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Tuesday, 14 June 2011
Page: 5919

Mr BALDWIN (Paterson) (20:17): Tonight 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. My contribution to the debate tonight will be confined to three areas: first, that this legislation will do nothing but increase the cost of living because in essence it raises over $518½ million over the forward estimates; second, that the bill is bad for the environment because it is increasing the tax revenue on the cleanest form of combustible energy that we have; and, third, that the bill will destroy jobs and destroy an industry.

This Labor government has proposed new fuel taxation regimes which will destroy the Australian ethanol, biodiesel and LPG industries. The Gillard Labor government proposes to phase in by July 2015 a 25c per litre excise on ethanol, a 19.1c per litre excise on biodiesel, a 12½c per litre excise on LPG and a 26.13c per kilogram excise on LNG and CNG. The ethanol excise will initially be offset by a production grant but that grant will reduce to zero by 1 July 2020. Existing protection against cheap and subsidised ethanol imports will also be phased out. An industry that is very close to my own heart in my own electorate—the biodiesel industry—will receive no protection, even though an Australian customs dumping inquiry has found that subsidised biodiesel imports from the United States are damaging our industry and interim dumping securities have been imposed.

The Europeans have placed countervailing duties on US biodiesel, which receives a dollar a gallon subsidy from the US government. It is impossible for Australian producers to compete against the might of the US Treasury. The US ethanol industry is subsidised to the tune of $6 billion a year and the US also imposes a 54c per gallon tariff on imported ethanol. So much for a free trade agreement between Australia and the US. If the US and the Europeans are prepared to place duties on subsidised and dumped fuels, why is the Australian industry being exposed to unfair competition?

This excise on LPG will increase the cost of the fuel by 12½c per litre. This is hypocrisy at its worst. This Labor government has said much about the need to reduce pollution. In fact, this government wants to introduce a carbon tax to reduce pollution but at the same time, with its vein of hypocrisy which knows no bounds, it is going to increase the cost by 20 per cent of LPG, the cleanest form of burning combustible fuel there is. It is a 12½c per litre increase in the cost of LPG.

Back in 2006, I happened to be sitting in the ministry room as the Parliamentary Secretary for Industry, Tourism and Resources when the Howard government decided, because the cost of fuel had hit over $1.60 per litre, that it needed to promote cheaper and alternative forms of fuel. So a subsidy program was put forward for people to convert to LPG. Most of that take-up was by tradies and by families who could not afford the cost of fuel. So here is what we have. We have this Labor government slapping families fair in the face with an increase in the cost of fuel. These people have invested in the conversion of their vehicles to LPG, with an expectation that the fuel would be cheaper.

Mr Shorten: It was your policy.

Mr BALDWIN: It was a policy that that was explored but it was not introduced as legislation. We are not like you, Minister—you say there will be no carbon tax and then you turn around and introduce one. Your hypocrisy knows no bounds. You want to tax carbon and now you want to tax cleaner fuel. Where does your hypocrisy end? There is a flow-on effect of this cost increase on the family home. For example, most taxis run on LPG. What you will be doing is increasing the cost of taxi fares. I am sure that your constituents out in Geelong will love you for increasing the cost of taxi fares.

Mr Shorten: Geelong?

Mr BALDWIN: You are Geelong, aren't you? Well, around that area—

The DEPUTY SPEAKER ( Ms AE Burke ): And, as you are also speaking through the chair, I certainly do not have any constituents in Geelong! I am referring to the use of the word 'you'.

Mr BALDWIN: I am sure, Madam Deputy Speaker, in your own constituency the people who use taxis will thank you very much for increasing taxi fares. Bus operators will also face higher costs through the increased cost of CNG. The New South Wales State Transit Authority operates over 400 CNG buses, and they have another 255 on order. The cost of operating them will now go up. Who will pay for that? It will be the consumers. What will happen? The cost of living will go up. This is another attack on the hip pocket. It will be very depressing for consumers to feel the member for Maribyrnong's hand slide straight into their pocket, reach into their wallet and take out this money. Over 283,000 vehicles have been converted to LPG under the government's scheme. The taxpayers have already subsidised the majority of those conversions. This $518 million tax grab will do nothing more than cover up the poor financial management of this Labor government.

My third point is that this tax will have a devastating effect on industry. Already businesses involved in the LPG conversion industry are shutting up shop. That is going to cost jobs. As this government introduces this tax, as this government looks at ways of getting out of supporting the LPG industry, jobs will disappear. I suppose that is the hallmark of this government. Already we have heard today of the thousands of jobs that will go in the mining industry because of this government's carbon tax—they are not our words; they are the words of the Minister for Resources and Energy. We also heard in recent days of the 6,500 jobs that will go from tourism under this government's carbon tax. We just keep adding to it, on a daily basis.

This government has absolutely no understanding of what drives the economy. What drives the economy is jobs. The more jobs, the more money people have to spend, the more money flows through the community and therefore the greater benefit to all. What we are seeing from this government is a direct slap in the face to jobs. With this legislation, which I oppose, the government will seek to increase the cost of LPG by 20 per cent—12½c a litre. The minister sits there with a smile on his face as though this is some great achievement—driving up the cost of living for people.

Mr Shorten: It is just the hypocrisy that takes my breath away.

Mr BALDWIN: No, it is not hypocrisy; it is hip-ocrisy because you are taking the cash out of their pocket.

Mr Shorten: It's not out of your pocket, Bob.

Mr BALDWIN: No, I do not have an LPG vehicle but, let me tell you, a lot of my constituents do. A lot of the taxis in my area run on LPG, and the buses in my electorate operate on CNG. They will all be taxed directly because of your policies.

Mr Shorten: It was John Howard's policy.

Mr BALDWIN: It was not our policy; it was put forward but it was never ever—

The DEPUTY SPEAKER: The minister will stop interjecting and the member will stop responding to the interjections.

Mr BALDWIN: I am not responding, Madam Deputy Speaker; I am clearly stating the fact that the coalition has never introduced this as a bill. So, Minister, it is you who is using weasel words and looking for a cop-out as you slam those people out there with these increased costs. You are very proud of that, I can see—sitting there with a smile on your face. You are very proud to be impacting on the cost of living of average Australians. A lot of tradies, too, have converted their vehicles to LPG because it is a cheaper way of operating them. All of a sudden you are going to increase the transport costs of their business by 20 per cent. That will flow on to the cost of the labour that they supply, so the cost of tiling, the cost of building houses and the cost of plumbing will go up—and you, Minister, will be the person directly responsible. That must make you feel so good, as the person who once stood up for the workers and working families. Here you are, prepared to slug them and slag them.

The DEPUTY SPEAKER: The member will return to the legislation.

Mr BALDWIN: Madam Deputy Speaker, with all due respect, I am talking about the legislation. This legislation is about the increases in the excise levies on LPG and other fuels and therefore the flow-on effect directly for individuals and particularly those who use LPG—and taxis are one of the greatest users of LPG so, with all due respect, I am addressing the legislation. I will be opposing the legislation. If the minister had one ounce of integrity and no hypocrisy, he would be withdrawing this legislation—he cannot be talking about reducing pollution by imposing a tax and then be increasing a tax on the fuel that produces the least amount of pollution.