Martin Ferguson (Batman, Australian Labor Party, Shadow Minister for Primary Industries, Resources, Forestry and Tourism) Share this | Hansard source

I rise today to speak on the Petroleum Resource Rent Tax Assessment Amendment Bill 2006 and the Petroleum Resource Rent Tax (Instalment Transfer Interest Charge Imposition) Bill 2006. In doing so, I say in response to the member for Cook that I agree with many of the issues he has raised in his contribution today. This is a very important debate. I simply say that I am disappointed that today, despite the importance of this debate, which is about Australia’s future energy security, the Howard government has chosen to guillotine consideration of these bills. At the moment, with its reliance for energy stability and security in the 21st century being placed on the unstable Middle East, Australia stands exposed. The Howard government has guillotined consideration of not only this bill today but also two other very important bills. We were not permitted to move amendments on the Fuel Tax Bill, aimed at assisting small business with changes in fuel tax excise arrangements in Australia. Similarly, on the tax laws legislation relating to the Medicare levy and measures going to the new business tax system, the Howard government chose this morning to circumvent debate to prevent the opposition and the Independents from moving amendments aimed at improving the bills before the House today.

I am very disappointed about this bill, which really goes to our future. Australia has a problem with the security of its energy supply. We can see countries beyond Australia, such as Qatar, attracting investment aimed at converting valuable gas to liquids for the purpose of trying to assess and secure energy security. However, we have a Prime Minister who wants a debate about nuclear energy. Nuclear energy in Australia simply does not stack up economically, yet he is not prepared to sit down and consider what would be the appropriate investment regime to attract investment into Australia going not only to the conversion of gas to liquids but also to the conversion of coal to liquids, which is about giving Australia some security with transport fuels. I raise these matters because, in the context of changes and useful modifications to the PRRT regime, I think we should be thinking about these other issues. I say that because it is appropriate to reduce compliance costs, improve administration and remove inconsistencies in the Petroleum Resource Rent Tax Act 1987.

The PRRT regime is a very important source of revenue for the Commonwealth. It is a very important tax to ensure that all Australians get a fair return on their oil and gas resources. PRRT revenue is expected to grow to $4 billion in 2009-10—no wonder the budget process is awash with revenue—and is currently estimated to be $1.4 billion. Clearly, PRRT is becoming a major part of our revenue base and, as such, any measures that erode that base or risk its erosion should be of great concern to the Australian community. That is why the opposition is referring these bills to a Senate committee to ensure that due consideration is given to these important measures.

But I also say, on behalf of the opposition, that we want our oil and gas industry and the revenue that flows from it to be healthy. That is important because that revenue base, as the recent budget process proved, is about tax cuts and about funding schools, roads, hospitals and all the other government services that the Australian community expects. The industry is also critical to Australia’s wellbeing and, importantly, its untapped potential goes to nation building in Australia, particularly in the gas arena and particularly in the gas to liquids conversion process. While we currently ride a resource boom, it is only six years since the price of oil was just $12 per barrel and times were not so good for Australia. The message is that there will always be good times and not so good times. We have to create the right policy and fiscal environments to keep the industry healthy throughout the cycle. Getting the PRRT regime right is the correct thing to do in that debate.

But I am also concerned about capacity constraints in the Australian economy, particularly the skills shortages that are dampening investment in the resources sector at a time when global demand and global prices mean that we should be maintaining our investment momentum. Australia cannot afford to let its oil and gas industry slip. Resources remain our biggest global competitive strength. I simply say, on behalf of the opposition, that Australia needs a new generation of nation building industries and infrastructure and a debate about energy security, which is a debate that the Prime Minister does not want to have.

The Prime Minister is interested in a debate about nuclear power—a debate that does not stack up economically in Australia—but he is silent when it comes to a serious debate about energy security in Australia. When have you heard the Prime Minister talking about our requirement to work with the private sector to create an investment regime in Australia that favours and encourages gas and coal to liquids? That is about energy security. That is about investment and long-term opportunities in Australia. But, unfortunately, the Prime Minister is silent on the future energy demands of Australia.

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