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Tuesday, 8 November 2011
Page: 8608


Senator BUSHBY (TasmaniaDeputy Opposition Whip in the Senate) (21:30): I also rise to contribute to the debate on the Steel Transformation Plan Bill. What a classic piece of doublespeak the title of that bill is. It makes me think that we are living in George Orwell's 1984, in which the ministry of peace conducted wars. The fact is that this Steel Transformation Plan is more like a steel snow job plan. It is really designed to cover up the dramatic effect that the government's toxic carbon tax will have on the steel industry—along with just about any other industry you can point a finger at in the country—and the need for some sort of pretence at doing something to keep the doors of the steel industry open.

The reality is that the only reason that there is any need for the Steel Transform­ation Plan is to try and limit the damage that we know the government's carbon tax will inflict on the steel industry. Indeed, Senator Thistlethwaite, earlier today in the debate on this very bill, made a statement which I do not mean to misquote him on, but I think he said that the effect on the steel industry will be devastating. He used the word 'devastating' and he made it quite clear that the effect on the steel industry will be devastating and that was why the government needed to introduce this plan. He is right. If there were not a carbon tax, there would not be a need for a Steel Transformation Plan, a steel snow job plan, or whatever you want to call it, because there would not be the devastating impact that the government's carbon tax will impose on the steel industry.

Senator Cash has very eloquently outlined the impact that this has already had on shareholders' assessment of the value of these two companies, and I will also look at that in a minute if I have time. It has been absolutely dramatic. We have seen a 66½ per cent fall in the share price of OneSteel since February of this year and a 66½ per cent fall in the share price of BlueScope Steel, a two-third slashing of the price. That is real money we are talking about. We are talking about $2½ billion slashed off the share price of OneSteel and over $2½ billion slashed off the price of BlueScope Steel. There is one reason, and one reason only, that that has occurred—the carbon tax.

You can look at the fall over the course of the year. It is quite clear that once the government set up its interparty committee on climate change and started talking about a carbon tax, the share price went into freefall, and it has continued on that line right up until the current time, when the share price is now roughly one-third what it was at the beginning of the year. Even Minister Combet, the Minister for Climate Change and Energy Efficiency, admitted that the establishment of the Steel Transformation Plan was driven purely by the carbon tax when he said that the negotiation of the Steel Transformation Plan came out of the discussions with steel companies which took place for months over the carbon price issue. The fact is that this is the 19th bill of the clean energy package. It may be not be described that way, but it is as necessary a part of the clean energy package as any one of the other 18 bills is. The impact that is being addressed by these bills, in part, arises directly out of the fact that the government has chosen, in breach of its solemn promise to the Australian people, to introduce the clean energy package and thereby its toxic carbon tax.

To the great shame of the Australian Labor Party, we have today, through the passage of those 18 bills, witnessed the biggest and most duplicitous betrayal of the Australian voting public this nation has ever experienced. Make no mistake, there is no chance that the ALP would have won enough seats at the last election to be in a position to sell their soul to the Greens if they had not promised that there would be no carbon tax under a government led by Prime Minister Gillard. The Prime Minister may be many things, but she is not a dunce. She knew in the lead-up to the election that the outcome would be close. She knew that the Australian people did not want a carbon tax. She knew that when the Leader of the Opposition challenged her to rule out a carbon tax in the days leading up to the last election she had no choice but to do so if she wanted to have any chance to hang onto power. And she knew that after the election, if she managed to hold onto power, she could, to paraphrase Mr Garrett, the member for Kingsford Smith, just change it all—and that is what she did.

In total disregard of the solemn promise that she made in order to trick enough of the Australian population into voting Labor, the Prime Minister immediately cast away any pretence of keeping that promise in order to do a dirty deal with the Greens to hang onto power. The national interest did not come into the decision. What is in the best interest of Australians did not come into the decision. A sense of integrity or wanting to keep good the promise made to the Australian people did not come into the decision. The only thing that mattered was holding onto power and, to paraphrase ex-Labor minister Graham Richardson, she did whatever it took to do so.

The fact is that the experts—the shareholders, the financial advisers and the financial analysts—agree that this is going to be absolutely devastating for the steel industry, which has a strong and proud record in Australia as an employer over many decades of tens of thousands if not hundreds of thousands of Australians. The steel industry is one that has enjoyed the confidence of shareholders for decades if not over a century, I think, in some cases. It has a long and proud history and has enjoyed strong investment, particularly in recent years, since the introduction of the superannuation guarantee charge, from superannuation companies. The reality is that there is a large amount of Australian superannuation holders' money in OneSteel and in BlueScope Steel.

In recent days we have heard stories about how the government would like to ensure that workers' superannuation and retirement incomes are protected into the future and that they are able to have a good solid nest egg when they retire, and that is why they are increasing the amount of the SGC from nine to 12 per cent progressively over the next few years. It is not going to be much use to increase their SG contributions by three per cent if you are making decisions which slash 66 per cent off the value of the shares that they hold in those companies. Make no mistake, a large percentage of Australian superannuants have shareholdings, through their trust funds, in companies just like these and in other companies outside the steel industry whose share prices will be similarly affected—to the same extent, less, maybe even more—by the decision that has been put into effect through the passing of the legislation earlier today.

The other thing about this transformation plan is that only two Australian firms—BlueScope Steel and OneSteel—qualify for assistance. This is because of the definition of 'eligible corporation', which is contained in proposed section 4 of the bill. In other words, the plan provides a rerun of the mining tax renegotiation debacle, where the government has gone off and talked to the top end of town, done a dirty deal with the top end of town and looked after them, but paid no heed whatsoever to middle-size companies or small companies.

Senator Cash highlighted very effectively the impact that the carbon tax will have on small businesses right across the country, particularly those that are involved in the steel industry. If I had more time I would talk about how the bill could only run for one year, whereas the carbon tax has been put in at least until 2050, on the basis of the government's own document, but the reality is that the vast majority of companies involved in the steel industry, other than these two companies, receive no assistance whatsoever despite the fact that they are also energy intensive in the same way that BlueScope Steel and OneSteel are. Their costs will also dramatically increase and their ability to be competitive on an international scale or with imports will also be vastly reduced as a result of this tax.

I understand that there are other senators who wish to speak so I will conclude my comments. I think this is an appalling bill that should never have been needed to be brought forward.