Tuesday, 16 June 2020
Questions without Notice
My question is to the Minister for Finance and concerns government procurement and expenditure. AusTender shows that, since 2016, the construction giant Lendlease has won federal contracts worth more than $661 million, overwhelmingly for Defence department construction. In addition, the defence minister announced in April this year the award of further contracts valued at $365 million, bringing Lendlease's total haul to over $1 billion. Is it not the case that the tax office's tax transparency reports show that, in the five years from 2013-14 to 2017-18, Lendlease generated $43 billion in revenue and generated a profit before tax of more than $5 billion but didn't pay a cent in corporate income tax? Are you aware that the company's own reports further show that they paid no income tax in 2018-19 and don't expect to pay any for some time yet? How do you reconcile awarding billions of dollars of contracts to corporate giants that pay no corporate tax?
Every business in Australia that makes taxable income has to comply with Australian tax laws and pay income tax according to our laws. I'm not going to discuss the tax affairs of individual taxpayers. That wouldn't be appropriate. Furthermore, you do know, of course, that tender decisions are not made by the government of the day. They're made following a proper, rigorous tender process, appropriately at arm's length from the government of the day—I think you would expect that to happen—and based on a proper assessment of the relative merits of specific proposals. In Australia, businesses are not taxed on their revenue. They're taxed based on their taxable income, and on that basis, of course, every business must comply with our tax laws.
The government's own figures and announcements show that Lendlease has been awarded nearly $800 million in contracts this year, 2020, and it's only June. In these circumstances, why is Lendlease allowed to access the JobKeeper program to pay some 15 per cent—nearly 1,400 out of 9,200 members—of its Australian workforce when it seems flush with contracts? How do you justify this company milking taxpayers' money when it pays no corporate tax?
I don't accept the premise of the question. The terms and conditions on which businesses can access support through the JobKeeper program are well known. For businesses with a turnover of less than $1 billion, it requires a 30 per cent drop in turnover. For businesses with a turnover of more than $1 billion, there is a bigger test, a higher test, a more difficult test. Indeed, they've got to demonstrate a 50 per cent drop in turnover. Again, I'm not going to talk about the specific affairs of individual businesses or individual taxpayers. That would be inappropriate. But, in the broad, the terms and conditions on which individual businesses can access that program, which has supported more than three million Australian workers, are, of course, the same for everyone.
To the finance minister: the information I'm talking about in relation to income tax comes from tax transparency data published by the ATO on Lendlease. Why is the government comfortable in awarding billions of dollars of contracts to a company, Lendlease, that has not paid a brass razoo in corporate tax for well over five years?
I refer Senator Patrick to my first answer to the primary question. We expect all Australian businesses to comply with our tax laws and to pay corporate tax or relevant taxes—corporate tax, in this instance—in relation to their taxable income. If the suggestion in your question is that, somehow, this business you're referencing has broken the law, then I would encourage you to make relevant reports to compliance authorities, to law enforcement authorities. If a business that complies with the law, employs many Australians and provides important services to Australia wins on merit a tender, I don't think you would suggest that we should politically interfere in preventing a business from taking on a tender that they've won based on proper competition and assessment at arm's length from government.