Susan McDonald (Queensland, National Party, Shadow Minister for Resources) Share this | Hansard source

Well, we would be providing them with another opportunity, Senator Hanson—would severely constrict regional Australia's ability to support businesses and families.

I also want to touch on Senator Hanson's comments with regard to the PRRT returns and company tax returns. I think what is not well understood is that, when these investments in these projects are made, it is billions of dollars not just in capital investment but also in precursory, environmental and other reviews. That costs a huge amount of money, which is able to be offset on part of the tax calculations, remembering that those dollars are spent in Australia with Australian companies employing Australian workers.

While this bill talks about community benefit, it is clear that mining in this country does already benefit the community in ways that may not appear on annual profit-and-loss statements. If we want to look at industry figures, the resources sector as a whole supports over 1.1 million direct and indirect jobs within Australia, contributing over $32.6 billion in direct salaries in 2021. The government has even acknowledged that the resources sector is to thank for a $50 billion budget boost this year and a brighter than expected fiscal outlook for Australia. The Australian oil and gas industry directly and indirectly supports over 80,000 jobs, contributed over $5.35 billion in tax in 2019-20 and recorded a $15.9 billion surplus in the trade of oil and gas. Over the past decade, the oil and gas industry paid more than $64.4 billion to the government, with contributions spanning decades totalling $161 billion since the mid-eighties.

This contribution is not limited to taxes. Over the last decade, the oil and gas industry has invested around $473 billion in the Australian economy. This includes about $170 billion spent directly, since 2007, on five offshore LNG projects, including Pluto, Gorgon, Wheatstone, Ichthys, and Prelude, and, as of last year, there are $120 billion worth of projects in the pipeline. That means more jobs in construction, supply chains and new operations. But we do, potentially, risk these investments with the introduction of the government's 43 per cent emissions reduction legislation, the Queensland government's increase in coal royalties and, potentially, this amendment, all of which go to undermining confidence in investment in this country.

Opponents of gas, coal and mining in general are quick to point out that tax and royalty payments are less than they believe they ought to be, but the full value of our resources sector is found away from the balance sheets, the prospectuses and annual reports. It is in the high-paying jobs both in the regions and in the metropolitan company head offices. It's in the sponsorship of sporting teams, events and community groups. Superannuation funds and shareholders rely on a profitable resources sector to supplement their incomes and pay for their retirement. This money flows through local businesses, creating employment, which is also taxed, generating more revenue for the government. Just as mining's ripple effect on the economy is far reaching, so too any impost on the mining resources sector will be felt far away from the pits, the pipelines and the corporate boardrooms.

Already, in Queensland, we are seeing big miners pull out of projects due to the state government imposing the world's highest coal royalties. This reduced investment in regional Australia is disastrous for engineering firms, food suppliers, workwear stores and everyone employed directly and indirectly by the mining and resources sector. Many of these businesses are run by families. They're not driving limousines or flying in private jets; they're cementing a future for their kids, providing apprenticeships and sponsoring local netball and football teams. Rugby clubs such as the Capella Cattledogs and the Emerald Rams in Central Queensland would struggle to survive without sponsorships by local businesses engaged by the resources sector. There is far more community support from resources companies operating in Queensland. We can point to a million dollars to build a new centre for the AEIOU Foundation in Townsville, which specialises in teaching children with autism; $6 million for the Banana Shire Library, museum and community hub; $8 billion for 16 affordable housing units in Isaac shire; $4.5 million for a pool in Mount Morgan; $7.8 million for a pool in Charters Towers; $834,000 for a sports facility upgrade at Cloncurry—the list goes on and on. And this is a snapshot of just one of the hundreds of resources companies operating in Australia that give back to local organisations and enrich small businesses. I can guarantee you that this Labor government would not be directing any additional royalties back to those regional communities.

Taking just one example from a submission to the committee that examined this bill, Chevron stated:

And this is just one company. Is this not already a benefit for Australian communities?

Across the industry, this has meant more export earnings, investments, taxes and royalties—things that benefit all Australians, as they provide the funds governments use to invest in infrastructure, education and social services. As the Australian Petroleum Production and Exploration Association said in their submission to the Senate Economics Legislation Committee's inquiry into this bill:

APPEA supports, and agrees, that the development of natural resources should be for the benefit of the Australian community.

…    …   …

The effect of this amendment, however, will do the opposite and will stymie investment.

…   …   …   

Claims that companies are 'hoarding' resources have been proven incorrect … and changing the objects clauses of the Act, under which hundreds of billions of dollars of investment have been made, drastically increases Australia's sovereign risk for no material gain.

The resources sector currently operates for the benefit of the Australian community, and the addition of this unnecessary amendment has the potential to simply shut down projects and drive investment offshore.

The Offshore Petroleum and Greenhouse Gas Storage Act 2006 provides for the safe and responsible operation of offshore oil and gas activities. It ensures that risks to safety and the environment are reduced to as low as reasonably practicable. It also ensures that industry meets the requirements of good oilfield practice and ensures that the recovery of oil and gas is at its optimal level.

One Nation's proposed amendment alters the objectives of the existing Offshore Petroleum and Greenhouse Gas Storage Act 2006 by adding the following clause:

to ensure that the exploitation of these natural resources is for the benefit of the Australian community.

While this change may seem innocent enough, in effect it injects a major ambiguity and uncertainty into the act. Poorly drafted amendments as proposed today can be hijacked and have serious unintended consequences that would undermine future resources investment. We are constantly told these days that words have consequences, and it is definitely true in the case of this bill.

The coalition has previously spoken in opposition to the bill due to the broad nature of the amendment and the unnecessary wording, which has the potential to open offshore petroleum exploration and development to legal challenges. The Greens supported the same bill last time with amendments that defined 'community benefit' as relating to the effects of climate change, and oil and gas's contribution to temperature rises. In applying this definition to that 'community benefit' term, the Greens proved that the bill's wording can be utilised against the sector to push extreme antidevelopment agendas. I've already touched on the legal system relying on explicit wording of legislation and clear definitions. With this term 'for the benefit of the Australian community' open to interpretation by the courts, we would allow radical environmental groups to tie up any projects in legal fights.

It is clear from even the most cursory look at the contribution of resources to our society that any moving of the regulatory levers must be meticulously considered and only done as a last resort, especially if there are moves to decrease the profitability of these companies via increased royalties and taxes. We have already seen in Queensland the Labor government's royalty increase send shockwaves not just through the coal sector but through all mining activities. While Queensland Labor claim they are doing this to benefit the community, the early signs are that it will result in long-term harm for regional communities. Federally, we have seen the introduction of new requirements in the investment objectives of a number of government agencies, like Infrastructure Australia and NAIF, hamstringing investment in industries like the gas industry and sending signals to investors that the government does not support the industry.

Australia must understand that this is a highly competitive space. We must continue to present ourselves as a viable, responsible and appealing investment opportunity to ensure that we continue to benefit from this sector. Over 70 per cent of our nation's income is drawn from mining and resource activities, and not to mention the highly paid salaries and the regional investment that allow towns like Dalby, Chinchilla and Cloncurry to be thriving with the activity of mining in this country. Poorly drafted amendments that can be hijacked and have serious unintended consequences would further undermine future resources investments. There is no benefit to an industry that no longer exists. The coalition will not be supporting this bill.