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Wednesday, 2 June 2010
Page: 4978

Mr CHEESEMAN (2:41 PM) —Mr Speaker, my question is to the Minister for Resources and Energy and Minister for Tourism. How will the tax reform and the resource super profits tax in particular provide for Australia’s long-term prosperity?

Mr MARTIN FERGUSON (Minister for Resources and Energy and Minister for Tourism) —Mr Speaker, tax reform in this country is both necessary and long overdue. That is especially the case in the resources sector, the objective being to make it more efficient. That effectively means a very serious debate, one which the government is engaged in, about removing royalties and introducing a profit based system.

A profit based system will provide fiscal stability compared to the current situation, where state governments can and do lift royalty rates when they need to boost their bottom line, as is currently occurring in the state of Western Australia. It will also turn the lose-lose situation of the royalties based system around, which means the same revenue is paid in the good times as in the bad. I remind the House that during the good times, when prices are high and profits are high, a profit based system provides the Australian community with a fairer return on the nation’s non-renewable resources. Equally, during the bad times, when prices are low and profits are low, a profit based system provides timely tax relief for miners. And on many occasions, the minerals industry has sought that relief from state based premiers and treasurers.

That is not just my view; it is also the view of the Minerals Council of Australia. They have set out a case for a profit based system in their submission to the Henry review. I was fortunate today to be amongst friends at the Minerals Council of Australia annual meeting. I want to bring to the attention of the House what the CEO of the Minerals Council of Australia said today. Perhaps the Leader of the Opposition ought to take some interest in this; he might learn something about the minerals sector in Australia. This is what Mr Hooke had to say this morning:

We certainly do want to see a profits based system.

He went on to say:

All the economists who say moving to a profits-based system is the way to go are right.

The CEO of the MCA went even further:

We’re the ones that said let’s move to a profit based system. Ipso facto, you pay more tax when you earn more profit.

I only wish that the Leader of the Opposition would pay a little bit of serious attention to what is a complex debate. Yesterday we had the Leader of the Opposition suggesting that what we are talking about is an extraction tax. We are actually talking about a profit-based tax. He clearly showed, again, that he is focused on the politics of the debate rather than the current hard policy options for the Australian community. That comes as no surprise to me, because—as we all know—he finds economics boring.

When it comes to advice on the minerals industry, he turns to the patron saint of the coalition—one Clive Palmer. We saw a cameo appearance by Clive Palmer at the National Press Club today. I only wish that the Leader of the Opposition had had time to watch that rather than delivering his political diatribe to the Minerals Council at lunchtime today. Let’s think about Mr Palmer. A fortnight ago he was making threats about walking away from investment in South Australia. Well, we are still looking for that project. Last week we had him running around saying that the resources sector in Australia pays a tax rate of 70 per cent. When he was questioned about that at the Press Club today, he was all over the shop like a dog’s breakfast. He could not support his previous claim that the resources industry pays a tax of 70 per cent. One should not be surprised, because Mr Palmer is used to throwing his weight around. I think the Australian community is fast coming to the conclusion that you cannot take Mr Palmer or the Leader of the Opposition seriously.

Only a matter of a couple of weeks ago he was making similar threats to another very important section of the Australian community—one that is pretty important to a lot of ordinary people because of their love of sport. I go to his endeavours to stand over the Football Federation Australia and his claim that he was going to walk away from the sponsorship of the North Queensland Fury. If you listened to Mr Palmer at the National Press Club today, you almost came to the conclusion that the poor bloke was walking around with his backside out of his pants. This is what he had to say a couple of weeks ago, and this really goes to the question of his credibility and the credibility of the opposition. When asked about his support for the Fury and whether or not he had the financial resources to meet those commitments—and he now says that the resources sector cannot afford to pay more taxes—he was quoted as saying:

“I can afford to lose eight million every day of this year and still be alright, you know,” he laughed.

Well, this is no laughing matter. This is a serious debate about the future of the Australian resources industry.

I simply say that this government is committed to getting the balance right—the appropriate balance between attracting investment in the resources sector of Australia and ensuring that the Australian community get a fair return on the development of the resources that they own 100 per cent. You can have Mr Palmer and his advice, because your credibility is about as good as his—

The SPEAKER —Order! The minister will refer his remarks through the chair.

Senator FERGUSON —Take his donations and sell your soul. We will stand up for the national interest of Australia.

Mr Pyne —Mr Speaker, I rise on a point of order. With due respect, we did believe the minister for resources was better than this grubby performance.

The SPEAKER —Order! What is the point of order?

Mr Pyne —I would ask you to ask the minister to withdraw the slur against all members of the opposition.

The SPEAKER —As I have said before, I am reluctant to intervene when comments are made that are, yes, hard-hitting, but are things that we confront day to day. My problem is that they would not be said if debate was not allowed in answers. That is the real problem because, in the preamble to his point of order, the Manager of Opposition Business used fairly over-the-top statements as well. Is the Manager of Opposition Business rising on a further point of order?

Mr Pyne —Mr Speaker, the difficulty the opposition has is that, as the government received $100,000 from mining companies at the last election and we received zero, we find it rather peculiar that they would be making—

The SPEAKER —Order! This is not a point of order.

Mr Pyne —outrageous claims against the opposition.

The SPEAKER —There is no point of order.

Mr Hockey —Mr Speaker, I rise on a point of order. Mr Speaker, did you sell your soul, because that is what the minister suggested—

The SPEAKER —The member for North Sydney will resume his seat. There is no point of order.