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Wednesday, 26 May 2010
Page: 4188


Mr TREVOR (2:38 PM) —My question is to the Treasurer. What have some of Australia’s most respected economists had to say in the last 24 hours about the importance of the resources super profits tax to the future success of our economy?


Mr SWAN (Treasurer) —I thank the member for Flynn for his question. The answer is that 20 of our most respected economists have had some very sensible things to say overnight about a resources super profits tax, and I will talk about that in a moment. But there has also been some more commentary today, particularly from the Leader of the Opposition. The Leader of the Opposition said today on Alan Jones’s program that miners were paying ‘more than their fair share’—more than their fair share. Now, we have been talking about this for about a month. There has been a vigorous debate about modernising our tax system when it comes to the mining industry. There is a vigorous debate about the tax, about its rate and about its design. But I think there is now one thing that almost everybody in the debate—except the Leader of the Opposition, Clive Palmer and one or two others—accepts, and that is that there is the capacity in the mining industry to pay more. It is universally recognised that the mining industry should be paying more because it has not been paying its fair share.


Mr Robert interjecting


Mr SWAN —Let us just go back and look at the figures. At the beginning of the decade, one dollar in three—


Mr Robert interjecting


Mr SWAN —was paid in royalties and charges out of mining profits.


The SPEAKER —The member for Fadden is warned!


Mr SWAN —At the end of the decade, that has fallen to one dollar in seven. So just about everybody in the community accepts that the mining industry can pay a bit more—except the Leader of the Opposition, who does what he is told by the likes of Clive Palmer. Some of those mining companies walked into his office in week one, told him what to do, and he has been singing their tune ever since then.

There is a wider debate happening in the community, and those 20 respected economists have gone to the core of why we do need change, fundamental reform, in this area. They are respected Australians: Professor Allan Fels, former head of the ACCC; Michael Keating, former head of the Australian Public Service; and the list goes on. They make some very sensible—


Mr Hockey —The list goes on? Go on. Keep going.


Mr Anthony Smith —Who are they?

Opposition members interjecting—


Mr SWAN —I am going to go on. Professor Quiggin—it goes on and on. Let us go into it. What do they say?

Opposition members interjecting—


The SPEAKER —Order! The Treasurer will resume his seat.


Mr Tuckey —He’s even worse than Ken Henry.


Mr Albanese —Outrageous.


Mrs Bronwyn Bishop interjecting


The SPEAKER —Often I adopt the attitude that members have to stand by their statements. When there is a vacuum, it is not necessarily the best time to fill it. The member for O’Connor should be careful.


Mr Albanese interjecting


The SPEAKER —There is nothing to withdraw, Leader of the House.


Ms Gillard —Tony Abbott should distance himself from that remark.


Mr Rudd —Do you back that?

Opposition members interjecting—


The SPEAKER —Order!


Mr Albanese —Mr Speaker, on a point of order—


The SPEAKER —The Leader of the House on a point of order.

Opposition members interjecting—


The SPEAKER —Order! I am happy for the Treasurer to have the call—but the Leader of the House has a point of order?


Mr Albanese —Yes, Mr Speaker. I think, to suit the decorum of the House, as a matter of common courtesy such an attack on the Secretary of the Treasury—

Opposition members interjecting—


The SPEAKER —Order! The Leader of the House.


Mr Albanese —The comments by the member for O’Connor, backed up by the member for Mackellar, are not acceptable, in that it is an attack on the Secretary of the Treasury, in this House. Mr Speaker, I would ask that you provide them with the opportunity to do the right and decent thing and withdraw.

Opposition members interjecting—


The SPEAKER —Order! Order! While it is not a point of order, I indicated that individual members, even when they are interjecting, should be very careful about the statements that they make and they have to stand by those statements. But on this occasion, as the person that has been mentioned is not covered by the standing orders, there is no action that I can contemplate and will take. The reason for me inviting the Treasurer to pause was that the level of interjection was not, by any standards, ‘robust’ or in any way respectful. I think that members should really just think about the way in which we engage with each other in this place. I am happy to have the contest of ideas; I am not happy to have the contest of personalities. The Treasurer.


Mr SWAN —I was talking about the views of 20 respected economists and I wanted to go through some of those views. This is a very important debate for Australia—for how we reform our economy as we go forward, for how we grow our economy, for how we invest in our businesses, for how we invest in infrastructure and for how we grow our national savings. Those 20 respected economists treat this issue very seriously, and it is worth while debating it in this House. I want to quote from them. This is what they say:

… it is desirable to levy a charge for access to publicly-owned mineral resources, in addition to normal corporate income tax.

…            …            …

… this is an appropriate time for them to adjust to a more efficient and equitable system of sharing the value of those rights.

Yesterday we were talking about the fact that these minerals were non-renewable, that they could only be mined once. What we have to do is extract the maximum value for the Australian people as we go forward—to reform our economy, to invest in our economy and to ensure our prosperity as we go forward. This is a very serious issue and it should be treated seriously by those opposite. The economists go on to say:

There is no reason to expect a net contraction in mining over the longer term as a result of replacing royalties with the proposed resource rent tax.

This is because a tax on economic rent of non-renewable resources is a more efficient revenue than taxing mining production.

These are very serious points, but they do not seem in any way to be accepted by those opposite.

Mr Quiggin went on today to make this observation, which was very pertinent to some of the points that were made in earlier questions. He said:

… there’s no reason at all to think that the tax is going to affect world prices of these minerals and therefore that that’s going to feed, in any way, into Australian consumer prices.

On the other hand, there’s potentially some benefit for consumers in the offsetting reductions in the general rates of company tax.

So it certainly is depressing to see this kind of scare tactic put up. It really is just to shorten the debate.

Those opposite do not want to acknowledge that we are also moving to a corporate rate tax cut. It is very embarrassing for the Liberal Party to be in this House opposing a corporate rate tax cut whilst at the same time wanting to impose their own. It is very embarrassing for the party that is supposed to be representing business in this House to be opposing sensible reforms to the taxation system for corporates and, most particularly, for small business. But it is more embarrassing for them because they are out there on their own—with Mr Palmer—opposing the fact that we need this profits based tax in the first place.

There have been some spectacular interventions in this debate, and probably none more so than the one this morning from the Leader of the Opposition where he said that they should be paying less tax. That is a view that is not shared by many. It is not even shared by the Minerals Council of Australia. Mitch Hooke said this morning, ‘The concept of a profits based tax is absolutely a tick.’ So even the Minerals Council of Australia is in the cart for a profits based tax, but of course the member for Groom is not and the Leader of the Opposition is not. It just shows you how short-sighted they are, how negatively political they are and how they are not interested in our national interest. They are simply stuck in the past and incapable of coming to grips with the big economic challenges facing this nation. We on this side of the House will do everything we can to ensure that Australians get a fair share of their non-renewable resources so we can invest in jobs, growth and prosperity for Australia.