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Tuesday, 22 November 2011
Page: 13315


Mr WINDSOR (New England) (17:08): It is with pleasure that I speak to the legislation before the House, the Minerals Resource Rent Tax Bill 2011 and cognate bills. I am on the record as having expressed on a number of occasions support for the concept of a rent resource tax. I agree with the position of the Minerals Council of Australia, particularly in relation to the way in which a rent tax works. It works on profits rather than on royalties. There has been a lot of talk about the way in which this particular rent tax has been designed, the way in which the previous superprofits tax was designed, and there has been a lot of politics in terms of how it has all come together.

It is public knowledge—I am sure that most people in the House know—that, even though I had been supportive of the concept of a minerals resource rent tax, I had occasion about a fortnight ago to be very annoyed with one of the major coal seam gas companies, Santos, and the way in which they were trivialising and treating constituents in the electorate of New England on the Liverpool Plains. They acted to put in place a drill hole to test-drill for coal seam gas. They did that in the full knowledge that an independent scientific study was underway—the Namoi Catchment Water Study. The Commonwealth funded that study to the extent of about $1½ million, and BHP, Shenhua and Santos themselves had put some money in to try to gain some independent knowledge about the relationship between the groundwater, the surface water, the flood plain and the Murray-Darling system and what was actually happening in that situation.

When Santos decided to proceed without the full knowledge of the independent study, people in my electorate decided to blockade that development. The day before, I had actually said to Treasurer Wayne Swan on the phone that I was supportive of the minerals resource rent tax. But I was annoyed with the way in which that company—which has generally got a pretty good reputation—treated these people and with the fact that these people had to embark on a blockade process.

Many of the same families, some of whom are in ill health and distress, embarked on a similar process when BHP marched onto the flood plain six years ago, not all that far away. BHP had been granted a licence by a New South Wales minister who had never been there. That minister is currently under investigation by ICAC, I believe. They had been granted this licence, and the minister did not even know the landscape that he had granted the licence over. BHP, with its muscle—and we in this place know about the muscle that it exerts from time to time—marched onto the flood plain and said: 'This is what we are going to do, boys. Welcome.' The community were outraged at the potential impact on water resources, particularly on the flood plain. That would have had an impact on the people in the immediate vicinity, potentially, and also on the interconnected groundwater systems that extend for about 300 kilometres within the Namoi system, and on the way those systems relate to the river system.

I commented on a number of occasions that it was almost an absurdity that, while we in the parliament are trying to design a Murray-Darling plan, we are allowing these activities to occur—not only on the Liverpool Plains but on the Darling Downs and in other parts of Queensland—for example where you reside, Mr Deputy Speaker Scott. There were very real concerns about what could happen in relation to water supplies. It was not about whether people were pro or anti mining; it was about whether the appropriate areas were being investigated and about the investigative pressures that the mining companies and the state governments—particularly New South Wales in this case—were under in terms of needing the cash from the exploration licence and potentially the royalties—

Mr Katter: It is no different in Queensland, I can assure you.

Mr WINDSOR: The member for Kennedy has vast personal experience in drilling holes and knowing where to find things. I know that he would understand a lot of the issues that are in Queensland. Many ministers have gone to the Liverpool Plains; the Prime Minister flew over there a few months ago; Minister Crean has been there; Minister Ferguson has been there; Senator Doug Cameron has been there; and many people from the coalition have been there, from both state and federal level. On the back of that action from Santos, I notified the Treasurer that I would not be supporting the minerals resource rent tax until three things happened. One of those is that Santos remove itself from this ridiculous action until appropriate scientific rigour can be applied to the process and the area.

For those who do not know, this particular area is a very small ridge in the middle of a flood plain which has very significant groundwater resources under it. The flood plain covers an area of about 100 kilometres, across the base of the hills, by about 80 kilometres. You can imagine a rectangle of about 80 kilometres by about 100 kilometres. And all of that water has to go through a six-kilometre neck at a little place called Breeza. You have this absurd proposition that has been placed on that community, and they boycotted BHP for 621 days until BHP saw sense and removed itself until the conclusion of independent scientific work. That is going to be completed probably mid next year.

This flood plain has this massive amount of surface water that flows across it from time to time—not every year. There are massive amounts of surface water and there is a massive drainage system. It connects with the electorate of Hunter. He would be well aware of the capacity of that flood plain to flood. He has represented part of it in the past. Given that knowledge and the fact that these people were going to blockade—in this case, a coal seam gas mine—I saw fit to use the leverage of this particular parliament to say to the Treasurer: 'I won't be supporting this unless you people fix this up. These companies aren't listening. They're just not listening to what these people are saying. They are using the law against the people on these very sensitive, highly productive agricultural areas.' And they are in fact, in my view, damaging the miners who are mining where they should be mining by attempting to move out onto these very sensitive landscapes.

The three issues I put to the Treasurer at the time included that Santos remove itself. That has happened. The second issue was that some of the proceeds of the minerals resource rent tax should be used to fund what I call 'bioregional assessments' at an independent level so the community can have some confidence in the process and in when an assessment process takes place and the independent science is found. Currently, the miners have to do that through their exploration licence. There is mistrust and no confidence in the process, because the state is relying on it for money. The third proviso was that the Commonwealth amend the Environmental Protection and Biodiversity Conservation Act to allow water to be a trigger. I have had legislation in the parliament on this particular issue since September. The Commonwealth, as it does now through heritage and endangered species issues, can in fact enter the planning process on extractive industries if there is a trigger. Currently, water is not a trigger.

Mr Deputy Speaker Scott, you would be aware of instances in Queensland where 1,200 conditions were placed on a coal seam gas field by the state and 300 were placed by the Commonwealth. If you have to place 1,500 conditions on anything it says that there is a problem with the process.

Mr Katter: You have a problem with policing and regulating.

Mr WINDSOR: The member for Kennedy is quite right. The capacity to police and prove things makes it very difficult.

What has come out of all of that is that Santos has removed itself from the pilot well and the government has agreed. I thank the government and the people I have been negotiating with for the last fortnight, who have been extremely positive in relation to this. I think most people—I hope on both sides of the parliament—recognise that there are very real issues here. This is not about playing a political game; there are legitimate issues.

I can remember something that happened in 2008. I attempted to amend the Water Act 2007 to allow a similar process that we are talking about now: an independent scientific process. That was passed by the Senate one night. The National Party and the Liberal Party supported the Greens, and it was passed. Press releases were sent out by many within the National Party about what a great thing they had done for the farming community. I remember Senator Joyce saying that the Liverpool Plains people would be so grateful to the National Party for what they had done. About 2 o'clock in the morning Mitch Hooke from the Minerals Council of Australia and others came into the building, and the very next morning the Liberal and National parties recanted their vote. It is one of the very few times it has ever happened, I am told. They recanted their vote on the pressures from the mining industry.

Proceed forward some time to 2008, and Melanie Stutsel, the environmental director for the Minerals Council of Australia, gave evidence to a Senate inquiry in response to some of the things that I had been suggesting at the time and had with the Howard government as well—the Howard government was still in play then. She gave evidence to say that a more appropriate role for the Commonwealth was to put in place a bioregional planning process where the states and territories would take that bioregional planning process into account when planning the release of exploratory or extractive licences. That is why the Minerals Council has not attacked my particular proposition: it is their words. They said at the time—and I have had discussions with them since and have high regard for a lot of people involved there, having known Mitch Hooke personally for many years—'Good idea, Tony, good idea—but we're not going to fund it.'

The minerals resource rent tax comes along, and they can fund it indirectly but not be in control of the process, as they are now through the exploratory processes. The Commonwealth will fund it, and it will be indirectly from the mining industry itself. So we will now have a process where potentially—if the states come onboard; although, the Commonwealth has given an undertaking that, if the states do not come onboard, it will legislate to the very same effect that the Commonwealth will take over some of those responsibilities in terms of the EPBC Act—an independent scientific committee is set up that will be funded to the extent of $150 million by the Commonwealth through the MRRT. That money will provide for these bioregional assessment processes. It will make the companies comply with a process that takes onboard that scientific information, some of which will be the very information that those companies have been finding anyway but has not been trusted by the community. So they do not have to pay for that anymore. The minerals resource rent tax will pay for that independent scientific bioregional assessment process.

I would urge people who are interested in this to read the Prime Minister's letter. It is very conclusive in terms of the issues that it raises and the processes that it involves. It will amend some of the states' legislation if they do not go down that track, and there is some reward built into it as well in terms of Commonwealth money. If they do not go down that track, the Commonwealth has given an undertaking that, if COAG cannot do it, it will legislate and do exactly the same thing in its own right, in terms of water being a trigger and the environmental bioregional assessment processes taking place.

I am very pleased to have been part of that process. In a sense, I thank Santos for doing what they did, because it brought this issue to a head. I am sure they did not mean to do that, but it has brought it to a head. I thank the members of this chamber who have privately and publicly said to me over the last few days that this sort of thing should have happened a long time ago. It could have happened in 2008 if the Water Act had remained amended, but that is history now. This is an opportunity for a fair go for people who live in these areas to have confidence in the process. (Time expired)