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Thursday, 30 September 1993
Page: 1526


Senator TAMBLING (3.13 p.m.) —by leave—I move:

  That the Senate take note of the answer given by the Minister for the Arts and Administrative Services (Senator McMullan) in response to a question without notice asked by Senator Tambling on this day relating to the proposed increase in fuel excise.

In his answer to my question today Senator McMullan was, in effect, taking the role of Pontius Pilate. Having had a whisper in his ear from Senator Collins during the question, it was obvious that Senator McMullan did not want to address the substantive part of the question which referred to the budget decision to increase excise duty on oil by 3c a litre now and another 2c over time, which amounts to an 86 per cent increase in taxation of fuel used by coastal shipping and some mining operations. Further, in the supplementary question, I referred to the operation of Nabalco at Gove in the Northern Territory where the impositions will result in a 96 per cent increase over one year—in the order of $25 million.

  As I said, Senator McMullan chose not to answer in any way the substantive questions that were addressed. This, in effect, is disgraceful, given the considerations that have been before the government on this matter for some time. Senator McMullan implied that Senator Collins had already addressed this issue. So I had a look at the Hansard for 6 and 7 September when Senators Parer and Ferguson raised this matter very directly with Senator Collins in questions in this place. On 6 September, Senator Parer asked:

. . . how does he—

Minister Collins—

expect the Australian shipping industry to contribute to boosting Australia's competitive position when his government's budget mark 2 has increased fuel taxes by $358,387 annually for an average vessel, which far out-weighs the $270,000 per vessel reduction in annual operating costs from shipping reforms.

On that occasion, Senator Collins replied:

. . . I can advise Senator Parer that the government has the matter of the fuel oil excise under consideration at the moment.

So it was under consideration as at 6 September. Senator Ferguson followed up this matter on 7 September and referred to Senator Parer's earlier question. Senator Ferguson asked:

Does this mean the government is planning to further amend its already discredited budget of betrayal to lessen the devastating effect that the increase in fuel excise will have on our shipping, road and rail transport industries?

On 7 September Senator Collins replied:

There is nothing I wish to add to what I said about this yesterday, except to point out that it is not the shipping industry's fuel oil excise. Fuel oil is also extensively used for the generation of power in isolated communities, particularly in mining establishments. One of the most notable that I am aware of, which is in my backyard, is the Nabalco operation at Gove, which uses fuel oil for that purpose. So it is not simply the shipping industry that uses fuel.

So three weeks ago Senator Collins said it was under consideration and the next day he acknowledged that Nabalco, in his own backyard, in his own electorate, in his own very special consideration, was being looked at. Yet, today he whispered in Senator McMullan's ear and, like Pontius Pilate, Senator McMullan said nothing, got away with it, admitted to nothing that has happened in the way of government in the last three weeks and did not address the issues that really do stand out. What representations has Senator Collins made in cabinet, and elsewhere, if he really does represent the Northern Territory that he so proudly claims to represent?

  The really important questions that have to be addressed in this issue that Senator McMullan failed to address in answer to my question today are: how could a Treasurer have made such a gross error, unfairly discriminating against one firm in an important export industry—$25 million for one company by one decision? To what extent does this compound the problem of sovereign risk for international investors in Australia? This is an extremely serious problem. No international investor in the mining sector can now look to this government without knowing that with a slash of a Treasurer's pen, new taxes will be put on in the order of $25 million. What confidence does that give in this particular area?

  I was attracted to a statement by Nabalco that the new budget impost cannot help but emphasise the heightened sovereign risk of investing in mining and minerals processing in Australia. That is significant. It cannot be passed on, in an instance like this, to international consumers. Nabalco pays two-thirds of all excise on inland consumption of this nature. What are the long-term prospects for future investment, future earnings and job security in a place like Nabalco? Certainly we cannot continue to rely on the ERA just as we have in the past. Senator McMullan failed to address these issues substantively today. (Time expired)