Stephen Parry (Tasmania, Liberal Party) Share this | Link to this | Hansard source

I inform the Senate that at 8.30 am today the Leader of the Opposition in the Senate, Senator Abetz, and Senators Brandis, Cormann, Fifield and Siewert each submitted letters in accordance with standing order 75 proposing a matter of public importance for discussion. The question of which proposal would be submitted to the Senate was determined by lot. As a result, I inform the Senate that the following letter has been received from Senator Brandis:

Pursuant to standing order 75, I propose that the following matter of public importance be submitted to the Senate for discussion:

The Gillard Government's continued secrecy and lack of accountability on revenue assumptions and costs regarding its mining tax.

Is the proposal supported?

More than the number of senators required by the standing orders having risen in their places—

I understand that informal arrangements have been made to allocate specific times to each of the speakers in today’s debate. With the concurrence of the Senate, I shall ask the clerks to set the clock accordingly.

Mathias Cormann (WA, Liberal Party, Shadow Assistant Treasurer) Share this | Link to this | Hansard source

Labor's mining tax is a bad tax from a bad government which came out of a bad process. When bad governments like the Gillard government do bad things badly, as with the mining tax, they inevitably go for the cover-up. They try and keep stuff-ups that they have done along the way secret, they try and cover up their actions and they try and cover up the impact of their actions because they are embarrassed. The government's actions and the outcome of its actions are there for all to see—the dog's breakfast which is the MRRT negotiated exclusively and in secret between the Prime Minister, the Treasurer and the three biggest mining companies in Australia while all of their competitors were excluded. People across Australia well understand that there is a lot this government is trying to cover up because it would not withstand public scrutiny. We should just pause for a moment to remind ourselves how this whole process started. Former Prime Minister Kevin Rudd commissioned the Henry tax review. The Henry tax review was supposed to be this once in a generation opportunity for root and branch reform of our tax system, to make our tax system simpler and fairer. Of course, what we have ended up with in this mining tax is a new multibillion dollar tax on an important industry for Australia which is manifestly more complex and less fair than the status quo. With any new tax, the things the parliament is interested in scrutinising and the things that people across Australia are interested to know are how much revenue it will raise and whether the revenue assumptions that the government has based its revenue estimates on are credible, whether they withstand scrutiny. Similarly, with any promises to spend money and any promises that are attached to the revenue from a particular tax, people across Australia and in the parliament want to know how much it will cost, whether the costs are legitimate, whether they are properly founded and whether the government has done its homework properly.

If the government comes up with a new tax, you would like to think that the budget overall will be in a better position than when you started. In relation to both the revenue that is to be collected from the mining tax and the cost of all of the promises that the government has attached to the mining tax revenue, this government has been ducking and weaving and avoiding public scrutiny. The Senate, through various committees and through orders of the Senate passed by this chamber, has asked the government to release the mining tax revenue assumptions—commodity price assumptions, production volume assumptions—to enable proper scrutiny of whether the revenue the government tells us is to be raised from the mining tax will eventuate. There are very serious question marks in relation to this.

We have to remind ourselves that this government negotiated this tax, this dodgy deal, with the three biggest mining companies, who are quite relaxed about it. People argue that the reason they are so relaxed about it is that they will not actually end up paying the tax. This is a deal that the Prime Minister negotiated exclusively and in secret, behind closed doors, without any direct involvement from Treasury, without any direct involvement from any official. It was a negotiation directly between the Prime Minister, the Treasurer and the Minister for Resources and Energy and the managing directors of these big multinational companies. Rumour has it that the mining tax deal was typed on the BHP computer and that it was signed there and then by the Prime Minister, the Treasurer and the Minister for Resources and Energy.

The government claimed at the time of the deal that it would raise $10.5 billion, and people were surprised. How come it will still raise $10.5 billion when the original resource super profits tax was supposed to raise $12 billion and the government has made many concessions? People were surprised that there was going to be what was on the face of it such a small fiscal impact, such a small impact on the budget bottom line. What this secretive and non-transparent Treasurer failed to fess up to at the time was that the government, behind closed doors, on the quiet, had made some significant changes to the underlying assumptions. They had made some significant changes to the commodity price assumptions, to the production volume assumptions and to about 100 other assumptions.

Are we allowed to know what these assumptions are? No, we are not. But what we do know is that, if the changes in those assumptions had been applied to the original resource super profits tax, rather than $12 billion it would have raised about $24 billion over the first two years. Out of the $10.5 billion from the MRRT over the first two years, $6 billion was based on changes in assumptions. The government says, 'We can't possibly give you those assumptions because those revenue assumptions are based on commercial-in-confidence data provided to us by the big three mining companies with whom we negotiated this tax.'

So not only are those big three mining companies allowed to design the tax but they are also the only ones allowed to know what the government's assumptions are. Here we have a government that negotiated a tax which helps those big three mining companies to further concentrate their market power, a tax which gives those three big companies an unfair competitive advantage and makes it harder for smaller local miners—those aspiring to be the BHPs and the Rios of tomorrow—to compete with the big three. But we are also told that the big three are the only ones allowed to know what the government's assumptions are. The parliament is not allowed to know. The people of Australia are not allowed to know. All of the competitors of those big three who were sitting in the closed room with the Prime Minister and the Treasurer are not allowed to know.

This mining tax package is a serious fiscal train wreck in the making. The cost of all of the promises that Labor has attached to the mining tax will be higher than the revenue the MRRT is expected to raise from 2013-14 onwards. That is a situation that will become worse and worse, year in, year out. That is because right now we have record terms of trade. We have the best terms of trade in 140 years. We have high commodity prices. As we have high commodity prices, there will be a supply response around the world. Other suppliers of iron ore and coal will come onto the market and increase the supply, which is why Treasury expects that over time the revenue from the mining tax will trend down—and Treasury information released under FOI earlier this year about the revenue expectations shows this. It is a highly volatile revenue because it changes with the commodity price. It changes with fluctuations in the exchange rate. It changes with a range of variables. But what we do know is that it is trending down over time. The cost of all of the promises that Labor has attached to the mining tax will continue to increase, increase, increase.

The Senate inquiry into the mining tax has conservatively estimated that over the next decade the cost of Labor's promises attached to the mining tax will be about $20 billion higher than the revenue it is going to raise. And that was before decisions were made in Western Australia, New South Wales, Tasmania and South Australia to make changes to their royalty arrangements in relation to iron ore and coal. The changes to the royalty arrangements in New South Wales and Western Australia alone have blown a $3 billion black hole in Treasurer Swan's budget, because of the dodgy mining tax deal that the Prime Minister and the Treasurer signed up to with the big three miners. They have promised to credit all state and territory royalties against any MRRT liability. This incompetent government never even thought to talk to the states and territories about their intentions in relation to royalty arrangements into the future before signing on the dotted line. Here we have Prime Minister Gillard and Treasurer Swan promising the managing directors of BHP, Rio and Xstrata that they are going to credit all of the state and territory royalties, and the Prime Minister and the Treasurer were too incompetent to ask Premier Barnett, Premier Rann and the Premier of New South Wales at the time, Kristina Keneally, what their intentions were in relation to their royalties into the future.

This is where this government just does not get it when it comes to tax reform. This government are so addicted to spending and so desperate for more cash that they are always looking for another ad hoc tax grab, but they have not got the time to go through the proper processes. They have not got the time to do the hard yards when it comes to tax reform. Genuine tax reform in this area—resource taxation and royalty arrangements—needs to be based on proper engagement between the Commonwealth and the states. This is a terrible government—and there is a lot of evidence on that—and they are pursuing a bad tax which came out of a bad process. Of course this parliament should not go ahead with it. The Greens in this chamber should join with the coalition to force this Labor government to release all of the secret information in relation to the revenue and the cost of the related measures. They can do it. (Time expired)

Matt Thistlethwaite (NSW, Australian Labor Party) Share this | Link to this | Hansard source

The minerals resource rent tax is sound economic and social policy—a recommendation of the Henry tax review and a reform supported by the overwhelming majority of economists in our nation. It is a reform that will ensure that the benefits of the mining boom that are being enjoyed by a few multinational, large miners—the majority being overseas owned—are shared by all Australians and that the revenue is directed to occupational superannuation, to tax breaks for small businesses and to investments in regional infrastructure.

I often wonder what Australian families think of the debates that occur in this place. The average Australian worker would be just getting home from work at the moment after a hard day's work, facing the prospect of paying the mortgage, school fees and bills, and getting by from week to week. What would they think about the approach that is being taken by the coalition to this major, important economic reform that will redirect some of the benefits of the mining boom and place it in the hands and the pockets of Australians through increased retirement incomes and tax breaks for small businesses?

The most profitable miners in this country are doing well. At its last AGM, Fortescue Metals announced a $1 billion profit—its largest so far. BHP, our largest miner, announced a $22.5 billion profit—and a majority of that was generated from the minerals boom that is occurring in Australia. Rio Tinto announced a 30 per cent increase in their first half figures for this year. This reform is aimed at ensuring that these big miners pay their fair share—and it is the big miners that will pay this tax—and at putting back into the Australian economy some of the benefits that they get from extracting a non-renewable resource, a resource that is owned by the Commonwealth, by the people of Australia, and selling it on the open market for a very big profit.

The opposition have sought to criticise the consultation process. I think Senator Cormann's words were that some of these people were 'in the back pocket of the government'. Well, the Policy Transition Group was established and they have undertaken a 12-month process, and there have been two rounds of public consultations. A Resource Tax Implementation Group has been established and it is made up of industry representatives—

Mathias Cormann (WA, Liberal Party, Shadow Assistant Treasurer) Share this | Link to this | Hansard source

Chaired by whom? Chaired by the former chairman of BHP. Chaired by whom?

Matt Thistlethwaite (NSW, Australian Labor Party) Share this | Link to this | Hansard source

I will go through some of the members of the Resource Tax Implementation Group, Senator Cormann. They include: Grant Cathro, partner at Allens Arthur Robinson, a tax law expert; Frank Drenth, executive director at Corporate Tax Association; Teresa Dyson, partner in tax law at Blake Dawson; Yasser El-Ansary, tax counsel at the Institute of Chartered Accountants—

Senator Carol Brown interjecting—

Mathias Cormann (WA, Liberal Party, Shadow Assistant Treasurer) Share this | Link to this | Hansard source

Chaired by whom? Chaired by whom?

Stephen Parry (Tasmania, Liberal Party) Share this | Link to this | Hansard source

Order! Senator Cormann, that is an unusually extra interjection, so please resist. Senator Carol Brown, please resist shouting across the chamber. Senator Thistlethwaite, please direct your comments to the chair.

Matt Thistlethwaite (NSW, Australian Labor Party) Share this | Link to this | Hansard source

Basil Mastilis, a partner at Ernst & Young; Noel Mullen, the deputy chief executive at the Australian Petrol Production and Exploration Association; Anthony Portas, head of tax at Asia Pacific Anglo American; and Gordon Thring, corporate and international tax partner at Deloitte. These are the people who, in the words of Senator Cormann, are 'in the back pocket of the government' when it comes to drafting this piece of legislation. They provided valuable input through the legislative drafting process and it reflects the view of the government that this is a necessary reform and one that we have consulted widely on.

The revenue raised from this tax will go to funding superannuation increases in our economy. We will move the compulsory superannuation level from nine to 12 per cent over the course of the next eight years. With an ageing population and an increasing burden on our budget and on our social security system, this is a major economic reform and an important economic reform. Up until a couple of weeks ago, it was opposed by the opposition, in line with their historical opposition to occupational superannuation in this country. When the Labor Party sought to introduce superannuation in the 1990s, it was opposed by those opposite. Now we have in our economy $1.3 trillion of funds under management and those funds are used for investment and growth by companies and to support jobs.

John Williams (NSW, National Party) Share this | Link to this | Hansard source

What about the industry super funds?

Matt Thistlethwaite (NSW, Australian Labor Party) Share this | Link to this | Hansard source

In fact, Senator Williams, during the global financial crisis when debt markets were frozen, when access to liquidity was difficult to come by, it was Australian superannuation funds that were invested in businesses, many in the mining industry. CBus, the construction industry superannuation fund, is one big investor in BHP and Rio. They are putting back into the mining industry, ensuring that there are sufficient investment funds for growth. Those opposite always oppose superannuation and up until a few weeks ago, they were opposing the increases in the superannuation guarantee from nine to 12 per cent being funded by this important reform. These reforms are supported broadly by the funds management industry and by the superannuation industry. A recent report by the Allen Consulting Group—a very enlightening insight into the state of superannuation in this country—highlights the fact that the increase from nine per cent to 12 per cent over the course of the next eight years will increase our nation's gross domestic product, our income, by 0.33 per cent to 2025. That means in 2010 dollars there will be an extra $5.4 billion in our economy because of this reform. That $5.4 billion will fund the retirement incomes of working Australians and provide an important pool of investment sources for business growth.

The other aspect of the revenue generated from this reform will be to provide assistance to companies in the form of an instant asset write-off, increasing from $1,000 to $6,500 over the course of the coming year. That will benefit 2.7 million small businesses throughout the country. The company tax rate will fall from 30 per cent to 29 per cent, funded by the minerals resource rent tax revenue—again, opposed by those opposite, those who claim to be advocates and supporters of the growth of small businesses.

We have often heard of the infrastructure bottlenecks that exist in our economy. The revenue generated from this tax reform will ensure that we invest in rural and regional communities, most notably in freight lines and overcoming bottlenecks associated with port infrastructure. Overwhelmingly, the revenue used from this tax will ensure a more healthy, stable economy into the future. It will boost retirement incomes, which is important for our ageing population, and it will provide tax breaks for small businesses. What a great shame that the mighty Liberal Party, the party of the free market, of business enterprise, of government getting out of the way, is opposing these reforms that will provide a big boost to retirement incomes, secure our economic growth into the future and ensure assistance for small businesses in our economy.

Those opposite come into this place and seek to make points about modelling. Senator Cormann made some comments about the modelling associated with this. Indeed, he has been one of the principal opposition critics of the Treasury modelling on the carbon price. Let us have a look at the Liberal Party's record on modelling. At the last election they refused to submit their election costings to independent expert analysis. Why was that? When they did, the costings came up $11 billion short—an $11 billion black hole. They said that they had their costings independently audited by a group of auditors from the North Shore of Sydney who signed off on them. When we had a look at the costings, we saw that those auditors would not give an unqualified audit of the Liberal Party's election costings. Yet the Liberal Party comes in here and criticises the government's modelling, when all the facts associated with the carbon price and this important reform are on the table.

We have had leaks from the shadow cabinet which indicate that there will be cuts of $70 billion to services under a coalition government. Then we had the almighty backflip on occupational superannuation a couple of weeks ago when the shadow finance minister Andrew Robb was not told that the coalition would not repeal the increases in superannuation. This will add an extra $12 billion to their budget bottom line costings. Ours is a sensible reform, it is costed and the Australian public needs it. (Time expired)

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

The dishonesty of Prime Minister Gillard's lie of not having a carbon tax has been extended to secrecy over the assumptions underlying this mining tax. This means the supposed benefits for superannuation, a reduction in company tax and the elimination of the deficit all have to be said to be in doubt. This version of the mining tax was conceived in secrecy as a result of a deal between the three big mining companies—BHP Billiton, Rio Tinto and Xstrata—and it excluded the smaller mining companies represented by AMEC. Those small companies are a very important sector of the mining industry. AMEC rightly complains that this proposal is anticompetitive and, as it stands, the tax will create an uneven playing field between the formative iron ore and coal miners—those trying to cut their teeth in the business—and the large conglomerates. It appears that the Labor Party is happy to be in bed with the big boys: BHP, Rio and Xstrata. So much for their rhetoric. Boy oh boy, what a revelation!

There are estimates, which have varied widely, of how much revenue this tax will raise. Last July, in 2010, we were told the tax would raise an estimated $10.5 billion over its first two years. Strangely, later in the MYEFO document, revenue was downgraded quite substantially by almost $3 billion to $7.4 billion, being the estimate of what this tax would raise. In the May budget this year, however, the revenue from total tax raised magically increased to $7.7 billion in the first two years and then $11.1 billion for the first three years. It seems to me that these figures are as much of a roller coaster as the Prime Minister's polling—up and down, all over the place—and give no real indication of what we can rely on.

The government claims taxes are variable because the prices of minerals vary so much, as do exchange rates. Well, there is some doubt in that. In many ways there are long-term projections made, with future markets and so on. The best that can be said as to the revenue value of the minerals tax is that it is very uncertain if it is based on such uncertain prices and so many uncertainties in the modelling. In the view of the miners who were not consulted, the smaller miners, the AMEC group in particular, this tax will not raise anything like the revenue projected.

Andrew Forrest, the head of Fortescue Metals Group, claims the three big miners who did the secret deal with the government to set up this tax will pay far less tax than the new players and the smaller miners. In fact, it has been estimated that the smaller miners will pay at least four per cent more than the big miners, and that is quite a substantial amount of money. We have to ask whether that is fair. The big miners are well-established big operations, whereas a lot of smaller miners are trying to get their operations off the ground. The concept that they should have to pay more tax is quite unreasonable. It means this tax is actually a discouragement to the future development of the mining industry.

We are told that the revenues generated from this tax will be allocated to improving superannuation, reducing company tax and, most importantly, eliminating the deficit. But, even though the government has these fine ideals, it seems very strange that it is denying the parliament the right to see the modelling underlying this tax. Surely it is reasonable for parliament to have the modelling, if for no other reason than the government's claim that the tax will help it return to surplus in 2014. Yet no information is being provided to the parliament. That has to be a matter of concern to us all.

As I said, the AMEC group of companies and FMG say that this tax was conceived in a secret deal between the government and the big miners—BHP, Xstrata and Rio—and we are told that the modelling was done by BHP. That is another thing which must make us a little bit concerned. BHP is a very large company, having a different set of figures to those of the smaller miners; perhaps modelling done by such a very big company does not translate particularly well into the operations of the smaller miners.

The Gillard government claims to be committed to openness and transparency, but in practice secrecy and opaqueness seem to be the order of the day for this government. Given the Prime Minister's acknowledged record of misleading the Australian people—to put it at its nicest, or lying, as some of my colleagues have said—over the carbon tax, parliament has every right to be rather dubious about the rationale for this tax and the underlying assumptions which have led to this tax being set at the rate that it has been. I think parliament has every right to demand access to the data underlying this tax to test the validity of the government's projections. The government claims that the information is supposed to be in confidence and that the Information Commissioner 'will arbitrate the release of documents to the parliament'. I must say I have never heard of the Information Commissioner before; it is a public office which I was totally unaware of. But here we are—we have got an information commissioner who is going to arbitrate what the representatives of the people of Australia are entitled to know about the underlying assumptions this government made in setting up this tax. In my view it is very important to remember that the parliament and the Senate are the representative bodies of the people of Australia. It is quite outrageous that this government is denying the parliament access to its modelling figures.

The Prime Minister's office claims that the functions of the Information Commissioner do not include 'reporting on or arbitrating disputes between the executive and the parliament'. I come back again to the simple proposition that the parliament represents the people of Australia, and this is one place where the people of Australia have the right to expect answers to questions raised on their behalf. It would seem to flow as a logical conclusion from the government's position that this government does not believe that the parliament should have sufficient information to make an informed decision on this matter.

It is a pretty outrageous and sad matter that we are contemplating, where a government is proposing to set up a super tax which other countries, our competitors, do not have and which will disadvantage our mining industry, making it less competitive. Part of the naivety of this government seems to be its failure to understand that the mining industry is truly international and that the big mining companies in this country can shift their projects and their money to other parts of the world, like West Africa, the gulf, Canada and Brazil, and it is an easy thing for them to do. That is something that this government simply does not understand. It is going to damage the industry which has made Australia's economy so strong.

In conclusion, I return to the fact that the parliament represents the people of Australia and it is the people of Australia to whom the Gillard government is saying, 'We are not going to tell you what the underlying assumptions for this tax were.' That is outrageous.

Glenn Sterle (WA, Australian Labor Party) Share this | Link to this | Hansard source

Before I make my contribution—sadly, I have only five minutes—I want everyone to know that I have the greatest respect for my colleague from Western Australia Senator Eggleston. But, unfortunately, Senator Eggleston has been hijacked by the nonsense coming out of the billionaire brigade in Western Australia. It is an absolute disgrace. Let us get a real handle on what this tax is all about before I go any further. Senator Eggleston, you suggested that Labor is in bed with the big boys. I tried not to laugh too loud. I look at Clive Palmer—

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

He's a big boy.

Glenn Sterle (WA, Australian Labor Party) Share this | Link to this | Hansard source

I am not talking about the size of the man. He is a major mining identity who is, I believe—and I will be corrected if I am wrong—a major donor to the National Party. For crying out loud!

Let us get back to what this mining tax is really all about. This is a tax on companies that mine iron ore and coal once the companies have made a $75 million profit. It does not kick in until they get to $75 million in profit. The language that is being used in this discussion by Senators Eggleston and Cormann is nothing short of misleading. We hear that this mining tax is going to kill the mining industry, kill the goose that laid the golden egg, absolutely jeopardise Australia's mining industry, send mining offshore. That is complete and utter nonsense. We are talking about putting a fair and just tax on these companies once they have got to $75 million in profit.

I only have five minutes but I could talk for an hour underwater with a gob full of marbles on this because I am so passionate about it, coming from WA. But I want to have an argument based on truths. I want to have an argument based on realities. I do not want to have an argument that is being misled by the rubbish coming out of the mouths of billionaires like Andrew Forrest. It is absolutely incredible to think that in evidence given to a parliamentary committee, I think as late as last week, one of Andrew Forrest's representatives actually told the committee that FMG had not paid any company tax, and that when Andrew Forrest addressed a meeting of his shareholders he said FMG expected to pay 'less than $20 million a year'. It was so small as to equate to a 'rounding error' for a company forecasting $4 billion in earnings. This is the same fella who prides himself on being on the front page of every newspaper saying, 'The Prime Minister won't return my call. It is going to send me broke.'

I am going to share a little secret with senators opposite, as long as they promise not to tell anyone else out there. I met with Mr Forrest. I met with him at his request last year, not long after he and that other small-business person Miss Gina Rinehart, with the big pearls, were waving signs saying 'Stop the tax'. Mr Forrest—promise you will not tell anyone—'hinted' to me in no uncertain terms that if the mining tax were to go ahead it could jeopardise his Solomon Hub project. What a load of absolute nonsense!

The truth is starting to come out now. I just hope that every Australian actually hears the truth about Mr Forrest, this Robin Hood of the iron ore industry and the small miners. What the hell is a small miner? I have spent a lot of time in the Pilbara and a lot of time in the Kimberley and the goldfields. Please tell me what a small miner is. Is their Mercedes-Benz any smaller than that of the miners from BHP or Rio Tinto?

And what nonsense from Senator Cormann—of all people to suggest that Labor is in the pockets of BHP and Rio Tinto. I think they are the words that were used. Senator Eggleston, you are nodding in agreement. That is what he did say? Okay. Senator Cormann, if you are listening out there, take 30 steps outside and say it out there on the steps tomorrow morning. Do a doorstop and accuse us of being in the pockets of the big miners.

Madam Acting Deputy President Adams, I say to you, as a good Western Australian and a colleague I have great respect for: I just want an argument based on truth—not on falsities, not on lies and not on complete deception from Western Australian billionaires who will absolutely not be impacted unless they earn $75 million in profit. Wouldn't you like to earn $75 million in profit before you had to pay tax? I know I would. (Time expired)

Richard Colbeck (Tasmania, Liberal Party, Shadow Parliamentary Secretary for Fisheries and Forestry) Share this | Link to this | Hansard source

Doesn't Senator Sterle have a nerve coming in here and talking about truth? You have to be kidding! Here is a member of a government whose Prime Minister went to the last election promising, 'There will be no carbon tax under a government I lead.' He then comes in here talking about truth. Give us a break! 'There will be no carbon tax under a government I lead'—that would have to be one of the biggest lies that I have ever heard in my parliamentary career, and Senator Sterle comes in here trying to convince us that we ought to be talking about the truth.

So let's go to the truths around the mining tax. The mining tax: one of the mechanisms that Prime Minister Gillard used to knife Kevin Rudd and take the prime ministership off him—there is a truth. Another truth: a deal negotiated by Prime Minister Gillard with the big three and announced before the election as one of her fixes, to the exclusion of the rest of the mining industry regardless of size. This is a deal negotiated by Prime Minister Gillard with the big mining companies—just three of them—in the lead-up to the election, after it was used as one of the reasons to knife then Prime Minister Kevin Rudd.

Another truth: the government will not release all the details of the spending measures in the out years. Senator Sterle wants to talk about truth; that is another truth. They will not release all of the information around the mining tax—another truth—which is the point of this motion here today. Senator Sterle wants to talk to us about the truth, yet they are the perpetrators of the greatest lie in recent political history: 'There will be no carbon tax under a government I lead.' They had better get used to hearing that because it is going to come back and back and they are going to hear it over and over right up to the next election.

The government want us to trust them with the information and the facts around the mining tax, yet they cannot be trusted to tell the truth. It was the very thing that Senator Sterle wanted to talk about in his contribution—the truth around the mining tax—yet Senator Sterle neglected to let us know that this is a deal that Prime Minister Gillard did with three big mining companies before the election, after using it to assist her to knife her leader Kevin Rudd and then move on to the election.

Senator Carol Brown interjecting—

Senator Carol Brown might like to tell us what she has done to assist the Savage River mine, where magnetite is mined on the west coast of Tasmania. They still do not know their status under the mining tax—whether they are in or whether they are out. Mr Wilkie came out yesterday quite flamboyantly saying that he had worked with the government to raise the threshold on the mining tax for Tasmania, but he has done absolutely nothing to assist this company mining magnetite on the north-west coast of Tasmania. They still do not know whether they are in or out. That is a truth of this particular piece of legislation. Here is a company which is in the iron ore game, but they are actually mining a product which, when it comes out of the ground, has very little value. They do not know at what point they are going to be taxed.

Senator Carol Brown quite rightly sits quietly because she has done nothing to help that business. Mr Wilkie did nothing to assist that business—and he is one of the people who had the whip hand in the negotiations. He is one of the people who had the opportunity to decide whether this tax got passed. He came out triumphantly yesterday to tell the Tasmanian people that he had had the threshold raised from $50 million to $75 million. That might be an achievement, but one of the major mines in Tasmania still does not know its status. Had Mr Wilkie been aware of some of the issues going on around the state and had he not been focused just on Hobart, he might have been able to make a difference. That is one of the truths of this mining tax.

Another truth of the mining tax is that the government tried to give the impression to small businesses across the country that they are going to get a tax rebate. Small businesses which are companies will get a tax rebate under this legislation, but 65 per cent to 70 per cent of them are not companies and they miss out on the tax rebate. So there is nothing in it. That is another truth of this piece of legislation.

Glenn Sterle (WA, Australian Labor Party) Share this | Link to this | Hansard source

What do you mean? Two million companies will get a tax break. What companies aren't companies?

John Williams (NSW, National Party) Share this | Link to this | Hansard source

Partnerships.

Richard Colbeck (Tasmania, Liberal Party, Shadow Parliamentary Secretary for Fisheries and Forestry) Share this | Link to this | Hansard source

Partnerships and sole traders—they do not get a tax break out of this. In fact, they potentially get a tax increase. The 65 per cent to 70 per cent of small businesses which are not company structures potentially get a tax increase because the 25 per cent entrepreneurs tax offset is gone under this piece of legislation. The 25 per cent entrepreneurs tax offset disappears under this piece of legislation—another truth. So rather than getting a tax cut as a small business, they get a tax increase as a small business—because they lose the tax offset which was part of the Howard government's 2004 election policy. That demonstrates the attitude of this government to small business—small businesses are the ones they get their union mates to go around and attack, trying to turn them around and change them into a different form of business. That is what happens to those small businesses, that 65 per cent to 70 per cent of small businesses which do not get any benefit out of this process.

The government also tried to tell small businesses and the employees who work in them that this process is going to fund an increase in the superannuation rate. But this process is not going to fund an increase in the superannuation rate; the employers are going to fund an increase in the superannuation rate. That is the truth of this legislation. The employers will fund it or, in some cases, it will be the employees of the business who will suffer a reduction in salary increases as a result of the increase in the superannuation guarantee. That might be a small percentage, but it is going to happen.

In fact that is what Henry said. That is what the Henry tax review, where this whole process started, said. The recommendation from the Henry tax review was to leave the superannuation rate at nine per cent. So the government cannot come in here and argue that Henry supports the mining tax on one hand because on the other hand he was making a very different recommendation when it came to superannuation.

You might look back and say, 'How do you end up with a decent small business here in Australia?' The answer to how you end up with a decent small business in Australia is to start with a big business and put this lot in government. You only have to look at the steel industry to get a demonstration of that. The two biggest players in the steel industry were worth $8 billion back in February. Now they are worth $3 billion. They have had $5 billion wiped off the value of their shares since February.

Glenn Sterle (WA, Australian Labor Party) Share this | Link to this | Hansard source

How is that our fault? It is the Aussie dollar.

Richard Colbeck (Tasmania, Liberal Party, Shadow Parliamentary Secretary for Fisheries and Forestry) Share this | Link to this | Hansard source

No, it is not because of the Aussie dollar, Senator Sterle. The steel rescue package only commits them to the retention of a fraction of their existing business. One of them is already closing down a smelter. The other one told us yesterday that their Whyalla smelter is on watch—it has 12 months. That is what is happening under this government. They bring out a steel transformation plan, but it is a bit late—because they have already transformed the steel industry. They have turned it from an industry where the two major companies were worth $8 billion at the top to one where those two companies are worth only $3 billion. That is a transformation all right.

They come in here and they want to talk to us about truth. The real truth is that you cannot trust this government. You cannot trust what this government says. It does not matter what arguments they try to put here in the chamber or what arguments they try to put outside. This is the government which promised the Australian people, 'There will be no carbon tax under a government I lead.' All of them were elected on that promise. Every single one of them was elected on the promise, 'There will be no carbon tax under a government I lead.'

Then we come to the 'year of decision and delivery' and what are the deliverables? A carbon tax and a mining tax. They are the key deliverables for this government—new taxes. Then, when they start talking about the offsets to the mining tax, the reality is that they are going to spend more than they raise from the mining tax. What sort of fiscal responsibility is that? How can they come in here with any credibility? 'There will be no carbon tax under a government I lead'—we have just passed a carbon tax and now they want to pass a mining tax.

Doug Cameron (NSW, Australian Labor Party) Share this | Link to this | Hansard source

I think this debate demonstrates the clear difference between the Labor Party and the coalition, because the Labor Party is standing up for eight million Australians, standing up for small business, standing up for decent infrastructure in this country and standing up for the right of all Australians to get a fair go out of the mining boom. And what about the coalition? Over there, they are defending their mates in the mining industry, defending those who are funding the coalition, defending those who are flying coalition senators around the world, over to India, to attend Bollywood weddings. That is the difference between us. We care about the future of this country. We care about making sure that industry pays its fair share. And we care about delivering a decent society in this country. All you care about is trying to make sure that you get more and more funding from the businesspeople that you defend day in, day out. And why are you defending them? You are defending them to make sure that they do not pay a reasonable amount of tax. It is outrageous for you to come here and talk about the Gillard government's continued secrecy and lack of accountability on revenue assumptions and costs regarding its mining tax.

You had all day today to develop some questions for question time on this issue that you are making all the noise about today. What did you do? You did not ask a question of a minister on this issue—not one question. Then you come here with your fake outrage and say this is a huge issue, but there was not one question in question time. You come here and run all the arguments in support of some of the richest people in this country, some of the people who are making huge profits, huge personal fortunes, out of Australia's mineral resources—not their mineral resources but our mineral resources. You come here and you defend them. Why do the Liberal and National parties defend them? Because they are your election bankers. They are the people who are putting the money into the coalition to bankroll your election campaign, so you come here and put the Australian public second to your funding from your rich business mates.

You talk about accountability and assumptions regarding the mining tax. Let me tell you about accountability in the coalition. The coalition under Malcolm Turnbull called for the establishment of a Parliamentary Budget Office—remember that? Malcolm Turnbull as Leader of the Opposition said we should have a Parliamentary Budget Office because he wanted accountability. He wanted access to assumptions and costs. So what happened? A parliamentary inquiry into the Parliamentary Budget Office was established, and I was on that parliamentary inquiry. There was a joint position arising out of the parliamentary budget inquiry that we should establish a Parliamentary Budget Office to make sure that there was accountability on revenue and assumptions so that the public knew what the financial position was of promises that were made by the coalition, by the Labor Party, by the Greens and by the Independents during an election campaign. A unanimous position was adopted by that parliamentary inquiry. What happened? The recommendations went up and immediately the coalition said, 'Uh-oh, no way. We are not going to be accountable. It might have been a good idea from Malcolm Turnbull, but we don't want to be accountable during the election campaign.'

And why would the coalition want to be accountable during the election campaign? In the last election campaign, the Treasury found a $10.6 billion hole in the promises that they were making and then they blamed some leak in Treasury as to why they would not submit their promises for scrutiny by the Treasury. This is the same Treasury that served John Howard and Peter Costello; the same Treasury that serves this Labor government. They said, 'No, we're not putting our election promises to the Treasury or to the department of finance because we don't trust them'—the same people who for 11½ years provided advice to John Howard and Peter Costello.

What did the coalition do? They were so upfront about accountability on revenue and assumptions that they got some accounting firm in Western Australia to cook the books to try and make it look as if they had a reasonable position on their election promises. But, as to the most experienced people in the country on analysing government funding, government programs and government promises—the two groups are the Treasury and the department of finance—they would not go near them.

So do not come here talking about accountability and do not come here talking about openness, because you have rejected the Parliamentary Budget Office. If you are truthful and you want to stand up with some credibility, when the bill comes to the Senate you stand up and make the same speeches about accountability, support the Parliamentary Budget Office and submit your shonky costings to the Parliamentary Budget Office at the next election. The reason you do not support the Parliamentary Budget Office is that you have no concern about accountability—absolutely no concern. You want to mislead the Australian public on your economic costs. You want to mislead the public on where you are going with your promises.

Why would you want to submit again to the Parliamentary Budget Office? You have admitted that you have a $70 billion black hole—$70 billion that you have to find before you can actually deliver reasonable policies to the Australian public at the next election. By the time you fund all the crazy promises that have been made, we know what is going to happen: you are going to have to slash 12,000 jobs in the Public Service and the services for ordinary Australians will disappear. You want to cut the health system, the education system and the welfare system, because that is what you will have to do to fund your $70 billion black hole. That is a reality. So do not come talking to us about assumptions in costs, accountability and secrecy. You are the ones who want to keep the secrets. You are the ones who do not want to be accountable. You are the ones who will not put your election promises to the Parliamentary Budget Office.

Let us go back to the issue of why the coalition would want to run away from that approach. Take Twiggy Forrest. I think Twiggy Forrest should be renamed—he should be Twiggy No Tax, because he is not paying any tax. He is a billionaire. Andrew Forrest's net worth privately, off the back of our mineral resources and for one individual, is $6.2 billion. He is a major supporter and a major bankroller of the coalition. Why would they argue for more tax for him when they put themselves before the national interest? That is the position that the coalition are taking. Then there is Gina Rinehart—net worth $9 billion. Gina Rinehart has been out there on the picket line, with her Armani gear on and pearls flying around, at the mass meeting of the millionaires. The Rolls-Royce revolutionaries are out there saying they do not want to pay more tax: 'I'm worth $9 billion but I don't want to pay more tax!' They had their mass meeting and the Rolls-Royces were queuing up for three kilometres down the main street of Perth. That is not like any mass meeting I have seen. The security guards were out there—it was all on!

Gina Rinehart has $9 billion. Clive Palmer, with $5.05 billion, is again a major Liberal supporter. Why would the coalition want to make him pay more tax? When he does not pay tax to help the Australian public he is shoving it into the coffers of the coalition for their election campaign. That is what this lot are all about. Do not get muddled up by any arguments about modelling or about secrecy—there is no secret to what this is about. It is not about modelling; it is about making sure that at the next election their election coffers are full of money donated by Twiggy 'No Tax' Forrest, Gina Rinehart and Clive Palmer. That is what they want to do, so do not come here lecturing us about what should happen to tax.

The difference between the Labor Party and the coalition is that we want people to get a fair go out of our natural resources. This is an opportunity for Australians to get something out of the mining boom and stop lining the pockets of the billionaires. There is $80 billion worth of investment in the mining industry over the next few years. I heard Senator Eggleston talk about how the mining industry will desert us and go overseas. I know one area they want to go to, and that is Zambia. In Zambia the government had to plead with the mining companies to get them to pay any corporate tax. The only tax the mining companies were paying in Zambia was the tax on what the workers earned. The workers earned their wages and paid their tax and that was the only tax the mining industry paid in Zambia. That is what the coalition would like, because then they would have a really big bank balance to go to the next election on. They come here and support their corporate mates: the small miners like Twiggy No Tax. What a joke! Personally, he is worth more money than a lot of our industries in Australia, yet the coalition do not want his company to pay any more tax—although it is not more tax because he has not paid any tax.

We want a fair go for Australians. That is the difference between the coalition and the Labor Party. We want the richest people in this country who are exploiting our mineral resources to pay a fair share of tax. We want the billionaires to pay a bit of tax to help build the schools, the infrastructure, the hospitals and the education system of the future. We want workers in Australia to get a decent retirement, not just billionaires like No Tax Twiggy and Gina Rinehart. They should stop flying Senator Joyce and Julie Bishop overseas to India in a private jet. Put that money back into Australia and stop looking after the coalition. That is my message to the billionaires in the mining industry.