Christine Milne (Tasmania, Australian Greens) Share this | Link to this | Hansard source

My question is to the Minister representing the Minister for Resources and Energy, Senator Ludwig. I ask: given that the evidence shows the government has made a complete mess of the treatment of royalties in the MRRT—including the blank cheque to state governments on future royalty increases—can the minister confirm that Minister Ferguson was present at the meetings with executives from BHP, Rio Tinto and Xstrata when the detail and structure of the mining tax was negotiated and agreed to by the government?

Joe Ludwig (Queensland, Australian Labor Party, Minister for Agriculture, Fisheries and Forestry) Share this | Link to this | Hansard source

Can I say that the Australian government's new resource taxation arrangements, the MRRT, now apply to iron ore and coal extraction in Australia where profits exceed $75 million. The PRRT has also been extended to all Australian oil and gas projects.

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

She asked you if Minister Ferguson was there!

Joe Ludwig (Queensland, Australian Labor Party, Minister for Agriculture, Fisheries and Forestry) Share this | Link to this | Hansard source

I will take that interjection. I did not know that you have joined the Greens, but thank you very much. It seems now that you are supporting their cause.

Honourable senators interjecting—

John Hogg (President) Share this | Link to this | Hansard source

Order! Senator Ludwig, ignore the interjections.

Joe Ludwig (Queensland, Australian Labor Party, Minister for Agriculture, Fisheries and Forestry) Share this | Link to this | Hansard source

It is quite unusual for me to see that. I know they are up for a marriage again but it seems that you are putting yourself up as a—

John Hogg (President) Share this | Link to this | Hansard source

Senator Ludwig, ignore the interjections; just address the question that has been asked by Senator Milne.

Joe Ludwig (Queensland, Australian Labor Party, Minister for Agriculture, Fisheries and Forestry) Share this | Link to this | Hansard source

I know you want to be a groom for the Greens, but that is a matter for you really. The MRRT revenue depends on a range of fluctuating elements, such as commodity prices, volumes and exchange rates. What I am doing, Mr President, is dealing with that part of the question that I can deal with, which goes to the MRRT. What I cannot do—which I will take on notice just to ensure that the interjector who is supporting the Greens understands where I am going, because he is apparently too slow to understand it. I will take that part on notice, because I do not have any prior knowledge as to what meetings Mr Ferguson might or might not attend. So I will take that on notice, but there were other elements of the question that I can answer, which it seems to me that Senator Ian Macdonald is too thick to follow.

The second quarter of 2012 saw some of the heat come out of global commodity prices. The price of iron ore is now around—

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

Mr President, I raise a point of order. I may be thick, but I am not corrupt like the Labor Party Ian Macdonald.

John Hogg (President) Share this | Link to this | Hansard source

That is no point of order.

Cory Bernardi (SA, Liberal Party) Share this | Link to this | Hansard source

Mr President, on a point of order: Senator Ludwig should withdraw his reflection on Senator Ian Macdonald—the good Senator Ian Macdonald, not the bad Ian Macdonald from the New South Wales Labor Party.

John Hogg (President) Share this | Link to this | Hansard source

That is not a point of order, Senator Bernardi.

Honourable senators interjecting—

No. Order on both sides! Before we get into that: Senator Macdonald got up and used the word himself. That is the difficulty that I am now placed in. I would encourage all senators to show the due respect for each other that is warranted in this chamber.

George Brandis (Queensland, Liberal Party, Shadow Attorney-General) Share this | Link to this | Hansard source

On the point of order, Mr President—

Honourable senators interjecting—

John Hogg (President) Share this | Link to this | Hansard source

Just wait a minute, Senator Brandis. Order! When there is silence, we will proceed. Senator Brandis is on his feet wishing to take a point of order.

George Brandis (Queensland, Liberal Party, Shadow Attorney-General) Share this | Link to this | Hansard source

Mr President, the day before yesterday, the Deputy President required me to withdraw a remark that Mr Wayne Swan was a dope, and I did. For the sake of consistency, Mr President, if I cannot call Mr Wayne Swan a dope—a self-evident proposition, Mr President—then I do not see how Senator Ian Macdonald can be allowed without objection to be called dumb.

John Hogg (President) Share this | Link to this | Hansard source

Senator Brandis, there is no point of order at this stage. All honourable senators should refer to each other in the appropriate terms for this chamber and not stoop to anything else. Senator Ludwig, you have 23 seconds remaining to address the question from Senator Milne.

Joe Ludwig (Queensland, Australian Labor Party, Minister for Agriculture, Fisheries and Forestry) Share this | Link to this | Hansard source

Mr President, I recognise your words, and I am always happy to withdraw if I have overstepped the mark. One of the difficulties in the question is that I know that Mr Ferguson goes to a range of meetings. It is on the public record that he was at meetings. The question never went to which meeting, which is the part I will take on notice. The other part, of course, is dealing more broadly with the MRRT revenue. (Time expired)

Christine Milne (Tasmania, Australian Greens) Share this | Link to this | Hansard source

Mr President, I ask a supplementary question. I thank the minister for taking on notice whether or not the minister responsible for resources and energy was actually at a meeting that determined the tax. Can the minister confirm that, even when mining companies arrange their affairs to pay no tax, royalty credits can be stored by corporations to be used to offset the paying of tax in future years? If so, can the government tell the Australian people through the Senate how much this design flaw of the tax is costing Australia in lost revenue over the forward estimates?

Joe Ludwig (Queensland, Australian Labor Party, Minister for Agriculture, Fisheries and Forestry) Share this | Link to this | Hansard source

Mr President, I will try—

Opposition Senators:

Opposition senators interjecting—

John Hogg (President) Share this | Link to this | Hansard source

Just wait a minute, Senator Ludwig. Those on my left, Senator Milne is entitled to hear the response of the minister.

Joe Ludwig (Queensland, Australian Labor Party, Minister for Agriculture, Fisheries and Forestry) Share this | Link to this | Hansard source

Thank you, Mr President. Clearly, the MRRT collections have been lower than Treasury expected, but anybody with an ounce of credibility can also see that the commodity prices have taken a big hit and that this is flowing through to the MRRT collections. The MRRT has only been in for six months, and mineral prices, particularly iron ore, have been incredibly volatile over that period. It takes months—

Christine Milne (Tasmania, Australian Greens) Share this | Link to this | Hansard source

Mr President, I raise a point of order. My question went to the issue of the royalty credits, not the commodity prices, so can you please explain to me how much?

Jacinta Collins (Victoria, Australian Labor Party, Parliamentary Secretary for School Education and Workplace Relations) Share this | Link to this | Hansard source

Mr President, on the point of order: my recollection is that the question referred to the royalty credits as a 'design flaw', and the minister is referring to why that is not a good assumption.

John Hogg (President) Share this | Link to this | Hansard source

That is a debating point. At this stage, the minister has 28 seconds remaining. I draw the minister's attention to the question.

Joe Ludwig (Queensland, Australian Labor Party, Minister for Agriculture, Fisheries and Forestry) Share this | Link to this | Hansard source

The premise of the question does go to whether there was a design flaw. We refute that. I am going through to explain, in fact, why it is refuted. It can take, as I said, months for higher spot prices to fully reflect the MRRT revenue, as trade can be conducted on a monthly or even quarterly basis. Resource rent taxes are by their very nature, as indicated, volatile, and— (Time expired)

Christine Milne (Tasmania, Australian Greens) Share this | Link to this | Hansard source

Mr President, I ask a further supplementary question. Given that Minister Ferguson chaired with former BHP chair Don Argus the Policy Transition Group, which recommended that all current and future state and territory royalties on coal and iron ore should be credited, can the minister explain why Minister Ferguson has been invisible in the last few months, why the last transcript on his website is from September 2012 and why he is not out with the Prime Minister and the Treasurer defending the dud of a mining tax that he helped to create?

Opposition Senators:

Opposition senators interjecting—

John Hogg (President) Share this | Link to this | Hansard source

When there is silence we will proceed.

Joe Ludwig (Queensland, Australian Labor Party, Minister for Agriculture, Fisheries and Forestry) Share this | Link to this | Hansard source

Much of that question went certainly not to me as minister representing Mr Ferguson, but let me refute this for a start. Mr Ferguson has been out there doing his duties as a cabinet minister across his portfolios very diligently and very capably over the last years, particularly explaining the MRRT, as I am doing now. It is a pity that the Greens in this particular instance do not recognise what has happened with the MRRT, but let me try again. As the ATO commissioner noted, collections rose significantly between the first and second quarters, and this is the same time as we began to see some recovery in commodity prices.

We recognise that some states have taken a reckless approach to royalties. I could name them, but I will not. That is why we had the GST review look into this, working with states or heads of treasuries— (Time expired)