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Tuesday, 22 June 2010
Page: 3885

Senator WORTLEY (2:19 PM) —My question is to the Assistant Treasurer, Senator Sherry. Can the Assistant Treasurer inform the Senate of the projected long-term growth of the resources sector and how much of a return Australians can expect for the resources they own 100 per cent? Is the Assistant Treasurer aware of any new large-scale contracts signed in the resources sector since the government announced its resource super profits tax to give Australians a fairer share of the resources they own and to fund a tax reform package aimed at boosting superannuation savings, helping other sectors of the economy and creating jobs?

Senator SHERRY (Assistant Treasurer) —Australia is indeed fortunate. We live in resource mining boom times, driven particularly by the fundamental change in the world economy driven by the growth from Asia, from countries such as China and India. That is why the government has acted to ensure that the nation as a whole will receive a proper return during this cycle by proposing a resource super profits tax. The reform of taxing profits rather than production is projected to increase investment in the mining industry by between 4.5 and five per cent. There has been a great deal of misinformation and claims, often spurious and inaccurate, made about investment not going ahead. But yesterday we had in Australia none other than the Vice President of the People’s Republic of China. He was here to sign agreements with Australia’s government as well as with a number of individual mining operations. We saw yesterday the announcement of 10 projects, seven of which were in the mining and energy sector. This is real proof that investments will flow and will continue to flow. We saw a new deal by Mr Palmer. Mr Palmer is a very frantic critic of the resource super profits tax. His own company Resourcehouse Limited signed a major cooperation agreement with several Chinese companies to establish a $10 billion China First coal project involving the construction of a mine, a 476 kilometre railway to the Port of Abbot Point near Bowen. There has been another critic, Mr Forrest— (Time expired)

Senator WORTLEY —I have a supplementary question, Mr President. Can the Assistant Treasurer inform the Senate of the movements in the price of Australia’s resources over recent years, and how much of these price increases have flowed back to the Australian people who own these non-renewable resources 100 per cent?

Senator SHERRY (Assistant Treasurer) —I can report to the Senate that there have been very significant price increases of some of our biggest-earning resources—very, very significant in recent years. Let me give you a couple of examples: iron ore prices have risen some 500 per cent since 2004; the price of coal has increased by between 300 and 400 per cent. These are resources owned by the Australian people and it is only fair, when there is a significant increase in prices and super profits flow as a consequence, that the Australian people should see a share of the additional profits that were only dreamed of five or 10 years ago. It is only fair that the owner of those resources—the Australian people—should obtain some benefit through a tax change on these resources. (Time expired)

Senator WORTLEY —I thank the Assistant Treasurer for his answers. Mr President, I have a further supplementary question. Is the Assistant Treasurer aware of any alternative policies that would return a fairer share of resource sector super profits to the owners of the resources—the Australian people?

Senator SHERRY (Assistant Treasurer) —The opposition has two policies. One is to increase company tax to almost 32 per cent, from 30 per cent to 32 per cent. That is one policy. The other policy is to oppose any of the increase in additional profits—not one cent. The Liberal and National parties oppose any of the additional profits that flow from the increased prices and the additional profits that flow from those increased prices on to the Australian people. They do not want to see one cent, except of course I notice the Western Australian government increased the price—I think it is from 1 July this year. That is all okay, apparently. The Western Australian government can jack up the price of its tax on resources, I think, by $300 million per annum. That is okay. (Time expired)