Mark Bishop (WA, Australian Labor Party) Share this | Hansard source

Before I address the content of the Minerals Resource Rent Tax Amendment (Protecting Revenue) Bill 2012 before the Senate, I want to rebut some of the points that Senator Milne just addressed in her contribution to the discussion. She made the point at the outset that budget commitments need to be funded. I must say on behalf of the government that we are in staggering and startling agreement on that point. That is why we participated in negotiations and agreed to the creation of the Parliamentary Budget Office and funded that; that is why we assisted Treasury and Finance to become parties to the protocol, so that the office can carry out its central function on costing issues associated with undertakings made by any and all political parties. With that little bit of rhetorical flourish, let us just say that the government also shares that view.

Senator Milne then went on to develop a point. Because she is an intelligent woman, I presume the point she addressed is one of rhetorical flourish—that somehow or other all of the minerals and, by implication, all of the oil and gas in and around mainland Australia are owned by all of us, by that amorphous mass called 'the people'. I presume she put that as a rhetorical proposition as we are on broadcast. As everyone in this chamber knows, and they learnt this in their first lesson in Constitutional Law I: minerals under the ground are vested in the Crown in right of the state. That has been the case for I do not know how many centuries and it has certainly been the case in this country since European colonisation in the latter part of the 18th century. But, 240 years since that time, as we consider the utility of the proposition I just outlined in rebuttal to Senator Milne, there is considerable sense in minerals under the ground being vested in the Crown in right of the state: it enables the state, at Commonwealth level, territory level or state level, to essentially regulate and control the use of land, whether that is done in an agricultural sense, a mining sense, an extractive sense or whatever. By 'regulate' I mean allowing access, allowing development and having proper regard for environmental considerations, on both the agricultural side and the mining side.

Consider the only sensible opposition to the Crown not having rights with respect to minerals under the ground. By definition, it would go to some other body. Most logically, that other body would be the individual landholder or leaseholder. We know how that system works, because it works in the United States. One only has to look at the huge degree of development with respect to the coal seam gas industry and the shale oil gas industry in the southern states of the United States, where mining companies pay the owner of the land a fee for access to minerals and the like under the soil, and the development goes ahead willy-nilly. There are a range of benefits from that system to individual landholders and to industry from the cheap gas that emerges from that process. That is probably a debate for another day. On balance, the system we have in this country, of the Crown having control of access to land and land use, is probably a better system. There is a terrible sense of deja vu about this debate. We have been having it every year—we had it in 2009, 2010, 2011 and all of last year—and now, as Senator Milne just said, there is further reference to the application of a minerals resource rent tax.

The bill before the chair attempts to amend the MRRT to achieve two purposes, and Senator Milne succinctly outlined them: firstly, that any increase in state royalties after 1 July 2011 be disregarded when calculating the royalty credits for the MRRT; and, secondly, to disallow provisions of the MRRT so that miners can no longer use the market value method to determine their starting base. So the bill before the chair attempts to remove, to negate, to disallow, the two most critical features of the MRRT Act that is currently proclaimed law in this country. If passed, this bill would totally neuter, make useless, the purpose and intent of the existing MRRT.

When one thinks about that ambition it cannot be described as small. It is no mean purpose that is sought to be achieved in this debate late on Thursday afternoon. But before we can properly discuss the bill before the chair a little bit of a history lesson in the development of the MRRT over the last three or four years would be useful. What does that little bit of history show us? It shows the following. First, the current MRRT Act was one of 11 bills discussed and passed in this chamber on 19 March 2012—almost 12 months ago. That package of bills—there were 10 or 11 bills—addressed a range of matters at that time: an overview of the position of the positive impact of the mining industry; how the MRRT was intended to operate; the revenue forecasts associated with the MRRT; a range of ways in which Australians might share from the benefits of the MRRT; and other tax conveniently avoided up this end but paid in large numbers by firms in the mining industry.

But there were a range of other matters before the chair that day. One went to increasing superannuation from nine per cent to 12 per cent. Some of us might have liked to have gone from nine per cent to 15 per cent in one fell hit, bringing it forward in bites of one per cent a year every year for six years until it reached 15 per cent. There was removal of superannuation age limits. There were benefits in low-income superannuation contributions. There was simplification of asset depreciation arrangements. There was the introduction of accelerated initial deductions for the purchase of motor vehicles by small business. And there were a range of other benefits to sectional interests in our community.

So the MRRT Bill, now the MRRT Act, was not the only matter that was up for discussion back in March 2012; it was one bill as part of a total package of 11 or 12 that were discussed at the same time. Those measures affected the mining industry, the offshore petroleum industry, small business, superannuation beneficiaries and those who enjoy depreciation arrangements for capital investment. When the MRRT package of bills was put up for a vote, the Greens and the current government combined 38 to 32 to support that package, including the MRRT, without amendment. The only parties to oppose it were the opposition over there.

Right from day one Labor government and the Greens brought forward a package of bills. Both parties voted for it, there were no amendments, it went to a division and it was carried 38 to 32. What does that mean? It is very simple: the Greens in the bill currently before the chair seek to negate what less than 12 months ago they stood and voted for, stood and supported, stood and endorsed.