Wednesday, 20 November 2013
Minerals Resource Rent Tax Repeal and Other Measures Bill 2013; Consideration in Detail
Today, a government which say they care about cost of living have ripped money away from Australian families. Today, a government which say they care about small business have increased tax on small business. Today, as members leave the chamber, a government which say they care about red tape for small business have increased red tape for small business. Where is the member for Kooyong whose job it is to reduce red tape? He just voted to increase red tape for small business. Every member opposite, with all their rhetoric about small business, just voted to increase taxation on Australia's small businesses. All their rhetoric about cost of living, all the crocodile tears about the carbon tax, all the rhetoric in the election about Australian families and they are taking away $400 per primary student and $800 per high school student from Australian families—$15,000 over the school life of an average family with two children. This government have just voted to repeal support for the Australian families who need it most.
We will not be lectured by this government about cost of living. We will not accept their crocodile tears about the pressures on Australian families. We will judge the government by their actions not their words. Their actions are actions which hurt Australian families. Their actions are actions which take money away from Australian families. Here is the member for Kooyong. He is in the chamber. He voted to increase red tape on small business and he is happy about it. 'Member for red tape', explain why now under the Abbott government the Australian small business community will have to fill in paperwork to claim a deduction which they would have gotten automatically under the previous government?
I am delighted to take the question, Madam Speaker.
The member pretends! It was a lot less than he pretends, but he is voting to increase regulation.
Mr Frydenberg interjecting—
You just did! You just voted to increase regulation on Australia's small businesses and you will be held to account for it. You will be held to account for it for the next three years. It is right and proper that democracy acts in the other place. The other place now has the right to vote on this bill, which this government has just enacted in this House.
In this House and the other house there are people looking for a voice. There are people on low- and middle-incomes looking for a voice. In fact, one in three Australian workers say, 'Why don't I get a tax concession when I save for the future? Why don't I get, not a large tax concession, not a huge tax concession, but just some help to save for the future?' I invite honourable members to explain why they think it is fair that somebody who happens to earn under $37,000 gets zero tax support for saving for their retirement. Zero! The government thinks it is fair that somebody with more than $2 million in their superannuation account gets an increased tax concession but somebody who earns less than $37,000 gets none.
We just do not think that is unfair: we fixed it. We fixed it in office by saying to Australia's low- and middle-income earners, 'You deserve a bit of support. If you're going to save for the future, you deserve a bit of help. You deserve a 15 per cent tax concession so that you can save for the future and you don't have to rely on the age pension, because we think that's fair.' That is what our values tell us is right.
Our values tell us that it is right and proper that a shop assistant, a factory worker or somebody who is working away to try and earn $37,000—whether it be full-time or part-time—deserves a bit of help; they deserve a bit of support. The Abbott government—which some people on under $37,000 would have voted for, and they have been betrayed by this government today—says, 'You're on your own. We don't care if you can save for the future. We're going to take away your tax concession. But we can afford to give one to you if you've got more than $2 million in your superannuation account. That's fine. We can afford—' (Time expired)
Here we hear the same refrain from the Australian Labor Party: do not get between the shadow Treasurer and the opportunity to extend the credit card, because if Labor has an opportunity to be out there claiming to be a friend of the Australian family, even if it involves borrowed money, then we know they will take it every single time.
The shadow Treasurer stands up and says, 'We won't be lectured to about the cost pressures on Australian families'. But it is the Australian Labor Party that has left a legacy of over $400 billion of debt. It is the Australian Labor Party that in this very debate is arguing to set increased expenditure of some $13 billion.
We already know that the shadow Treasurer stood up and said, 'Oh look, there were, I concede, a couple of problems with respect to the design and implementation of the mining tax'. But let's look at what these so-called problems that the shadow Treasurer identifies actually are. A projection of $49½ billion worth of revenue, subsequently revised down to being a projection of around $24 billion worth of revenue, with expenditure of some $16 billion tied to it and what is the actual outcome? The actual outcome of Labor's trumpeted mining tax is, in net terms, $400 million. And yet the Labor Party comes in and the shadow Treasurer says, 'Oh, we won't be lectured to about standing by Australian families,' as if in some way they should wear a badge of pride that they are sticking up for the next generation of Australians.
Let's be clear, Labor Party, about what the Labor Party is intending to do. The Labor Party's approach in this debate, consistent with their approach in government, is to keep borrowing and borrowing and borrowing and borrowing! The Australian Labor Party is perfectly happy to keep borrowing more money. And guess what, Madam Speaker? They will keep dishing it out. It is like the show, Treasure Island. The shadow Treasurer is like the P Diddy of his side. You can see him with one dollar notes, just throwing them up into the air if he wanted to, because he is a man of largess, a man who cares. But the reality is that that is not the right thing to do by Aussie kids. It is not the right thing to say to Aussie kids, 'Here, we'll give a cash splash to parents to make ourselves more popular', but the actual consequence of that is that they are going to be paying off that debt for decades. That is Labor's legacy: decades of debt. And that is the only consequence that will arise.
Opposition members interjecting—
The other extraordinary thing, as I stand here at the dispatch box, is that opposition members are interjecting, but they want to put up the debt ceiling. Well, der, Labor members; because you are the people who in this current situation are now arguing against a $13 billion reduction in expenditure. We are trying to reduce expenditure by $13 billion. The Labor Party is opposing a reduction in expenditure.
The Labor Party is opposing a reduction in expenditure and they are saying, 'But hang on—why do you want to increase the debt ceiling?' Well, it is because lunatics like the Australian Labor Party want to keep taxing and spending and taxing and spending, and borrowing and spending and borrowing and spending. That is the reason, and it is the exact reason why, as a government, we are determined to make sure that the Labor Party—
I withdraw, to assist the House, Madam Speaker.
So, they are a precious lot over there, aren't they? But the reality is that with respect to Labor's approach, it is crystal clear. It is crystal clear that Labor's approach is not to recognise at all the message that was delivered to them from the Australian people, that the Australian people can walk straight through their attempts to buy their way back into office. The Australian people have had enough of Labor's approach, which saw them borrow money, and spend money and increase taxes to spend more money. The Australian public does not want to know about the old approach of the Australian Labor Party. They want a government that is focused on reducing debt, on reducing the deficit and on reducing expenditure in order to get that mountain of debt under control.
So I say to the Australian Labor Party: if you are genuinely serious about reducing Australia's debt, do not vote against this bill.
This afternoon we heard something which I think was an illustration of where this government is coming from. This afternoon in question time the Prime Minister, in response to a question about these matters, said, 'It's not all beer and skittles.' Dead right it's not all beer and skittles! It is not all beer and skittles for small businesses in this country. It is not all beer and skittles for families in this country.
Let's make it very clear. At this last election we went to the polls and in my electorate I canvassed the community on the issue of the schoolkids bonus. In fact I can tell you, certainly without debate from my perspective, that the reason I am here is because I campaigned on that very issue in bush communities. Remember, 40 per cent of my constituents are Aboriginal people living in remote communities—the poorest Australians. The average age in the Northern Territory is 30 years. It is the youngest constituency in this country. Aboriginal people have large families. These kids are the most disadvantaged in the nation and they live in communities with the highest cost of living in the nation. They have benefited from the schoolkids bonus more than almost any other Australians would have.
Yet now we have got to tell them that it's not all beer and skittles, that you've just got a cop it, because the Prime Minister went to the last election saying to the Australian people: 'We're going to give you one up the ribs. You'll feel it all right, because we're going to take away the schoolkids bonus. We're going to affect your lives in a way no other government has done and we're going to do it to make sure you feel it.' And today we had confirmation that that is what it was meant to do. It was designed to hurt the community. And he stands up here, proud as punch, and says, 'Well, we had to tell the community it's not all beer and skittles.'
Dead right it's not all beer and skittles—a disgusting episode by a Prime Minister who should have more faith in the Australian community. Not only the Prime Minister; but all of those people on the other side who go into their communities and no doubt tell all the families, the low-income earners, what this is going to do to them. How many of them actually went to the election telling people that they were going to abolish the schoolkids bonus? How many of them? How many of them went to the last election saying they were going to abolish the income support bonus? How many said they were going to abolish the low-income superannuation contribution? Not one of them. That is the truth of it—not one of them. Did they go out knocking on doors saying, 'Oh, by the way, how many kids have you got?'
I support the carbon tax. Let's be very, very clear. When you have knocked on the doors of those people you were doorknocking and you saw them walk out the front door with three or four kids, did you tell them, 'Oh, by the way, the money you're getting for those kids'—$400 here, $600 here, added up to $1,200 per family across the country as the average. You know very well, you proud wearers of that great mantle of the Liberal Party, went to the Australian community knowing that you were not going to tell them any detail.
Mrs Griggs interjecting—
You tell me, Member for Solomon, which of your community members did you tell you were going to take money off them? Not one. You are shameful.
I am so pleased, thank you. But let's be clear: in my community this will have a dramatic impact on the lives of thousands of people. Thousands of families are going to suffer as a direct result of this—and they simply do not care. I know that every Australian, particularly those who are low-income earners, are rueing the day, if they did vote for the Liberal Party, that they voted for them. They now know that they are going to be deliberately hurt by this government. The Prime Minister admitted it today when he said, 'Look, they just have to accept life's not all beer and skittles.'
The constant disregarding of the Australian people's views continues in this place yet again. The reality of the election still has not hit the once great Australian Labor Party. We just saw another member, the member for Lingiari, get up here and continue the great sook that is going on on that side of the chamber—and we have got two more weeks of it in the rest of this year. The reality just has not sunk in yet for those sitting on the other side that there is a government that said to the electorate, 'We will do something,' and then you follow through and you do something. What a shock! You do not say, like the member for Isaacs did, 'There will be no carbon tax under the government I lead,' and then, three months afterwards, 'Oh, that's what we had to do to get through the election.' You do not say, like the member for Chifley, wandering around with his big red button before the election: 'Ding, ding, ding! There's more NBN. Ding, ding, ding!' The new Minister for Communications will daily take him through every little bit of embarrassment that he will have to live through for that record. I know the member for Blaxland must be very thankful that he has been given that gem of a portfolio to look after now, thanks to the member for Chifley and his efforts in government!
The truth about this debate is we have an Australian Labor Party who refuses to accept the election result—utterly refuses.
Mr Dreyfus interjecting—
Don't talk to me like I'm an air hostess! This is an Australian Labor Party who absolutely refuses to accept the election result. We said prior to the election that we would—
Thank you, Madam Speaker. On a point of order, the member made what I regard as disparaging comments about air hostesses. I would like him to clarify what he meant by the comment that he made about calling the member for Isaacs an air hostess.
If the member for Canberra wants us to walk through what happened on an aeroplane with the former Attorney-General and his behaviour, I am happy to. That is exactly what I was referring to.
Thank you, Madam Speaker. I will return to the point of this debate, which is the abolition of the absolutely failed and flawed piece of legislation that the current member for Lilley—not 'current' for much longer, we understand—and the current shadow Treasurer supported.
Mr Dreyfus interjecting—
Thank you, Madam Speaker. The Labor Party will not accept that they lost the election, an election when we put very clearly that we would abolish the mining tax—
Mr Dreyfus interjecting—
Thank you, Madam Speaker. The choice is very clear for the Australian Labor Party: accept the Australian people's verdict. We took this to the election. We made it very clear.
Ms Owens interjecting—
That is exactly what I just said. We said that we would abolish this tax. We said that we would abolish the payment because the money did not exist! You told them fibs. The money did not exist. Get rid of the bill. Get rid of it now and stop the shame.
Madam Speaker, what I, and I believe the Australian public, are sick and tired of are Liberal governments cutting the money out of our education system. When we look around Australia we see example after example of state Liberal governments ripping money out of the heart of our school system, our TAFE system, and our education system as a whole. What is most offensive about this particular piece of legislation is not just that it is yet another Liberal cut to education, but that it is the sly, sneaky and deceitful way it is being done. Let us be very clear about this. This has been slipped in. Cutting the Schoolkids Bonus from 1.3 million Australian families has been slipped in. It has been slipped in under 'other measures'.
Let us be very clear: the Schoolkids Bonus has absolutely nothing to do with the MRRT. In fact in the 2012-13 budget some measures were grouped together under the 'spreading the benefits of the boom' package. The measure to introduce the Schoolkids Bonus, however, was absolutely not. This is just a way for this government to sneak in an education cut in the MRRT legislation.
The Schoolkids Bonus replaced the existing tax refund, the Education Tax Refund, which refunded the money that Australian parents were spending on school related items. We know that many parents struggled to meet the costs not just school fees but also school uniforms, books, school excursions and of a whole range of different expenses associated with education. Those opposite are claiming that they were upfront. The member for Solomon said that she told all of her constituents that she would cut the Schoolkids Bonus—she doorknocked them, she put it in all their brochures. The Australian people want the schoolkids budget cut, according to the member for Solomon. But let us just be very clear about this. What those opposite actually said about education during the campaign was misleading. They misled the Australian people by saying that they were on a unity ticket with the Labor Party when it comes to education funding. I wish that were the case. But if you are on a unity ticket, I tell you one thing, there would be 1.3 million Australian families who were not about to have their funding cut.
We know that this is incredibly important to these Australians. We have heard today from grandparents in Victoria—and what did they say about the Schoolkids Bonus cut? I think the term was 'unusually cruel' for a government to want to come in here and do this.
The member for Kingston has a very good point. We wish it was unusual when it comes to this government. We have had just five sitting days and this government is proudly on the fifth sitting day cutting the funding for 1.3 million Australian families, funding which goes towards supporting the costs of their children's education. So if those opposite want to be proud about that, then I think that they should have a long and hard think about the 'unusually cruel' message from grandparents of Australia. If you do not want to listen to the grandparents, that is one thing—
Mr Ciobo interjecting—
They want their Schoolkids Bonus cut, do they?
Mr Ciobo interjecting—
Even the member opposite will not admit that they want it. I want to share with you what some other Australians have said about the Schoolkids Bonus. We have been receiving a lot of feedback about just how important this legislation is.
Isabel, for example, said, 'The Schoolkids Bonus has helped my family and community go to school, to buy uniforms and schoolbooks as well as many other things which are just vital to an education. The Abbott government is cutting so much more than financial aid, but opportunities and disadvantaged families.'
Mr Ciobo interjecting—
Now the member opposite might like to think that Isabel does not exist, but she does and there are thousands more of them. There are thousands like Simone who said that she was among many who have said that she had used it for books and uniforms, and she just does not know how she will be able to get all of these books for her children next year under this government.
Then there is Karen. Karen makes a very good point about the greater cost to the local community when she says, 'I think most parents who are eligible would have used it on school uniforms, on shoes and stationery. Small business will miss out too. Kids still need items but, let's face it, you have to make sure it's budgeted for and that means being much more frugal with Christmas shopping and groceries and holiday activities over the Christmas break.' She says, 'I would like to know what the total amount was that was budgeted for, because it would have worked as a stimulus to our economy. It would have helped support small business in our economy.'
This is shameful. It is sneaky and it is deceitful. The Liberal government must stop cutting education funding. (Time expired)
In the consideration in detail stage of this bill we are considering one of the worst examples of public policy we have seen in recent times. In the future, no-one will go back to the mining tax and its various iterations and hold it up as a proud example of a functional federal government. Let us just go back and remember. In its first iteration, with Kevin Rudd mark 1, this was a mining tax, the resource super profits tax—because profits are bad—and it was expected to raise $49.5 billion. Then it was revised to the MRRT, and it was forecast to raise $26½ billion over five years. And now we see that, since it began, the MRRT has raised only $400 million. The former government had all these compensation measures to compensate people for the impact of the mining tax, but the mining tax raised no money. They locked in more than $16.7 billion in spending over the forward estimates, or $18.4 billion of expenditure on a fiscal basis over the current forward estimates.
It is disingenuous of the opposition to come in here and talk about this measure or that measure which is going as a consequence of the abolition of the mining tax. This was one of the central policies in the federal election, and the Labor Party fought it out as well. They had their internet stuff about the schoolkids bonus. We all saw that. People were very aware. But the problem with Labor's approach to spending is that it was simply unsustainable.
We have heard the argument that, no, the schoolkids bonus was not part of the mining tax. The former government were very clear on this. Former Minister Penny Wong, Senator Wong, from South Australia, linked the payment of the schoolkids bonus to the proceeds of the MRRT. She said:
I think it's about making sure we use the benefits of the boom wisely. And I think the Government's approach with the mining tax and making sure the benefits of that flow through to families, particularly low and middle income families through the School Kids Bonus, where people get assistance for kids' education costs—
does that. That was Senator Wong on 891 ABC Adelaide Drive with Michael Smyth on 6 June 2012.
Now, there are arguments for a resource tax. This was done in Bass Strait, and the Hawke government was actually a very good example of how to achieve this. But the Rudd and Gillard governments just completely mismanaged this. They came up with a mining tax which raises no money and linked it to $12 billion to $15 billion of spending, of compensation for a tax which raises no money. It is simply unsustainable.
I want to say something about the impact of this in South Australia. Everyone in South Australia has been anticipating the benefits of the mining boom for a long time. The state government were always spruiking it: with Olympic Dam, we were going to see 20,000 jobs. But having a mining tax does not make investment in mining go ahead. Having a carbon tax does not lead to the conditions that are going to make someone invest and see it go ahead.
The Liberal Party have said that we need to do everything possible to see that Olympic Dam goes ahead. We cannot promise that it will go ahead, but I can tell you—as sure as this—that having a mining tax in place makes sure that it does not go ahead. The Prime Minister has said:
I want to do everything I humanly can to help this expansion to go ahead by not having a carbon tax, not having a mining tax, and trying to ensure that we don't have bloated construction costs because of union militancy through the restoration of the Australian Building and Construction Commission.
It is very simple. We need to remove the government of— (Time expired)
The government is making much of the fact that the mining tax does not work, that it does not collect and will not collect enough money, and that is true: it is not working as it was hoped it would work. It is not collecting the sort of money that it was expected to collect. But, instead of just getting rid of it, why doesn't the government fix it? There are any number of ways in which the mining tax could be enhanced to achieve the sort of revenue that is in the forward estimates, the sort of revenue that this country desperately needs to look after the people who need looking after the most.
At the end of the day, what is the role of government? Yes, it is to keep our country safe, but it is also to make sure that everyone gets a fair go in the community. It is to make sure that the people who rely on the public health system can have the best public health system in the world, that the people who need to rely on the public education system can have the best education in the world, that the people who need to rely on public housing do not have to wait years on a list and that people with a disability get the very best care in the world. That is a primary responsibility of any decent government.
Surely it is the responsibility of this government to pick up the mining tax that it was left by the previous government and fix it—for example, to do away with the outrageous depreciation provisions, to prevent the three mining companies that basically designed the tax from getting away with blue murder. The fact is that companies like BHP, Xstrata and Rio have so much that they can write off that they will pay next to no tax for quite some time to come. Well, let us get rid of those depreciation provisions, make the settings right and allow the tax to collect the sort of money it should be collecting.
What about increasing the rate? The fact is that, if any company in this country is making a genuine superprofit, they should pay their fair share of tax. Maybe consideration should be given to increasing the rate. Consideration should be given to fixing the royalty provisions, which are allowing state governments to do whatever they want with the royalties, knowing that they will be reimbursed by the Commonwealth.
What about expanding it to other resources? What about expanding it to gold or expanding it to uranium instead of having it restricted to a very narrow set of resources? In fact, while we are at it why don't we have a conversation about doing this right and, instead of having a very narrow resource rent tax, having a genuine superprofits tax because surely any business in this country that makes a genuine superprofit can afford to pay a bit more? In the fiscal year 2012-13 the four banks made almost $30 billion in profits. Four Australian companies made almost $30,000 million in profit. Now they are crying poor; they are saying it is a very poor return on their investment. I reckon that is hogwash. Surely the banks and the big miners like BHP, Xstrata and Rio can afford to pay a bit more, because it is completely unacceptable that we continue to live in a country where people wait three years for a hip operation, go to a substandard school despite the best efforts of the teachers, wait years for public housing and live in states where the government will not even cough up $300 for a wheelchair while companies like BHP, Rio, Xstrata, the Commonwealth Bank, Westpac, ANZ and NAB are pocketing enormous sums of money. There is a fundamental inequity in this which a decent government would do something about.
Even if we do not have a superprofits tax applying to all companies that operate in the economy, let us at least have the sort of resource superprofits tax that Ken Henry recommended. Ken Henry is one of the leading minds in this country. He made a number of very well researched, credible recommendations to the previous government. If the previous government was not going to listen to those good recommendations then maybe a decent current or future government will pick up those recommendations and run with them. The federal budget for this financial year has a revenue forecast of $388 billion—that is, $388,000 million—yet we are going to rip money off people on low incomes who want a bit of a hand with accumulating their super and we are going to take money from disadvantaged families who need a bit of help with their school costs.
What is going on here? We talk about a corporate rate cut. We are talking about a better deal for the miners and not getting into the banks when in any number of electorates people need a bit of a hand and this tax is one way of creating the money to give them a hand.
We have heard the members for McMahon, Lingiari and Adelaide talk about what they think is going to be taken away from people. I can tell you that the mining tax, combined with its toxic partner the carbon tax, took away something from many North Queenslanders and many Central Queenslanders. It took away something very fundamental to them. It took away their jobs. There have been over 8,000 job losses in the Queensland coal sector, according to the Queensland Resources Council. There were 37 job losses in Mackay announced by Thiess yesterday. There have been dozens of mine closures throughout the Bowen Basin. There has been a domino effect through the mining service sector in Mackay. We have had scores of job losses in our local town and it is hurting a lot of people.
If there is one thing you do not want to take away from someone, it is their job. That is what the last government did with its carbon tax and its mining tax. To fund their out-of-control addiction to spending and waste they found an ATM and the ATM was the mining industry. The mining industry was contributing about $20 billion a year to state and federal coffers back in 2010 but that was not enough. The original estimate, as has been said before, was that the mining tax would collect around $26.5 billion from 2012-13 to 2016-17. What did it actually collect? A few hundred million dollars. The forecast in PEFO was that it was down to $4.4 billion over that same period. I think the figure it has collected right now is $400 million. So it utterly failed. Despite the failure to raise revenue, the impact on the industry was huge.
I note the contribution by the member for Denison, which no doubt is supported by the member for Melbourne. These guys were saying, 'Let's just fix the tax so we get some more money.' You will fix the mining industry. You will fix towns like Mackay that rely on the mining industry. You will fix them good. You will close them and they will become ghost towns because the tax will be even worse.
I challenge the member for Melbourne to come to Mackay. I will walk him down Paget to see some of the business owners and workers who are sweating on whether the next job is going to turn up from BHP or Rio. They are sweating on whether they going to get the next contract because there is no investment at the moment. They are waiting for us to repeal these taxes. They are waiting for the people in the Labor Party to support our measures to repeal these taxes.
If it went down the track that the member from Melbourne wants, there would be no mining industry. They should be honest and tell the people that their ultimate agenda is to close down mining. It is not all the Labor Party's fault in this and the carbon tax, because these guys were niggling them from the sidelines of the last parliament making them do all this crazy stuff. They are very culpable for the outcomes. The outcomes for my community have been absolutely disastrous. The goose laying the golden eggs for the nation has been almost plucked to death through this mining tax. The dark ages of the previous government have well and truly finished. The adults are now back in charge of running the country and we are open for business. I have to say that we are going to axe the carbon tax and the mining tax one way or the other, with or without the opposition's support. After 1 July next year we will be given that chance if they do not support us now.
Mining will come back. It will rebound if it is given half a chance. There will be life in the mining industry and new jobs throughout North Queensland and Central Queensland. But we have to ask ourselves: was this carbon tax actually worth it? The industry told us it was not worth it.
An opposition member interjecting—
Well the mining tax wasn't worth it either. The subsequent loss of investments told us that it was not worth it. Families who lost their jobs told us it was not worth it. And, more importantly, the people of Australia told us on election day that it certainly was not worth it. These people should do the right thing and vote with us to get rid of this mining tax, and also vote with us to get rid of the carbon tax.
I am really pleased to be able to get the opportunity to speak on this, because of course the Liberal Party gagged the debate on this really important issue. It is disappointing that I have not heard from any of those on the other side give any commitment to the principle that the Australian people own the minerals in the ground. They have failed in this debate to ever mention the fact that these minerals are owned by the Australian people and that dividends from these minerals should go back to the Australian people. It is very concerning to see the priorities of this government, the priorities that say, 'Give the money back to the mining companies; give the money back to those who can most afford it and take it from those who can least afford it'.
I was somewhat surprised when the Prime Minister got up in question time, I think it was yesterday, and said he was a good friend of the worker. I could not think of a statement that was more ironic—I took it as irony—because we now see this bill before the House that is abolishing so many things that are important to low-paid workers, and in particular the low-income superannuation contribution.
Who would have thought it would be the Liberal Party that would be putting tax back on? They talk a lot about tax, but what they are doing by abolishing the low-income superannuation contribution is putting a tax back on our lowest paid workers. Many of these workers are in my electorate—in fact there are 25,300 of them in my electorate who are going to have a 15 per cent tax put back on. These people work very hard. Many of them are working as sales assistants, checkout operators and cleaners. They are people who are working hard and they are putting money away for their retirement. But what do the Liberal Party want to do? They want to come and snatch 15 per cent of that back. They want to snatch it back and ensure that low-income workers have less money to retire on, less money to make ends meet when they finally retire.
But it does not stop there. Those opposite are delaying the increase of nine per cent to 12 per cent superannuation. They are delaying an important part of our policy, which was to ensure that people retired on an adequate income. Of course the Liberal Party have never been a friend of superannuation. They have never liked superannuation. That is why we see—
Yes, the member for Warringah, before he was Prime Minister, actually said it was a big con. We have had to drag them along kicking and screaming, but we still see—they are not willing to come out and still say it is a con, but they will give a little sidekick to it every now and again, hurt those who are most vulnerable and ensure the delay to go from nine to 12 per cent means that so many people will miss out.
It is not only low-paid workers that this government is out for, it is also our most vulnerable. These include those on a disability support pension. I have many people in my electorate who are on a disability support pension. We know when the coalition were last in government that they refused to provide bonus payments to those on a disability support pension. They have come along again and, a couple of weeks into government, they have gone straight for those on disability support pensions and other payments by abolishing the low-income superannuation contribution. That has been a really important element that many low-income workers and those who are on things such as the disability support pension payment have relied on, and this mean-spirited government is taking that away.
Then we come to the Schoolkids Bonus. We know that those on the opposite side have always been against the Schoolkids Bonus. In fact, I remember the debate in this House when many of those on the other side lined up to say that parents would waste this money: parents would not spend it on their children, they would not spend it on anything sensible; they would probably go and spend it on alcohol or other things. Member after member of the then opposition got up and said that parents would not spend this money properly. They did not have trust in Australian families. What we on this side of the House know is that this money was really, really important to parents to pay for things like uniforms, books, excursions, swimming lessons—a whole range of things. This mean-spirited government once again is going to rip that away from many families. I ask the government to rethink this and to not continue on with this mean-spirited policy.
It is always very interesting to follow the member for Kingston. I am sure if anyone was listening to the member for Kingston's contribution, they may be confused to think that the mining industry actually pays no tax and that these big evil multinational companies are coming in and stealing these mineral resources, which rightly do belong to all people of Australia, out of the ground and not making any contribution to the nation. Nothing could be further from the truth.
We know that our mining companies pay substantial royalties to our state governments. Not only that, we know when you compare the term of the Howard government to the years of the Labor government, then those royalties that the state governments have enjoyed have more than doubled. And we also know it is the same with company tax. That is right: people listening to members of the Labor Party may have forgotten that the mining companies actually pay company tax on the profits that they make. And those profits we have seen more than double since the years of the Howard government compared to the last years of the Labor government.
But it is not only the royalties, it is not only the company tax, it is also the payroll of these companies. The payroll of the mining companies in the last year was close to $30 billion. They paid the Australian economy $30 billion worth of wages. Of course, all those wages go in and the people who earn those wages pay income tax. The average full-time wage of the 249,000 people that the mining sector employee is $125,000, which of course creates enormous economic activity throughout the entire economy and especially in our regional areas. The mining sector is also the largest employer of our Indigenous sector. There are more Indigenous people employed in the mining sector than in any other sector throughout the economy.
Our nation is getting enormous benefit from the mining sector, and that is why this tax is such a risk. It is a risk because it makes our tax regime internationally uncompetitive. Australia is not the only nation that has the benefit of coal and iron ore in the ground. Of all the world's coal resources, Australia holds but seven per cent; 93 per cent of the world's coal resources are held outside Australia. If we are going to compete for the capital investment from the mining sector we must have an internationally competitive tax regime. That is something that, unfortunately, the Labor Party fails to understand. The prosperity and wealth the we enjoy from the mining sector is at risk from this ill-designed tax.
The other concern is all the promises that the previous Labor government made—and they now continue to make in opposition. Basically they want to become the Santa Claus party of giving things away. It is very easy to promise things—to promise the schoolkids bonus, to promise things to small business, to promise things to all different sectors of our economy—but you have to be able to work out how you are going to pay for it. That is something that the opposition seems completely oblivious to.
I would like members of the opposition when they go out to their schools in their coming presentations to walk into those schools and apologise—to stand up, look those little kids in the eye and apologise to them and say: 'Because of our incompetence over the last six years, running the five largest budget deficits in our nation's history, you kids are going to have to pay the interest on our debt. Somehow you have to pay it back and every single year the interest repayments alone will be $10 billion.' In each electorate around the nation, that is $200 million— (Time expired)
It is interesting to hear the members opposite concentrate almost entirely on the needs of miners in the speeches that they have made today. There are, of course, a number of other measures in this bill which will dramatically impact on small businesses around the country and in my electorate. I want to address those, because we are losing some very important measures tonight with this vote.
The first one is the loss carry-back introduced by Labor as at the 2012-13 year. It was a measure requested under the Henry review and strongly supported by business advocates around the country—by accountants, by small business associations and small businesses themselves.
When you use the words 'loss carry back' you assume it is about a business that has a bad year and makes a loss and is able to carry that back. That is part of it, but it is also a measure that assists businesses whose economic cycle is not actually a 12-month cycle. It is one of my great interests that the whole field of accounting was actually created by a monk in the agrarian age, when the annual cycle was the norm. For a lot of businesses it is the norm, but for other businesses that work in highly creative fields that have long development lead times because they are developing new products or film or intellectual property the economic cycle is not one year and the losses in one year can be substantial and the income can flow in a very lumpy way in one year or another.
The parliamentary secretary opposite said it was a Liberal Party policy. Well, you are about to abolish it, Parliamentary Secretary. If you think it is so great, perhaps you should consider keeping it—
because for businesses whose economic cycle is not over a 12-month period, it is an incredibly important measure. As we see innovation, new technology and people working round the world and combining ideas and working in modern forms with intellectual property, it will become increasingly important and not less so.
The other two measures involve accelerated depreciation. We heard the Minister for Small Business today say they are not very sensible measures because a business has to spend the money now and wait till the end of the year to get the tax advantage. I suggest he goes and finds out what depreciation actually is, because standard depreciation is you spend now and you wait several years to get it back in bit-by-bit approach at the end of each year. This actually improves that for small business. It improves the way it was before and it is better than what the government is about to impose on small business again. It allows small business to claim at the end of the financial year an accelerated depreciation up to $6,500 per asset that costs less than $6,500. This is a substantial benefit to small businesses.
I have been in small business myself and I know that one of the things that you think about very seriously when you purchase something is how long the depreciation schedule will last. It is incredibly important for small businesses who have cash flow problems to reduce the period of time between when they spend the money and when they get the tax advantage. That is the purpose of the instant tax write-off.
The other one, of course, is the legislation which provides small businesses a claim of up to $5,000 as an immediate deduction for motor vehicles, new or used, that cost $6,500 or more. I have a string of companies that sell motor vehicles in my electorate. I do not have a Moorooka Magic Mile of motors, but I do have something that looks very much like that.
Of course I know about the Magic Mile, everyone knows about the Magic Mile. I would love to have a Magic Mile. I've got a magic half-mile in Parramatta.
When we introduced the instant write-off during the global financial crisis, the affect that it had on that strip of motor vehicle sellers was extraordinary. The comments that they made about it and the effect that it had was amazing. In fact, when we introduced both of these write-offs in 2012-13, the businesses that sell to businesses—the businesses that sell carpet, the cabinet-makers who make shelving and counters, people who sell refrigeration, people who sell computers, people who sell tools and people who sell motor vehicles—used it as a way to promote their businesses to other businesses. It became quite a focus within the small business sector.
If the government thinks that they made it clear before the election that they were going to remove these tax concessions, they are wrong. The slogan was 'axe the tax', not 'axe the tax concessions'. They left off the last word. The commitment to axe the tax concessions was very silent. These are bad changes and it is a bad bill.
The debate from the Labor Party in relation to the Minerals Resource Rent Tax Repeal and Other Measures Bill 2013 has been predictable. We have seen Labor rail against the various measures that are contained within this bill. And I get it. I get that the Labor Party genuinely hold the view that the abolition of the various incentives within the bill is, for some, a regressive step. I get that. But the reality is that the coalition's approach stands in stark contrast to Labor's approach. We do not do these things because we are cruel people—as we heard in some of the more outlandish claims from members of the Labor Party. We do not do these things because we like to inflict pain on the Australian community—again as we heard put forward in some outlandish comments by the Australian Labor Party. We make these hard decisions because they are necessary decisions.
When members of the Australian Labor Party and the Greens stand up and rail against the Liberal Party cuts and the National Party cuts and say, 'How can you do this?' I will explain the reason. And I will explain the reason in the chamber in exactly the same way as I have explained it in the community. And do you know what, Madam Speaker? The general community gets it. The general community understand why we have to have cuts. The only people who do not get it are the Australian Labor Party and the Australian Greens. And do you know the reason they do not get it, Madam Speaker? It is not because they are thick—some might say that, but it is not because they are thick. The reason they do not get it is because they do not want to get it. The Labor Party and the Greens want to go down a populist path. They want to be able to stand in the chamber and say, 'We fought for the schoolkids bonus.' They want to be able to stand in the chamber and say, 'We fought for accelerated depreciation.' They want to be able to stand in the chamber and say, 'We fought for the tax loss carryback.' That is the reason they do it. But what they always neglect to say is that none of these measures are affordable. They always neglect to say that because they pursued these policies over the last six years, Australia went from net assets to being $400 billion in debt. They always neglect to say that because they pursued these policies the Australian people now have seen the five biggest budget deficits in our nation's history. And do you know what, Madam Speaker? The Australian public get it. They understand that this kind of unsustainable spending is not in our national interest. They understand that the inevitable end destination of Labor's spending, borrowing and taxing is to end up like states like Greece.
The only thing that separates where we are today and a nation like Greece is time. Make no mistake: if the Australian Labor Party still occupied the Treasury benches, together with their mates in the Greens, they would still be spending, they would still be taxing, they would still be borrowing, and they would do it term after term, holding themselves out as the great defenders of the Australian workers. But they are not that.