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Wednesday, 13 February 2013
Page: 1186

Minerals Resource Rent Tax

Mr HOCKEY (North Sydney) (14:11): I refer the Treasurer to his 14 December 2010 press conference where he was questioned as to whether it was an error to credit all state royalties under the heads of agreement signed with mining companies. The Treasurer replied, 'No, it’s not an error at all.' Does the Treasurer stand by his words, and will the Treasurer rule out any changes to the treatment of royalties under the mining tax: yes or no?

Mr SWAN (LilleyDeputy Prime Minister and Treasurer) (14:11): I do thank the shadow Treasurer for his question, because I did answer that comprehensively yesterday. It is the case that they are a deductible credit—no doubt about that. That was contained in the report which was produced by the Minister for Resources and Energy, Mr Ferguson, and Mr Argus, along with some advice that we should sit down with the states and work our way through all of these issues, which is precisely what we are doing as we speak. Our treasuries are engaged in this discussion, and they are engaged in this discussion for a very good reason: we want our resources industries to grow and prosper. The whole argument for a resource rent tax is that it is the most efficient way of generating growth and jobs in industry, as opposed to the regressive impact of royalties and how they punish projects, particularly those which have higher costs.

What you have seen in the state of Queensland has been jacking up of royalties, which has cost jobs. We have not heard one peep from them about the job-destroying impact of what has gone on in Queensland from the royalty increases by the Queensland government. We are determined to work through with the states the intersection of a resource rent tax with royalties. That is what we have said we are doing, we have been doing it and we will continue to do it because it goes to the health of our industry which has been growing dramatically since we announced the introduction of the MRRT in 2010. I went through some of the figures yesterday.

Mr Simpkins: One hundred and twenty-six million.

The SPEAKER: The member for Cowan is warned.

Mr SWAN: Something like 60,000-plus jobs additional in mining when those opposite claimed that jobs would be reduced. We have seen a dramatic increase in investment since 2010 in mining, all because we have been determined—

The SPEAKER: The Treasurer will resume his seat. The member for North Sydney on a point of order.

Mr Hockey: Madam Speaker, I rise on a point of order. The question was pretty simple. I asked him whether he was ruling out changes to royalties, yes or no. That was the question. Does he stand by his decision?

The SPEAKER: The member for North Sydney will resume his seat. The minister will not engage in chatter across the table. The Treasurer has the call.

Mr Pyne: Inane chatter.

The SPEAKER: The Manager of Opposition Business may reflect on the use of the word 'inane' in his own chatter throughout question time. The Treasurer has the call.

Mr SWAN: As the Argus-Ferguson process recommended and as the GST distribution panel recommended, we have been working with the states to see if we can get a resolution to this issue. I would have thought that that is a very clear answer to the shadow Treasurer. But what is he really on about here? He is upset that there is a resource rent tax in the first place, and $1 of tax raised through resource rent taxes is an affront to everybody on that side of the House. We on this side of the House have a fundamental belief that the Australian people should be getting a share in the superprofits that are made from the resources that we own 100 per cent. That is why we have been a supporter of the MRRT and that is why we have been a supporter of the PRRT, which has raised something like $28 billion in the time that it has been in operation. And it was opposed by those opposite. (Time expired)

Mr HOCKEY (North Sydney) (14:15): Madam Speaker, I ask a supplementary question. Given the extreme concern of the Treasurer for the welfare of the states and given the fact that the Treasurer is concerned that royalties are a problem, will the Treasurer now guarantee that no state will be worse off as a result of the changes that he is proposing on royalties?

Mr SWAN (LilleyDeputy Prime Minister and Treasurer) (14:15): This is an extraordinary question when you consider that the Leader of the Opposition has come into this parliament and invited the states to put their royalties up. That is what he is on the record as doing: coming in here and recommending that states increase their royalties. What we will do is work with the states to get a satisfactory resolution that will grow the industry and provide a fair return to the Australian people.