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Thursday, 28 February 2013
Page: 1348

Senator MARK BISHOP (Western Australia) (16:32): Before I address the content of the Minerals Resource Rent Tax Amendment (Protecting Revenue) Bill 2012 before the Senate, I want to rebut some of the points that Senator Milne just addressed in her contribution to the discussion. She made the point at the outset that budget commitments need to be funded. I must say on behalf of the government that we are in staggering and startling agreement on that point. That is why we participated in negotiations and agreed to the creation of the Parliamentary Budget Office and funded that; that is why we assisted Treasury and Finance to become parties to the protocol, so that the office can carry out its central function on costing issues associated with undertakings made by any and all political parties. With that little bit of rhetorical flourish, let us just say that the government also shares that view.

Senator Milne then went on to develop a point. Because she is an intelligent woman, I presume the point she addressed is one of rhetorical flourish—that somehow or other all of the minerals and, by implication, all of the oil and gas in and around mainland Australia are owned by all of us, by that amorphous mass called 'the people'. I presume she put that as a rhetorical proposition as we are on broadcast. As everyone in this chamber knows, and they learnt this in their first lesson in Constitutional Law I: minerals under the ground are vested in the Crown in right of the state. That has been the case for I do not know how many centuries and it has certainly been the case in this country since European colonisation in the latter part of the 18th century. But, 240 years since that time, as we consider the utility of the proposition I just outlined in rebuttal to Senator Milne, there is considerable sense in minerals under the ground being vested in the Crown in right of the state: it enables the state, at Commonwealth level, territory level or state level, to essentially regulate and control the use of land, whether that is done in an agricultural sense, a mining sense, an extractive sense or whatever. By 'regulate' I mean allowing access, allowing development and having proper regard for environmental considerations, on both the agricultural side and the mining side.

Consider the only sensible opposition to the Crown not having rights with respect to minerals under the ground. By definition, it would go to some other body. Most logically, that other body would be the individual landholder or leaseholder. We know how that system works, because it works in the United States. One only has to look at the huge degree of development with respect to the coal seam gas industry and the shale oil gas industry in the southern states of the United States, where mining companies pay the owner of the land a fee for access to minerals and the like under the soil, and the development goes ahead willy-nilly. There are a range of benefits from that system to individual landholders and to industry from the cheap gas that emerges from that process. That is probably a debate for another day. On balance, the system we have in this country, of the Crown having control of access to land and land use, is probably a better system. There is a terrible sense of deja vu about this debate. We have been having it every year—we had it in 2009, 2010, 2011 and all of last year—and now, as Senator Milne just said, there is further reference to the application of a minerals resource rent tax.

The bill before the chair attempts to amend the MRRT to achieve two purposes, and Senator Milne succinctly outlined them: firstly, that any increase in state royalties after 1 July 2011 be disregarded when calculating the royalty credits for the MRRT; and, secondly, to disallow provisions of the MRRT so that miners can no longer use the market value method to determine their starting base. So the bill before the chair attempts to remove, to negate, to disallow, the two most critical features of the MRRT Act that is currently proclaimed law in this country. If passed, this bill would totally neuter, make useless, the purpose and intent of the existing MRRT.

When one thinks about that ambition it cannot be described as small. It is no mean purpose that is sought to be achieved in this debate late on Thursday afternoon. But before we can properly discuss the bill before the chair a little bit of a history lesson in the development of the MRRT over the last three or four years would be useful. What does that little bit of history show us? It shows the following. First, the current MRRT Act was one of 11 bills discussed and passed in this chamber on 19 March 2012—almost 12 months ago. That package of bills—there were 10 or 11 bills—addressed a range of matters at that time: an overview of the position of the positive impact of the mining industry; how the MRRT was intended to operate; the revenue forecasts associated with the MRRT; a range of ways in which Australians might share from the benefits of the MRRT; and other tax conveniently avoided up this end but paid in large numbers by firms in the mining industry.

But there were a range of other matters before the chair that day. One went to increasing superannuation from nine per cent to 12 per cent. Some of us might have liked to have gone from nine per cent to 15 per cent in one fell hit, bringing it forward in bites of one per cent a year every year for six years until it reached 15 per cent. There was removal of superannuation age limits. There were benefits in low-income superannuation contributions. There was simplification of asset depreciation arrangements. There was the introduction of accelerated initial deductions for the purchase of motor vehicles by small business. And there were a range of other benefits to sectional interests in our community.

So the MRRT Bill, now the MRRT Act, was not the only matter that was up for discussion back in March 2012; it was one bill as part of a total package of 11 or 12 that were discussed at the same time. Those measures affected the mining industry, the offshore petroleum industry, small business, superannuation beneficiaries and those who enjoy depreciation arrangements for capital investment. When the MRRT package of bills was put up for a vote, the Greens and the current government combined 38 to 32 to support that package, including the MRRT, without amendment. The only parties to oppose it were the opposition over there.

Right from day one Labor government and the Greens brought forward a package of bills. Both parties voted for it, there were no amendments, it went to a division and it was carried 38 to 32. What does that mean? It is very simple: the Greens in the bill currently before the chair seek to negate what less than 12 months ago they stood and voted for, stood and supported, stood and endorsed.

Senator Williams: Guillotined as well.

Senator MARK BISHOP: Guillotined as well. Maybe we did guillotine it. That is what happens when you have the numbers. Thirty-nine is more than 37. Welcome to the real world. I do not know if it was guillotined. If it wasn't, it should have been. The point was this: we did not have 39 votes in our own right; we wandered down to the end of the chamber. They said, 'Yeah, that's a good package of propositions in there,' about the capital investment, the superannuation improvements, the bringing forward of write-offs for small business for motor vehicle purchases, the improvements in the petroleum rent resource tax and the imposition of the MRRT. They said, 'Gee, we don't like bits and pieces here.' We responded, 'Hey, we also don't like bits and pieces.' As I said at the outset, some of us would have liked to increase superannuation not to 12 per cent over eight or nine years but to 15 per cent over five or six years. But in the negotiation process the eventual outcome was that what was put in this chamber, and the Greens and the government had full knowledge of its content and supported that package.

So it is a bit rich now, barely 12 months after the ink is dry, and after a little bit of adverse evidence from the Secretary of the Treasury a couple of weeks ago in estimates outlining what everyone in the world knew about the design of the MRRT, to use that as an excuse to come back in here and essentially renege on an agreement fully entered into, fully supported, on the basis of—what?—full information. It doesn't get any better than that. The blind, deaf, dumb and ignorant might have a reason to go back on their word. But when you have participated in all the negotiations, sat through all the committees, sat through the debate here, agreed to a particular outcome and voted for the outcome, you do not get to come back 11 months later and say, 'Hey, we don't like that; we want to do something else.'

The inquiry into the bill before the chair, conducted by the Economics Legislation Committee and tabled earlier this month, addresses that point exactly in paragraph 1.12. It says:

Following negotiations with the mining industry and the deliberations of the Policy Transition Group (PTG), which was established to advise on the implementation and technical design elements of the MRRT, the government agreed to the PTG's recommendation 'that there be full crediting of all current and future State and Territory royalties under the MRRT so as to provide certainty about the overall tax impost on the coal and iron ore mining industries.

That statement was released under the authority of Mr Swan and Mr Ferguson on 24 March 2011. Everyone knew what was going on. The government had accepted the recommendations of the Policy Transition Group and had put out a press release in writing to that effect, and everyone in the government and everyone in the Greens knew that.

The time sequence in this discussion is clear, and for the last four years the Greens have been fully aware, fully consulted and, to a very, very significant extent, involved in a lot of discussions. In December 2010 there was the report of the Policy Transition Group. In March 2011 there was government acceptance of that recommendation that I just read out. In March 2012 there was an inquiry into the then MRRT Bill, and on 19 March, barely a fortnight after the recommendations of that bill inquiry came down, the Greens voted for the two measures that were at the heart of the then bill, now act, and are at the heart of the bill they bring before the chair today to renege on. You cannot do business like that.

Turning now to the bill before the chair, chapter 2 of the Senate Economics Committee report is instructive, and it deserves to be put more fully on the public record. It outlines the process of inquiry into this bill. It is only a very brief report. It is only in two chapters, no more than 10 pages. The inquiry was conducted from November 2012 until February 2013: November, December, January, February. It went for almost four months, knocking off a month for January, of course. There was one significant extension of time granted by the committee at the request of the Greens, presumably to get more submissions into the inquiry so we could have a fuller discussion at the appropriate time.

In that four-month period, do you know how many submissions that committee inquiry into the bill before the chair received? It received only six submissions. There were four months of examination and four months of writing to interested parties. The database in the economics committee of interested players in this debate, as you can imagine, goes to hundreds and hundreds of individuals, groups and associations, and only six put in a written comment. Of those six, a full five opposed the passage of the bill before the chair. So after a four-month inquiry, an extension granted at the request of the Greens, six submissions were received. Of those, five opposed the bill, and only one supported the bill before the chair. The committee, in its wisdom—it must be said—decided not to hold a public inquiry on the basis of only six submitters, five of which opposed the bill. We did the report on the papers, and it is before us today.

But what can one conclude from a bill inquiry on a subject which is apparently of great public notoriety when hundreds and hundreds of individuals, groups, associations, companies, governments and the like are invited to put in a submission that essentially goes to a reworking of the MRRT Act? What conclusion can we draw? The conclusion we can draw is that there is just about no interest in this country in revisiting the design features of the MRRT. You would have thought they would have been lined up in their thousands, seeking to come in and say how onerous it is, how heavy it is, how inefficient it is, how bad it is, how whatever it is. You would have thought that the churches would be organised, along with some of the community groups and some of the NGOs. But, no, there was a wailing silence between November and February, because nobody—I beg your pardon, I mislead the chair—rather, one person in Australia took the trouble to write a submission supporting the bill before the chair. Nobody else cared. Nobody else wrote. Talk about Orphan Annie!

I have never been in a bill inquiry, in all the time I have been here—and I have been in inquiries on a whole range of matters—where there were only six submissions, with five opposed to the content of the bill and only one supporting it. Think back over the years. How many contentious pieces of legislation did we handle in opposition and have been part of government policy for the last five years? How many inquiries have people in this chamber participated in, written reports on and given speeches about? I, for the life of me, cannot recall one where there was only one submission in favour of the bill.

Perhaps I have drawn the wrong conclusion on that; perhaps there is a great deal of interest out there in this proposition. We are going to find out because, in addition to all of those matters that I outlined in 2010, 2011, 2012 and 2013—legislation inquiries, the Policy Transition Group, the pre-existing bill under Mr Rudd, the reform bill under Ms Gillard and the numerous inquiries—less than an hour ago, the Senate Economics References Committee accepted another reference to inquire into the MRRT. It seems to me that the norm is now that you get about 17 bites at the cherry. We dress up the conclusion, in terms of the argument about wanting to have money to spend on Gonski, or disability— (Time expired)