Speech by Hon Bruce Scott MP – Hansard, House of Representatives

Mr BRUCE SCOTT (Maranoa) (11:57 AM) —I rise to speak on Appropriation Bill (No. 1) 2010-2011, Appropriation Bill (No. 2) 2010-2011 and Appropriation (Parliamentary Departments) Bill (No. 1) 2010-2011 Despite the rhetoric that has been uttered by the Treasurer since the bringing down of the budget – and in fact in the lead-up to the budget when he said that this was going to be a boring, low-spending budget – the reality is quite the opposite. When you start to go into the details you find it is a big-spending, big-taxing budget. But that is what we find from a Labor Government: big spending and big taxing. And, of course, there are new taxes. In fact, this budget is built on the new mining tax, the resource super profits tax, in which anything above a six per cent return on capital is considered a superprofit. Look out any company in Australia listed publicly. If you are making more than a six per cent return on capital, the Labor Party considers that as a superprofit. It is also built on a new tax on cigarettes. In some ways I do not mind the fact that there will be a tax in that area, but we have got to also match that approach to addressing the issue of getting people to stop smoking because of the risk to their health.

The Prime Minister and the Treasurer have had a billion-dollar blow-out in their budget due to the failed Home Insulation Program. Not only have they spent something like $2.5 billion giving out free batts to insulate roofs, we now find in the budget that they are going to spend a billion dollars to take them out. A billion dollars after having spent $2.3 billion in a flawed approach to put them in ceilings. We have had a $1.7 billion blow-out in the Deputy Prime Minister’s program to put her name tag on halls – in building ‘memorial halls’, as we have come to know them, in schools across Australia. Many of those are going very well in the private schools, the Catholic schools, the independent schools and the Christian schools. The cost of building them under their supervision is about 25 per cent of the cost of those in the public sector, because the state governments are involved in it and they are running it in their departments. That program initially was part of a stimulus package designed to stimulate the economy in 2009-10. Yet they will still be spending this money, stimulating the economy, in 2012-13. The so-called stimulus package was meant to be targeted in that period in history under the global financial crisis tag.

We have seen a billion-dollar blow-out in the Computers in Schools program. We also saw this Government commit something like $4 billion for the National Broadband Network prior to the election. But what we see now is a $38 billion National Broadband Network, and we are starting to see some of it rolled out in parts of the country without even legislation passing either house – without that yet appropriating funds through other methods to put some optic fibre cables in marginal seats. I can see the vision already: Prime Minister ‘hard hat’ with high-vis jacket during the election campaign rolling out blue cable into an underground trench somewhere when the fact of the matter is that more than 50 per cent of it is going to be along power lines. I can see the vision already of this Prime Minister during the next election campaign.

Regional Australia hardly rated a mention in the budget. Agriculture and the farmers did not rate and yet they are a significant part of our national economy. So often we hear from this Prime Minister that mining saved us from the recession. I put it to you, Deputy Speaker Slipper, and to this chamber, that the farming community of Australia and farm exports, which were up in value during this period and continue to grow because we have the most efficient farmers in the world, contributed significantly to helping Australia avoid dipping into a recession. So it is not just the mining sector. Yet in the Treasurer’s speech in the House I think he mentioned regional Australia once and farmers not at all. There is no new funding for quarantine. Some 250 Customs staff look like they are going to be sacked and yet we want to keep our borders safer, we want to keep our clean and green image and we want to keep ourselves free of disease in this country. Yet what we see is a cut in this area of the budget.

In Dalby in my electorate of Maranoa we have the first grain ethanol plant in Australia. All they use is grain to produce ethanol. It is a brand-new, high-tech plant. Under the Coalition we put incentives through the tax system for ethanol to ensure that ethanol was taken up as part of the mix in petrol for consumers. There was no tax on it. But we find in this budget a tax on ethanol that will progressively ramp up between now and 2015. This is going to possibly impact on the production of ethanol, because it may mean that fewer people will use the E10 mix in our motor vehicles. It is going to cost jobs, potentially, over time. What was this Government about? Another new tax.

The deficit this year will be some $57 billion. That is the biggest deficit that Australia has seen in its peacetime history. In 2½ years we have gone from surplus budgets, money in the bank, to this year $57 billion in deficit. We are also going to end up with a $93 billion debt. It took the previous Labor Government some 13 years to rack up $96 billion, but this Labor Government gets the gold medal three times over – gold, gold, gold! – because they will achieve that inside their first term. They started with no net debt and $20 billion in the bank.

The Government, because of its reckless spending and its inability to manage the economy and the finances of this nation, will now borrow $100 million a day. This week they will borrow $700 million just to pay the bills. That means that every man, woman and child in Australia will have a debt of $4,075. On the birth certificate of a child born today will be, ‘$4,075 of debt compliments of the Labor Party.’ Somehow they will have to pay back those $4,075. That is their inheritance from the Labor Government.

When I look at this budget deficit, the interest that we are paying is $4.7 billion this year, $6.5 billion next year and then it rises up to $8 billion. That $8 billion, which has to be paid before any other bill is paid, as anyone with a mortgage would know, would build the inland rail twice every year. It would upgrade the Warrego Highway from beginning to end, from just west of Brisbane to Charleville, 16 times every year.

We are desperate for money for those major highways. The Landsborough Highway is 1,000 kilometres long and is the major arterial route from southern Australia right through Mount Isa and on to Darwin. How often would it rebuild or at least upgrade that highway? This Government has not even got any money in the forward estimates for this 1,000 kilometres of strategic road. It is important not only for tourism but also for the development of the Galilee Basin resources sector and for the defence links between Darwin, northern Australia and right down to southern Australia. What about some strategic roads for the outback? How much would that $8 billion a year do for strategic roads in the outback? What about some money for optic fibre cable into those communities that rely on radio signals to gain access to the main telecommunications networks in Australia?

Under this Government we have also seen power prices rise 18 to 22 per cent across the nation in the last 12 months. The Prime Minister went to the election talking about working families. He was going to do something about groceries, the cost of living and petrol, yet petrol in the last 12 months has gone up over six per cent. There have been three interest rate rises and we are still counting. Where are the Prime Minister’s working families now?

The Prime Minister committed prior to the last election that he would axe the Public Service. He would get into it and make it an efficient public service, yet we have seen 20,000 new positions created in the last 2½ years. What about Minister Wong’s department of climate change? They awarded some 220 new contracts worth $32 million. The ETS is in the bottom draw somewhere but, if they win government, it will come out for sure. That will be $14 billion a year in new taxes on all Australians. What are they doing? Are they just sitting in limbo? Have they been moved to other departments?

The Prime Minister was also going to take over health and fix our hospitals without any new bureaucracy. But what we find in the budget is $500 million for additional bureaucracy in the health department because he wants to get control of this, notwithstanding the states saying, ‘Sorry, Prime Minister, under our model the public hospital systems will share the responsibility but you are not going to take it over down in Canberra.’ Yet there is $500 million for new bureaucracy in that sector.

Let us go to the big one – that is, the superprofits tax. It will eventually mean that the resources sector will pay a 58 per cent tax on their profit. The only country in the Western world that has got a tax that is even close to that is the United States of America, which has a 40 per cent tax rate. Resource companies already pay 30 per cent on their profits. They pay 10 per cent of their gross in terms of royalties and they pay payroll tax to state governments as well. Canada, which is our most direct competitor, taxes its mining sector at the rate of 25 per cent. We have already heard the Lieutenant Governor of Saskatchewan saying that they would love to attract some of this investment which would create jobs in their minerals and mines area. Why? Because they are a competitor to us in the global market, yet the tax they impose on the mining sector there is some 25 per cent.

An interesting comment was made by the head of Rio Tinto, Tom Albanese. He was quoted in the Australian on Monday this week saying:

‘Over the past month I’ve been to Japan, Canada, Europe, the US, China and they are all asking me ‘what the heck has happened in Australia?’

Tom Albanese, head of Rio Tinto, well, Kevin Rudd and Wayne Swan is what happened in Australia. It is all about their great big new tax because of their failure to manage the economy. All they have done to the economy is put it into debt after debt that only a Coalition Government will address in order to start to repay it and so manage the economy, as we demonstrated during the Howard and Costello years when it paid off the previous Labor Government’s debt. We left a legacy of a budget surplus and money in the bank – the Future Fund.

I want to touch on where some of this money could have gone. This Government will spend some $38 million on advertising, without going through the approval process that they promised prior to the last federal election. This is $38 million being spent on advertising how their mining tax will help our economy. It is $38 million that could have gone into, in my case and I think across Australia, disability services. Just some of that money would help the Granite Belt Support Services to purchase a new building 19 times over. A problem that we have to address is support for these support services that are doing a magnificent job looking after people with disabilities. In the town of Dalby is a wonderful organisation called Waminda which provides support for children with autism. It is a shocking statistic there that one in every 52 children enrolled in schools across southern Queensland between Jondaryan and Charleville has been diagnosed with autism. Couldn’t some of the $38 million have gone into supporting those services with infrastructure rather than being spent on advertising for this great big new tax that was not proposed prior to the last federal election?

I want to touch on one other issue – and I will be saying a lot more about it in the time ahead – Northern Australia. We have not seen any money in this budget go towards significantly addressing the needs of Northern Australia. Northern Australia’s population is 4.7 per cent of the total population of Australia. Northern Australia is described as ‘north of the Tropic of Capricorn’. That covers some 45 per cent of the land mass of Australia. It is also where the great mineral resources are in Australia. It is where the future prosperity of our nation will be generated from, but we have to do more for this area. I support a proposition that is being put by an organisation called Australians for Northern Development and Economic Vision. The purpose of Australians for Northern Development and Economic Vision – and I support this in concept – is to influence federal and state governments and other interested parties to secure the lowest possible tax rates for the remote north of Australia and to create a range of practical incentives to achieve investment and attract and retain a sufficient workforce.

We have a zone tax rebate system in place in Australia today but it is not addressing the fundamental and core issue that needs to be addressed: in order for mining and the resources sector to develop projects they have to operate staff on a fly in fly out basis. We need to have personal income tax concessions to encourage the people who work in these sectors not only to live there but to work there in that zone for at least one year. We have to do something about the population of Northern Australia. This is where the economic zones and the prosperity of Australia will be generated from in the future, yet this Government has not seen fit to do anything about addressing the serious issue of the lack of an available local workforce in this part of Australia.

We could also extend that zone beyond the Tropic of Capricorn into the Cooper Basin. In my electorate, for instance, I have the Galilee Basin, the Surat Basin and the Cooper Basin. If today Mount Isa was built on a fly-in fly-out basis, we would not have Mount Isa as it is today. It would be a donga resource centre that would not have the infrastructure that it has today. Previous generations did it; we have to return to that area and do it again.

My electorate will see, if a Coalition Government is elected and we repeal this mining superprofits tax, the development of the Surat coal basin, where there is some $80 billion of investment sitting on hold – and the jobs that go with it. Of course there is also the Galilee Basin in the east of the Barcaldine-Alpha-Jericho area in Maranoa. We need to make sure that these developments can proceed. Under the Government they will not proceed, they will be put on hold and that capital will go to other countries. We will lose as a nation an opportunity to grow our economy while the Labor Government is in power, proposing yet more taxes on the sector that is going to help us grow our economy and our future prosperity.

ANDEV, Australians for Northern Development and Economic Vision, have my support. I certainly look forward to talking with them. We are short of workers in this country. So many of the skills that we need are being provided through 457 visas. In fact, in my own hometown such is the shortage of skills that you cannot make a McDonald’s hamburger or service a vehicle without a 457 visa worker. We have to develop Northern Australia, and I support the ANDEV concepts.

(Time expired)