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Tuesday, 20 March 2012
Page: 3508

Dr EMERSON (RankinMinister for Trade and Competitiveness) (15:31): On issues of the impact of carbon pricing or the MRRT on business investment decisions, listen not to what the coalition says but look at what investors are doing. The projections in the MYEFO, the Mid-Year Economic and Fiscal Outlook, suggest that the pipeline of resources investment in Australia is continuing to grow since the budget to more than $450 billion. It says:

Following growth of 34 per cent in resources investment in 2010-11, resources companies expect to increase their capital expenditure by a further 74 per cent in 2011-12 …

Indeed, the Reserve Bank's most recent statement on monetary policy predicts that investment, as a share of GDP, will hit its highest level in half a century. That is why I say: listen not to what the coalition says in its fear campaign but look where investors are putting their dollars.

Modelling has been done on the impact on the economy of Queensland of putting a price on carbon. That modelling suggests the following: the growth of the Queensland economy is expected to be strong, with average annual gross state product growth, in real terms, of 3.5 per cent per annum to 2019-20. That is Queensland Treasury modelling and it indicates very strong growth. In fact, the modelling report goes on to say:

… average annual growth in Queensland’s real GSP to 2019-20 will be 3.5 per cent both with and without carbon pricing …

This is the crucial point: there will be strong growth of 3½ per cent with or without carbon pricing. Yet we have the Leader of the Nationals coming into the parliament seeking to convey a belief, an impression, that the carbon price is going to have an adverse effect—some sort of devastating effect—on our mineral and mineral-processing industries in Queensland. Indeed, the same report from Queensland Treasury says:

… employment is forecast to grow at 2.0 per cent per annum both with and without carbon pricing, with an extra 474,000 jobs expected over the period to 2019-20 …

Those are the dispassionate forecasts done by the Queensland Treasury, but we hear not a word of that from the Leader of the Nationals and would-be Deputy Prime Minister of Australia.

Very soon after the announcement by the Gillard government of the carbon-pricing mechanism, Peabody, the largest coalmining company in the world, made a $4½ billion bid for Macarthur Coal. That is a major investor voting with its wallet. Indeed, I have a list here of major mining projects that have been approved and announced, including: BHP Billiton's Caval Ridge Mine project development; BHP Billiton again with the Goonyella to Abbot Point rail line, employing 2,000 people directly; QR National's Wiggins Island rail project, employing 3,000 people directly and indirectly. Origin Energy, ConocoPhilips and Sinopec—this is coal seam gas, which obviously the coalition is opposed to both up in Queensland and here federally, as they never stop attacking the coal seam gas industry—are employing 6,000 people in construction and 1,000 people in operations. Xstrata has the Lady Loretta zinc construction project. BHP Billiton is the lead company for the Bowen Basin metallurgical coal project—that is a $5 billion investment. And there is the Lake Vermont expansion of the coal-handling and preparation plant near Dysart in Central Queensland. Those are just a few of the examples of the projects that are going ahead under the carbon price that has been announced by the Gillard government.

The problem is that the coalition is speaking out of both sides of its mouth. When the Leader of the Nationals is up in regional Queensland he is very fond of attacking the mining industry. At the beginning of the matter of public importance he said the mining and processing industries are the 'economic pillars of Queensland'. That is what he says when he comes to Canberra, but when he is up in Queensland he says:

I share the disappointment about how few mining companies contribute to the areas they invade …

So we have the Deputy Leader of the Opposition in Queensland accusing mining companies of invading areas, yet when he comes to Canberra he says they are the pillars of the economy of Queensland. That is the sort of approach we get from the coalition: saying one thing to one audience and another thing to another audience.

It is not just mining companies who are voting with their wallets; it is members of the opposition who are voting with their wallets. I will go through the members of the coalition who have invested and continue to invest their money in mining companies: the member for Goldstein, the member for Durack, the member for Maranoa, the member for Canning—

Mr Ian Macfarlane: Madam Deputy Speaker, I am very reluctant to rise to my feet to call a point of order on relevance, but I remind the minister that the MPI—

The DEPUTY SPEAKER ( Ms AE Burke ): The member for Groom will resume his seat. This is a matter of public importance. All these debates are far ranging. The MPI refers to the 'massive impact of the carbon tax on mining and mineral processing'. The member for Groom needs to be aware that when you offer up an MPI that allows—a bit like a question—wriggle room people are going to take it. The minister has the call.

Dr EMERSON: The point I am making is that in one breath coalition MPs are saying that putting a price on carbon will devastate the mining industry in Queensland and in Australia. That is what they say, but what do they do? They actually lodged a vote of confidence in the future of the mining industry of Queensland and Australia through their wallets, just like the major mining companies such as Peabody, Rio Tinto, BHP and Xstrata are doing. That is why the member for Ryan, the member for Bennelong and the member for McPherson have mining shares. I have no problem with that. It is just that they should not be going around saying that the mining industry faces a bleak future. Then there are the members for Moore, Bradfield, Dickson, Grey, Swan, Fadden and Brisbane. In fact, two MPs—the member for Stirling and the member for Flynn—acquired their shares after the implementation of a price on carbon.

So, when it comes to their wallets, when it is in their kick, when it really comes down to the basic motivations of MPs, they are in there investing in the future of mining in Australia. I do not have a problem with that. What I have a problem with is when they come into this chamber and say, 'Mining is going to be wiped out.' The member for Flynn is here and I think he might be one of these investors. Maybe he could tell us later. Yes, I see that he is. He showed his vote of confidence by investing after the implementation of this measure.

So let us not have in this chamber—I know we cannot use the word 'hypocrisy', so I will not—the double standards of people coming in here and pretending they have great concern for the future of the mining industry when in fact they do not. Indeed, the implementation of the mining tax, the MRRT, which is designed to share the benefits to the very communities to which the Leader of the Nationals has referred, could and would do that. In fact, $5.6 billion of the $6 billion in the Regional Infrastructure Fund is being funded by the minerals resource rent tax, and to what purposes is this infrastructure fund being put in Queensland alone? The Blacksoil Interchange project, with up to $54 million in the electorate of Blair, the Townsville Ring Road project, with up to $160 million in the seat of Herbert, and the Peak Downs Highway project, with $120 million in the seat of Capricornia. The member for Capricornia supports it and supports the raising of the revenue that would fund this investment, but it is opposed by the Leader of the National Party and would-be Deputy Prime Minister.

In addition there is the upgrade of the intersection of the Bruce and Capricornia highways for up to $40 million. Again, it is strongly supported by the member for Capricornia and strongly opposed by the Leader of the Nationals because the Leader of the Nationals opposes the minerals resource rent tax. He wants to give that money back to Clive Palmer and Gina Rinehart because he, along with the Leader of the Opposition, believes that Clive Palmer and Gina Rinehart pay too much tax and that these communities do not deserve the benefits of this infrastructure investment.

The Mackay Ring Road study of up to $10 million is also being funded out of this infrastructure fund which is overwhelmingly being funded by the minerals resource rent tax. So where is the true allegiance of members of the coalition? It is not with the Queensland economy and not with the mining communities of Queensland but with Clive Palmer and Gina Rinehart, because the opposition believes they are paying too much tax.

I never thought I would see the day when coalition MPs came in here and voted against a reduction in company tax and against a small business tax break allowing small businesses to write off instantly any and all assets valued at up to $6,500. I see the member for Higgins and I wonder if she would agree with her predecessor, who said that when it comes to cutting the company tax rate this is a reform that is in the national interest. He called upon Labor to support that reform in the national interest. When the coalition reduced the company tax rate, funded by some base-broadening measures, the former member for Higgins said that it was incumbent upon the Labor opposition to support these measures in the national interest. And what did Labor do? We supported them in the national interest. We supported the implementation of the business tax reform measures that were the outcome of the Ralph review. We had the former member for Higgins saying that we must because there was an obligation on oppositions to vote in the national interest.

They were the good old days as far as opposition parties voting in the national interest are concerned, because this political party, the coalition, will not vote in favour of a reduction in company tax which would support mining communities and would give a tax break to all of the 2.7 million small businesses in Australia—all of the contractors, not just the 30 per cent who are companies.

We had the embarrassment of the member for Goldstein coming in here and saying, 'But the company tax rate only applies to incorporated entities, which is only 30 per cent of them, so the rest of the small business community gets nothing.' He must be the only guy in Australia who does not understand the $6,500 instant asset write-off. In a debate late last week, when we were discussing the instant asset write-off, the member for Goldstein made exactly the same point. Learn nothing, forget nothing. It was exactly the same point. I said—predictably—in response that, of course, all small businesses get the benefit of the instant asset write-off. And he said to me, unbelievably, 'But you've got to spend $22,000 to get the $6,500 write-off.' I explained to him that you do not; you spend $6,500 or less to get the $6,500 write-off. He thought you had to spend three times that amount. He multiplied something by 30 per cent—one over 0.3—and got this figure in his head. I explained all this. Learn nothing, forget nothing. He comes into the parliament and asks the same question.

The reason he is not voting for it is that he does not understand it. The reason the Leader of the Opposition is not voting for it is that he wants to increase tax to pay for his paid parental leave scheme with a great big new tax on everything you buy. He wants to increase tax by 1½ percentage points. The true high-taxing champions in Australia are the Liberal Party. If you want to look for tax relief, if you want to look for incentive and if you want to look for small business support, then always look to the Australian Labor Party.