Mathias Cormann (WA, Liberal Party, Minister for Finance) Share this | Hansard source

Let us be very clear about what it is the government is doing. In the budget the government announced that we would reintroduce regular indexation of the fuel excise. Indexation of the fuel excise was abolished, as senators would be aware, back in 2001. At that point, the value of the excise as a percentage of the price on fuel at the pump was worth about 42 per cent. That has fallen to 25 per cent today. The decision we made is that we wanted to preserve the real value of the excise on fuel moving forward, that the deterioration on the back of inflation of the value of the excise on fuel needed to stop. That is why we very openly and transparently set out in the budget that we would reintroduce that fuel excise indexation. That will have a modest impact on households. The typical household, using about 50 litres of fuel a week, will pay about 40c a week more for their fuel by the end of the financial year. There will be an additional cost of 40c a week for the typical household. This will enable us to make a significant additional investment in road infrastructure—job-creating, productivity-enhancing infrastructure—helping us to build a stronger, more prosperous economy so that everyone can get ahead. It will raise, in net terms, about $2.2 billion over the forward estimates, $19 billion over the next decade. If the Labor Party is opposed to it they should tell us where the money is going to come from, given that they are going to bring the budget back to surplus sooner. (Time expired)