Wednesday, 3 April 2019
Statement and Documents
It's an ex-coalmine—I'll take that interjection. It was a coalmine and now we can get some gas from that mine. The GFG steelworks in Whyalla is also due for a significant upgrade, which is a fantastic thing. Also, at Wudinna we've got the Iron Road project, which is another substantial iron ore deposit where we could open up that region to a significant iron ore mining opportunity. People are working towards these things, but, when I look at the infrastructure that we have in those areas, there's very little in the way of rail to get these commodities to any ports and, indeed, no deep-sea ports in South Australia on the Eyre Peninsula, where we probably could be shipping these resources at relatively low cost. CU-River Mining have an iron ore mine that is very close to Coober Pedy. They're going to have to take their product down to Port Augusta and then load it onto barges to take it out to a ship, a Cape class vessel, that can export that iron ore. It's a rather inefficient way of doing things.
But there's a lack of a plan. There's no plan to look at rail. In fact, I probably mislead the chamber in some respects because one of the priority projects in our Infrastructure Priority List is the Iron Road project, which includes the iron ore mine at Wudinna and a rail line running down to Cape Hardy, where we could have a seaport. But instead of backing that, spending some money and actually seeding that project—a priority project, no less—the government has sat on its hands and done nothing at all to support that project moving ahead. There's a great opportunity for Cape Hardy to become a multi-user seaport where it services the iron ore mine, were it to go ahead at Wudinna. Indeed, grain growers all across the Eyre Peninsula and a number of other companies have indicated that they'd be most pleased to use that port. But, instead of backing that port, somehow we've now got a situation where additional port options have been thrown up. Now we've got options at Port Spencer; we've got options at Stony Point near Whyalla; we've got an option for a seaport at Lucky Bay; we've got an option for a seaport at Whyalla. Of course, all that does is just create confusion. Business doesn't know what to do. We're in this sort of vacuum of leadership, and this will cause a delay and perhaps even prevent some of these projects going ahead—and there's $10 billion worth of economic activity that could flow from these projects. But there is no plan from the government and no funding in the budget to assist in that economic activity.
When it comes to growing South Australia, one of the good things is that we may well get more migrants, but more migrants are no good unless they're well trained. We need skilled migrants. We also need skilled Australians. Leigh Creek will likely employ something like 3½ thousand people; the Whyalla steelworks, 2,500 people; Olympic Dam, probably around 3,000 people; the Iron Road project, somewhere around 3,000 people. This is getting close to 15,000 people when I include the people that will be required in Adelaide for the naval shipbuilding program. It's all good stuff, except that, with the skills package that's been announced in the budget, which I support to a certain extent—there are some problems there; I'll talk about them in a moment—there's no indication of where this training will be located.
I do have a problem. The budget talks about 80,000 apprentices, and most people think that's great. We're creating an opportunity for 80,000 young Australians to get a trade—except that the government has cancelled or hasn't funded the mentoring program that we've seen in South Australia to move completion rates from 50 per cent to 95 per cent. So it's no good creating 80,000 places; I mean, there is some good in that, but it's much, much better to have 80,000 apprentices finishing their trade. The mentoring program that was so successful in boosting the completion rates for apprentices is missing from this budget. That's a little bit disappointing, once again, because of the number of jobs that could be formed in these projects running all across regional South Australia.
I welcome the government's $100 million injection into regional airports. That's really good. We can have some upgrades to our airports—upgrades that would have otherwise ended up being funded by councils—by ratepayers. Air transport is the lifeblood of regional communities. People in regional communities want to connect to the cities. They want to be able to get access to medical services. They want to be able to get access to educational services. Businesses need to be able to get access to their headquarters in the capital cities. We need to be able to get locums to travel to these places. But right now we're facing a problem where we've got very expensive regional airfares. And what have the government done? In last year's budget, they announced that they were going to spend $51 billion on upgrading security at some of the regional airports. That's fine. That pays for the screening equipment, the X-ray equipment, that might be needed to upgrade security. But they failed to pay the somewhere between $530,000 and $760,000 per annum required to operate that security equipment. Councils are somehow going to have to find more than half a million dollars to run those security services at the airports. They can't just make that money. What they're going to have to do is pass that charge on to the airlines, who are going to pass it on to their customers, who are going to raise their prices.
The Senate committee that's looking into rural airfares heard evidence from Qantas, specifically in relation to Port Lincoln, Whyalla and Kangaroo Island—they were the examples given by Qantas—that those services may become unviable when those additional costs are passed on to the airlines. At a hearing we held in Old Parliament House on Monday, the department conceded they had never done any analysis on the effect of these security changes—on these costs to regional communities. That's a total lack of due diligence. They had only looked at things from a security perspective. So we needed something in the budget. If you're going to impose a security regime on regional airports—and, note, it's to deal with national security—then national security should be paid across the nation, not lumped onto local councils. It's a hugely problematic situation that we've got. I foreshadowed in the committee and I'll do so now here in the chamber that I will move to disallow the regulation which requires that additional security, until such time as we make sure that regional communities don't have to bear the cost and perhaps lose air services. That's certainly on my radar for when we come back.
I will go to energy prices: I know that we have the energy assistance package, which Senator Storer mentioned just before. As I mentioned in a speech earlier today, that idea came from Centre Alliance back in 2017, when we were negotiating the tax enterprise bill that gave tax cuts to businesses with a turnover of less than $50 million. So I find it interesting that the bill mentions one-off payments, because it's not a one-off payment; this is an ongoing payment, and it's an ongoing payment because of a failure of government policy. When we negotiated that particular payment with the government, we did so on the basis that people needed help with their electricity bills, their energy bills, whilst the government sorted out our energy problems.
Since that time, we've seen an EIS proposed, we've seen a clean energy target proposed by Professor Finkel, we've seen a NEG, we've seen a NEG plus and we've even seen a big stick waved around, but there have been no changes, which means we now have to make this payment. So I think that payment, that bill, is the most stark evidence that the Senate can possibly have that there has been a total failure in energy policy, in electricity policy, from this government.
And it's not that the Senate wouldn't have supported a NEG. I think we could have got there. There was some debate about whether or not the emissions would use the Paris targets or 35 per cent or 60 per cent—whatever the Greens were proposing. That could have been dealt with. The problem was the coalition couldn't get it past their own party room. In fact, I recall Prime Minister Turnbull did get it past the party room and then a week later, for some reason, just backflipped. Then a week later he was no longer the Prime Minister. So that's a signal in the budget that there's a real problem.
Finally, I'll just wrap up with concerns about GST. It appears that South Australia will lose out on $517 million of GST. We've got a hole in the South Australian budget—a punishment to the South Australians. I remember being in this chamber when we were talking about GST and trying to make it absolutely fair. Of course, we needed to appease the Western Australians. We needed to give them more GST.