s paper that, according to the Australian, one of the people who allegedly paid him the money has just today been awarded a Queensland government contract for a prison, I might say, up in the north—the Lotus Glen prison. Perhaps he has been given instructions to fix it up so that Mr Nuttall can serve out his time in a better constructed and better appointed prison. But how could that possibly be? I know that a lot of people say a lot of funny things happen in the state of New South Wales in relation to the Labor Party government, but could this be happening in my own state of Queensland? We know former Labor leader Keith Wright is still in jail, we know that Bill D’Arcy, a Labor member of parliament, is in jail for matters and everybody knows that Mr Nuttall is there on bribery convictions. But surely the Queensland government cannot be awarding contracts on a non-competitive basis, according to the Australian, to a man who was actually a part of the payment of money to Mr Nuttall.

Ursula Stephens (NSW, Australian Labor Party, Parliamentary Secretary for Social Inclusion and the Voluntary Sector) Share this | Link to this | Hansard source

Mr Acting Deputy President, I rise on a point of order. I draw your attention to the legislation we are currently debating. I do not think that Senator Macdonald’s ramblings about Queensland state government issues are relevant to the Uranium Royalty (Northern Territory) Bill 2008. I think there is a matter of relevance.

Gavin Marshall (Victoria, Australian Labor Party) Share this | Link to this | Hansard source

Senator Macdonald, I simply remind you of the question before the chair.

Ian Macdonald (Queensland, Liberal Party, Shadow Parliamentary Secretary for Northern Australia) Share this | Link to this | Hansard source

I can understand why my colleagues opposite might be a bit sensitive about these issues in Queensland. But the point I was making was that the Queensland government, I would hope, would be able to give us a clear lead on what it intends to do with the huge uranium resources in our state of Queensland. I was surmising that perhaps they cannot because they are distracted with these other things that are happening in my state of Queensland, which are somewhat beyond belief.

As I indicated earlier, I support this bill, and the coalition will be supporting it. As I conclude, I make a further observation in relation to the bill: where mining occurs on Aboriginal land, the Commonwealth is obligated under the Aboriginal land rights act to make payments to the Aboriginal Benefits Account from the Consolidated Revenue Fund of amounts equivalent to royalties. This payment would be in addition to payments to the Northern Territory of amounts equivalent to the royalties collected by the Commonwealth from uranium in the Territory. I raise that simply to say that that is a system that does—I think appropriately—work, in relation to mining. But it does raise the wider issue of royalties and where they end up. In both Commonwealth and state areas around Australia a lot of the nation’s wealth comes from mining—and therefore from royalties, company tax and income tax—generated in the north of Australia. It often seems unfair to me that the considerable amount of wealth that is raised in the north of our country, particularly in remote and regional parts of Northern Australia, is not returned to those people in the form of infrastructure in Northern Australia. We who live in Northern Australia, and particularly in Queensland and the Northern Territory are aware that governments never seem to recognise where the wealth of their states comes from. A lot of the wealth of Queensland originates in the north-west mineral province but the wealth ends up in the south-east corner of our state.

I think it is time that we as a nation had a closer look at this. I am delighted that Mr Barnett, the Premier of Western Australia, is addressing this issue in Western Australia by ensuring that some of the wealth from the north-west of Western Australia is actually returned into regional Australia, providing an equitable and fair distribution of moneys. I would certainly think that the Queensland government could well take a leaf out of Mr Barnett’s book in providing back to North Queensland and Northern Australia some of the very considerable wealth that flows to the state capital and, indeed, the national capital from the wealth created in those areas.

I am pleased to have been able to contribute to this debate. I am pleased that the Labor Party will have, by the passage of this legislation, completed the work commenced by my colleague the Hon. Ian Macfarlane some years ago when he was the resources minister. I am pleased that we are rationalising the payment of royalties in the Northern Territory. It appears that Mr Albanese will not be able to help me, but perhaps someone who is yet to speak from the government side could explain to me in pretty simple terms just what the Australian Labor Party’s policy is in relation to uranium, both across Australia and in my own state of Queensland. I know that I and many workers and other people in the north who understand the benefits of uranium mining would be very pleased to get a significant and definitive statement from the Labor Party on what the future of the uranium industry in Australia is.

Alan Eggleston (WA, Liberal Party) Share this | Link to this | Hansard source

First of all, I would like to pick up on the closing remarks of Senator Macdonald about the need to return some of the wealth that comes from Northern Australia to Northern Australia. It is a very salient point. Last year in Karratha there was a conference called ‘Riding the boom’ that was about this very issue of improving community infrastructure in the Pilbara in Western Australia, which is an area from which a great deal of Australia’s export income is derived. A huge percentage of Australia’s export income comes from off the Pilbara coast, from Port Hedland down to Karratha and Dampier. It comes in the form of exports of iron ore and gas. And yet those towns in that area are very deficient in community infrastructure. One of the points that was made at the ‘Riding the boom’ conference was that these towns are no longer transient towns. The Pilbara iron ore industry was established in the 1960s. These towns have been there for 50 years. It is time that some of the money generated in that area came back into the area, because it is quite obvious that these towns are going to be there for another 50 years—and maybe 400 or 500 years, given the huge resources that are in the Pilbara.

That conference was attended by Gary Gray, who is now the parliamentary secretary responsible for Northern Australia. Regrettably, in response to calls for more funding to go into the area, Gary Gray described these calls as being ‘mere whingeing’. That was a very bad misjudgement on his part, because there is, as Senator Macdonald has said, a very justifiable case for returning more of the huge income that is derived in the form of royalties and in taxation payments from the great companies which exist in the minerals industry across the whole north of Australia—not only the north of Western Australia but also the Northern Territory and Queensland—to developing the towns and cities in the north of Australia so that they become better places for their citizens to live in. We need to ensure that we attract people to live in the north as permanent residents and not just as transients, because we very much need as a matter of national priority to populate the north.

Turning to this report on the proposal to covert to a profit based royalty system all future uranium mines in the Northern Territory, the coalition senators on the economics committee supported the concept of moving to a profit based royalty system. We were of the opinion that there would be no detriment to the flow of income to Indigenous communities, as was alleged by some witnesses at the hearings, as a result of this move. In fact, we supported the contention of the Northern Land Council that overall there was no real difference likely in the sum of royalties which would be paid to Indigenous communities if a profit based system was adopted.

One of the features of this hearing was that a number of witnesses expressed great concern about the further development of the uranium industry in Australia and were very critical of it. They seemed to be opposed on the basis that uranium is a mineral that can be used for the development of nuclear power and nuclear weapons. So I would like to make some general remarks about Australia’s uranium industry and nuclear power prospects. Uranium, in summary, is part of Australia’s mining heritage. Although only three mines are currently operating, there are many more proposed. We in fact have some of the largest, if not the largest, uranium reserves in the world in Australia. We are in fact the Saudi Arabia of the world in terms of uranium deposits. Just as Saudi Arabia had the largest reserves of oil, we have the largest reserves of uranium. Uranium and nuclear power have to be part of the solution in terms of future electricity generation for the world as concerns about carbon based fuels grow.

Australia’s uranium is used solely around the world for electricity generation. It is supplied to other countries—in fact, quite a lot of other countries—under arrangements that ensure that none of our uranium finds its way into nuclear weapon production. In the five years to mid-2008, Australia exported over 50,000 tonnes of uranium oxide concentrate with a value of almost $3 billion. Australia at the moment does not generate nuclear power. But, given the concerns about the future of fossil based fuels in terms of carbon emissions, we have to face up to the fact that nuclear power generation is definitely something that we in Australia are going to have to consider.

On the question of royalties, Aboriginal people in Australia receive, in general terms, royalties of 4.25 per cent on sales of uranium from the Northern Territory mines. The total received by Indigenous communities from the Ranger mine alone is now over $207 million, while some $14 million in royalties from Nabarlek have also gone to Indigenous communities. As far as the general economic benefit of uranium mining to the Australian community is concerned, around 1,200 people in Australia are employed in uranium mining, another 500 in uranium exploration and about 60 in the regulation of uranium mining. So it is a significant but not large employer. Nevertheless, uranium mines generate about $21 million in royalties each year. In 2005, Ranger produced $13.1 million in royalties, Beverly produced $1 million and the Olympic Dam mine produced $6.9 million, while corporate taxes from the uranium mining sector amounted to some $42 million. So uranium mining is making a significant contribution to the Australian economy—those royalties are going back into the Northern Territory and the Northern Territory government and providing services that benefit the Indigenous community of the Northern Territory as well as other components of the Northern Territory population.

In each of the last three years, Australia has exported, on average, almost 10,000 tonnes of uranium oxide. Our mines provide about 22 per cent of the world’s supply of uranium. Uranium exports comprise about 35 per cent of Australia’s energy exports. I suppose the most important other supply of energy from Australia to the world is gas exports. Australia’s uranium is sold strictly for electricity generation. As I said earlier, safeguards are in place to ensure that our uranium is not used for nuclear weapons production.

The countries that purchase our uranium are many and various. They include: the United States, which imports about 4,000 tonnes of uranium a year from Australia and which has 104 nuclear reactors supplying 20 per cent of its electricity; Japan, which takes 2,500 tons per year and has 53 reactors supplying about 30 per cent of its electricity needs; South Korea, which takes 1,000 tonnes per year and has 20 reactors supplying 35 per cent of its power needs; and, most interestingly, the European Union, to which we export about 3,500 tonnes of uranium per annum. I would like to specifically mention France, which has 59 reactors and generates 77 per cent of its power from nuclear reactors. In that context, it is interesting to know that France has the lowest carbon emissions profile in the European Union. There is perhaps a message in that for Australia in terms of our future generation of power. We are also the preferred uranium supplier in East Asia, where demand is growing rapidly. In 2006, a bilateral agreement was concluded with China, enabling Australia to export there. Australia could readily increase its share of the world market because of its low-cost resources, its political and economic stability and the fact that many countries are now turning to nuclear power as an answer to the problem of carbon emissions.

So what do we have to consider in Australia when it comes to the question of whether we could go to a nuclear future for the production of electricity? At the present time, coal provides about 78 per cent of Australia’s electricity. That is a very high percentage given that coal is a major producer of greenhouse gases. As it happens, in the next 15 years or so, Australia is going to need to replace its oldest quarter of thermal power stations—that is, coal power stations—simply because these power stations are getting too old and need replacing. Perhaps this is a point where we need to start giving consideration to the possibility of turning to nuclear power.

The advantages of nuclear power in terms of carbon production are very obvious: nuclear power does not have a carbon footprint. It is all very well for us to talk about emissions trading schemes compensating for carbon production, but it would be so much more sensible, one would have thought, to go down the road had that France has gone down and ensure that our power generation comes from a means of production which produces a very low level of emissions. As I have pointed out, France has the lowest level of emissions in the European Union, and that is something that we should surely be giving some consideration to.

A lot of people object to the development of nuclear power because of what is described as the waste disposal issue, but a few years ago the House of Representatives—the economics committee, I think—did a report on nuclear power. They thought the waste disposal issue was quite grossly exaggerated. In fact, I recall going to a presentation in Parliament House in Perth where Harold Clough, who was the head of Clough Engineering, discussed nuclear waste disposal. He thought that, from an engineering point of view, building a facility to handle nuclear waste produced in Australia would be a fairly simple and easy thing to do and that it could be done while providing very long-term security to Australia from any adverse effects from storing nuclear waste.

In fact, very little waste is produced from nuclear plants, and the size of the facility required to store the nuclear waste which might be produced from nuclear power generation in Australia is not great. In fact, a very small facility would handle nuclear waste produced in Australia over many years. So really the waste disposal issue is not one that we need to give too much consideration to. From my reading of the House of Representatives report, and from the comments Harold Clough made at that meeting I went to in Perth, I think the concern about it is very grossly exaggerated.

In conclusion, the uranium industry is a very important industry. It is an industry which I am sure will become more important to this country as time goes on because of the need to reduce carbon emissions. It is certainly an industry which I hope that we in this parliament will not be averse to giving further reasoned and sensible consideration to.

Ursula Stephens (NSW, Australian Labor Party, Parliamentary Secretary for Social Inclusion and the Voluntary Sector) Share this | Link to this | Hansard source

I table an addendum and a correction to the explanatory memorandum relating to the Uranium Royalty (Northern Territory) Bill 2008.

I thank all the senators who have spoken, for their contributions to the debate. As is so often the case in this place, the quality of the contributions varies greatly.

Ian Macdonald (Queensland, Liberal Party, Shadow Parliamentary Secretary for Northern Australia) Share this | Link to this | Hansard source

You haven’t answered my question as to what the Labor Party policy is. Come on!

Ursula Stephens (NSW, Australian Labor Party, Parliamentary Secretary for Social Inclusion and the Voluntary Sector) Share this | Link to this | Hansard source

I thank Senator Eggleston for his contribution, because I think it does begin the conversation again. People want to have this conversation and I think that it is helpful that a reasoned argument like that is on the public record to enable that to happen.

To Senator Macdonald, I say that Labor’s policy is very clear. All he has to do is refer to the party platform. Labor supports uranium mining with the world’s best practice environmental safeguards in place. It is very clear. If you go to the ALP website you will find it in the national platform, Senator Macdonald.

This bill is directed at applying a royalty regime to all new mining projects in the Northern Territory containing uranium and other designated substances such as thorium—an issue that I know is of interest, particularly to Senator Heffernan—and that is consistent with the royalty regime that applies to other minerals mined in the Northern Territory. Therefore I commend the bill to the Senate.

Gavin Marshall (Victoria, Australian Labor Party) Share this | Link to this | Hansard source

The question is that the second reading amendment moved by Senator Ludlam be agreed to.

Question negatived.

Original question agreed to.

Bill read a second time.