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Wednesday, 9 February 2005
Page: 183

Senator O’Brien asked the Minister representing the Minister for Industry, Tourism and Resources, upon notice, on 23 December 2004:

(1)   For each of the financial years 2002-03, 2003-04 and 2004-05 to date, what amount has been expended on ethanol production subsidies.

(2)   For each company that has received a subsidy:

(a)   what subsidy has been paid.

(b)   what volume of subsidised ethanol has been produced.

(c)   what feedstock has been used to produce the subsidised ethanol.

(d)   where are the company’s ethanol production facilities located.

(e)   has the subsidy resulted in increased production; if so, can this increased production be quantified.

(f)   how has the Commonwealth audited the subsidised production.

Senator Minchin (Minister for Finance and Administration) —The Minister for Industry, Tourism and Resources has provided the following answer to the honourable senator’s question:

(1)   2002-03 - $21,682,940

2003-04 - $10,883,056

1/7/04 to 31/12/04 - $3,967,964

Total - $36,533,960

(2)   (a)  

Manildra - $34,659,031

CSR - $1,427,836

Schumer (Rocky Point) - $447,093

Total - $36,533,960


Manildra - 90,866,033 Litres

CSR - 3,743,376 Litres

Schumer (Rocky Point) - 1,172,150 Litres

Total - 95,781,559 Litres

(c)   Manildra produces ethanol from wheat starch. CSR and Schumer (Rocky Point) both produce ethanol from C Molasses.


Manildra - Bomaderry (NSW)

CSR - Sarina (QLD)

Schumer (Rocky Point)               - Woongoolba (QLD)

(e)   No, production of fuel ethanol has fallen over the period, largely reflecting a decline in consumer confidence in the fuel ethanol market.

The Government has worked actively with industry stakeholders to address consumer confidence issues through the Ethanol Confidence Working Group including advising on ethanol labelling and on new point of sale information.  To coincide with the introduction of ethanol labelling from March 1, 2004 the Federated Chamber of Automotive Industries (FCAI), on behalf of the Ethanol Confidence Working Group, released a list of all vehicles capable of running on E10 blended fuel. This list provides comprehensive advice to consumers on which vehicles can operate satisfactorily on ethanol blends of 10 percent. The Government is committed to maintaining the ethanol confidence working group to bolster consumer confidence in the use of ethanol petrol blends.

(f)   The Government has a number of procedures in place to protect itself from fraudulent claims. Each time a producer submits a claim they are contractually required to provide evidence that the ethanol has been produced in Australia from biomass feedstock, entered for home consumption and that fuel excise has been paid.

In support of their application, producers must attach a copy of the Australian Taxation Office Excise Return form that deals with the entry into home consumption of the ethanol for which funding is being claimed and evidence of the electronic funds transfer for the Duty paid on the ethanol referred to in the Excise Return form.

The Department of Industry, Tourism and Resources also receives statements via producers from the Australian Taxation Office (ATO) on the amount of excise paid on fuel ethanol. This information allows the Department to acquit the grants paid under the Ethanol Production Grant with ATO excise records.

The funding agreement between the Commonwealth and the ethanol producers enables the Department to audit and inspect records pertaining to claims for the Ethanol Production Grant and the equipment and facilities used to produce the fuel ethanol at any time.