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Monday, 19 March 2012
Page: 2107


Senator FIERRAVANTI-WELLS (New South Wales) (13:42): I rise to speak on the Minerals Resource Rent Tax Bill and the related bills. The coalition has consistently said that it will oppose the Australian Labor Party's mining tax and all the legislation associated with it. It is yet another of the Alp's taxes on success. Previous speakers have made it very clear that miners already pay company tax and state royalties, but now they will be slugged by Julia Gillard and Wayne Swan as part of—

The ACTING DEPUTY PRESIDENT ( Senator Crossin ): Senator, I remind you about the correct use of titles for people from the other chamber.

Senator FIERRAVANTI-WELLS: Thank you, Madam Acting Deputy President. I withdraw that; they will be slugged by Prime Minister Gillard and Treasurer Swan and their Greens-ALP alliance partners.

Mining investment in Australia, as a percentage of global investment, is already falling, and this will make it much worse. Labor's claim that it will provide tax cuts is just another con based simply on a tax increase. The only genuine tax cut—and one would have thought that they would have worked this one out by now—is one funded through expenditure restraint. The coalition demonstrated at the last federal election that it can deliver tax cuts based on modest expenditure cuts, and that the ALP is really all about waste. Labor is now borrowing $100 million a day, and by the time it has run this country into the ground it will be up to the coalition to pick up the pieces.

The Gillard government's mining tax is divisive, complex, unfair, fiscally irresponsible and distorting. It will reduce our international competitiveness and was developed through a highly flawed and improper process. I come, in particular, to one aspect of it, and that is the constitutional validity of this legislation. Ken Henry has confirmed that the federal government never sought advice on the constitutional validity of this legislation. There are serious question marks over whether this tax, as a tax on the resource at the point of extraction, is in fact a tax on state property, as prohibited by the Constitution. Let us recall the last time that the Australian Labor Party told us that about the constitutional validity of legislation. Remember the Malaysian solution, the Malaysian solution that was supposedly a watertight case? We saw what the High Court did in relation to it. It threw it out. So this government does not have a very good track record in terms of its assertions about the constitutional validity of its policies and of its legislation. The migration legislation was one example and now, in the health area, the tobacco legislation will be litigated before the High Court. I see Senator McLucas here in the chamber. She will recall that, in the debate prior to the passage of this legislation, I asked her about whether the government had set aside funds in relation to litigation over the tobacco legislation and she told me that it was all hypothetical. So we will see how the government fares with the tobacco legislation going before the High Court. As various other speakers have said, already a number of mining ventures and the state government in Western Australia have flagged High Court action if this legislation should pass the parliament. There is also a valid question about the discrimination between states, which is also prohibited in the Constitution.

This legislation has a number of other flaws. As I said, it is a bad tax that came out of a deeply flawed process. The initial resources super tax was announced without consultation with anyone—no consultation with industry and no consultation with state and territory governments, despite serious implications for their own source revenue.

Let me take the Senate back to the Henry tax review recommendation that a national profit based resource rent tax replace state and territory royalties and that the Australian government should negotiate the federal-state financial relations implications of such a move. Of course, this government did not have the gumption or the fortitude to engage with the states and to do the hard yards on genuine tax reform. So we came up with various workarounds, making the system more complex and messy. Of course this is not the first time that this government has undertaken changes which it did not consult anyone about. In the area of health and ageing I have traversed on many various occasions this government's record in relation to lack of consultation. It simply undertakes a particular course of action to cut something. We have seen it again recently with the solar panel rebate system. The government just cuts without any consultation. Most recently, in my own area of mental health, without any consultation with the medical profession, without any consultation with allied health professionals, this government simply cut sessions that were available to mentally ill Australians without any consultation, with no consideration whatsoever, as to the effect that it would have on their health or on their treatment. If one is going to undertake major change, whether it be in health or any other area, it is vitally important that there be proper consultation. But this government has not been about consultation. And, yes, Senator Johnston did mention they did have some consultation, but they limited it to the three top miners without consulting with the rest of the industry, where it was going to have a vital impact.

The Henry tax review was supposed to be about root-and-branch reform to deliver a simpler, fairer tax system. Instead, this government's mining tax is much more complex and less fair than was originally intended. The Henry tax review also recommended a lower tax burden for smaller mining ventures, to help start-ups grow and prosper and to keep mining ventures in their decline phase alive longer. Instead, smaller and mid-tier mining ventures will pay a higher effective tax rate under the Gillard government's legislation than the big three, who were given exclusive access to negotiations with the government. The Gillard government's mining tax will also reduce our international competitiveness in attracting further investment. The Gillard mining tax package will leave the budget worse off. In particular, over the medium to long term it will worsen the current structural deficit.

So what is all this about? This is about the tired old policies of old Labor, and we have seen it bared in recent times with the class warfare and the billionaire bashing. I will take the opportunity in this debate to raise the fact that I could not help noticing that those opposite in the Australian Labor Party have reduced their side of this chamber to basically a used car yard, with all of its idiosyncrasies. Through the recent episode with the class warfare and the billionaire bashing, we are witnessing what can only be described as a reinvigorated hard sell of tired old banger policies peddled by the usual dodgy salespeople you see lined up there in the front row of every dubious used car yard ready to swoop on the unsuspecting customer. We all know the Australian Labor Party's policies are designed to reduce all to the lowest common denominator. Quite frankly, it is enough to make George Orwell roll over in his grave. We are all equal but, of course, some are more equal than others. What a disgrace! What a tired and flawed philosophy the ALP is following with its policy of winding clocks back yet again by dodgy salespeople through the introduction of bigger bureaucracies, bigger taxes, bigger spending et cetera.

I cannot help but notice that there are plenty of old retreads fitted in the car yard as well. As I said, when all else fails, they will return to their old class warfare strategy—the billionaire bashing. Forget about hope, reward and opportunity, and what it means to Australians who want to get ahead. They might go out and bash the billionaires but ultimately their policies every day, increasingly, are hurting more and more ordinary Australians. But, returning to the old retreads that are now fitted into the used car yard: the targeting of the private schools funding, targeting the successful tall poppies in society—these are their tired old policies. The targeting of the health rebate, which has seen another disgraceful broken promise by the Gillard Labor government, the reintroduction of the issue and a whole range of other retreaded old policies—there are dodgy brakes everywhere in the car yard and they just cannot stop. They cannot stop spending other people's money.

The Australian Labor Party loves red ink. They know little about economic management; they are the economic mismanagers because of their vigorous pursuit of sovereign debt at every opportunity. Whenever and wherever the Australian Labor Party has been in power for any length of time, it has left a trail of red ink for us to fix. Senator Conroy! Senator Conroy is going to leave us the biggest trail of red ink—$50 billion worth—and you smile. Anyone can spend money but it takes discipline and planning to spend within one's means. People are expected to manage their finances and to live within their means. The Australian people expect their governments to live within their means. But given its record to date, near and far, the concept of balanced budgets, surpluses and savings, such as the Future Fund, are alien concepts to the Australian Labor Party and, more particularly, the incompetent Treasurer, Mr Swan.

The Australian Labor Party hides the tired old socialist policies of wealth distribution to screen its incompetence at managing other people's money. Results are the measure of successful policies, not words and spin. With respect to foreign policy, all of the excellent work done by foreign ministers like Alexander Downer over the years has been undone by the incompetent bullying tactics of Mr Smith, Mr Rudd and now Senator Bob Carr, leading with his chin, mouth in top gear and brain in neutral—evident in his dealings with PNG.

We have a lot of work to do employing sophisticated diplomacy around the world to clean up the mess after this lot. You have to admit, it is a tired looking old car yard over there. One does not have to lift the bonnet to locate the source of the problem because the rust, the bald tyres, the dodgy brakes and clocks wound back are evident everywhere and in many cases, I suspect, are terminal. As I and other senators on this side have said, bring on a federal election so that some of these jalopies can be either scrapped or retired to the junk yard.

Senator Conroy: Don't talk about yourself like that, you old jalopy.

Senator FIERRAVANTI-WELLS: Senator Conroy, at the end of this process it will not be me who will be so described, it will be you. Just remember the epitaph on your political grave after we have to pay back that $50 billion that you are squandering with your silly NBN process that you dreamt up on the back of a coaster in some aeroplane at the back of Woop Woop.

Honourable senators interjecting

Senator FIERRAVANTI-WELLS: Yes, absolutely. I return, if I may, to the issue of the mining tax. As I said, the coalition will be opposing this legislation and all the legislation associated with it. If there is anything to do with success, anything to do with Australians getting ahead, this government will tax them. The government is not interested in Australian families working hard to get ahead for themselves and for their children. The government is only interested in taxing Australians. As I have said, Australian mining companies pay company tax and state royalties but now they will be slugged by yet another impost. The failure to consult properly has now resulted in a piece of legislation that is so complex that it will be so difficult to navigate, not just for the big companies but also for smaller companies.

On constitutional validity, what are the issues about discrimination between states? Has this government got legal advice about this legislation? They are prepared to ridicule people like Clive Palmer who has indicated that—

Senator Brandis: He's a great man.

Senator FIERRAVANTI-WELLS: Thank you, Senator Brandis, just because it is his right to challenge—of course he has a vested interest—this legislation. Those opposite denigrate his right as an Australian to challenge this absolutely atrocious piece of legislation.

Debate interrupted.