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Thursday, 26 March 1987
Page: 1585

Mr SINCLAIR —Is the Prime Minister aware that the figures from the Australian Bureau of Statistics on Monday showed that petroleum exploration spending dropped by 54 per cent from July to December in 1986 from the figures from January to June in the same year-from $342m in the first half of last year to $157m in the second half? Is he aware that at the end of February 38 of Australia's 43 on-shore drilling rigs were idle, three of four off-shore drilling rigs were idle and 19 of 20 seismic crews were idle? In light of these alarming statistics on petroleum exploration-of course, with its effect on Australia's self-sufficiency and the problems that we have already with Australia's chronically adverse balance of payments-and given the continued instability in world oil markets, why is the Prime Minister proceeding with the resource rent tax?

Mr HAWKE —I am aware of the statistics to which the right honourable gentleman referred. The whole question of getting an appropriate balance between the incentive for exploration, the appropriate return for producers and the interests of consumers is under constant attention. It is currently being particularly investigated by the Minister for Resources and Energy, Senator Evans. I am totally confident that the Minister will be able to recommend to the Government the policy mix which is appropriate to take into account those varying and, I concede, at times conflicting considerations. I think the right honourable gentleman would concede that, if we were to undertake a decision which took into account solely the interests of those concerned with exploration, in fact that could have adverse implications in respect of other quite legitimate considerations.

Insofar as the right honourable gentleman included in his question the reference to the resource rent tax, I make the point that I think he would understand-I am not too adventuresome when it comes to talking about what he understands-that by definition the resource rent tax is a profit-related tax. That is, if there are no profits then, by definition, there is no tax. Relating the right honourable gentleman's question to the broader issue, which he did, of our external position, I think he would appreciate that we as a Government are very acutely conscious of the need for us to shape our whole mix of macroeconomic policies in a way which is calculated to narrow the gap between what we earn by way of exports and what we pay for imports. Indeed, I hope the right honourable gentleman will appreciate that it is precisely the mix of policies that we have adopted which is directed to achieving that end. We are confident, as I hope the right honourable gentleman would be, that the evidence which is becoming increasingly available in this regard should give us all-not just in the Government but in the Opposition as well-cause for confidence.

I quickly refer the right honourable gentleman to some of the more important elements of recent statistics. For instance, the most recent figures show that in the last seven months of this financial year exports of manufactured goods were some 35 per cent higher than in the corresponding period last year. We have had the fifth successive quarter with a reduction in the imports of consumer goods. The right honourable gentleman would understand that our competitive position is now the best it has been for some two decades. We are confident, with both the policies that we have and the most recent statistics, that fortunately for Australia the situation is improving. Unfortunately for the Leader of the Opposition, the times are decreasingly becoming his times.