Warren Snowdon (Lingiari, Australian Labor Party, Shadow Parliamentary Secretary for Northern Australia and Indigenous Affairs) Share this | Hansard source

I am pleased to speak in this discussion on the Fuel Tax Bill 2006 and cognate bill but with mixed feelings. On the one hand, the legislation is part of a major reform of fuel taxation in Australia and may have a positive effect on regional Australia in streamlining compliance and administration of grants available to reduce costs for transport and eligible off-road activities. Hopefully these reforms will remove the bias in grey areas that have emerged from the current arrangements. On the other hand, I am concerned by the abolition of the Fuel Sales Grant Scheme, which was introduced when it was becoming quite apparent that the introduction of A New Tax System—the GST—on 1 July 2000 was not going to deliver cheaper fuel to regional and remote Australians.

The Fuel Sales Grant Scheme provided registered retailers with grants of 1c per litre in non-metropolitan zones and 2c per litre in so-called remote zones and then an additional grant of 1c per litre where the fuel price is consistently over $1.21. The relief provided by these grants was meant to be passed on to consumers, although it is doubtful that it ever was. I remind the House of this because, in the months prior to the introduction of the GST, there was a very lively debate in the Northern Territory about the impact of a GST on fuel prices. Even former Territorian CLP Senator Grant Tambling was prepared to bet cartons of beer on ABC radio that the GST would deliver not only cheaper fuel but cheaper prices of goods on the supermarket shelves as a flow-on. You and I both know, Mr Deputy Speaker, that that was never an outcome—it did not happen. Even with the Fuel Sales Grant Scheme, Territorians very quickly became used to paying more for fuel and more fuel tax than anyone else in Australia.

We hear volatile discussion at the moment about rising fuel prices and people in the city expressing their dissatisfaction at paying $1.30 or $1.40 per litre. People living in the bush are used to these prices because they have been paying them for some time. Certainly people in my electorate are very used to paying these sorts of prices for fuel. I say to the government that in my constituency fuel prices are a major issue. The member for Melbourne pointed out that people who live in towns adjacent to cities drive longer distances than people who live in regional Australia. That may well be true, but it is also true that people who live a long way away from towns have to travel long distances to service centres to access fundamental services such as medical facilities, schools, legal services and other services which they require for their ongoing lives. In the Northern Territory that means people often travel vast distances on sometimes very poor roads. At the time we were debating the GST and talking about fuel prices and arguing whether or not fuel prices would be higher as a result, people at Ramingining in my electorate were paying $1.30 per litre; today they are paying between $1.55 and $1.60 per litre. If you happen to be living on the Barkly Tablelands, perhaps travelling from Tennant Creek to Mount Isa or Camooweal, if you stop on the highway you would today be paying $1.85 per litre.

You hear the debates in this place and you hear the government say how conscious they are of the people who live in remote communities and in the bush. Frankly I do not think they care, because if they did care they would be doing something about a tax on a tax which, as the prices increase, becomes greater for those people who live in these areas where the price of fuel is so high. Last week while I was travelling around the bush I even heard a story of one place where fuel prices are $2.40 or $2.50 a litre. Of course, travelling becomes completely uneconomical. People who have low discretionary incomes, as many people who live in the bush do—as you would know, Mr Deputy Speaker Causley, coming from the land as you do—do not have the dough to throw away on paying huge costs extra for fuel. They already pay huge costs because of where they live.

If you live in a remote Aboriginal community in the Northern Territory it is more than likely you are probably earning somewhere around $200 to $240 a week; you might have an annual income of $10,000 to $12,000 a year. If you are lucky you might have a vehicle. Can you imagine travelling the distances that these people are required to travel and paying $1.80 or $2.00 a litre for fuel, and travelling on poorly maintained roads because this federal government have perennially failed to provide appropriate money for the infrastructure? We have had debates in this place about the Roads to Recovery program. I have been up in the scrapers here many times, talking about the failure of the government to recognise their responsibilities for providing funding for roads on land in the Northern Territory which is not in local government areas. We are talking of 9,000 kilometres or thereabouts of dirt roads.

Because you have traversed this part of the country, Mr Deputy Speaker Causley, you would know that many of these roads are economically very important. They carry the tens of thousands of head of cattle that traverse the Darwin wharf on a regular basis at this time of year, heading for markets in South-East Asia. The fuel cost is borne ultimately by consumers, wherever they might be. Producers of cattle in the Northern Territory, indeed across the Top End of Australia, because a large amount of the beef that is exported across the Darwin wharf comes from western Queensland, pay for it. Either they have to absorb the additional cost within their pricing or they pass it on to someone else, and we know that that has an outcome on supermarket shelves either here or overseas.

Also because of the failure of this government to provide the adequate resources to maintain the roads in the region, people are required to drive extraordinarily long distance to get their cattle to market. I know of a property owner on the Plenty Highway who was selling into the markets in Queensland. Normally, you would expect to be able to drive across the Plenty Highway towards Winton and to take the product to market at Rockhampton or wherever the saleyards are. Do you know what these people have to do? They have to drive down to the Stuart Highway—that is, they have to drive west not east—then drive north to the junction of the Stuart Highway and the Barkly Highway, then drive across to Mount Isa and then drive down to the saleyards. That creates an enormous burden upon them, and it adds substantially to their costs. The other costs that arise are those which transport companies bear in maintaining their road trains. Maintenance work increases extraordinarily as a result of having to traverse these roads.

I have mentioned Mount Isa but at Alpurrurulam, a community of 300 on the Queensland-Northern Territory border, a community operated bowser currently is selling fuel at $1.70 a litre. That is cheaper than on the highway because the community is not that far from the homestead on the Barkly Highway, which I have already quoted as having fuel at $1.85 a litre, and it does it at cost. There is no profit in it; they just do it at cost to service their community and because they are aware of the low levels of income of members of their communities. At Borroloola, in the Gulf, fuel is currently selling at $1.65 a litre. At Ampilatwatja store, 300 kilometres north-east of Alice Springs along the unsealed Sandover Highway, a road that is similar to the Plenty Highway and which comes off the Plenty Highway, you will pay $1.68 for a litre of unleaded fuel, and diesel will cost $1.78.

As I have said previously, when people discuss regional Australia generally in this place they are not referring to the part of Australia that I live in. They are not referring to Northern Australia. They are certainly not referring to the Northern Territory or to the Kimberley, and I know you have had experience in the Kimberley, Mr Deputy Speaker. They are not referring to Far North Queensland, or western Queensland or Cape York. What they think is regional is Moss Vale. They have no idea. They think that if you put on a pair of riding boots and get into your Land Rover and drive over the top of the Great Dividing Range you have hit the bush. They have no idea at all. They might be dealing with Gippsland—of course, we know about Gippsland and the National Party’s representative in here from that area. They might be referring to the Mallee and or even to the south-west of Western Australia, which is beautiful country and which might be classed as regional, but it is absolutely nothing like the North. When they have a picture in their minds of regional Australia, that is what they see. They have, in my view, little experience, knowledge, understanding or comprehension of the part of Australia that I am talking about, the part of Australia that I am privileged to represent in this parliament.

When I discuss regional Australia in the Northern Territory, I am talking about a relatively small number of pastoral holdings, something in excess of 250 across the Northern Territory; a number of mine sites scattered around the Northern Territory producing enormous wealth for this nation, whether it is at Nhulunbuy with Alcan or the producing of gold in the Tanami or manganese on Groote Eylandt; and a large number of discrete Indigenous communities scattered around the Northern Territory—some hundreds of them. When I sit here in this place and listen to the government dealing with issues such as fuel tax they are talking about farmers. They do not talk about the large number of small communities scattered around the vast areas of the north, not only in the Territory but elsewhere such as in the electorates of the member for Leichhardt, the member for Grey, the member for Kalgoorlie or the member for Kennedy. Australians living in those electorates, like Australians living in my electorate, have been savaged by the burden of the GST. They pay more fuel tax—and the cost of fuel of course is relatively higher in any event. Whatever merits there might be for the GST, I have always argued that Australians living in remote Australia pay more GST. The fuel sales grant was implemented to ease that burden. The scheme was not indexed, so as the price of fuel has increased since July 2000 the relative relief provided by the scheme has become less and less. When you are paying the prices I quoted earlier for fuel at different locations, the grant of 3c per litre for 2006 is not worth much. Consumers have had to absorb the increase in fuel price, including the tax component—and, as I say, I am not even certain that the benefit was ever really passed on to the consumers.

Other failures of the scheme, such as boundary anomalies and whether the full extent of the grant was being passed on to consumers, mean very little when you are paying 20c or 30c more for each litre of fuel. I have always argued that the Fuel Sales Grants Scheme would not compensate for the impact of the GST in rural and remote communities. In fact, the fuel taxation inquiry found it difficult to identify the benefits to consumers in rural and remote areas. They said the scheme had to be abolished. The money saved by its abolition—$270 million in 2005-2006—is to be channelled into road funding. It will be very interesting to see if we get any more road funding in the Northern Territory. A significant amount is required to address the road needs that I identified earlier and that are commonly understood by people who drive in the Territory and live and work in these remote places.

It is worth while pointing out how fuel prices might impact on communities and the relative cost of living in different places across Australia. As it happens, since 1998 the Northern Territory government’s Department of Health and Community Services has done a regular survey of the cost of household food baskets in rural and remote areas as part of its nutrition and physical activity program. It is called the market basket survey of remote community stores. Recall that I said that on the Barkly motorists are currently paying $1.85 a litre for fuel. I also mentioned a figure for Borroloola. We know that, if you live on the Barkly in that remote part of the Northern Territory, you will pay 153 per cent more for a food basket than you would pay in Darwin. What does that tell you? It tells you not to have a lot of money in your pocket. It tells you that the additional cost of paying for fuel at the price which is currently being asked for in the bush means that you have even less money in your pocket.

I know there has been a lot of discussion about alternative fuels. I heard the member for Melbourne talk about how we need to adjust our minds to the idea of higher relative costs for transport. That may well be true, but if we want people to thrive in remote Australia we have to find a way to provide them with fuel at a reasonable cost, not unreasonably different from that which their city cousins pay in Sydney or Melbourne. I have some personal views about this which I have expressed at meetings I have had with some of my colleagues. They do not all agree with me—not even my mate sitting next to me, the member for Hunter. We have conversations about this, but I have a view which he does not share. He comes from a little place called the Hunter Valley.

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