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Tuesday, 26 August 1980
Page: 715

Mr KEATING (Blaxland) - There was no news in the statement delivered by the Prime Minister (Mr Malcolm Fraser). There were no new announcements. What we have just witnessed is an idle piece of political window dressing to give some form to the ad hockery of the Government's energy and resources policies. In fact the statement could have been labelled '101 unreported Press releases' because there is nothing in it that we have not seen spread over the last 18 months. The statement is laden with distortions and half truths. Repeatedly in this statement, the Prime Minister refers to maximising the benefits for Australia but he cannot even get together a statement on the Government's policies. What the public would not have seen, with that incorporation in Hansard, is a second statement of 31 pages which was obviously intended to be the original statement and which was rewritten into a 20 page statement which was just read by the Prime Minister. So we have now had 20 pages read and 31 pages unread but incorporated in Hansard. This amounts to a 50 page statement. The Opposition received one hour's notice of this statement. No attempt was made to permit study of the statement because the Government is not interested in scrutiny.

Government members interjecting -

Mr KEATING - Mr Speaker,could you give me some protection from the drongos on the other side of the House, the layabouts on the Government back bench, the drones? Quite simply, no attempt has been made by the Government to allow any kind of scrutiny of the statement by the Opposition.

There is no news in the statement. The Prime Minister talks about making the most of our opportunities. Clearly there was no policy by the Fraser Government to make the most of Australia's opportunities in the areas of energy or resources policy in general. There is now no semblance of a foreign investment policy to maximise Australian ownership. The great boom which we are led to believe will take place will not benefit Australians in the way in which it should. Of course no tax regime is being or has been established, other than company tax, to try to equitably share the benefits between the Australian community at large and private corporations, many of which are overseas corporations, which would participate in mining and energy ventures in this country.

There is no national pricing policy. We are now selling coking coal - some of the best coking coal in the world - at $8 a tonne to $10 a tonne less than we should be selling it and we are exporting about 35 million tonnes. So we are losing about $350m of national income this year simply because the Government does not have the foresight to develop a rational export pricing policy in respect of those resources. It does not matter where honourable members look in the resources front. Australia may muddle through, but there will certainly be no plan by the Fraser Government for the development of Australia for the benefit of most Australians. As far as it is concerned, leave the El Dorado to the foreigners and maybe we will get some of the crumbs from the table.

The whole mining industry of Australia employs 1 i per cent of the work force of Australia. The Government talks about an investment of $x billion in the next five years. Already thousands of billions of dollars are invested in the Australian resource industries which employ H per cent of the work force. Even if $ 1 0 billion or $ 1 5 billion - take the last number you thought of and double it, as the Government does - were to be invested, the existing level of investment would not be duplicated. Even if it were, it would increase the work force in the mining industry from H per cent to 3 per cent.

What is being done about employment in Australian cities, where the majority of the people live? Australians are very immobile people and we have a very high level of home ownership. They do not want to pick up their houses and go to the backblocks of north Queensland. If they did the Government would tax their subsidised rental accommodation, as it is now trying to do in the case of the miners of Queensland and the miners of Kalgoorlie in Western Australia. The Government wants people to go to these places and develop them and then it wants to impose economic sanctions on them.

The Government will not tell us where it will supply some jobs in the cities of Australia. This is a very urbanised country and the Government does not have a policy for providing employment where it matters. If honourable members opposite think that the Baader-Meinhof groups and the urban guerrillas of Western Europe will not be a feature of Australia as we move through the 1980s with high levels of employment in the cities, I think they may be disappointed. The Government has no policies about developing Australia. Australia has an abundance of coal and the Government is hoping that the world will want to buy steaming coal, so that we can all hop into the back of the steaming coal truck and be delivered to the land of prosperity - the great El Dorado.

The Prime Minister talked about 38 million tonnes of coking coal exports this year. Coking coal is associated mainly with the steel industries of Japan. There is no growth in the world's steel industries. Also, the unit of coal per tonne of steel is dropping continually. There will not be the growth in coking coal exports that people on the Government side of the House believe. It just will not be there. We are exporting about five million tonnes of steaming coal. The Prime Minister quoted the International Energy Agency as saying that we will export 35 million tonnes to 40 million tonnes of steaming coal. Frankly, that is an overoptimistic figure and it will not be reached. What the Australian Government is doing, what the Fraser Government is doing, is waiting on the electricity producing industries of Japan to come here and order steaming coal for new steaming coal power generation plants.

There is no inventiveness about converting to coal the oil fired plants which are languishing in every developed country and then selling the pulverised coal to these oil fired conversions. There is nothing as imaginative as that whereby Australia would get in on the ground floor of a huge market which we could make available to Australians. No, we are going to sit back and wait until each new coal fired station is developed and then sell it coal. As well as that, so much coal will be available that prices will be depressed. The Japanese power industries will make sure that they manipulate Australia so that they develop much more capacity than they need in any one year. We will find the same position applying to steaming coal as applies to coking coal - namely, depressed prices for Australia. Australians are selling their heritage in coal - their non-replaceable reserves - to Japan and to other countries for less than those reserves are really worth.

Before the Second World War and after that war the rule of thumb was that steaming coal was worth half the oil price per tonne. On that basis, steaming coal today would be worth about $80 to $90 per tonne. We are getting $32 per tonne. A year ago we were getting $22 per tonne. This is the sort of stupidity that the clowns of the Government believe can be defended as commercial exploitation of Australian reserves. They have no idea what to do with this country or how to develop it. They are turning it over to foreigners who will take them to the cleaners because they are small businessmen.

Government members interjecting -

Mr DEPUTY SPEAKER (Mr Jarman)Order!The Prime Minister was heard in silence. I expect the same courtesy to be extended to the honourable member for Blaxland.

Mr KEATING - They are small time solicitors, refugees from the small debts courts--

Mr Neil - I take a point of order. I object to what the honourable member is saying.

Mr DEPUTY SPEAKER - Order! There is no point of order.

Mr KEATING - They are broken down real estate salesmen, second class car salesmen and small debts solicitors.

Mr Neil - Mr Deputy Speaker--

Mr DEPUTY SPEAKER - Order! The honourable member for St George will resume his seat.

Mr KEATING - There are no businessmen in the Fraser Government. There are no people with creative ability on the other side of the House. Supporters of the Government would not know an international businessman if they fell over one.

Mr Neil - What the honourable member is saying--

Mr DEPUTY SPEAKER - I warn the honourable member for St George that if he continues to interject I will take action against him.

Mr KEATING - Government members could not manage the thrust of nations such as West Germany and Japan - the motor economies - which are looking for energy and will manipulate any country to achieve that end. The Government has no policies. It is about to try to hook itself to what is happening in New South Wales. The Prime Minister talks about the power generation program there. Who put the power generation program together? It was Neville Wran, notMalcolm Fraser. Neville Wran is the person who convinced the aluminium industries to set themselves up in the Hunter Valley. He is the one, through the Electricity Commission of New South Wales, who is developing the new capacity.

What did the Commonwealth do? At a meeting of the Loan Council the Commonwealth gave the New South Wales Government approval to operate in its own right and to carry the economic responsibility for its borrowings. Thank you very much! Big deal! In other words, the Commonwealth has allowed New South Wales to carry the can for its own borrowings. That is what the Prime Minister now calls the national power generation program. This part of the program is the creation of the New South Wales Government, which wanted to do something about the declining fortunes of the Hunter Valley in New South Wales and the languishing shipbuilding industry which the Federal Government virtually snuffed out and which the State Government has developed now to the point where the employment implications for the Hunter Valley region of New South Wales are important.

Let me say the same thing about the Queensland Government. At least what that Government is doing is being done on its own initiative. It is not being done by the Fraser Government. Honourable members opposite are a lot of carpetbaggers when they come in here and say that it is their program. They could not find their way to the wharves, the power generation plants or the new railways, much less build them. In a cardinal act of fiscal and economic irresponsibility the Prime Minister says without any prior consultation, without any investigation, that he will electrify the Sydney to Melbourne railway line. When Rex Connor talked about this proposal five years ago it was labelled a piece of economic irresponsibility- a reprehensible circumstance. Now, of course, the Government is looking for these token gestures. It will grab at anything. The Prime Minister is trying to climb onto the development bandwagon started by the State Premiers and to take unto himself the borrowing program. The borrowing program is a disgrace because the Commonwealth is to allow the States to carry the load of the borrowings.

The Prime Minister talked about the establishment of a committee of inquiry into electricity generation and sharing of power resources in south-eastern Australia. The casual observer would be excused for believing that the Commonwealth is really thinking about some kind of national approach to power generation. After all, one of the first things an intelligent country, particularly a country with a lot of coal resources, would do would be to organise its power generation into a national grid, but the Government does not have a national energy policy. It does not think about anything other than high petrol prices. Belting the motorist is the Government's only energy policy.

The committee of inquiry into power generation and power sharing in south-eastern Australia is not a Commonwealth initiative at all. It is an initiative of Dick Hamer, the Victorian Premier, and was put forward simply because of the power planning deficiencies of the Victorian Government. It has dawned on Premier Hamer that six or eight years down the track there will not be enough electricity for Victoria. What he is now doing is using Prime Minister Fraser, through the Liberal Party, to plug himself into the New South Wales grid, which will have plenty of power because of the decent planning of the Wran Government and the Electricity Commission of New South Wales. Let me tell honourable members this: New South Wales will have not a bar of it. The Prime Minister can talk about his committee. We will tell him what he can do with his committee. He can go and tell Premier Hamer to get off his backside, do some work and develop some decent power policies for Victoria instead of turning over half of Victoria's brown coal fields to some spurious coal to oil program using Second World War second rate technology based on the SASOL model. He should tell Mr Hamer to get down there and really produce some economic benefits for Victoria.

We hear all this talk from the Prime Minister about aluminium. Somebody listening to the speech of the Prime Mininster on the radio could be excused for thinking that there are some real initiatives here. There are no initiatives by the Commonwealth; they are all State initiatives. Worse, we have a Commonwealth that could really help if power generation was being sold short in Victoria. Victoria's policy is to sell power at cost without a real benefit to the Victorian people, to the people who smelt aluminium in this country. If it were to sell power at cost the final product price should reflect the subsidy of that cheap electricity. If the Commonwealth were to look after the interests of the people of Australia - the corporate wealth of the Commonwealth, of the Australian public - and to have a pricing policy which makes sure that the price of smelted aluminium is a price equivalent to the traded price internationally, then, of course, the profits would be declared by the companies operating in Australia. Under a company tax and a resources tax the Australian public would have the benefit of the cheap electricity. This Government does not even have a pricing policy on aluminium. Worse still, a couple of weeks ago the Commonwealth allowed the decision of the High Court to permit Comalco Can and Containers Ltd to sell its aluminium to a subsidiary operating in Hong Kong where the subsidiary picks up the profit and is not liable for Australian taxation. Once again, Australia is short changed. The High Court of Australia, that citadel of income tax evasion and avoidance, aided and abetted by the Commonwealth Government in its complacency in energy pricing, particularly in respect of aluminium--

Mr Neil - Mr Deputy Speaker, I take a point of order. That was a serious reflection on the judiciary and should be withdrawn.

Mr DEPUTY SPEAKER (Mr Jarman (DEAKIN, VICTORIA) - I did not hear any reflection, in my opinion.

Mr KEATING - If the Commonwealth Government were at least to buttress what the States are doing with a decent aluminium pricing policy then these big international aluminium companies could not through their vertical integration, shuffle the product prices in such a way that Australians lose that benefit. The Government does not even have an aluminium pricing policy. Not only is the Government not establishing the power reactors to smelt the aluminium, and establishing an aluminium smelting facility, as have been established by the States, but also, it does not even have a pricing policy for which it has constitutional responsibility. The Government is a disgrace to this country. It has no ideas. If Australia remains in this Government's hands for very much longer Australians will miss most of the benefits which could accrue from the development of our natural resources.

The Prime Minister justified his high petrol pricing policy; his import parity pricing policy; the rip off; and the tax by stealth at the petrol pump. There was a very interesting quote in his supplementary speech which I think will have a great bearing on the election. The Prime Minister, in a very uncharacteristic display of candour; said that even on relatively optimistic scenarios for future production and consumption the prospect is for further increases in oil prices. In the last few weeks Government Ministers have been arguing that a world oil glut is developing and there will not be any movement in prices, therefore there will be no difference between the policy of the Australian Labor Party and the policy of the Government. Here the Prime Minister is committing himself in a statement to increases in oil prices. Because of the Government's commitment, reaffirmed a few minutes ago by the Prime Minister, that the price of oil in Australia will be tied to the international price of oil, under a Fraser Government in this country we can expect continuing increases in the price of Australian oil.

A Labor government will break that nexus or link with import parity pricing. There will be cheaper oil and cheaper petrol under a Labor government. This confirms what the Labor Party has said over and over again, that our oil prices will continue to rise and that Saudi Arabia will lift its price from $28 to $32 a barrel in an attempt to get to a uniform Organisation for Petroleum Exporting Countries price. If the people of Australia were unlucky enough to have a Fraser government at the end of the year, on 1 January that Fraser Government would lift petrol prices once again. Every sensible Australian should reject that proposition.

When one looks at the rip-off in petrol prices which the Government implemented one sees that in the December quarter of 1975 the price of petrol was 15.6c a litre. Today, in August 1980, it is 36c a litre. The price has more than doubled. The revenue which came from old oil was $257m in 1975-76; $309m in 1976-77; $458m in 1977; $1,189 in 1978-79; $2,200m in 1979-80; and an estimated $3,054m this year. In other words, this year oil and petroleum products will account for 1 1 .8 per cent of total Budget receipts. Three years ago it was 5.7 per cent. This Government is engaged in the most massive tax wrought and rip-off that the Australian public has ever witnessed - a tax by stealth. It was a tax which had no mandate at the last election. In fact, it was a mandate to the contrary- to reduce tax.

We remember the sleazy advertisements of the Government with the fistfull of dollars and the statement: 'Ring up and find out what your tax cut will be'. The Government gave tax cuts in February and took them back in July. Then it implemented this tax by stealth at the petrol pump which cost the average family $950 each year in petrol taxes. The Government had no approval, no mandate at an election, and it made no mention at an election of this slug, this tax by stealth. The Government's policy is now working! Today the Prime Minister boasted that the Government had reduced petrol consumption by 0.7 per cent of one per cent. This year in the United States of America petrol consumption has been reduced by 10 per cent - not 0.7 per cent of one per cent - without an import parity policy. Do honourable members know why? It is because the United States Congress had the guts to say to the United States motor vehicle manufacturers that there would be mandatory fuel consumption standards; that the manufacturers would make motor cars which would do so many miles per gallon. But this Government would never say that to Brian Inglis from the Ford Motor Co. of Australia Ltd or to Chuck Chapman from General MotorsHolden's Ltd. It would not have the guts to say that to them. We know what those companies will do. They will run down investments in their old engine plants, putting a five-litre motor into the latest Commodore, which does about 1 1 miles a gallon, or four-litre engines in the Ford and General-Motors range.

This Government is not requiring mandatory fuel consumption standards as the Americans and Europeans do. It is using the blunt instrument of price to belt every low and middle income earner off the streets. That is the policy of this Government. Its policy is to drive every low and middle income earner off the road. If one has money in Australia one can enjoy all the fruits of the industrial society. One can lease Mercedes Benz. Rolls Royces and BMWs. This is tax deductible and the petrol is also tax deductible. If one happens to be a slave or ordinary working person one is taxed off the street all on the basis that only price should be the weapon which rationalises petrol. It is not that all cars should be made more fuel efficient, or that we should be reducing consumption through more efficient vehicles. The Government does not worry about that. Its attitude is: Do not upset General-Motors or Ford, but just belt the Australian motorist and his family.

In the last year we have had a 33 per cent increase in petrol prices. This year $3.5 billion will have changed hands between the motoring public, the Government and the oil companies. What do we have for the $3.5 billion transfer of wealth? We have a reduction of 0.7 per cent of one per cent. The Prime Minister has the hide to stand here today and to say that that is some kind of virtue or some kind of achievement. It is a disgrace that we have such modest gains with such a high cost policy. Absolutely no comparison can be made with any of the other industrialised countries which do not have an import parity policy and which are not ripping off their own people and making them pay the world price for their own oil, as we in Australia are paying. We are being asked to pay $27.50 a barrel for oil which is produced at a cost of $1 a barrel at Bass Strait. This is the kind of puny justification of the Prime Minister.

We heard the Prime Minister talk about Rundle. We have heard so much about Rundle from the Government. Again there were quite uncharacteristic references in the Prime Minister's speech to the real impact of Rundle. I will tell honourable members what he said. He said that by 1985 at stage one the much publicised Rundle would produce 20,000 barrels of oil a day. Do honourable members know what 20,000 barrels of oil a day represents? It is 5 per cent of Bass Strait's production. It will produce 5 per cent of Bass Strait's production by 1985. If that is a success, Rundle will then go to stage 2 which is 200,000 barrels a day or half that of Bass Strait production in 15 years to the year 1995. So what the Government is talking about when it crows about Rundle, as it does incessantly, is that it will produce about half of the Bass Strait production in 1 5 years time and 5 per cent of the Bass Strait production in five years time. God strike me pink! How can the Government talk about that being the economic salvation of Australia? It talks as though it is going to change the economic face of Australia next year. Rundle will not even have its pilot plant operating until 1985, on the Prime Minister's own admission, and then it will produce 5 per cent of Australia's oil production. We could get more than 5 per cent from the liquefied petroleum gas which comes out of the Cooper Basin or Bass Strait.

The Prime Minister went on to say that Rundle will be developed because of the Government's pricing policy. Of course, that is just a plain untruth. The Australian Labor Party introduced the policy of import parity for new discoveries of oil in 1975. The Government has continued with that policy. In pricing terms, Rundle will be developed under our policy the same as it is being developed under the Government's policy. It has nothing to do with the price of old oil. The price that we pay for Bass Strait oil has nothing to do with Rundle. There is no reason why Australians should be paying $27.50 a barrel for Bass Strait oil when it costs $1 a barrel to produce and when both parties support the payment of the full world price for oil yet to be discovered and produced. Rundle comes into that category; so Rundle could be developed under the terms of our policy the same as it will be developed under the Government's policy. Of course it is just so much hogwash.

The Government has mentioned development of the North West Shelf. I have forgotten more about the North West Shelf than most Government ministers know about it. I have been involved with it from the day it started, from the day Broken Hill Pty Co. Ltd took over the Burmese interest. In all of the brochures which have been produced in Japanese and German and in all of the other brochures which have been produced for the banking consortium, my statements and the statements made by the Leader of the Opposition (Mr Hayden) in support of this development are printed. The consortium knows this and every decent thinking Australian knows this too. But the Government tries to claim that for itself as it is trying to claim Rundle for itself and as it is trying to claim the aluminium industry for itself. These developments do not belong to the Government. They were started by the States and by entrepreneurs, not by the Fraser Government. It cannot even introduce a decent pricing and tax policy that makes sure most Australians get some of the benefits.

The really savage misrepresentations and distortions in this statement came in respect of oil exploration. The Prime Minister said that 29 wells were drilled in 1975 and 121 wells were drilled this year under the Fraser Government. In other words, 29 wells were drilled under the Labor Government and 121 wells were drilled under the Fraser Government. 1 ask honourable members: What is the real truth? In the three years of the Labor Government, 146 wells were drilled; in the first three years of the Fraser Government, 94 wells were drilled. In other words, 60 more wells were drilled in the first three years of the Labor Government than were drilled in the first three years of the Fraser Government. In the three years since import parity pricing was introduced, 151 exploration wells have been drilled in the country. Despite a trebling in oil revenues to the oil producers in that period, the Government still has a drilling rate which is akin to the rate of 1973 to 1975. So where is the value for all of the heartache and suffering it has inflicted on motorists, farmers and industrialists through its high petrol pricing policy? Where are the benefits in exploration? They simply are not there.

When the Labor Party proposes that some of the money which the Government collects from oil production goes back to exploration, it is called a socialist monster. Not one penny of the $2, 200m of the crude oil levy that the Government collects this year will go to exploration. A Labor Government will return that money under an Australian hydrocarbon corporation which will be a government body the same as exists in most parts of the world to search directly for oil and gas, something this Government is not doing. This year 60 holes will be drilled in Australia. This year 3,000 holes will be drilled in Canada and 250,000 holes will be drilled in the United States. There will be 250,000 holes drilled in the United States compared to 60- not 60,000- in Australia and 3,000 holes will be drilled in Canada compared to 60 holes drilled in Australia. Sixty miserable holes will be drilled off-shore and on-shore in Australia. More than that number were drilled in the early 1970s. The Government has fleeced the Australian public of $3.5 billion in the process. What has the Australian public got in return?

What is the Government spending on energy research and development? Last year the Government spent $9.1m out of a total of $2,200m. This year the Government will spend $ 13.5m out of a total of $3,000m. That amounts to $2.10 per capita in Australia compared with $13.80 being spent in Belgium, $4.90 in Canada, $4.80 in Denmark, $6.90 in Japan and so on. In other words, we are spending an infinitesimal amount of this huge rip-off money on energy research and development and nothing on new exploration. The Prime Minister should be ashamed of his statement. As I said earlier it could be called a collection of 101 unreported Press statements. It is a mish-mash of ill-truths, half-truths and illconceived notions, all on the basis of giving some kind of form to the ad hockery of the Government's energy and resources policy.

Mr DEPUTY SPEAKER (Mr Jarman)Order!The honourable member's time has expired.

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