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Monday, 20 June 2011
Page: 3306


Senator BRANDIS (QueenslandDeputy Leader of the Opposition in the Senate) (18:02): I rise to speak on the Taxation of Alternative Fuels Legislation Amendment Bill 2011, the Excise Tariff Amendment (Taxation of Alternative Fuels) Bill 2011, the Customs Tariff Amendment (Taxation of Alternative Fuels) Bill 2011 and the Energy Grants (Cleaner Fuels) Scheme Amendment Bill 2011.

What we are seeing from the Gillard government with this set of bills is yet another attack on the cost of living of all Australian families. The first three bills deal with the taxation of gaseous fuels for motor vehicles. They will apply a tax to LNG, CNG and LPG. They will apply a tax to the taxi fleet. They will apply a tax to the public transport systems, particularly those in cities such as Sydney, Perth and Brisbane whose buses use compressed natural gas not only to lower emissions but also to lower pollution. These buses burn cleaner and provide Australia with an opportunity to use some of the overwhelmingly ample resources that we have in natural gas.

Australia is a very lucky country. We are self-sufficient in energy. We are in fact one of the few OECD countries that export energy. That energy comes from a number of sources. It comes from coal, and we are the biggest exporter in the world of both coking coal for the manufacture of steel and steaming coal for the production of electricity. That energy comes also from LNG, of which similarly we are a very significant exporter. We have a supply of gas in Australia that will probably last a couple of hundred years at a bare minimum based on current reserves. It makes sense to use that resource here in Australia in trans­portation fuels, which is the one area in which we are deficient. We import almost 50 per cent of the petrol, diesel and crude oil that we use in our transport fleet. Finally, the energy comes from LPG, of which we are also net exporters and, while many of us in this place know LPG as the thing that runs our barbecues and in some cases our hot-water systems and stoves, LPG's main use is in transportation fuels. It makes no sense to apply a tax to those fuels.

On top of the increases to electricity prices and the cost of living expenses that will occur as a result of the carbon tax, families and businesses now face yet further pressure on the cost of fuel because of the Gillard government's policies. Where will it end? Perhaps at the next election.

As we see from these bills, the intention of the government is to raise by 20 per cent the cost of those fuels to those families using LPG in their vehicles. This is not a small increase; this is a major hit on the family budget, an attack by the Gillard government on the purse strings of everyday Australian families already struggling under massive increases in electricity prices, gas prices, water charges and other living costs. These increases are soon to be made even more massive by an ill-conceived carbon tax which will add yet further costs, including in the area of transport, to all Australians.

Applying an excise of 12½ per cent per litre on LPG makes no sense at all. This government runs a program to encourage families through a financial incentive to convert their vehicles to LPG by offsetting some of the cost of conversion. Yet with all that encouragement, the government is really just setting a honey trap: 'We'll get these vehicles onto LPG,' they think, 'and then we'll increase the cost of LPG by 20 per cent. We'll increase the tax to make sure that these families can no longer cope with the pressures of the cost of living.' That is the Labor Party's way of deceiving the public and the way they think about increasing the pressures on Australian households.

Currently, 283,000 vehicles have been converted to LPG under this government scheme. Every single one of those vehicles is owned by a family. This scheme is not open to commercial vehicles. It is not open to fleet vehicles and it is not open to business vehicles. It is only open to family-owned vehicles. As I said, there are 283,000 vehicles owned by 283,000 Australian families who, if the first of these three bills passes, will wake up to higher fuel costs courtesy of the Rudd-Gillard Labor government.

There is absolutely no justification for this. Why is the government doing it? It needs the money. Why does it need the money? It wasted so much money. This is an old-style spend, waste and tax government of the kind that we always see from Labor. It spends money and wastes money until it has no option but to increase the taxes on ordinary Australian families. Shame on you.

This tax on Australian families is intolerable and the opposition, we hope with the support of Independents, will do everything we can to defeat these first three bills. Along with those 283,000 vehicles of which I have spoken, there are another 400,000-plus vehicles that have already been converted to gas, and a majority of those vehicles would be owned by families. Some of these families would have bought them second-hand from a car yard in the expectation that they would be able to continue to use the vehicles to lower the cost of living, to lower the cost of taking their kids to school every morning and to lower the cost of running a family in Australia under a government that is so out of touch. Costs rise every day. Soon, with a carbon tax, those costs will rise even more steeply. What we see in these first three bills is a government so desperate for money to fill the enormous black holes it created by wasting money that it has decided to cast the burden on the shoulders of working families, with whose support it was elected in 2007 and whom, through its own mismanagement, it is now betraying.

I would like to give the government the benefit of the doubt that they are not trying to destroy family budgets with this tax but that the money will actually be needed because they are incompetent money managers and wasteful with spending. I would like to think that was the reason, but sometimes it is hard to accept that it is the only reason. It appears to me that this is more about them being completely out of touch and completely lacking in compassion for and understanding of the way in which families in Australia are currently struggling under cost-of-living pressures generated in part by the Labor government.

The fourth of these bills, the Energy Grants (Cleaner Fuels) Scheme Amendment Bill 2011, is one which the coalition will support. It is a bill to extend the grants scheme to biodiesel and renewable diesel. In Australia we face a challenge in supplying enough transport fuel. We are trying to build a biofuels industry in Australia. The coalition support the measures that were taken previously by the Howard government and continued by the Rudd and Gillard governments to provide grants to the ethanol, biodiesel and renewable diesel industries to offset the excise which is applied to those fuels at the full rate of 38.143c per litre. The coalition will support the Energy Grants (Cleaner Fuels) Scheme Amendment Bill because it maintains the grants for the biodiesel and renewable diesel industry. This is an industry that is doing it tough. The industry has faced unfair dumping from overseas suppliers. I commend the govern­ment for continuing what we started. With that certainty, at least until 2020, I hope that the biodiesel industry, truly supported and protected from dumping actions by the anti-dumping legislation, will be able to resume some economic growth and help us to supply the burgeoning demand for diesel fuel in Australia.

Let us look at the trend in the motor industry in this country. Much of the romance goes to hybrid vehicles—and we are producing hybrid vehicles here in Australia, including, for example, the Camry, which is based on Toyota's Prius technology. There are a number of other vehicles around now that run on hybrid technology. If you want a Porsche, you can buy one that uses hybrid technology. But, if you want to drive the most efficient vehicle in the world as measured by litres consumed per 100 kilometres, you will buy a diesel vehicle. If the opportunity is there for Australia to increase its self-sufficiency by using the most efficient of fuels, diesel, through the production of renewable diesel or biodiesel, then we need to ensure that those incentives continue. That is what the fourth bill does: it provides the incentive for diesel production.

We then move to compressed natural gas. It is a cumbersome fuel but one which has a place in the Australian urban environment, particularly for delivery vehicles or buses that return to a depot and can carry this bulky fuel. It is not liquefied; it is compressed, which is why it is called compressed natural gas. It takes up a lot of room and the fuel tanks weigh a lot, but it has a very significant role to play in public transport. This is a fuel that we are trying to get into our bus fleets. Might I pause to commend my friend and colleague Mrs Jane Prentice, the member for Ryan, who is the chair of the Brisbane City Council's transport department and who pioneered the introduction of such buses in my city. Perth has about 300 such buses, Sydney has around the same number and growing and, as I said a moment ago, Brisbane has made an investment in these buses. The buses do not leave particulates in the air, they burn cleaner, they provide an opportunity to reduce emissions and they will increase the efficient transport of people through the public transport system.

So what does the government do to those buses? It taxes them. What is the result of the tax? Those buses will no longer be bought, because the economics of running a compressed natural gas bus simply will not be there. We will stop using a fuel that we are abundant in—so abundant that we export tens of millions of tonnes and perhaps soon 50 million times per year in the form of LNG. This government will tax it to the point where it is not economical to run those buses and so they will go back to using diesel. Then there are all the issues associated with that in terms of the balance of payments. Shame on you. Further, those 900 buses already in use would face a fuel price increase of at least 20 per cent in the case of CNG. That means that bus fares will go up. Here we have a government that claims it is all about reducing emissions and introducing efficiencies and all about trying to get people to use public transport, but it is so desperate for money it has to present these bills to the parliament, with the effect that I have indicated. This government reaches out to every part of sensible living and taxes it. We have a tax on family cars, a tax on compressed natural gas buses and we also have a tax on taxis. The 19,000 taxis in Australia are going to see a 20 per cent rise in their fuel cost. That means higher taxi fares in Australia, because the Gillard government just cannot manage money. They are so desperate to get money into their coffers that they will literally tax anything that moves.

This is bad legislation. It is not about improving efficiencies in this country. It is not about ensuring that Australia is a better place to live. It is legislation about taxing a fuel source which we have in abundance. It is legislation about taxing a fuel source that is efficient. It is legislation about taxing a fuel source that is a low emitter. It is legislation about taxing the livelihoods of Australians. It is legislation about increasing the cost-of-living pressures on families. Shame on you.

The opposition will oppose the first three bills. I flag that we will move an amendment to the fourth bill. This is necessary because the government has incorporated a suicide clause. If each of these bills is not passed, none of them will receive royal assent. The government is prepared to say to the biodiesel industry: 'If the opposition knocks over these bad bills on LPG, we are going to tax you at 38.143c.' Our amendment will break the nexus between these bills. It will ensure that if the first three bills are defeated, which they should be, and the fourth bill is passed, which it should be, then we do not have to rely on all four bills being passed to get royal assent.

Our amendment will make the fourth bill, the Energy Grants (Cleaner Fuels) Scheme Amendment Bill 2011, effective from 1 July 2011. There should be no other way. You cannot leave the biodiesel and renewable diesel industries swinging in the breeze while the government plays games with their livelihood. As I said, the biodiesel industry has been through enough already. We need to give that industry certainty and, as usual, it is the coalition that will do that. That is the reason that the Howard government never proceeded with this. We never presented legislation in this House when families were in financial crisis, because we knew, we were in touch and we understood. We believed in ensuring that these pressures were not put on families by a new tax. This government is oblivious to that fact. It knows, or it should know, that families are under pressure now, just as we knew when we were in government, which is why we never proceeded with these bills, but this government, in its ignorance, callousness and obliviousness to the concerns of everyday Australians, proceeds with this bad legislation in any event.