Warren Snowdon (Lingiari, Australian Labor Party, Shadow Parliamentary Secretary for External Territories) Share this | Hansard source

I found it very difficult to come to the conclusion that I should support this legislation, the Excise Tariff Amendment (Fuel Indexation) Bill 2015 and related bills, and I will explain why in a moment. But, having given proper consideration to all its elements, I am now in a position where I can support it. But I will be making some comments on how I think some of the money should be spent—the $1.1 billion which Labor has been able to get the government to devote to Roads to Recovery for regional roads as a result of our agreement to reintroduce the indexation of the fuel excise.

I want to make it very clear that the reason for my concern is expressly around issues to do with my electorate and other parts of remote and rural Australia—but most particularly remote Australia. As we know, under this proposal, as a result of fuel indexation, fuel potentially will rise in price twice a year in line with the consumer price index. As we know, the consumer price index is determined by the Australian Bureau of Statistics. It takes into account a range of factors, including goods and services, transport, clothing, housing, health and food. Once the CPI is arrived at there will be an effective change in indexation. If the CPI falls, what will be the impact on fuel prices? One assumes that, consistent with the approach of the government, it would come off. Nevertheless, I understand the impact of this is inevitably to increase the price of fuel twice yearly.

That will have a particular impact on communities in my electorate. There are a number of reasons for that. One of them is the dire straits that many people in rural parts of my communities feel. They live in hundreds of Aboriginal communities around the Northern Territory. Many of them are very isolated and their transport access is poor. The roads are roughly made, if at all in some cases, and require a lot of resources to maintain. They are maintained by either the Northern Territory government or local governments around the Northern Territory. There are large numbers of trunk roads that are maintained by the Northern Territory government, which will not directly benefit as a result of the decisions taken here.

We know that many people in these communities are dirt poor. The Treasurer believes that poor people do not drive cars, but for these people cars are their only method of transport between their communities and major centres. As a result, they purchase fuel from their local suppliers to travel of those distances, whether it is from Yuendumu to Alice Springs, from Numbulwar to Katherine or wherever. I do not think this is properly understood by this parliament: these people will wear a disproportionate cost as a result of this fuel indexation measure because they pay significantly more for their fuel than other Australians.

It is worth noting that currently the national average price of fuel is 143.4c a litre, the national metropolitan average is 145.4c a litre, the five major capitals average is 143.1c a litre and the total regional average is 139.6c a litre. If you live in Tennant Creek, which is up the Stuart Highway from where I live in Alice Springs, you pay $163.5 a litre but if you live in remote communities across the Northern Territory you pay significantly more. People are paying today at Docker River $2.35 per litre, at Lajamanu $2.15 a litre, at Finke $2.25 a litre and at Yuendumu $2.16 a litre. On the face of it people will say that is because of transportation and because there is a single provider and no competition. All that might be true, but the bottom line is that the poorest Australians have to pay that price for fuel in those communities to transport themselves to and from those communities.

What does this mean in the context of this fuel excise legislation? The GST applies on the final price of the fuel so, every time there is an increase in fuel costs as a result of an increase in the CPI, people who live in these communities pay additional GST on the difference in price and that has a disproportionate impact on these communities. Even though the fuel excise might be a set level, it has an impact on the final price of the fuel and as a result there will be a disproportionate impact on the GST price being paid by people in these communities. I do not think that is commonly understood. Certainly there is nothing that the government has proposed—or the opposition for that matter—that will remedy that situation, because it is very difficult to remedy.

I am looking at what might come out of this for people who live in those communities and I am looking at the $1.1 billion. I know—and I have had many years of experience watching this—that people who live in these communities are effectively forgotten when it comes to the allocation of resources across this country. We have horizontal fiscal equalisation that is supposed to provide comparative levels of services across this country as a result of local government funds and financial assistance grants. We have seen the FAGs cut by this government. The direct impact of that of course is that the people in these communities have less money to spend on the roads, which are decrepit in any event.

When we are contemplating how we address these issues—and I am pleased that this $1.1 billion has been made available—I am wanting assurances that when this money is allocated the real needs of people across this country in terms of road infrastructure are actually addressed, not just the needs of those who live in urban areas because of their political clout. Let there be no doubt about it that the people most disadvantaged and most in need of improved road infrastructure are the people who live in very remote parts of this country, whether it is in my electorate of Lingiari, the seat of Grey or the seat of Durack in Western Australia. By the way, I have not seen the members representing those electorates come and make these arguments, but they are real arguments which need to be properly understood. But there are so few seats affected by this, because of the population distribution across this country, that, when it comes to making decisions about the allocation of road funding, it escapes the minds of people. There are so few seats in contest that it escapes the minds of people to actually address the funds where they need to be addressed for those most in need.

This is a plaintive call, I suspect, but I am hoping that, when it comes to the distribution of these additional funds which will be coming out of this hypothecation—which, as the shadow Treasurer commented, is questionable—the additional funds will be made available to where they are most needed, because if they are not made available to those communities that are most in need then it will further exacerbate the difference in access to services for people who live in remote parts of this country. When we think about it, it is not just a question of these communities and the community members; it is a question of those people who run commerce on these roads.

In the local government areas of the Northern Territory, they manage 15,240 kilometres of local roads, with the Local Government Association of the Northern Territory managing 2,117 kilometres of local roads. But only five per cent, or 700 kilometres, of the roads maintained by regional local councils in the Northern Territory are sealed. Five per cent of rural local government roads are sealed and have a kerb, from a total, as I said earlier, in excess of 15,000 kilometres. This is not something which can be just looked over. It emphasises the need for capital investment in these places. If there are benefits to be derived from these people who travel on these roads, who pay the most for fuel in this country, then those benefits ought to be derived in terms of additional capital infrastructure for these roads and roads elsewhere.

I had reason to look at a comment made by the manager of a Northern Territory trucking company, Mr Mark Castagna, earlier in the week, when he was talking about the $600 million being proposed for funding the development of northern Australian roads out of the northern Australia white paper:

Mark Castagna … from Tanami Transport—

a company I know well—

said the money would not go far.

"I can't see too much bitumen coming out of it," he said.

"I think they'll have to re-look at it and get a bit more money."

Estimates of the cost of bituminising a kilometre of road vary enormously across this country, but if you assume, very generously, that $1 million can seal, say, three kilometres of dirt road, and you are looking at 1,800 kilometres of dirt roads, potentially, to be sealed across northern Australia, that ain't a lot. I have just talked about 15,000 kilometres of local government roads, and just two roads, the Outback Way and the Tanami Road, alone amount to 2,600 kilometres. It is unlikely, therefore, that we are going to see those roads have the investments that they require to be bituminised.

Mr Castagna said the road funding was a good start and admitted he was biased because he had been "carting on these mongrel roads for 35 years".

"We need to prioritise the Tanami and the Plenty Highway," he said.

"That is where most of the tourists want to go and most cattle come through those two roads."

But Mr Castagna said "a man will be grey and pushing up daisies before it happens".

He said the Northern Territory stock routes were the only place you could drive about for a week and not see a grader.

These observations are valid observations, and they highlight the dire straits and dire need of roads in the bush. So, when I came to make a decision about this piece of legislation, that is what was at the front of my mind. I am hoping, therefore, that in addressing this particular issue the funds which are made available are allocated as I have described, for those people most in need—most in economic need and most in need of infrastructure development—not those who have the most political clout. We know, as surely as night follows day, that in this place political clout determines how money is spent. Well, it should not. It should be based on a fair assessment of need and where money should be spent based on need. But that is not how it is done, and we need to change the way we do things to make sure those people who are impoverished and need access to these roads are properly resourced.

I am pleased to be able to support the legislation.

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