Senator GEORGE CAMPBELL (2:00 PM) —My question is to Senator Hill, representing the Prime Minister. Can the minister confirm that the next indexation of fuel excise, due in February next year, will be abnormal in that the CPI will reflect the inflationary spike caused by the GST? Is it true that this is likely to add around 2c to 3c per litre to the price of petrol? Can he explain why the ever growing number of government backbenchers calling for a freeze on fuel excise indexation are, in the words of the Prime Minister, naive and irresponsible? Is the Australian Chamber of Commerce and Industry also naive and irresponsible in calling on the government to consider using a discounted CPI measure for the indexation—one that is not distorted by the GST's impact on inflation?

Senator HILL (Minister for the Environment and Heritage) —Since coming to office in 1996 the coalition has not increased petrol excise; it has of course continued the usual indexation in line with the CPI. Compare that with the record of the previous Labor government: when Labor came to office, petrol excise was 6.155c per litre; when it left office, excise was 34.183c per litre—an increase of 28c per litre or over 550 per cent. That was the Labor record in relation to excise.

The DEPUTY PRESIDENT —Order on my left! Senator Cook, can I have some order and less noise in the chamber.

Senator HILL —I will provide some more information for Senator Cook in particular. Labor introduced excise indexation in August 1983. That is worth remembering—Labor introduced excise indexation. Of course as indexation is linked to the CPI, petrol excise increased far more under Labor— with an average of 5.2 per cent inflation between 1983 and 1996—than it has under the coalition, with an average of 1.4 per cent inflation between 1996 and 2000. So Labor bring in indexation with CPI and, as a result of inflation being higher under Labor—a high expenditure government, with high taxes and high interest rates—the rate of increase is higher than under the coalition government. Since coming to office, the coalition has not increased petrol excise; it has continued only the indexation with CPI. So what are the Labor Party on about? I would have thought that the Labor Party would be embarrassed about raising this matter, because their record was appalling. In contrast to the coalition not increasing petrol excise, Labor increased it by 7.5c per litre as a discretionary budget measure while in office—5c being announced in their 1993 tax hike budget. Labor's 1993 petrol tax hike raised them an extra $5.2 billion—for Senator Cook's benefit—or $3.55 million per day. That is what Labor did with a voluntary hike in excise duty.

The DEPUTY PRESIDENT —Order, Senator Cook!

Senator Cook —Well will he answer the question.

The DEPUTY PRESIDENT —Senator Cook, will you please come to order. Senator Hill has the call—that means that you should not be talking for the whole time he is.

Senator HILL —Despite rising world oil prices, and because this is a government that constrains tax, Australia still has the fourth lowest petrol prices amongst the industrial-ised countries of the OECD. A contest is always between two sides. In this case it is between a low tax government, the Howard government, and a high tax alternative, the Labor Party, based on its 13 years in office.

Senator GEORGE CAMPBELL —I ask a supplementary question, Madam Deputy President. I ask the minister: where is that fairness in jacking up the government excise on petrol in response to an abnormal CPI increase caused entirely by your GST?

Honourable senators interjecting—

The DEPUTY PRESIDENT —Order! The level of noise on both sides of the chamber is not tolerable.

Senator HILL (Minister for the Environment and Heritage) —I am sorry that Senator Campbell did understand the answer, so I will repeat it for his benefit. It was the Labor Party that introduced indexation. The Labor Party also voluntarily added extra taxes on petrol. This government has not increased the indexation; it has only been indexation in relation to CPI. The real contrast is that, when Labor came to office, petrol excise was 6.1c per litre; when they left office, it was 34.1c per litre. That is what the Australian people ought to think about. Yet even with that record the Labor Party seek to alarm the Australian people today. It is just a political hoax. Their record is appalling. This is a low tax government, and we are proud of it.