Mrs Bronwyn Bishop (Mackellar, Liberal Party) Share this | Hansard source

After that rather moving and colourful speech from the member for Kennedy, I thought I might return to the topic of this matter of public importance, which is ‘The worsening impact of increasing petrol prices and the Government’s reluctance to act’.

I was very interested at the outset to see that this was an amalgam of Independents and the Labor Party, with the member for Hunter saying that he was disappointed that he was pipped at the post for his matter of public importance because he would have been much tougher than the Independent proposer of the matter of public importance has been. I found that a fascinating statement. In this debate we have certainly heard a lot about ethanol and the importance of ethanol as a future source of fuel for motor vehicles, yet one of the things that is a strong disincentive to individual car drivers utilizing ethanol is a really malicious and wicked campaign that was prosecuted by the Labor Party against ethanol saying that it would destroy your engine. In fact there was hardly a single thing that went wrong with your car that ethanol did not cause!

That was a deliberate policy of the Labor Party to try to put suspicion into the minds of motorists, and it was very successful. It was successful to the extent that you had service stations around Australia putting up signs saying ‘No ethanol here’. That was in contradistinction to the situation in the United States, which has been pointed out by the member for Kennedy.

If we are really being honest in this debate, we have to look at the parameters that the government has set, in which it acts against the simple rhetoric of the opposition, which has gone from a position of saying, ‘Ethanol is wicked and bad, and we’re here to tell you so,’ to a position where it gets into bed with the Independents and says, ‘Actually, we like ethanol and we really think we are on the same side.’ So the degree of hypocrisy in this debate coming from the opposition is just mammoth.

If we look at the situation of the allegation in the MPI—that is, the government’s reluctance to act—I think it is important that we perhaps look at some factual bases of the way in which the escalating world price of crude is impacting on all of the OECD countries. You do not have to be a super sleuth to realise that the impact of China and India wanting added resources and added oil is adding to the price—plus, of course, the conflict that exists in the Middle East.

There is a very interesting graph that has been put together by Treasury based on estimates from the International Energy Agency—and it has been the practice to hold up graphs in this chamber today—and it shows that the cost of unleaded petrol in all of the OECD countries does not vary much. You can draw a straight line down and see that it is a constant price right across the developed countries. To that basic price is then added a selection of taxes. Of the countries on that list, Turkey has the most expensive petrol in the OECD by virtue of the taxes it puts on its unleaded petrol, and Norway comes in next. Then there is a whole clutch of European countries and then, right down the bottom, the last three countries are Australia, Canada and the United States. In other words, the action that the government has taken to reduce the incidence of tax so that individual motorists are not bearing an untenable burden has been quite responsible.

The first thing we did in 2000 with A New Tax System, when the GST was put on petrol, was to lower the petrol excise by 6.7c per litre so that there would not be a great increase in the cost of a litre of petrol. Of course, as was pointed out by the member for Indi, all the GST money is paid to the state governments. The Queensland government elected to use part of its GST to subsidise the cost of petrol in Queensland, which is consistent with the position it took prior to A New Tax System coming in and prior to the decision of the High Court, which said it was illegal for state governments to put so-called franchise fees—or whatever other name they chose to call them—on petrol because it was an excise and the Constitution said only the Commonwealth government may charge an excise. So, suddenly, all the states except Queensland had a great deficit in their budget. They asked the Commonwealth government if we would apply that tax on their behalf and then rebate it to them, and that is precisely what we did. But the premiers were sufficiently dishonest to then say that they did not have any petrol taxes in their states, and that the federal government was putting on the tax, when in fact it was at their request that we made up the deficiency when their own taxes were declared to be invalid.

So Queensland has elected to use part of its GST to reduce the cost of petrol in that state by about 9c a litre. That option is open to every other state and territory in the Commonwealth, but Mr Bracks has said he will not do it. I have not seen one single state premier or head of the territories say that they will follow the Queensland example and subsidise petrol in their state or territory. The fact of the matter is that the amount of money guaranteed to the states until the full impact of the GST was felt has been far exceeded by a very considerable sum from the collections of GST. This means that the states and territories are far better off than they would have been under the old arrangement. So they are perfectly at liberty, by good management if they choose, to use that GST money to subsidise the cost at the bowser for individual drivers and other consumers of petrol.

The second thing that the federal government did was in 2001, when we got rid of the automatic indexation of excise on petrol. That was something introduced by the Hawke government as a revenue measure, and it was in 2001 that this government said we would not allow that to continue and that we would abolish it. In fact we have reduced the impost of excise to 38c per litre. It is not a percentage figure and it is not a moveable feast; it is a fixed sum. So there is no additional benefit to the Commonwealth that accrues with the increase in petrol price. So the 38c per litre is fixed and does not depend on the price at which petrol is sold.

The net result of the actions we have taken is a saving of around $13 billion for petroleum users. If we had not taken that action, petrol would probably be around 17c per litre more than it is now. So to simply say, as this MPI does, that there is a reluctance by the government to act is not true. And it is not true also because the government is prepared to listen to suggestions that people are making, whether that is helping people convert their cars to using gas as a source of fuel, as distinct from petrol, or some other thing. Of course the use of ethanol is supported by this government. It is not mandated, but it is thoroughly supported, advocated and indeed proselytised in trying to remedy the damage done by the Labor Party when it went out to maliciously damage the reputation of ethanol.

So, in replying to those who have spoken on this MPI, I can say that I believe there is an acceptance and an understanding in the electorate that the cost of crude oil has gone up due to factors beyond the control of any of the governments of the OECD or of any government that may be elected in this country. The fact of the matter is that it is an international price that flows through here, but we have been sensible in the way that we have dealt with tax on fuel so that we have reduced the impact on consumers, and we are listening further for ways in which this can be done. (Time expired)

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