The DEPUTY SPEAKER (Ms AE Burke) took the chair at 09:00, made an acknowledgement of country and read prayers.
MOTIONS
Budget
Mr HOCKEY (North Sydney) (09:01): Madam Deputy Speaker, I seek leave to move a motion.
Leave not granted.
Mr HOCKEY: That is a little disappointing. I move:
That so much of the standing and sessional orders be suspended as would prevent the Member for North Sydney from moving the following motion forthwith—That the resolution of the House of Representatives of 8 May 2012, regarding the management of proceedings in respect of Appropriation Bill (No. 1) 2012-2013, Appropriation Bill (No. 2) 2012-2013, Appropriation (Parliamentary Departments) Bill (No. 1) 2012-2013, Appropriation Bill (No. 5) 2011-2012 and Appropriation Bill (No. 6) 2011-2012, be rescinded to allow the House to properly consider the proposal contained in Appropriation Bill (No. 2) 2012-2013, to increase the Commonwealth debt ceiling from $250 billion to $300 billion.
Stop covering up! Have a proper debate!
The DEPUTY SPEAKER: Order! The member for North Sydney will resume his seat.
Mr Albanese: Madam Deputy Speaker, I would ask that the member withdraw that last comment.
Honourable members interjecting—
Mr Albanese: What am I covering up?
The DEPUTY SPEAKER: The Leader of the House will resume his seat.
Mr Hockey: No, I don't withdraw!
The DEPUTY SPEAKER: The member for North Sydney does not have the call. He will resume his seat. I call the Leader of the House.
Mr Albanese: Madam Deputy Speaker, the shadow Treasurer is alleging that the budget papers are somehow not transparent; they are!
Opposition members interjecting—
Mr Albanese: I read in the Australian that he, indeed, said he supported this measure!
Mr Pyne interjecting—
The DEPUTY SPEAKER: The Manager of Opposition Business does not have the call. I call the Leader of the House.
Mr ALBANESE (Grayndler—Leader of the House and Minister for Infrastructure and Transport) (09:03): I move:
That the member be no longer heard.
The DEPUTY SPEAKER ( Ms AE Burke ): Lock the doors. The question is that the member be no longer heard. The ayes will pass—
In division—
The DEPUTY SPEAKER ( Ms AE Burke ): No! Lock the doors; too late—no way; not on. Out!
Mr Hockey: Madam Deputy Speaker, you just called him back in.
The DEPUTY SPEAKER: I did actually call him back in, because the doors had locked.
Mr Hockey: The Government Whip—
The DEPUTY SPEAKER: The Government Whip does not have the authority. I actually said he should return to the chamber because the doors had been locked and he was actually in the chamber when I said, 'Lock the doors.' In accordance with the rules, I had asked him to stay in the chamber, as the doors had been locked. I think that is the right way to proceed.
Mr Hockey: Madam Deputy Speaker, I raise a point of order. Just to clarify: as we said that we would not accept the vote of the member for Dobell, when we realised—
The DEPUTY SPEAKER: The member for North Sydney does not have the call. The member for North Sydney, it is not for the opposition or the government to accept a member's vote. We need to clarify this: it is for the parliament to accept a member's vote. The member for North Sydney.
Mr Hockey: The coalition has said it would not accept the vote of the member for Dobell and if the member for Dobell entered the House and voted with us, we would have someone leave the chamber. To provide clarity, we became aware that the member for Dobell was sitting on our side, and that is why the Leader of the Opposition and the Manager of Opposition Business attempted to leave the House, on that note. The member, obviously—
The DEPUTY SPEAKER: The member for North Sydney has made his point. We are in the middle of a division. The issue still remains that, when the call for the doors to be locked has been made, those in the chamber must be counted in the vote. I understand the point the member for North Sydney is making, but there is no ability for the parliament to exclude a member's vote. The member for Groom is seeking the call. I would like to now, before that, put the question. The question is that the member be no longer heard.
Mr Ian Macfarlane: Madam Deputy Speaker, on a point of order: you are classed as outside the chamber if you are past the adviser's box.
The DEPUTY SPEAKER: The Leader of the Opposition was on the floor at the time—that is the chamber. We will now proceed with the vote. The question is that the member be no longer heard.
The DEPUTY SPEAKER ( Ms AE Burke ): The member for North Sydney's time has expired. Is the motion seconded?
The House divided. [09:07]
(The Deputy Speaker—Hon. Anna Burke)
Mr ROBB (Goldstein) (09:19): I second the motion. This Treasurer is addicted to debt.
Opposition members: Hear, hear!
The DEPUTY SPEAKER: The member for Goldstein will refer to the motion before the chair.
Mr ROBB: I am, Madam Deputy Speaker. 'Debt' is a dirty word for this government, a word never to be mentioned—
The DEPUTY SPEAKER: The member for Goldstein will refer to the motion before the chair.
Mr ROBB: We need to suspend standing orders, Madam Deputy Speaker, because this government is ashamed and embarrassed with the cover up that is taking place with this debt.
The DEPUTY SPEAKER: The member for Goldstein will resume his seat. The Leader of the House.
Mr Albanese: Madam Deputy Speaker, I raise a point of order. The member must argue why standing orders should be suspended. That is the motion that is before the chair and that is what the member for Goldstein must refer to.
The DEPUTY SPEAKER: The Leader of the House will resume his seat. The member for Goldstein must refer to the motion before the chair.
Mr ROBB: The reason that standing orders must be suspended, the very important reason that they must be suspended, is that this government knows that a proper debate about debt would expose the extent of its profligacy. The government has gagged debate. We have seen it again already. The way this government has gagged debate about debt exposes both its shame and its shamelessness. It is ashamed because it does not want the public to know and it is shameless because it does not care. It does not care about the dead weight of debt that this government is putting—
The DEPUTY SPEAKER: The member for Goldstein will resume his seat.
Mr Albanese: Madam Deputy Speaker, the member is going to the substance of the motion that he is attempting to suspend standing orders for. The member must stick to the suspension of standing orders that is before the chair.
The DEPUTY SPEAKER: The Leader of the House will resume his seat. The member for Goldstein has the call.
Mr ROBB: The need to suspend standing orders is quite clear when you look at the problem that we are addressing with this motion. This is a government quite incapable of living within its means. It is still borrowing $100 million a day and this is why—
Mr ALBANESE (Grayndler—Leader of the House and Minister for Infrastructure and Transport) (09:22): I move:
That the member be no longer heard.
The DEPUTY SPEAKER ( Ms AE Burke ): The question is that the member be no longer heard.
The DEPUTY SPEAKER ( Ms AE Burke ): The time for the debate on this motion has expired. Can I record my thanks and appreciation to the parliament for their good humour in what has been a trying issue. I am trying to assure the clerks that I am not trying to make it into House of Representatives Practice. I seem to be doing so every day, so I want to thank everyone for their help in these matters. Thank you.
The House divided. [09:26]
(The Deputy Speaker—Ms AE Burke)
Carbon Pricing
Mr HUNT (Flinders) (09:34): I move:
That so much of the standing and sessional orders be suspended as would prevent the Member for Flinders from moving the following motion forthwith—That this House requires the Minister for Climate Change and Energy Efficiency to come into the Parliament:
(1) to tell the truth and correct his statement that “on road fuel costs are not increasing under the carbon price and in fact off road costs will decrease. Excise is being cut. It will fall from July the 1st for local Governments”, given that:
(a) the carbon tax will apply to off road commercial activity from 1 July 2012;
(b) the carbon tax will apply to on road commercial activity from 1 July 2014;
(c) the Government’s own projections show a total increase in fuel excise revenue as a result of the carbon tax package of $920 million over the first three years of operation;
(d) the Minerals Council estimates that the fuel tax changes will hit 60,000 businesses in year one and will hit almost 100,000 businesses by year three; and
(e) the South Australian Local Government Association has confirmed in its report, Financial Implications of the Carbon Price on South Australian Councils, that councils will have increased off road charges from 1 July 2012 and increased on road charges from 1 July 2014; and
(2) to explain why he says fuel taxes are going down when in fact they are going up by $920 million.
Fuel taxes are going up under the carbon price, not down. The minister has deceived this House and he should have the courage to make a statement about it now.
Mr Albanese: Madam Deputy Speaker, on a point of order: I seek your clarification. There are specific provisions in the standing orders, if a member has deliberately misled the parliament, for it to proceed in terms of substantive motions. The member for Flinders has not had the courtesy to provide us with a copy of the resolution in order to make a judgment as to whether we will support the suspension of standing orders or not.
The DEPUTY SPEAKER: The Leader of the House is correct that there are other forms of the House if the member is claiming the minister has misled the parliament. I also do not have a copy of the motion before me, so it does generally—
Honourable members interjecting—
The DEPUTY SPEAKER: Order! I am not disputing who did or did not. I am just stating: I do not have a copy. I am not trying to apportion blame. If there are portions of the motion about misleading the House, then there is another form to do that. But the member has the call, as there are other issues in respect of the motion he is moving. I will ask him, though, if it is a suspension of standing orders, to refer to the actual motion before the chair.
Mr HUNT: I will indeed, Madam Deputy Speaker. It is urgent that this minister explains himself. He made a statement in question time yesterday which was completely at odds with the $920 million of additional fuel taxes outlined in the government's own MYEFO.
The DEPUTY SPEAKER: The member for Flinders will resume his seat—and it is not just about the Leader of the House seeking the call; it is about me requesting people to resume their seats, and people should respect that call.
Mr Albanese: Madam Deputy Speaker, on a point of order: the member is now attempting to move a suspension of standing orders. He must outline to the House why the suspension of standing orders should be allowed as opposed to the budget that is before the chamber—the budget of the Commonwealth of Australia.
The DEPUTY SPEAKER: The Leader of the House will resume his seat. The member for Flinders has the call and will refer to the motion before the chair.
Mr HUNT: This matter is urgent, immediate and important, precisely because a statement was made which was completely at odds with the budget of the Commonwealth. The reason that it is important is that yesterday the minister denied the fact that fuel excise is going up, under the carbon tax, not down. He claimed that it was going down; it is going up.
Mr Albanese: Madam Deputy Speaker, I rise on a point of order. Given that the member is incapable of speaking to the suspension of standing orders, I move:
That the member be no longer heard.
The DEPUTY SPEAKER ( Ms AE Burke ): The question is that the member be no longer heard.
The House divided. [09:44]
(The Deputy Speaker—Ms AE Burke)
Mr BILLSON (Dunkley) (09:52): I second the motion. Labor's carbon tax would push up fuel costs and we need to suspend standing orders so that we can establish just by how much those fuel prices will go up. This is extraordinarily urgent and the reason for suspending standing orders is that in one month's time Australian businesses and consumers are faced with the world's largest carbon tax. We need to suspend standing orders so people have an understanding about how much fuel prices will go up so they can make decisions about pricing in their business. Certainty is required. That is why we need to suspend standing orders. We need to suspend standing orders because, without that clarity, how will businesses be able to price their services and products, how will the households of Australia be able to manage their budgets, and how will those marauding ACCC inspectors threatening a $1.1 million fine on businesses that do the wrong thing in relation to the carbon tax know what they can do if we do not suspend standing orders and get clarity?
The DEPUTY SPEAKER: The member for Dunkley will resume his seat. The Leader of the House on a point of order?
Mr Albanese: I move:
That the member be no longer heard.
The DEPUTY SPEAKER ( Ms AE Burke ): The question is that the member be no longer heard.
The House divided. [09:58]
(The Deputy Speaker—Ms AE Burke)
BILLS
Appropriation Bill (No. 1) 2012-2013
Report from Federation Chamber
Bill returned from Federation Chamber with an unresolved question; certified copy of the bill and schedule of the unresolved question presented.
Ordered that this bill be considered immediately.
Unresolved question—
That the amendment moved by the honourable member for North Sydney be agreed to:
That all words after "That" be omitted with a view to substituting the following words:
"whilst not declining to give the bill a second reading, the House requests the Government to vary the resolution in relation to the Appropriation bills agreed by the House on 8 May 2012 to permit amendments to be moved and debated to Appropriation Bill (No. 2) 2012-13."
Mr BRADBURY (Lindsay—Assistant Treasurer and Minister Assisting for Deregulation) (10:05): I am pleased to bring the second reading debate on Appropriation Bill (No. 1) 2012-2013 to a close. I thank those members who have made a contribution. Despite the impacts of a sovereign debt crisis in Europe and unprecedented natural disasters here in Australia, Australia's economic prospects remain strong. We have one of the lowest unemployment rates in the developed world and our economic growth is expected to be stronger than every single major advanced economy over the coming two years. We will confirm our position by returning the budget to surplus in 2013 and growing that surplus over the forward estimates.
In this budget we are returning to surplus while ensuring that families and small businesses are sharing in the benefits of the resources boom. This budget provides a $1.8 billion increase in family tax benefit part A for all eligible families from 1 July 2013. It also provides a further $1.1 billion for a new supplementary allowance for the unemployed, students and parents with young children on income support, with the first payment commencing on March 2013. The government is also providing an extra $2.1 billion over five years for a new schoolkids bonus paid directly to eligible recipients, despite opposition from those on the other side of the chamber. From 1 July 2012 we are more than tripling the tax-free threshold from $6,000 to $18,200 which will free up to one million Australians from the need to lodge a tax return. We will invest $1 billion over four years in the first stage of the National Disability Insurance Scheme. This is a very important Labor reform which will see around 10,000 people start to benefit from mid-2013 and expand to cover 20,000 people from mid-2014.
This budget will also help businesses to invest. We have announced a new initiative to allow businesses to carry back their losses to offset past profits and to get a refund of tax previously paid on that profit. From 1 July 2012 companies will be able to carry back up to $1 million worth of losses to get a refund of tax paid in the previous year, and from 1 July 2013 companies will be able to carry back up to $1 million worth of losses against tax paid up to two years earlier. We are also delivering tax breaks which will significantly help small business from 1 July 2012, such as the increase to the instant asset write-off threshold to $6½ thousand.
A number of comments have been made by members as part of this debate concerning the amendments to the Commonwealth Inscribed Stock Act 1911. While I note that similar amendments were included in Appropriation Bill (No. 2) of last year, I will spend a little bit of time explaining, particularly to those opposite, the rationale behind these amendments. I state upfront that the Commonwealth government securities on issue, subject to the current legislative limit, are projected to be below $250 billion at the end of each financial year across the forward estimates. However, fluctuations in cash requirements that result during the financial year are a normal feature of the Commonwealth's annual financing task.
The number of Commonwealth government securities on issue during any part of the financial year varies in order to adequately manage any mismatches in the timing of revenue collection and expenditure outlays. Being able to manage these fluctuations in an efficient manner is critical. The Australian Office of Financial Management should not be affected by short-term borrowing constraints, as these have a negative impact upon the AOFM's ability to operate its normal cash management functions in the current financial climate. The increase in the legislative limit on borrowing from a total of $250 billion to $300 billion will allow the AOFM to most efficiently manage within-year mismatches. It will also provide the flexibility to maintain a liquid and efficient government bond market in the years to come.
Australia looks toward the future from a position of strength—strength in our economy, strength in our people and strength in our policies. This government is focused on prioritising spending to provide lasting gains to convert an increasingly productive economy into a fairer community for all Australians.
The DEPUTY SPEAKER: The question is that the amendment be agreed to.
Original question agreed to.
Bill read a second time.
The House divided [10:14]
(The Deputy Speaker—Ms AE Burke)
Reference to Federation Chamber
Mr BRADBURY (Lindsay—Assistant Treasurer and Minister Assisting for Deregulation) (10:20): by leave—I move:
That the bill be referred to the Federation Chamber for further consideration.
Question agreed to.
Broadcasting Services Amendment (Improved Access to Television Services) Bill 2012
First Reading
Bill and explanatory memorandum presented by Mr Albanese.
Bill read a first time.
Second Reading
Mr ALBANESE (Grayndler—Leader of the House and Minister for Infrastructure and Transport) (10:21): I move:
That this bill be now read a second time.
Access to electronic media is important to all members of our community, including those with a hearing impairment. It is expected that by 2020 hearing loss is likely to affect more than five million Australians.
The Broadcasting Services Amendment (Improved Access to Television Services) Bill 2012 implements the government's response to the media access review. This was a review in access to electronic media for people with hearing and vision impairment. It involves significant public consultation, including receiving more than 200 submissions on two discussion papers. The purpose of this bill is to amend the Broadcasting Services Act 1992 to provide for greater access to free-to-air and subscription television for the hearing impaired.
The bill will achieve this by introducing new legislative requirements and, where applicable, increasing existing requirements for captioning on commercial, national and subscription television broadcasters.
The bill will implement captioning targets that are comparable with international best practice.
Reaching these targets will be a significant achievement, as we move toward equal access to electronic media, for all sections of Australian society.
A gradual, incremental increase in targets will assist the nation's broadcasters adjust to the increasing costs associated with the changes.
The bill will also provide for improved access to televised emergency warnings for people with a hearing or vision impairment by mandating that these must be transmitted in the form of text and speech, and captioned where reasonably practicable.
The bill will also address issues with variability in the quality of captions.
Under this bill the Australian Communications and Media Authority will determine standards relating to the quality of captioning in terms of readability, comprehensibility and accuracy.
There are a number of programs that broadcasters are not currently required to caption for practical reasons, and these exemptions will be maintained.
The bill will prescribe the new captioning requirements in the Broadcasting Services Act 1992 under the Disability Discrimination Act 1992. This will provide both consumers and broadcasters with a level of regulatory certainty through one set of clear future targets and one overarching regulatory system. This will remove the current duplication where broadcasters are subject to targets under both the Broadcasting Services Act 1992 and the Disability Discrimination Act 1992.
The Attorney-General will develop the required regulation.
The government will ensure that meaningful improvements to levels of media access for people with hearing and vision impairment are achieved in a way that is practical for broadcasters and content producers.
The passing of this bill will improve the accessibility of television, ensuring a more inclusive viewing experience for all Australians. I commend this important bill to the House.
Debate adjourned.
Maritime Powers Bill 2012
First Reading
Bill and explanatory memorandum presented by Ms Roxon.
Bill read a first time.
Second Reading
Ms ROXON (Gellibrand—Attorney-General and Minister for Emergency Management) (10:25): I move:
That this bill be now read a second time.
I am pleased to introduce the Maritime Powers Bill 2012. The maritime domain poses particular challenges to the effective enforcement of laws. Enforcement operations in maritime areas frequently occur in remote locations, isolated from the support normally available to land-based operations and constrained by the practicalities involved in sea-based work.
Commonwealth officers across a range of portfolios work tirelessly on the community's behalf to enforce Australia's maritime laws. This work often takes place in treacherous conditions. We owe it to these hardworking Australians to provide a legal framework that fully supports their commitment by being tailored to the conditions and recognising the inherent difficulties of the environment.
Under the current legislative structure, operational agencies use powers contained in at least 35 separate Commonwealth acts. This structure is inefficient and can lead to operational difficulties for the primary on-water enforcement agencies.
The government has undertaken an extensive review of existing arrangements. The product of that review is the Maritime Powers Bill. The bill provides a smarter and simpler approach to maritime enforcement through a single maritime enforcement law. This single law consolidates and harmonises the Commonwealth's existing maritime enforcement regime. The powers contained in the bill are modelled on powers currently available to operational agencies.
Outline of bill
The bill contains a comprehensive framework for enforcing Australia's laws at sea.
The bill establishes a system of authorisations under which a maritime officer may exercise enforcement powers in the maritime domain.
In addition to providing the necessary operational flexibility, this system of authorisations puts in place a range of safeguards to make sure maritime enforcement powers are authorised and exercised appropriately and for a proper purpose.
A key safeguard is the requirement for the exercise of powers to be authorised on specific grounds by a senior maritime officer or member of the Australian Federal Police.
This provides clarity around who must make decisions to take enforcement action and ensures appropriate oversight in relation to the exercise of powers.
The types of authorisations available under the bill will cover the full variety of situations which arise in the maritime environment, including fishing, customs and migration matters.
Once an authorisation is in force, a maritime officer generally has access to the full suite of powers set out in the bill.
The powers contained in the bill are based on powers currently available to operational agencies and under the bill the role and functions of these agencies will not change.
The powers include searching things and people, seizing and retaining things, boarding of vessels and requiring persons to cease conduct that contravenes Australian law.
Enforcement powers under the bill will be exercised by officers of the Australian Defence Force, Customs, the Australian Federal Police, and other persons appointed to conduct enforcement and monitoring activities in the maritime environment.
Conclusion
The Australian government is committed to ensuring that Australia's laws are monitored and enforced in the maritime domain. The unique aspects of the maritime environment merit a tailored approach to maritime powers, helping to ensure flexibility in their exercise and to assist maritime officers to deal with quickly changing circumstances and often difficult and dangerous situations.
As the Leader of the House noted recently, we are getting on with the business of government. These reforms are just one aspect of the government's work to provide Australia with a modern legal framework.
This bill will streamline and modernise Australia's legal framework for maritime enforcement and thereby support the hardworking Australians who work on our behalf to uphold Australia's maritime laws. I commend the bill to the House.
Debate adjourned.
Maritime Powers (Consequential Amendments) Bill 2012
First Reading
Bill and explanatory memorandum presented by Ms Roxon.
Bill read a first time.
Second Reading
Ms ROXON (Gellibrand—Attorney-General and Minister for Emergency Management) (10:30): I am pleased to move:
That this bill be now read a second time.
The Maritime Powers Bill 2012 and the Maritime Powers (Consequential Amendments) Bill 2012 provide a smarter and simpler approach to maritime enforcement through streamlining the framework for use by our on-water enforcement agencies.
Where existing maritime enforcement powers overlap with powers in the Maritime Powers Bill, this bill will reduce that duplication.
The bill has been the subject of an extensive consultation process with agencies to ensure that the consolidation exercise maintains current operational powers for agencies.
I commend the bill to the House.
Debate adjourned.
Crimes Legislation Amendment (Slavery, Slavery-like Conditions and People Trafficking) Bill 2012
First Reading
Bill and explanatory memorandum presented by Ms Roxon.
Bill read a first time.
Second Reading
Ms ROXON ( Gellibrand — Attorney-General and Minister for Emergency Management ) ( 1 0:32 ): I move:
That this bill be now read a second time.
The Crimes Legislation Amendment (Slavery, Slavery-Like Conditions and People Trafficking) Bill 2012 will protect some of the most vulnerable people in Australian society.
With this bill, the Gillard Labor government is protecting vulnerable women and children and, in some cases, men from trafficking and slavery.
For many in our community, the notion of 'slavery' evokes 19th century images of people sold as chattels, shackled and transported between countries. Tragically, 19th century slavery has not been abolished. It has simply taken other forms.
People traffickers recruit, transport, transfer, harbour or receive their victims through force, coercion or other means in order to exploit them. This is the modern-day face of slavery.
A common factor of contemporary slavery and trafficking—from forced labour and forced marriage to organ trafficking—is the misuse and abuse of power. And such an abuse has no place here in Australia.
I want to send that message loud and clear to all Australians and to all young people: duress, violence and intimidation are not acceptable in contemporary Australian society—in any context. Slavery, trafficking and forced marriage are unacceptable and they will now be very serious crimes.
That is why Labor is bringing forward this bill to improve protections for victims of all forms of slavery and trafficking, and to help law enforcement agencies detect, investigate and prosecute perpetrators.
Fortunately, slavery and people trafficking are not common in Australia, but the effect on victims is traumatic and can have lifelong consequences.
The bill will strengthen and expand the capability of investigators and prosecutors to combat these crimes by introducing new offences of forced labour, forced marriage, harbouring a person for the purposes of furthering the offence of trafficking, and organ trafficking into the Commonwealth Criminal Code.
More specifically this bill will:
create a standalone offence of forced labour where a reasonable person in the position of the victim would not consider him or herself to be free to cease providing, or leave the place where they provide, labour or services because of the use of coercion, threat or deception
criminalise the conduct of a person who uses coercion, threats or deception to bring about a marriage or marriage-like relationship. The offence would also apply to a person who is a party to, but not a victim of, a forced marriage
criminalise the conduct of a person who harbours, receives or conceals a victim and in doing so, assists or furthers the purpose of a third person who has committed, or is committing, a trafficking, slavery or slavery-like offence
create standalone offences criminalising trafficking a victim, either to or from Australia or within Australia, for the removal of his or her organ.
The bill will also insert general relevant evidence provisions into both divisions 270 and 271 of the Criminal Code. These provisions set out a list of matters a court or jury may have regard to in determining whether a victim has been coerced, threatened or deceived, whether the victim or the guardian consented to the removal, in the case of the organ offences, of the victim's organs, or whether another person has caused the victim to enter into debt bondage.
It will also insert general consent provisions into divisions 270 and 271 to make it clear that a victim's consent or acquiescence cannot be used as a defence in a proceeding for an offence against those divisions.
Reducing a person to a state of slavery or servitude often involves suppressing the person's free will and their self-respect, as well as their ability to make decisions for themselves. To allow a defendant to escape liability because his or her offending achieved the desired effect in bringing about these changes in a victim so that they appear to consent would be inexcusable. This provision makes that clear.
These measures will establish a continuum of offences criminalising exploitative conduct ranging from slavery to debt bondage. The definition of 'exploitation' in the Criminal Code will be expanded to cover broader forms of exploitation including debt bondage, forced labour, forced marriage, and all forms of servitude including non-sexual servitude.
Forced labour goes against everything that Labor stands for. And that is why we must act to make sure that no-one in this country is subject to such a misuse of power. And that no-one is able to get away with forcing someone to work in that way. The Labor Party has a long history of protecting Australia's most vulnerable—whether through the government's introduction of Medicare, the introduction of the Sex Discrimination Act or our current steps to introduce the National Disability Insurance Scheme. And this bill will continue that proud tradition.
It was the Labor Party which repealed Tony Abbott's unfair workplace laws.
And it is the Labor government which is now introducing a new offence of forced labour.
While the majority of identified victims in Australia have been women trafficked for the purposes of exploitation in the sex industry, law enforcement agencies are increasingly identifying both men and women who have been subjected to exploitation in a range of other industry sectors and workplace environments. This bill will introduce a stand-alone offence of forced labour and expand the existing offences of sexual servitude and deceptive recruiting to ensure they apply regardless of industry.
Where a person who does not consider himself or herself to be free to cease providing, or leave the place where they provide, labour or services because of the use of coercion, threat or deception they will be protected.
Penalties for the existing debt bondage offences will also be increased, reflecting the seriousness of these crimes.
I would like to take this opportunity to say something about one particular aspect of this bill and that is forced marriage. As Australia's first female Attorney-General, I am proud to be introducing legislation which makes forcing someone into a marriage illegal. It is a serious matter and should be treated as such. Marriage should be a happy event, entered into freely between consenting adults.
Forced marriage places young people at risk, and can result in many harmful consequences including the loss of education, restriction of movement and autonomy, and emotional and physical abuse.
Some critics have asked: 'Won't this just force this underground?' I say to them that it is already underground and it cannot afford to stay that way. As Attorney-General it is my role to make it completely clear that in Australia, marriage must be entered into freely, without duress or constraint.
In order to strengthen the law's ability to deal with the perpetrators of slavery and trafficking offences, this bill also makes it a crime for another person to assist or further the commission of these offences. The new offence of harbouring will extend criminal responsibility to those who facilitate a slavery or trafficking offence by harbouring, concealing or receiving a victim of a slavery or people-trafficking offence. This is to ensure that there is no way for people to avoid prosecution because they did not themselves transport, recruit or transfer the victim into the country.
The bill also creates stand-alone offences of organ trafficking. Trafficking a person to remove his or her organ is currently criminalised through offences relating to exploitation. This amendment will clarify the circumstances in which an offence of organ trafficking will apply, including situations in which the victim's organ is not ultimately removed.
These organ-trafficking offences will ensure that Australia meets its international obligations and comprehensively criminalises this exploitative conduct.
The bill will increase the capacity of law enforcement agencies to investigate and prosecute perpetrators, and to better support and protect victims. It will assist in addressing the impact of crime by improving the availability of reparation orders to individual victims of Commonwealth offences, including slavery and people trafficking.
In conclusion, the Crimes Legislation Amendment (Slavery, Slavery-like Conditions and People Trafficking) Bill 2012 was prepared following extensive public consultation.
The government released two discussion papers on slavery, people trafficking and forced marriage, and also sought submissions on an exposure draft of the bill.
May I digress for a moment to thank my predecessor the Minister for Home Affairs, Mr O'Connor, who was strongly involved in this, and also the officials from my department and the Federal Police who have had particular carriage of what has been a challenging piece of work. I thank them for their determined efforts.
With this bill, the government will clarify and strengthen the operation of existing slavery and people-trafficking related offences to make sure that the perpetrators of these offences and those who facilitate them cannot escape prosecution.
The bill reflects the government's commitment to doing all it can to prevent slavery and people trafficking. It is easy to say no. It is harder to stand up and do the right thing. And that is what this bill is about. For the Labor Party, it is about protecting the most vulnerable in Australia. It is about us getting things done to make this country a fairer, safer place for all of us.
The Gillard government is carrying on, in introducing this bill, the great Labor tradition of standing up for those who are less powerful against the strong and giving a voice to those who cannot always speak up for themselves. I am very proud to commend this bill to the House.
Debate adjourned.
Greenhouse and Energy Minimum Standards Bill 2012
First Reading
Bill and explanatory memorandum presented by Mr Dreyfus.
Bill read a first time.
Second Reading
Mr DREYFUS (Isaacs—Cabinet Secretary, Parliamentary Secretary for Climate Change and Energy Efficiency and Parliamentary Secretary for Industry and Innovation) (10:43): I move:
That this bill be now read a second time.
Introduction
The Greenhouse and Energy Minimum Standards Bill 2012 implements a commitment by this government and the Council of Australian Governments to achieve nationally consistent regulation of equipment energy efficiency.
The national framework established by the bill will, for the first time, establish uniform national legislation for energy efficiency. In doing so, it will replace seven overlapping pieces of state legislation and allow future expansion of the Equipment Energy Efficiency Program, commonly known as the E3 program.
Australia's energy efficiency regulation began with energy labelling for household refrigerators and freezers in 1986 in New South Wales followed shortly after by Victoria. In 1992, a national program was established and funded collectively to coordinate energy efficiency regulation across all Australian states and territories. Today, the E3 program now includes New Zealand and covers 23 product types in the residential, commercial and industrial sectors, delivering energy and financial savings to Australian households and businesses. The consistent efforts and contributions of all Australian and New Zealand governments for over two decades makes ours one of the world's longest-running energy efficiency programs.
The E3 program aims to overcome some of the market barriers impeding the development of more energy efficient products. It relies on two main tools: mandatory minimum efficiency levels, and energy rating labels. Minimum efficiency levels help to keep the most inefficient products out of the Australian market. Energy rating labels help Australian consumers and businesses compare upfront costs with costs over time, assisting them to make the best purchasing decisions. These labels also provide an incentive for manufacturers to innovate and produce more energy-efficient products for all Australians. Together these cost-effective measures support two of Australia's most important policy objectives: helping households and businesses to manage energy bills and reduce greenhouse gas emissions.
The E3 program's familiar energy rating label is one of the most well recognised brands in Australia. In 2005, 83 per cent of surveyed consumers reported referring to the label when purchasing major household appliances.
The program is not only popular but delivers real and significant benefits to Australia. In 2010 alone, energy-efficient air conditioners and refrigerators promoted by the E3 program saved Australian households and businesses over $1 billion in electricity costs.
National consistency
Despite the successes of the E3 program, further improvements are possible. Australian governments have coordinated well to achieve energy savings, but over 26 years inconsistencies have arisen across the state based programs. These inconsistencies increase the regulatory burden for businesses and governments alike.
To address these inconsistencies the Council of Australian Governments agreed in 2009 to establish national legislation to regulate energy efficiency. This commitment was recorded in the National Strategy on Energy Efficiency (measure 2.2.2). The agreement reflects the cooperative history of the E3 program, which has benefited from the cooperation and contribution of every Australian jurisdiction for the past 20 years.
The Greenhouse and Energy Minimum Standards Bill 2012 will implement the joint commitment to address the inconsistencies in the E3 program and streamline processes for Australian businesses.
The bill will establish a single national regulator and a single program framework. The new law will replace seven state based legal frameworks. The new national regulator will replace four state based regulators. Obligations, efficiency standards, registration processes and fees will be harmonised.
The national system will improve the regulatory framework while retaining the best of the existing system. Existing efficiency standards and the popular energy rating label will remain unchanged. The national regulator will work cooperatively with state and territory agencies and draw on their expertise. New Zealand, which is a participant in the E3 program, will continue to collaborate on energy efficiency regulation, ensuring the greatest net benefit for both countries.
Expansion
Over the past two decades the E3 program has focused primarily on electrical equipment. The new national framework will allow Australian governments to regulate energy efficiency for a greater range of products.
The expanded E3 program can cover electricity, gas or other energy sources. It can regulate products such as windows and insulation, which affect the energy use of heating and cooling systems. Into the future Australians will benefit from increased energy efficiency across a greater range of products.
Any expansion of the E3 program is of course subject to consultation and rigorous assessment procedures to ensure regulatory action will deliver positive economic benefits, but the bottom line is that more efficient products save energy and that saves Australians money.
Key points on how the bill operates
Under the new framework businesses must register regulated product models with the national regulator. This maintains the practice of the existing E3 program.
Registration allows the national regulator to monitor which products are entering the Australian market. The regulator records registered products on the public energy-efficiency database, which allows the Australian public to research and compare all registered product models to inform purchasing decisions.
Businesses that deal with regulated products must ensure their products meet minimum efficiency standards and carry accurate labels. For the first time, businesses that directly import products for commercial use will also be subject to these obligations. The existing E3 program only targets businesses that supply products in Australia and does not regulate businesses that purchase products overseas. The GEMS bill will end this double standard, closing loopholes in state law that might encourage businesses to purchase products overseas instead of purchasing in Australia.
The bill will establish a range of enforcement options to support these business obligations. It will allow the national regulator to issue infringement notices or ask businesses to compensate consumers for the costs of products that do not comply with regulations. For more serious breaches of the law the bill allows the courts to impose financial penalties. Experience under the current program emphasises the importance of regulators having a range of powers to test products and inspect business premises to ensure a high level of compliance with the act.
The GEMS bill introduces new powers for the national regulator to obtain information needed to administer the E3 program. This includes requirements for registrants to provide information on the number of regulated products sold in Australia each year. These powers are modelled on similar powers already used in the New Zealand energy efficiency program.
Accurate market information will allow the national regulator to identify market areas that may require regulatory intervention to overcome non-price barriers to greater energy efficiency. This information will also allow Australian governments to better coordinate the joint E3 program nationally and with New Zealand.
The Australian government is aware of the potentially sensitive nature of the commercial information and is committed to protecting it. The GEMS bill institutes strict controls on the handling of commercially sensitive information, including criminal offences for government officers who share information without authorisation. The government will support these legal safeguards with a detailed information-handling policy.
Conclusion
The E3 program is an important part of ensuring affordable energy for all Australians and assisting Australia's transition to a low-carbon future.
The benefits are real and significant. By 2020 existing E3 measures are forecast to save Australian households and businesses $5.2 billion per year and reduce household electricity use by 13 per cent per year compared with business as usual. The planned regulatory program is forecast to bring about a further reduction of almost 15 per cent, saving Australian households more than 25 per cent of their yearly power bills.
The Australian government is committed to reducing energy costs for Australian households, to reducing market barriers for Australian businesses and to reducing greenhouse gas emissions for the entire country. The improvements made by the Greenhouse and Energy Minimum Standards Bill will ensure a strong foundation to continue this important work well into the future.
Debate adjourned.
Greenhouse and Energy Minimum Standards (Registration Fees) Bill 2012
First Reading
Bill and explanatory memorandum presented by Mr Dreyfus.
Bill read a first time.
Second Reading
Mr DREYFUS (Isaacs—Cabinet Secretary, Parliamentary Secretary for Climate Change and Energy Efficiency and Parliamentary Secretary for Industry and Innovation) (10:53):I move:
That this bill be now read a second time.
The Greenhouse and Energy Minimum Standards (Registration Fees) Bill 2012 accompanies and supports the main Greenhouse and Energy Minimum Standards Bill 2012.
The main GEMS bill implements a commitment by the Council of Australian Governments to establish national legislation to regulate energy efficiency. The national framework will improve Australia's existing Equipment Energy Efficiency Program by replacing seven state and territory legal frameworks with a single, nationally consistent law. The national framework will also allow the expansion of the E3 program in the future.
The enhanced E3 program will retain many existing practices, including a requirement for businesses to register regulated product models. Registration will allow Australian consumers to research and compare different products on the energy rating website. Registering products will also assist the national regulator to monitor trends in energy efficiency.
Consistent with existing practice, the national regulator will charge fees when businesses register their products. This bill, the Greenhouse and Energy Minimum Standards (Registration Fees) Bill 2012, grants the national regulator the power to set registration fees.
The purpose of registration
Registration fees will recover a portion of the costs incurred administering the E3 program. For example, fees may recover the cost of processing registration applications, and costs incurred monitoring compliance with the law.
Recovering a portion of the registration and compliance costs will enable the national regulator to expand the product testing program and increase the number of store inspectors. Cost recovery will also facilitate a faster, more streamlined registration process. These measures will allow the national regulator to deliver a more effective E3 program.
Australian business stakeholders consulted during the development of GEMS legislation gave strong support for an enhanced compliance monitoring regime, backed by registration fees and cost recovery.
Registration Fees Bill separate for constitutional reasons
Legally, fees to recover costs of the compliance monitoring regime may be considered a form of taxation, rather than a fee for services provided. Section 55 of the Australian Constitution requires laws imposing taxation to deal with no other issues. The GEMS registration fees bill therefore separates the power to set fees from all other provisions in the GEMS legislation.
The existence of the separate registration fees bill does not alter the way in which fees are calculated or the way in which fees are charged. It does not alter the proposal to deliver a more effective compliance monitoring regime for all Australians.
The separate registration fees bill simply establishes a clear legislative basis to introduce the enhanced E3 program supported by Australian businesses.
Fees specified by legislative instrument
The GEMS registration fees bill grants the national regulator the power to set fees in legislative instruments. This ensures that fees set by the national regulator will be developed in a transparent manner and tabled in parliament for the public record. Setting fees in legislative instruments allows flexibility to alter fees in the future.
Conclusion
The Greenhouse and Energy Minimum Standards (Registration Fees) Bill 2012 is integral to the success of the enhanced E3 program. The bill will establish a clear legislative basis to recover a portion of the costs incurred administering the program. This cost recovery will assist the national regulator to deliver an expanded compliance monitoring regime, a measure supported by Australian business stakeholders.
Together with the main GEMS bill, the GEMS registration fees bill will deliver an enhanced and more consistent E3 program. This enhanced program will help to drive even greater energy efficiency for the benefit of Australian households and businesses.
Debate adjourned.
Financial Framework Legislation Amendment Bill (No. 2) 2012
First Reading
Bill and explanatory memorandum presented by Mr Gray.
Bill read a first time.
Second Reading
Mr GRAY (Brand—Special Minister of State and Minister for the Public Service and Integrity) (10:58): I move:
That this bill be now read a second time.
The Financial Framework Legislation Amendment Bill (No. 2) 2012 would, if enacted, amend 21 acts across six portfolios to regularise Commonwealth payments supported by special appropriations (including special accounts) consistent with the legislative requirements and section 83 of the Constitution.
It is the 10th financial framework legislation amendment bill since 2004. It forms part of an ongoing program to address financial framework issues as they are identified and assists in ensuring that specific provisions in existing legislation remain clear and up to date. This has been done in collaboration with the relevant ministers and their departments.
The bill addresses issues that have been raised by the Australian National Audit Office recently, although many of the issues have existed since before the introduction of the Financial Management and Accountability Act 1997. The amendments are technical in nature but important and in some cases relate to statutory schemes that have been in place for more than a decade. Specifically, this bill implements amendments that can be discussed thematically.
The bill would amend nine acts to provide a mechanism called a recoverable payment. These amendments permit agencies to make payments on the basis of information available at the time but require overpayments, including those made in error, to be recovered in line with section 47 of the Financial Management and Accountability Act 1997 (relating to the duty to pursue recovery of a debt). The bill would also amend the Taxation Administration Act 1953 within the Treasury portfolio, to enable the Commissioner of Taxation to decide to make a recoverable advance. These advances would apply where the commissioner, or delegate, decides to make payments because the likely cost of not making these payments would exceed the total of the advances. If a recoverable advance were made, then the amount of the overpayment would remain a debt due to the Commonwealth and would need to be recovered.
The bill also amends seven acts that operate in the area of public sector superannuation, to authorise the Commonwealth to make recoverable death payments. These amendments allow payments to be made to recipients until ComSuper or the relevant departmental secretary is notified of the recipient's death. Where payments have been made in the interim period, those amounts would be recoverable from the deceased's estate.
The bill provides that where the recoverable payment, recoverable advance or recoverable death payment provisions are used, the relevant departmental secretary or chief executive is to ensure that a report is published.
This means that parliament would directly be requiring transparency on these issues in future.
The bill also amends 10 acts to better align current payment practices with the relevant legislation such as in the recovery of administrative costs.
The bill would also validate certain benefits under the Defence Force Retirement and Death Benefits Act 1973 to regularise the treatment of certain benefit recipients, consistent with existing practice.
The proposed acts being amended relate, largely, to routine activities of government and, if enacted, would allow the continued effective management of these activities, while having parliament require appropriate levels of transparency and accountability.
This bill is, accordingly, another step to help ensure that specific areas of the Commonwealth's financial framework remain effective and up to date. I commend the bill to the House.
Debate adjourned.
BILLS
Clean Energy Finance Corporation Bill 2012
Clean Energy Legislation Amendment Bill 2012
Clean Energy (Customs Tariff Amendment) Bill 2012
Clean Energy (Excise Tariff Legislation Amendment) Bill 2012
Second Reading
Cognate debate.
Debate resumed on the motion:
That this bill be now read a second time.
Mr BRIGGS (Mayo) (11:02): I will continue on from where I left off last night, when I was interrupted by the adjournment of the House. I was making the point that this is a terrible piece of legislation. It is probably one of the most insidious aspects of the Labor and Green alliance that we have seen in this hung parliament. Long-term damage will be done by this allocation of some $10 billion of Australian taxpayer money, which will be allocated for projects which have not met commercial viability tests, which the market will not fund, and which will distort an already existing market for renewable technologies. It is widely accepted that in renewable energy markets those companies and entrepreneurs who have already invested much in those technologies will be damaged. Those people have already put their own capital and work into creating these circumstances.
The member for Melbourne nods his head—he accepts that. The member for Melbourne knows better than the market does! The member for Melbourne knows exactly which of his mates, which industries, he would prefer to fund with $10 billion of Australian taxpayer money. That is exactly what this is all about. This is part of the sorry deal that the Australian Labor Party have made, much to their shame. We know that there are good ministers in that government who are increasingly stepping out of this deal, who no longer want to be associated with it. One of the ministers at the table, I know, is increasingly uncomfortable. I say, good on that minister, for some of the hard policy decisions he has forced through the Labor caucus in the last week. Good on you, Minister Grey. Good on the Minister for Immigration and Citizenship and good on the Minister for Resources and Energy for standing up for good public policy in this nation against the vested interests of those on their left who are putting so much pressure on their base with their idealism, which is outside of the reality of how you need to govern this country.
This will be one of the worst legacies of this Labor government—this Labor-Greens alliance. The minister at the table knows it. That is why he is slowly but surely making his views the real policy views which need to be taken to ensure that this country is successful in the future. We know that the Greens approach to Australian public policy—
The DEPUTY SPEAKER ( Ms Grierson ): Member for Mayo, I remind you to confine your comments to the legislation before the House.
Mr BRIGGS: I am, Madam Deputy Speaker; very much so.
The DEPUTY SPEAKER: I am listening very carefully.
Mr BRIGGS: This is a Greens wish list. This is a Greens desire. The new leader of the Greens, Senator Christine Milne, is taking the Greens even further to the left. I never thought I would see someone—she has taken over in recent days—take Bob Brown further to the left. We know there is not a lot of happiness in the Greens, because we have read about it recently. There is not a lot of happiness with the new leadership team.
Dr Leigh: I rise on a point of order. Deputy Speaker, the member for Mayo is defying your ruling, which was very clear. He should restrict his comments to those that are relevant to the bill before the House today.
The DEPUTY SPEAKER: Member for Mayo, I encourage you to confine your comments to the cognate bills before the House.
Mr BRIGGS: Thank you, Madam Deputy Speaker. I understand the embarrassment of the member for Fraser. For a so-called economist to be standing by this piece of legislation he must be ashamed of himself. You must be ashamed. You can hand back the little prize that you got a little while ago—
Ms King: I rise on a point of order. The member is now impugning another member. I ask him to withdraw or go back to the substance of the debate.
Mr Tony Smith: On the point of order, the members opposite are clearly trying to curtail debate. If they want to use this tactic they will find that it will become a habit through this debate.
The DEPUTY SPEAKER: Member for Mayo, before you continue, you have had two advices from the chair. I would like you to refrain from personal comments and to confine your comments to the legislation before the House rather than to the tactics.
Mr BRIGGS: Madam Deputy Speaker, I am being completely relevant regarding this legislation, because we know that there are members on that side who are very uncomfortable with these pieces of legislation, for very good reason: because it makes no economic sense. We know how much this Labor government have wasted over the last five years. Now we are going to hand them $10 billion to give to their mates in the Greens as a little reward for the support in keeping them in government. That is what this bill is all about. It is a shameful waste of Australian taxpayers' money. That is why there is so much sensitivity from those on the other side, trying to interrupt coalition speakers on this bill—because they know this will hang over them for a generation of Labor MPs who have stood by this piece of legislation.
One of the other issues that I will touch on, briefly, as I have been interrupted on so many occasions during this contribution, is that it strikes me as passing strange, in relation to the appointment of the CEO of this organisation, that the CEO's remuneration will not be set by the Remuneration Tribunal. I wonder how the member for Melbourne stands by that in his electorate? Presumably we will see an NBN-style CEO payment of about $2 million a year. I wonder if the member for Melbourne will go out to his electorate and tell his Green constituents that—that the member for Melbourne's piece of legislation, that he and Senator Christine Milne want and support, would encourage and allow market rates for this so-called bank. The market rate is not going to be anywhere under seven figures. So I look forward to the brochure from the member for Melbourne talking about executive salaries. What hypocrisy! What utter hypocrisy! What an absolutely hypocritical thing for you to do, sir, when you claim that you stand by the low-paid in society and rail against high bank salaries. I bet you this salary will be nothing under seven figures. Why else would it be outside the Remuneration Tribunal? And those on the other side know it. They know it.
This is a terrible piece of legislation. It should not pass the parliament. It will inflict damage on our economy for years to come. They should be ashamed of themselves for supporting it. (Time expired)
The DEPUTY SPEAKER ( Ms Grierson ): Before I call the member for Melbourne, I do remind the House that it has been agreed that a general debate be allowed covering this bill, the Clean Energy Legislation Amendment Bill 2012, the Clean Energy (Customs Tariff Amendment) Bill 2012 and the Clean Energy (Excise Tariff Legislation Amendment) Bill 2012.
Mr BANDT (Melbourne) (11:09): It is always a thrill to follow the member for Work Choices, because it reminds you just exactly how much—
Mr Tony Smith: Madam Deputy Speaker, I rise on a point of order. In accordance with your strict traffic-cop ruling, I suggest you call the member for Melbourne into line.
The DEPUTY SPEAKER: Member for Casey, please do not reflect on the chair.
Mr BANDT: It is always a thrill to follow this member because you realise just how much those on that side of the House are completely out of touch with what is happening in the rest of the world, even in the conservative side of politics. If one were to ask the Conservative Prime Minister of the United Kingdom, David Cameron, what they are doing to tackle climate change and what steps they are taking to support a renewable energy industry in their country, one would learn that, even though they participate in the European emissions trading scheme, they are looking at increasing their carbon tax—and it is a tax in that country—because they have been worried that the level of the price imposed on carbon was not high enough to allow them to develop offshore wind to the point necessary to give confidence to investors to make the substantial amounts of investment that they would need to deliver long-term offshore winds. These are expensive projects that are being done for the first time and that need the kind of government support that the government gave dirty energy when it was built for the first time. If you were to go to the United Kingdom you would hear them there saying, 'Yes, we want offshore wind, and we will do what we need to do to sustain it.'
If one were to go to Germany—an economy that is a shining light at the moment in the European crisis—and ask the conservative chancellor of Germany and the conservative government what they are doing there, they would say, 'By 2050 we are going to get 80 per cent of our electricity produced from renewable energy, and we are phasing out nuclear power.' What you would also find, if you went and asked the conservatives in Germany about progress there, is that last year they produced 20 per cent of their electricity from renewables. They are ahead of their target.
During the recent cold snap in France, France, with all its nuclear power, got energy imported into the grid from renewable-energy-rich Germany because they ran out. In Germany they got 20 per cent of their electricity last year from renewables. How did it happen? It happened because the government got behind it when there were Greens in government, a long time ago, who helped set these settings that have been continued by the conservatives. There are now 382,000 jobs in the renewable energy sector in Germany. That is around 102,000 jobs in Australian numbers, or more than twice as much as in coalmining, oil and gas put together. That is the kind of future we can have in Australia if we as parliamentarians and we as a government get behind the clean energy industry and give it the kind of support that governments previously did and still continue to give to polluting energy. And that is something that you never hear the modest members talk about: the enormous $15 billion subsidies per year that are given to coal and dirty, polluting industries.
Mr Briggs: Madam Deputy Speaker, I rise on a point of order. On your ruling as to relevance to the bill before the House: this is far outside that. He is attacking other members of the parliament. He should be—
The DEPUTY SPEAKER: I listened very carefully.
Mr Briggs: brought back to the provisions of the bill and explain—
The DEPUTY SPEAKER: Thank you, member for Mayo; please resume your seat. I am listening carefully to the Deputy Leader of the Greens, and he may continue.
Mr BANDT: The fact that the member interjects and suggests that subsidies that are given to dirty, polluting industries is not relevant shows just how out of touch the conservatives here are with the conservatives in the rest of the world.
We know two things. Firstly, industries, when they begin—especially in Australia, where we do not do enough to support innovation and commercialisation—can go through, and often fail in, the valley of death. That is especially the case for these industries that are new in Australia but are increasingly entrenched in the rest of the world, and we risk being left behind in this clean energy race if we do not give our nascent clean and renewable energy industries the kind of support that is being given elsewhere around the world. That is why I commend the government for introducing this legislation, because one of the things that it is going to do is to give those clean and renewable energy industries the support they need to get to a viable commercial stage. Secondly, it is suggested that that is an aberration but, as I have said, we continue to give up to $15 billion a year in subsidies to fossil fuel industries. Why is it that when someone goes to the petrol pump in Melbourne or Sydney they pay 38c a litre in excise, but when a wealthy mining company does it they pay zero? Why are they entitled to that subsidy? This is the unlevel playing field that renewable energies and the new industries are competing against. And that is why it is absolutely appropriate that we here give whatever support we can to these industries to allow them to become commercially viable in their own right. It has got to the point now in Germany that, because their renewable energy subsidies—including a green bank, a green finance corporation—have been in force for so long and have worked so well, they are able to start winding back some of those subsidies because their firms are so commercially successful and viable in their own right. That is the point we will get to in Australia in a very short period of time because of our incredible intellectual and natural resources, but we will only do it if government is the midwife of the renewable energy industry in this country.
That is why I commend the government for the introduction of this bill, the Clean Energy Finance Corporation Bill 2012, and I note just how well the consultation and preparation phase has been done and how professional it has been. The fact that previous speakers in this debate have said it is outrageous that we are going to have industry experts who might have skills comparable to their peers in the private sector coming to work in this corporation does not show that there is anything wrong with this bill. It shows exactly what is right, because those experts will be making the decisions about how to allocate the substantial sums of money they will have at their disposal based on sound business propositions that come to them and they will be able to tailor the kind of support for a particular business based on what that business actually needs. It might be some form of loan guarantee; it might be underwriting some continuous purchase arrangement. That is exactly the kind of flexibility that this finance corporation will have and it will be run professionally.
This package of legislation happened because of the constitution of the parliament that we have at the moment and because it was something that we as the Greens pushed for very hard during the course of negotiations. That is why I am disappointed that the member for Fraser is not here. I respect the member for Fraser, but in a previous debate he said: 'Why are we even debating this now? The Greens should have supported this many years ago.' When that came from someone I respect, I was very disappointed to hear the most intellectually dishonest contribution to this debate that I have heard for some time. How can one get up here as we are debating this package and this Clean Energy Finance Corporation, which has never been on the table before and is only on the table now because the Greens are here, and say that the previous package should have been passed? If you were to say that that would have been better, then you would have to take into account, as the member for Fraser did not, the emissions savings we are going to get from this Clean Energy Finance Corporation. You would have to take into account the fact that we now have an 80 per cent by 2050 reduction target. You would also have to take into account the fact that we have a significant amount of money going into a biodiversity fund, that we have a floor price, that we have a climate change authority that will look over the targets we have set and recommend them downwards and that we have a tapering-off of the compensation that is going to be paid.
None of those were in the original proposal cooked up between Labor and the coalition that the member for Fraser urgently wanted us to pass, and yet he has the gall to come into this chamber and say that somehow that would have resulted in a better outcome for the planet. It is folly, and I hope he gets the chance to come back in here during this debate and respond to it. As someone who prioritises evidence, he should have been more careful about what he said and he should have been more intellectually honest about calculating the emissions reductions that will come from this package, instead of using this as an opportunity to suggest that there is some political mileage that might be made.
This package is in fact a reflection of what happens when people from differing political positions work together, and it will stand as a testament to this parliament that we have achieved such significant reform. Just think about this for a moment. In this parliament we have managed to get conservative country Independents, the Labor Party and the Greens together on the same page to pass one of the most significant reform packages that this parliament has seen. It is completely unlike any package previously before the parliament. It will set Australia up for a clean and renewable energy future. It will deliver more for rural Australia than any other package that has ever come before this parliament. And it will fast-track the development of renewable energy technologies in a way that no other package that has ever come before this parliament would have done.
This is not an opportunity for division and point-scoring. This is an opportunity for recognising what can happen when people of goodwill, coming from different points of view, are prepared to work together for the benefit of the planet. This is going to stand the Australian economy in good stead. It will only be a matter of years before we have those 102,000 jobs in renewable energy in this country. I am extraordinarily pleased that we are able now to assist those renewable energy industries to develop and flourish. And I do hope we get to the point where, in five, 10 or 15 years time, we can say, 'Perhaps we do not need to give them the support anymore because they stand on their own two feet.'
The University of Melbourne predicts that it will be somewhere around 2022 before solar becomes cost competitive with coal, absent any other subsidies. It may not be that long before we are able to talk about Australian inventions like the one that is being researched in my electorate where they are now printing solar cells onto almost any surface, working together with the note printers of Australian currency. BlueScope Steel is part of that project because it hopes it will be able to print directly onto surfaces so that your rooftop or your wall becomes a power source in and of itself. Newcastle university are looking at ways of getting microscopic solar cells into paint so you can paint the side of your house and use that as a power source. These are exactly the kinds of innovations and developments that this bill is going to fast-track. So I look forward to the day in 10 or 15 years time when we can come back here and say, 'This corporation is no longer needed,' because, like Germany, we will be getting the majority of our energy from renewable energy.
I commend the government for the introduction of this bill. I commend the people of Melbourne for the role that they played in getting this on the table, getting it into the House of Representatives and getting it passed by the parliament. I commend the bill to the House.
Mr TUDGE (Aston) (11:22): There is a long list of terrible programs introduced by this appalling government: pink batts, green loans, $700 set-top boxes, cash for clunkers—I could go on. But the program which underpins and is proposed by this Clean Energy Finance Corporation Bill 2012 would have to be right up near the very top of the worst of all programs that this government will be introducing. This bill involves an appropriation of $10 billion from taxpayers to put into a government fund to invest in speculative projects that the commercial sector would not invest in. Hence, I predict that billions of dollars will simply be wasted. It is the sheer magnitude of this that is astounding—$10 billion! If you lined up $100 notes end to end, it would go for 20,000 kilometres—from here to the other side of the world. That is the size of this program that we are talking about, and it is all on the government's credit card—or, should I say, the taxpayers' credit card. It is astounding.
I want to raise three core arguments against this bill. Firstly, this proposal, despite the sheer magnitude of it, comes with no mandate and no detailed policy underpinning it. This is simply a grubby deal done with the Greens. Secondly, it is entirely funded by government debt at a time when we can least afford to be adding to it. Thirdly, this bill will have no impact on the renewable energy sector, as the member for Melbourne would like us to believe, because the renewable energy sector is governed by the Mandatory Renewable Energy Target and not by this. What is worse, we will see billions of dollars wasted.
If I can go to the first point, the only reason we are discussing this bill at all is because the Greens have forced it upon the government. The member for Melbourne, who spoke just before me, was very clear in that regard. In fact, the Greens first raised this concept back in July 2007 and had the opportunity to implement it through its negotiations with the government when they were discussing the carbon tax proposal—that tax that the Prime Minister said that she would not introduce. As you might recall, Deputy Speaker Grierson, after they had negotiated the carbon tax deal out popped this green energy fund—$10 billion worth—and Senator Milne, the deputy chair of the multi-party task force which was investigating this, proudly proclaimed that it was her idea, a great initiative and therefore it will occur, because what the Greens call for the Labor government will introduce.
There was no mandate for this. It is a $10-billion appropriation, but the government did not take it to the last election to reach a mandate. There was actually no policy paper underpinning this proposal. There is no discussion paper to get community views about this. In fact, the government would not even allow a House of Representatives standing committee to investigate this proposal before we are forced to debate it and vote on it. No, it was just a grubby deal with the Greens. It is as simple as that, with no policy underpinning at all.
We cannot just hold the Greens responsible for this fund. Yes, they were the catalyst for it, but Labor agreed in part to this $10-billion fund—in part because the philosophy underpinning the fund perfectly aligns with modern Labor's philosophy of having the government at the centre of the economy. Kevin Rudd talked about this, as you will recall, Deputy Speaker Grierson, very loudly and clearly in his essays. Prime Minister Gillard, of course, supports this proposition, and we can see it in the government's other policies, most particularly the National Broadband Network policy. We are the only country in the world that is renationalising its telecommunications network. We see it in the carbon tax policies, which re-regulate the economy. We see it in the 16,000 regulations which the government is proposing. So this bill is actually very much in keeping with modern Labor philosophy of having government right in the heart of our economy. It was not the philosophy in the Hawke-Keating era, when they knew that the private sector had to flourish, but it is the philosophy of modern Labor and this bill is in keeping with this philosophy.
The other reason that the Labor government are supporting this, despite it being advocated by the Greens, is because they have realised the politics of it. The first tranche of money—the first $2 billion—will start to be paid out merely weeks before the next federal election is due. What a coincidence! This government has seized upon this and thought, 'Geez, we can put this towards our marginal seats, all underneath the budget radar.' That is the reason. So, yes, it started as a deal driven by the Greens but is very much aligned with the Labor Party philosophy and the whatever-it-takes group that now drives the Labor Party.
My second point is that this bill and the financing that underpins it is all done on borrowed money. The concept of this green energy fund managed by the government and invested in speculative projects that the commercial sector would not touch would be a bad enough concept in and of itself and under fantastic economic circumstances. But it is particularly bad when the government has so categorically blown out our government finances. Of course, we all know the numbers. They started with a $20-billion budget surplus; they started with $70 million in the bank. But for the next five years we had the four biggest budget deficits in Australian political history and now we have net debt of $145 billion. We have interest payments on that debt of $8 billion per annum and we have had to increase the debt ceiling to $300 billion.
The DEPUTY SPEAKER ( Ms Grierson ): The member for Aston will resume his seat. The member for Throsby on a point of order?
Mr Stephen Jones: My point of order goes to relevance. We are debating the clean energy legislation, not the appropriation bills. Perhaps he has got his speeches mixed up.
The DEPUTY SPEAKER: Thank you, member for Throsby, I take your point. You have outlined your premise. Please continue member for Aston.
Mr TUDGE: This goes to the heart of this bill—it is about where it is going to be financed from. It is not getting financed from some magical budget surplus that the government would like to think they will have, but rather this is just getting added to the government debt—$145 billion in net debt already, and this just adds another $10 billion. I can see why the member for Throsby is very sensitive about this topic. He is supposed to be one of the smarter members on the other side of this chamber, so he does not want this discussed. But this is $10 billion—
The DEPUTY SPEAKER: I have taken your point that you were relevant, but you will desist from reflecting on other members. Please continue.
Mr TUDGE: This goes straight to the heart of how this is financed. The other side of this chamber will say, 'This actually isn't borrowed money because it doesn't appear on the budget papers'. No, this is the accounting trickery that also goes to the heart of this particular proposal, because the government would like to proclaim this as being a commercial venture and therefore it does not have to appear on the budget papers. It does not have to appear on the underlying cash balance of the government finances. We all know from a few weeks ago the Treasurer proudly proclaimed that the government was going to be delivering a $1.5 billion surplus in 2012-13, but if you just took this fund alone and you added it to next year's budget it would rapidly turn that tiny budget surplus into a deficit. That is the accounting trickery that also underpins this particular proposal. Ten billion dollars, whether it is on the budget or off the budget, is still $10 billion of taxpayers' cash that will be added to government debt. That is the bottom line. More debt means more upward pressure on interest rates and it means mortgaging future generations.
My final point is that this bill will not actually grow the renewable energy sector, but worse it will probably end up with literally billions of dollars wasted. It may seem incredible that there is a $10 billion fund that is going to invest in renewable energy projects and that it will not expand the renewable energy market in Australia. The reason this is the case is that the size of the renewable energy market in Australia is entirely driven by the mandatory renewable energy target, which yesterday, before this bill was introduced, was set at 20 per cent. Today and tomorrow it will still be 20 per cent. So all that $10 billion of investment into renewable energy will do is simply replace projects that otherwise would have got up on a commercial basis with more expensive renewable energy that will be funded through this particular fund. That is what will occur. It will not change the amount of renewable energy that we will actually consume in this country.
Most egregiously though, this bill will result in the waste of billions of dollars—that is my prediction. I say that for two simple reasons. First, by definition, and as outlined in this bill and the explanatory memorandum, the $10 billion will be invested into projects that the private sector would not invest in because there would not be a sufficient return and because they would be too speculative. This is where this $10 billion will be invested—into speculative projects. Second, governments have a terrible record at investing into projects generally. It is astounding that we have to repeat the arguments as to why this is the case. It is astounding that we have to repeat the arguments that it is better for the private sector rather than the government sector to invest in commercial projects. The reason is that the government sector (a) does not have the expertise and (b) does not have the same skin in the game that the commercial sector has. The commercial sector has the expertise, has the financing, has the skin in the game, can analyse projects properly and can take the risk.
This will be invested into projects that will be highly speculative and it will result in billions of dollars of taxpayers' money simply wasted. You do not have to believe me, but you can look at some of the evidence abroad and you can look at some of the evidence back home when governments tried to invest in speculative projects. Abroad, of course, most recently we have had the Solyndra projects: the United States set up a similar type of fund and put $700 million into the Solyndra project and, of course, that has all disappeared—$700 million. We have also seen the Solar Trust of America project, which had a $2.1 billion loan guarantee from the US Department of Energy, again under a similar program to what the Labor government is proposing here, and that $2.1 billion just disappeared because it was in a speculative investment which the private sector, quite rightly, did not want to touch. And of course, for the Victorians in this parliament or in the gallery, we only need to look back a decade or two to when Joan Kirner and John Cain were running our state and we had the Victorian Economic Development Corporation, which was investing in all sorts of speculative commercial projects, which quite rightly should not have been invested in with taxpayers' money. That almost bankrupted the state.
We thought that we had moved on from this style of economics from the Labor Party, but clearly we have not. I say in conclusion that if the member for Throsby, who will be speaking next, and the other members on the other side of this House honestly believe that this is such a great idea—to appropriate taxpayers' money to invest in speculative projects—then I suggest this weekend, before they vote on this bill, they go out to their community and speak to constituents and say, 'We're going to put $1,250 against your household's credit card to invest in speculative projects' and see what they will have to say. (Time expired)
Mr STEPHEN JONES (Throsby) (11:37): It is a pleasure to be speaking on this package of bills. These are bills for all of Australia, not, as many of those on the other side have suggested, bills for the Labor Party or, as the member for Melbourne was just claiming, bills for the Greens. The objective of these bills is to build capacity in clean energy technology, which is critical for our energy security and critical for the future of the nation. It is also critical that this legislation be passed by the House, because what it actually does is address a market failure. The member for Aston just gave a great dissertation on the importance of markets. He obviously did not get that argument up in his own party room when they were addressing their response to climate change and how we implement policy here in Australia, because if ever there were an example of the rejection of a market based and evidence based approach to dealing with reducing carbon emissions and building a clean energy future it is the policy proposals of the member for Aston's party, which presumably he is going to get up at some point in time and defend in this place.
The reason we need this legislation is that essentially we have a market failure. The Clean Energy Finance Corporation will encourage private investment that would not otherwise occur to help overcome financial barriers to commercialising and deploying clean energy technologies. There is a global recognition of the importance of moving to clean energy sources, and due to its endowment in the use of low-cost fossil fuels Australia is a late starter in the transformation to clean energy technology. It does not mean that we have not been great innovators in the research and development of clean energy alternatives. Indeed, we have, and the University of Wollongong in my own electorate has been a leader in the area of developing new cleaner energy technologies. But it is one thing to invest in the research and development; it is another thing entirely to bring that research and development onto a commercial footing and to make it available for large-scale use. It is that purpose that the Clean Energy Finance Corporation is directed to.
Some background to the bills is important because a number of the contributions to this debate have talked about the process, and I will go to that in some detail. But, in essence, on 17 April this year the government released the expert panel's review on a report on the design of the $10 billion Clean Energy Finance Corporation, and the bills before the House accept almost in full the recommendations of that expert panel. I know members of the coalition parties do not like to listen to expert advice in this area. In fact, they reject it at every turn. But the bills before the House today are based on the expert advice commissioned by this government, a detailed consultation process, and a research process and, on the basis of that advice and sound policy making, we have introduced this legislation.
Why have a clean energy finance corporation? It is a part of a suite of government initiatives designed to transform the Australian economy for a cleaner energy future. The government's $10 billion investment in the Clean Energy Finance Corporation will play a role in unlocking significant new private investment and clean energy projects and the supply chain that feeds into these projects. Australia's clean energy market is at an early stage, categorised by incomplete knowledge and a limited experience of the risks associated with investing in these technologies on a commercial basis. That means that there are barriers inhibiting the efficient and effective allocation of capital. The corporation will leverage private sector financing for renewable energy, low emissions and energy efficiency technologies investments, which are critical to the transformation of the Australian economy.
The CEFC will make investments and encourage private investments in clean energy technologies which build upon the core of our policy—that is, to put a price on carbon, because it is the price on carbon which is key to changing behaviour and to creating a market in this area. There still may be market barriers that prevent these projects from going ahead, such as the incomplete knowledge or the lack of familiarity with investors in these emerging technologies, but the CEFC will have tools at its disposal to tailor investments to address market barriers. Over 50 per cent of the investments of the CEFC will have to be in renewable energy technologies. So it is good legislation and it is directed at that critical purpose of addressing the market failure which exists in ensuring that we are able to move to a clean energy future.
There are alternatives to the proposals in the legislation today. One of those alternatives is for us to do nothing. But daily we see the consequences of what doing nothing means. It means, for example, falling behind China, which is investing more in clean energy technology than any other country on the planet, a country which we are daily competing with in terms of our technology and our exports. I would argue that it is in our national interest to ensure that the government is doing its bit to ensure that we as a nation, with an abundant supply of non-renewable and renewable energy sources, is investing in the research and technology and putting in place mechanisms such as the clean energy fund to ensure we can commercialise that research and development.
The second alternative not mentioned by the member for Mayo, the member for Aston or, in fact, any of the coalition members who have contributed to this debate is that the consequence of doing nothing means, quite literally, we will be paying more for electricity. This is not because of the carbon price but because every single party, and by inference every single member of this parliament, has signed up to the renewable energy targets. We said that it is our commitment to ensure that we increase the amount that renewable energy contributes to our national energy load. Unless we put in place large-scale investments into large-scale renewable energy projects, we will be relying on the sorts of small-scale projects which currently characterise the renewable energy market. The feed-in tariffs from people having solar panels on the roofs of their houses is the best example that comes to mind. Every economic expert that has had a look at this has said this is probably one of the most expensive ways to generate renewable energy. Quite literally, unless we put in place the sorts of mechanisms that are contemplated by this legislation, we will be paying more for our electricity.
We need to ensure that we are not paying more than we need to pay for the renewable energy proportion—that members on that side of the House and members of this side of the House have all signed up to—by investing more in commercialising and bringing into the market large-scale alternative renewable energy or we will be paying more for electricity. That is a fact that those on the other side do not wish to mention. The simple fact of the matter is unless we put in place mechanisms like this, which enable us to commercialise large-scale renewable, alternative and clean energy technologies, we will be paying more for electricity. That is the nub of the policy of those on the other side of the House.
Of course, there are other alternatives that have been floated. We had an excellent dissertation from the member for Aston earlier—and repeated by the various contributions from the member for Mayo. I love being in the House when the member for Mayo is speaking. With the amount of energy that he emits, I always feel like bringing in a bag of washing and some soap and throwing it in his direction because, with all the sound and fury and activity, we could get a fair bit of recycling of energy going on—more noise than light. One of the interesting things in his earlier contribution was his astounding statement that he abhors the proposition the government should pick winners, that it is not the role of the government to enter into an area of activity that should be filled by the market and we should not be throwing billions of dollars into this area by essentially picking winners. Obviously, he lost that argument in his own party room because, if you have a look at the coalition's own policy—and this is one of the alternatives to that which we see before the House this morning—you see that their alternative is simply to set up a billion-dollar fund without the rigorous commercial guidelines that are included in the clean energy fund. They would set up a billion-dollar fund which would provide grants, presumably to those people who can convince coalition ministers that their proposals are worthy of support. Well, if ever there was an example of a government an alternative government attempting to enter the market and pick winners, it exists in the coalition's policy.
Absent in their policy is the proposition that you would put in place commercial principles or that you would require an interest return on the investments made. The same sort of rigour that a bank or a venture capitalist would apply when investing in a new project would be applied in their grants based scheme. I really found it quite amusing when I heard those on the other side, those from the coalition parties, attacking this proposal because it was an example of the government intervening in the market and picking winners. You would hope we would pick winners, because winners are the things that are going to ensure that we do have a clean energy future.
I will spend a bit of time addressing some of the other criticisms that have been made by coalition members. In particular, the member for Higgins made the astounding observation:
It is important to note that the consultation on this bill has been negligible. The consultation process has been virtually zip.
I have done some work on this and I can inform the House that since 1992 there have been around 36 parliamentary inquiries into climate change and the appropriate government response to it. I have about six pages here which list, line by line, those inquiries from 1992 through till today. I would be happy to table those pages if other members of the House do not believe me. There have been over 36 inquiries since 1992 looking into this area.
The legislation, as I already said, follows the report of the expert committee. This expert committee was chaired by Ms Jillian Broadbent, an eminent Australian who has a 30-year career in banking. I know her because she happens to be the vice-chancellor of the University of Wollongong as well. Her career in the finance and business sector, I would say, is entirely remarkable. She is a board member of Woolworths and Coca-Cola. She is known to all members in this place. She is a Reserve Bank board member and she has served on the boards of Woodside and Qantas. If you were thinking about anyone who could bring to this area a more commercial focus, you would think it would be the chair, Jillian Broadbent, together with other eminent members of the expert committee.
The expert committee received 151 public submissions to the inquiry. On the basis of those public submissions and their own research, they said to the government that they see the establishment of a clean energy finance corporation playing an important part in addressing the government's vision for a clean energy future, tackling climate change, lowering carbon emissions and transforming Australia's energy sector. In attacking the consultation process which has led to the introduction of these bills, the coalition are attacking the process that has been set up by the eminent people on the expert committee and the recommendations that were made. The expert committee was not the first time we dipped our toe in this water in this particular parliament. It follows the Joint Select Committee on Australia's Clean Energy Future Legislation's inquiry in October 2011, an inquiry that received several hundred submissions and held numerous public hearings.
I have also had a look at the number of questions that we have had in this House on the particular matter. Over 300 questions have been asked and in excess of 20 matters of public importance debates have been had on this in the last 12 months alone. In my estimation, on the parliamentary debates— (Time expired)
Mr CRAIG KELLY (Hughes) (11:52): I rise to speak on the Clean Energy Finance Corporation Bill 2012. To start with, putting aside the carbon tax and the NBN, this legislation is one of the most economically irresponsible pieces of legislation that have ever been introduced into this parliament, for what this legislation actually does is to take $10 billion—that is $10,000 million—and hand it over to as yet unidentified groups to spend on so-called green investment projects—projects that the private investors would not touch with a 40-foot barge pole. Let us not forget that on top of that $10 billion there is an additional $57 million in the forward estimates thrown in for some sundry expenses. So where is the government going to get this money from? Where is the government going to find another $10 billion? It simply plans to borrow it—every single last cent, most of which will be borrowed from foreigners. What the people in the gallery need to understand is that every time you borrow money someone has to write the guarantee. So it is the Australian taxpayer who is writing the guarantee for this borrowing. In fact, every Australian family of four has to guarantee $2,000 to underwrite this legislation. That is the cost.
This bill, like many others, is destined to end in tears. Mark my words: when the carnage of the long-term economic damage arising from this government's policies is finally tallied and engraved on its tombstone, this boondoggle will be right at the top. It is not surprising when I look at the speakers list that there is a complete dearth of speakers from the government side that are prepared to come into this chamber and mark their name down in the Hansard as having spoken in favour of this bill, because they know that, like the long list of other failed so-called green schemes, this will end in tears and a very substantial part of that $10 billion will simply be vaporised in failed schemes. For those that have been foolhardy enough to come into this chamber and debate on this bill, if you think that it is really a good idea to invest this $10 billion and you truly believe that this money is going to be wisely spent, it is very simple: you should be putting your own money up. You should be writing the guarantees out to provide for these loans. Why don't you put your own superannuation savings up? You simply will not, because you know this is going to end in tears.
The absurd waste of resources that have so far been expended on so-called green energy in the delusion that we can take action to manipulate our climate should make us weep. Consider how many lives could be changed for the better if, instead of being wasted on this boondoggle, this $10 billion were invested to help our kids with disabilities and their carers, taken to fix up the mess of our hospitals or used to invest in our roads, in our public transport or in fast rail. Every cent that is spent has an opportunity cost.
I would like to refer to a few words in the explanatory memorandum to this bill which clearly demonstrate that the authors of this bill have not got a clue. It speaks of a government that knows little about the real world of industry and business and is simply determined to try to reshape it in its own politically correct image. The explanatory memorandum to this bill states:
The Corporation will finance Australia's clean energy sector using financial products and structures to address the barriers currently inhibiting investment.
The barrier currently inhibiting investment is that so-called green energy is hopelessly inefficient. No-one is going to invest in green energy unless they are guaranteed a huge taxpayer subsidy. The explanatory memorandum goes on:
The Corporation will apply capital through a commercial filter …
To talk of a commercial filter and to suggest that a commercial filter can somehow magically limit losses to 7½ per cent of its capital in unsuccessful projects is an absolute absurdity. It is the complete commercial naivety that you would expect from someone that invests in a Nigerian 419 scam. But sadly this is the type of commercial naivety we have seen over and over again from this government, from GroceryWatch to the BER to the set-top projects et cetera, et cetera, et cetera.
In the time left, let us have a quick look at some of the past so-called green schemes that supposedly would have passed through a commercial filter. I am sure we can all remember the ZeroGen project in Queensland, promoted by their former Premier Mr Beattie. A press release from 30 August 2007 titled 'Smart state takes step closer to clean coal with ZeroGen' states:
Premier Peter Beattie welcomed news today that development of vital technology to help secure the future of Queensland’s coal industry and the thousands of jobs it creates had reached a major milestone.
We all know what happened to ZeroGen. When our then resources minister, Ian Macfarlane, warned that ZeroGen in Queensland would collapse, Mr Beattie accused Mr Macfarlane of being on drugs. Well, the only thing that went up in smoke was $50 million of taxpayers' money.
Then take an example of a project passing a commercial filter, with the example of Solyndra from the USA. Solyndra was meant to be the flagship of the Obama administration's effort to drive the clean energy industry. Back in May 2010, President Obama visited the solar panel manufacturer's Californian headquarters to celebrate the $500 million of American taxpayers' money that he had thrown at it. The President declared:
The true engine of economic growth will always be companies like Solyndra.
How misguided. Solyndra is now closed. The $500 million of taxpayers' funds has been vaporised. But even worse, the so-called clean and green solar manufacturer has closed its doors leaving behind tonnes of toxic waste.
While the solar energy industry claims to be clean and green, the Solyndra debacle highlighted the fact that toxic waste is produced in the manufacture of solar cells. This has been a problem for years. Solar panel production creates many toxic by-products including silicon tetrachloride, an extremely toxic substance which renders crops infertile, causes skin burns and increases the likelihood of lung disease, and transforms into acids and poisonous hydrogen chloride gas when exposed to air.
The lessons from these debacles should be clear: when governments force taxpayers to subsidise any business it almost always leads to economic damage and collapse. Today, we see the green energy bubble bursting around the world. And around the world, the claims of those that prophesied for the IPCC are collapsing. Just take the recent statement from Professor Klaus-Eckart Puls, a leading German physicist and meteorologist:
Ten years ago I simply parroted what the IPCC told us. One day I started checking the facts and data – first I started with a sense of doubt but then I became outraged when I discovered that much of what the IPCC and the media were telling us was sheer nonsense and was not even supported by any scientific facts and measurements. To this day I still feel shame that as a scientist I made presentations of their science without first checking it.
… … …
Scientifically it is sheer absurdity to think we can get a nice climate by turning a CO2 adjustment knob.
He also said:
The CO2-climate hysteria … is propagated by people who are in it for lots of money, attention and power.
And that is what this bill does. It hands over lots of money—ten thousand million dollars.
We should be looking at what is happening around the world. In Germany, they have already given away $130 billion in green subsidies, mostly to solar power companies. Yet in Germany, solar power makes up a minuscule percentage of the German power supply while at the same time doing nothing towards the original objective of reducing German greenhouse gas emissions. So it is no surprise that, last February, Germany's Minister of Economy and Technology announced a pullback from green power subsidies, stating that such a cost was 'a threat to the economy'.
In Spain, where they have poured billions of dollars of cash into solar and wind power subsidies, they have little to show for this except a $25 billion increase in that financially crippled nation's debt, an unemployment rate of 25 per cent, and, for those under 30, it is getting close to 50 per cent. In the United States, where green power companies have received more than $4 billion to build wind farms, a recent Wall Street Journal investigation found that these projects have created only 7,200 temporary—temporary!—construction jobs at the amazing cost of US$600, 000 per job and only 300 permanent jobs at the unbelievable figure of US$14 million per job.
Around the world, the green energy bubble is bursting. Take the recent comments from Fiona Kobusingye, a director and coordinator of the Congress of Racial Equality in Uganda. Ms Kobusingye wrote:
Life in Africa is often nasty, impoverished and short. AIDS kills 2.2 million Africans every year according to WHO (World Health Organization) reports. Lung infections cause 1.4 million deaths, malaria 1 million more, intestinal diseases 700,000. Diseases that could be prevented with simple vaccines kill an additional 600,000 annually, while war, malnutrition and life in filthy slums send countless more parents and children to early graves.
And yet, day after day, Africans are told the biggest threat we face is – global warming.
… … …
It’s the almost total absence of electricity keeping us from creating jobs and becoming modern societies. It’s that these policies KILL.
… … …
Not having electricity means millions of Africans don’t have refrigerators to preserve food and medicine.
… … …
Not having electricity also means disease and death. It means millions die from lung infections, because they have to cook and heat with open fires …
… … …
Hypothetical global warming a hundred years from now is worse than this?
Ms Kobusingye concludes:
Telling Africans they can’t have electricity and economic development – except what can be produced with some wind turbines or little solar panels – is immoral. It is a crime against humanity.
The other reason the green energy bubble is bursting is the misguided theory that renewables will soon be able to compete with coal and gas, because coal and gas will become more and more expensive. That is how as the theory goes. But this overlooks the ingenuity of the free markets in developing new technologies—the very type of new technologies that this bill actually retards. In the last couple of years, we have seen the price of coal fall from a high of $140 per tonne down to, today, around $55 per tonne. Gas, back in 2008, was $125 per kilojoule; today, the price of gas has fallen to less than $25. So our conventional production of electricity should be getting cheaper. So it is no surprise that we have seen the failure of billions of dollars wasted on green energy subsidies that not only increase our power costs but also do absolutely nothing to reduce the emissions of carbon dioxide.
An article titled 'Perfect storm hits green energy stocks' recently reported that 10 wind and solar energy equipment manufacturers in China, India, Europe and the USA have seen their share prices collapse by 86 to 98 per cent since 2008. That is why this scheme is destined to fail. But there is perhaps one thing that we could invest this money in. Perhaps this fund could buy 1,000 pairs of $2-pliers and send them off to every morgue in the country. The climate change commissioner, Professor Flannery, following his expertise in predicting endless drought, now wants undertakers to pull the fillings from dead people. He said the solution for undertakers was to remove them, adding, 'You just need a set of pliers.' It is a $2 solution.
This bill is a tragedy and a train wreck waiting to happen. The ultimate victims will be the ordinary working people of this country. (Time expired)
Mr DREYFUS (Isaacs—Cabinet Secretary, Parliamentary Secretary for Climate Change and Energy Efficiency and Parliamentary Secretary for Industry and Innovation) (12:07): I rise to speak on the group of clean energy bills that are before the House. The bills include the Clean Energy Finance Corporation Bill 2012, which will establish the long awaited Clean Energy Finance Corporation, and a number of clean energy bills which make improvements to the Clean Energy Act 2011, the Fuel Tax Act 2006, the Excise Act 1901, the Excise Tariff Act 1921 and the Customs Tariff Act 1995.
These amendments will improve the working of the Carbon Farming Initiative, enhance the powers of the Clean Energy Regulator, improve working relations with the Clean Energy Finance Corporation and amend the coverage of gaseous fuels under the carbon-pricing legislation. These are important bills because they take Australia closer to a low-carbon future. They are important bills because by establishing the Clean Energy Finance Corporation they will help us unlock our national potential by securing a strong and sustainable renewable energy industry.
The establishment of the Clean Energy Finance Corporation will act to overcome market failures by providing financing for Australian based renewable energy technologies, low-emissions technologies and energy efficiency projects. This is nation building; this means jobs for Australians. These bills are an example of the best aspects of the Australian Labor Party being forward thinking and being unashamedly determined in our desire to reshape our nation for the better. It is a great honour to be part of a government that is putting in place such a substantial change that will create jobs and reduce pollution.
I know that there have been a great many speakers on this bill and I know that there will be more. But I would like to take the time to outline in a little more detail the shape of the Clean Energy Finance Corporation because it is such an important initiative. I think this is important because, as usual, we will see the same grab bag of untruths, misrepresentations and outright lies from the opposition. The speeches we had yesterday and today and the hysteria that we continue to see from the opposition simply underscore the vast gulf between the two main political parties. We are a party with an optimistic vision for the future. We are acting to put in place far-reaching legislation that will reshape this nation for the better. The coalition is a party with no vision and whose only reason for being is to oppose. They will say and do anything at all, no matter what the cost to the nation as a whole and no matter what the cost to the lives of all Australians, if the Leader of the Opposition believes it might take him closer to the Lodge. The latest example of this insistence on acting as wrecker, as opposer-in-chief no matter what the cost, is their opposition to the Clean Energy Finance Corporation.
Let us go through the facts. It is clear that while the carbon price will provide a massive incentive to invest in clean energy, new technologies do face a range of obstacles in attracting financing. Because of this, the government is creating the Clean Energy Finance Corporation, which will invest in renewable energy technologies, low-emissions technologies and energy-efficiency projects. The government will provide $2 billion in funding per annum for five years, and any interest earned will be available for reinvestment. This bill requires that the corporation have at least half of its investments in renewable energy technologies by 30 June 2018. The corporation will apply a commercial filter when making its investment decisions and will focus on projects and technologies at the later stages of development. This is to ensure that the corporation will invest responsibly and manage risk while also making sure the corporation values any positive externalities which are generated by financing.
Establishing the corporation will mean that we have taken a very large step towards reducing our carbon emissions. We must act now or be left behind. The need to establish the Clean Energy Finance Corporation is a pressing one. I am prompted by another ridiculous speech, the one that we heard just now from the member for Hughes, one of the climate change deniers of those opposite—and there are quite a number of them. We need to face this. There is a clear consensus among climate scientists that climate change is real and we will have significant future impacts if no action is taken to reduce global greenhouse gas emissions.
The world is acting to reduce carbon emissions and to create a global low-carbon economy. That is what the United Nations Framework Convention on Climate Change is for. That is why the 195 nations of the world that are participating in the United Nations Framework Convention on Climate Change meet every year in one very large formal meeting and at a range of smaller meetings during the year. There is agreement on the end objective, which is to reduce the world's carbon emissions. Of course, as is always the case in large multilateral negotiations, there is not yet agreement on how the world is to go about reducing carbon emissions, but many nations are already acting to reduce national emissions. Australia, in the Clean Energy Future package and in this part of the Clean Energy Future package setting up the Clean Energy Finance Corporation, is joining that global effort. If we do not act now, we will be left behind and we will miss out on the global jobs that will come from investing in clean energy and investing in renewable technologies.
A low-carbon global economy is coming and it is up to us to decide whether we help Australian business to take advantage of this or simply bury our heads in the sand. There are many countries around the world that are assisting their businesses to move on low-carbon technologies and to invest in low-carbon businesses. We should be doing the same. Many other countries have acted to put in place similar financing arrangements to this Clean Energy Finance Corporation to kick-start the clean economy. I can give some examples. These are some of the larger finance corporations, which countries around the world have, that invest in new technologies, that invest in sustainable technologies and that invest in low-carbon technologies. I would start with the example of the United States Department of Energy, which has issued loans and guaranteed loans to encourage early-stage commercial use of new or significantly improved technology and energy projects. The United States Department of Energy has given to around 35 projects, between September 2009 and September 2011, loans and guarantees worth around $35 billion, dwarfing the size of the Clean Energy Finance Corporation that this legislation proposes.
Germany's main development financing agency, KfW, is also a significant financier of clean energy by providing commercial banks with liquidity at low rates. This same German agency has provided funding to 80 per cent of Germany's newly installed wind energy and 40 per cent of the solar panels installed in 2010. It is estimated that this agency will commit over €100 billion in the energy sector over the next five years. Another example of international action is Brazil. The Brazilian economic and social development bank, BNDES, provides long-term finance with a very strong clean energy focus. In 2011 this bank approved financing of approximately US$1.8 billion for the construction of wind farms, and there are a range of other projects. I have had a presentation from that Brazilian development bank and I know the range of clean technology projects that the Brazilian development bank is investing in.
The world is acting and many countries are putting in similar financing arrangements to those that we are proposing with this legislation for the Clean Energy Finance Corporation. It is time for Australia to play its part. As part of the clean energy future package we must look after people. I think it is worth talking briefly about the impact of the carbon price more generally and what we are doing to ensure that we are helping working Australians, mainly because it is an issue that the other side of this House raises again and again. They consistently and deliberately get it so wrong. Our whole reason for being in politics is to provide support to working families, to improve services and to make this country fairer. Apparently the reason the Leader of the Opposition is in politics is to help Clive Palmer.
Our budget—and our clean energy future package—contains important measures to help households make ends meet. More than 1.5 million families will benefit from increases to family tax benefit part A from 1 July next year, with nearly half of those taking home an extra $600 a year. A new supplementary payment will help the unemployed, students and parents on income support meet the cost of essential bills, worth $210 a year for singles and $350 a year for couples. Earlier this week pensioners started to receive upfront household assistance payments of $250 for singles and $380 for couples combined. These payments will be paid straight into pensioners' bank accounts over the coming few weeks. About 2.1 million pensioners who are on the maximum rate of the pension will be better off by $134 a year for singles and $201 a year for couples, on average—a buffer of more than 65 per cent against the expected modest impact of the carbon price. And 93 per cent of pensioner households will be at least 20 per cent better off, thanks to these new payments. Of course, we are putting in place tax cuts for all taxpayers earning up to $80,000 a year from 1 July through a tripling of the tax-free threshold.
By advocating to abolish the carbon price and scrap this assistance, the Leader of the Opposition wants to make millions of pensioners worse off and millions of benefit-recipients worse off. I think that when such an opposition engages in such negative scare campaigns—an opposition that opposes sensible measures like the bills that are before the House today—we should also look at the alternative that is being presented by that opposition. We should look at the opposition's so-called plan—a cobbled together policy that they have no intention of pursuing if they ever do hold office—its direct action policy. Do not be fooled. This is a plan which is not designed to reduce emissions. All the policy is designed to do is give an appearance of action, give some kind of appearance that the opposition care about this policy area. The member for Hughes, who spoke before me, needs clearly to take up with the leadership of his party this direct action policy, because it appears that he thinks that we should not be seeking to reduce Australia's national carbon emissions and, indeed, that the whole world should not be seeking to reduce carbon emissions. If that is so, he needs to take up with the leadership of his party the Direct Action Plan, the purpose of which is said to be to reduce Australia's national emissions.
Their direct action plan—if you can call it that—is even worse than this. It involves the purchase of abatement of emissions at taxpayers' expense. That method of attempting to reduce emissions has been tried before and has proved to be entirely ineffective and very expensive. Everyone looking at the alternative plan to reduce Australia's emissions, from those who like to badge themselves as the alternative government, needs to bear in mind that families will be worse off under the plan put forward by the Liberal Party. Families will have to pay $1,300 more in taxes and that money will be given straight to the big polluters. It is mystifying to think what the coalition's policy is in this area when one listens to speeches like that delivered by the member for Hughes or those regularly delivered by the member for Dawson or the member for Tangney. These are self-expressed climate change deniers who would assert that there is no purpose in seeking to reduce Australia's carbon emissions.
Mr Morrison: On a point of order, Mr Deputy Speaker Murphy, I would ask the member to withdraw the slur on those members. He knows full well the use of the term 'denier' has a connotation that he would be particularly familiar with and I would ask him to withdraw that.
The DEPUTY SPEAKER: There is no point of order. The member for Cook will resume his seat.
Mr DREYFUS: He is wasting the House's time with his nonsensical objection. I absolutely reject the suggestion put forward by the member for Cook.
Mr Morrison interjecting—
The DEPUTY SPEAKER: Order! The member for Cook will desist from interrupting.
Mr DREYFUS: It is a ridiculous and I will repeat: these are climate change deniers on the other side of this House. It is an entirely legitimate phrase. It is an appropriate phrase to use about those on the other side of the House who do not accept the science of climate change, and they need to start accepting the science of climate change. The member for Cook is lending his assistance to the ridiculous suggestions put forward on the other side of this House. We are acting on climate change and will continue to do so. (Time expired)
Mr MATHESON (Macarthur) (12:22): I rise today to speak on the Clean Energy Finance Corporation Bill 2012 and the suite of bills to amend the Clean Energy Act 2011. This set of bills seeks to establish an incorporated entity under the Commonwealth Authorities and Companies Act 1997 to be known as the Clean Energy Finance Corporation, CEFC. These bills will give CEFC substantial powers to invest in financial assets for the development of Australian based renewable energy and low-emission technologies along with energy-efficiency projects. The bills will also provide the CEFC with the power to enter into investment agreements itself, provide commercial loans and, as well, make investments for its subsidiaries.
The Clean Energy Finance Corporation is the brainchild of the Greens members of the Multi-Party Climate Change Committee, of course. It is, however, nothing more than a slush fund for the Greens to grant funding to projects that fit within their green utopian view of the world. As the member for Mayo brought up earlier today, the CEO's salary is outside the Remuneration Tribunal's jurisdiction so what are we going to have? Are we going to have a union hack being the CEO, or are we going to have Mr Bob Brown himself coming back to head it up? If I were a betting man, I am sure that they know who it is going to be.
For the creation of the CEFC's special account, $10 billion will be appropriated over five years with the first instalment of $2 billion to be paid on 1 July 2013. The government intends the CEFC to be self-sustaining once it has matured. Any funds returned to the CEFC for its investments will be available for reinvestment. While this sounds wonderful and economically sound, the bill already predicts a loss to this monumental taxpayer investment. Indeed, Treasury officials have confirmed to a House of Representatives Economics Committee that around 7.5 per cent of the loans for investments made by the CEFC will not be recovered.
Mr Morrison interjecting—
Ms King interjecting—
The DEPUTY SPEAKER: Order! Would the member for Macarthur resume his seat. It is very difficult to hear what the member for Macarthur is saying while the member for Cook and the parliamentary secretary conduct an ongoing exchange in light of the recent point of order.
Mr MATHESON: Thank you, Mr Deputy Speaker. In yet another feat of tricky accounting, most of the lending is off-budget, yielding a deceptive budget surplus. This is risky business indeed. There will be operating costs and there will be write-offs, but the tell-tale signs that this scheme is yet another Greens inspired pipedream is the concessional component of the loans made by the CEFC to renewable energy projects. Only a Labor and Greens government would borrow money at one rate and then lend it out for incredibly risky projects at an even lower rate. This aspect of the CEFC will expose the belly of the beast to the world of heartache.
We have seen firsthand the problems created when a government backs a so-called winner. In Australia alone we have witnessed the monumental collapse of the Queensland government's ZeroGen project, costing taxpayers well over $100 million of losses. This was despite many warnings from the opposition as well as industry experts that this project was doomed to fail from the start. The government's $700 million Solar Flagships program in Moree and the Queensland Solar Dawn projects are struggling to gain industry support.
For international examples we only need to look at the United States with the monumental failure of their $700 million Solyndra project, a project that had been the President's shining example of a green-energy company. The failure of Beacon Power also occurred under a remarkably similar scheme to this one proposed by this government, as did Solar Trust of America which collapsed despite having a $2.1 billion loan guarantee from the US energy department. History does not bode well for the CEFC. If the finance sector is not convinced of a project's economic viability, why does the government think that it should then expose billions of taxpayers' funds to these exceptionally risky projects.
Indeed, the Greens believe, as announced by Senator Milne, that the CEFC will be able to access finance from the private sector on top of its own taxpayer funding for renewable energy projects. Judging from the interest that the private sector has shown in our nation's largest renewable energy projects, this may not be as easy as the senator thinks. The corporation has a lofty aim to overcome the market barriers to big renewable energy investments. However, one point that this government seems to miss time and time again is that the private sector knows that money does not grow on trees.
Private investors in general part with their hard earned money wisely. The private sector will not often expose itself to anything that it sees as too risky, whether this be actual investment risk, the perceived risks of a new type of investment, or pressure from the tightening of purse strings by banks looking towards Europe's pending financial disaster. So where the private sector dares not tread, this government is blindly barging ahead with billions of taxpayers' dollars hastily shoved into its pockets ready to be thrown at risky and commercially unviable projects.
The Clean Energy Finance Corporation Bill also establishes a board of the CEFC. The board will be tasked with the statutory responsibilities for decision making and managing the corporation's investments. The government has gone to lengths to claim that the CEFC will be an independent body—indeed, the legislation stipulates that the CEFC will make investment decisions independently of the government. However, this independence is skin deep. The bill requires ministers to issue an investment mandate for the corporation. Indeed, the explanatory memorandum of the bill states:
The investment mandate may include, but not be limited to, directions on matters of risk and return, eligibility criteria of investments in renewable energy technologies, low-emission technologies and energy efficiency projects, allocation of investments, limits on concessional investment, types of financial instruments in which the Corporation may invest and broad operational matters.
It seems to me that this is one hell of a mandate for a minister to give an independent corporation. It is apparently clear that the government is happy to allow the CEFC to independently select the individual investments and projects for funding, but the criteria for investment selection as well as the suitability of a project will be tightly controlled by the minister and the government of the day. To further the government's grip on the CEFC's so-called independence, the investment mandate will take the form of a written non-disallowable legislative instrument. This is consistent with ministerial directions issued to statutory bodies such as the Future Fund. The bill also states that the CEFC will apply a commercial filter when making investment decisions. Business hopes to ensure that the CEFC will invest responsibly and manage risk so that it is financially self-sufficient and able to achieve a targeted rate of return. One of the objectives for the CEFC, as agreed by the CEFC expert review panel, is to apply capital through a commercial filter to facilitate increased flows of finance into the clean energy sector, thus preparing and positioning the Australian economy and industry for a clean energy future. Nobody would question the need for increased flows of finances into the renewable energy and low emission energy technology sector. However, this raises at least one very serious concern about the potential for the CEFC to have disproportionate impacts on the market and at the same time not stimulate tangible results for progress in renewable energy projects.
The board of the CEFC will have to be assiduous in their decision making to avoid creating chaos in the renewable energy sector. This concern has largely been ignored by the government in their eagerness to pick a winner and pull the renewable rabbit out of their clean energy hat. The renewable energy target is the best way to ensure that the private sector continues to invest in affordable and sustainable renewable energy. The coalition has offered bipartisan support to a commitment to ensure that 20 per cent of Australia's electricity supply will come from renewable sources by 2020. It is highly unlikely that the government's $10 billion slush fund will be invested successfully and even less likely that any new renewable energy above the 20 per cent target would ever be realised as there is no incentive for energy companies to purchase higher cost renewable power above their mandatory target.
The renewable energy target has been the driving force behind private sector investment in the renewable energy sector. The renewable energy schemes that have been able to show their viability and return on investment have, of course, secured finance. The private sector has identified the most cost-effective and efficient means to produce renewable energy. Through thorough risk assessments and extensive analysis of project viability, the market has supported renewable energy projects that will be financially sustainable. This outcome, which is undeniably a win for consumers and the environment, is in direct contrast to the objectives of the CEFC, which are to provide finance for technologies which the market considers to be unproven, too speculative or too risky for commercial financing.
Origin Energy hit the nail on the head in their submission to the Clean Energy Finance Corporation expert review. They assert that the CEFC could aid in the operation of effective markets 'if it is able to identify and address financial market failures to investment'. However, Origin Energy is very careful to point out the risks of the CEFC to the renewable energy sector if it only serves as another source of unsustainable subsidy or high cost technologies. For the government to now introduce this $10 billion slush fund will throw a spanner into the works for large-scale renewable energy projects that have already sought out and obtained commercial financing.
New projects that are fortunate enough to secure the concessional loans and finance from the CEFC will have the benefit of receiving direct subsidies and could, in turn, jeopardise the viability of current investments financed through far more expensive commercial lending. If the CEFC merely adds its $10 billion to the mix of high-cost technologies that are economically unviable in the long term, then all that will eventuate are higher electricity prices paying for unsustainably expensive technology. Programs very similar to the CEFC have experienced massive failure and controversy in the United States. Billions of taxpayers' money in loan guarantees have been lost because the United States government tried to pick a winner.
This bill is economically irresponsible and unlikely to achieve its stated aims. There is little doubt that the CEFC will end up as nothing more than a $10 billion slush fund to be spent on the whimsical dreams of the Greens, a waste of taxpayers' money and a waste of an opportunity to truly help the Australian environment in an innovative and practical way. That is the price you pay to stay in government.
I move on to the three bills which seek to amend the Clean Energy Legislation Amendment Bill, which seeks to amend the Clean Energy Act, the Australian National Registry of Emissions Units Act , the Carbon Credits (Carbon Farming Initiative) Act, the Fuel Tax Act and the National Greenhouse and Energy Reporting—NGER—Act. Amendments proposed in the Clean Energy Legislation Amendment Bill aim to extend the reach of the carbon tax to include fuels which are eligible for the opt-in scheme and the definition of carbon dioxide equivalence. This bill will effectively bring LPG, LNG and CNG directly under the carbon tax. There have been some reasonable technical amendments to the way the Carbon Farming Initiative, or CFI, is administered. These include the backdating of a methodology to enable greater access to the scheme for projects that were underway before the CFI came about. This will allow existing projects to benefit from the scheme.
The Clean Energy Legislation Amendment Bill also amends provisions in the NGER Act to allow people to nominate who has the operational control of a facility where it is not already clear. This amendment is necessary for organisations where there is no majority owner or where the entity may be controlled by a trust. Other elements of this bill seek to amend the Clean Energy Act and the Fuel Tax Act to apply the carbon tax to LPG and LNG rather than through fuel tax arrangements.
The Clean Energy (Customs Tariff Amendment) Bill and Clean Energy (Excise Tariff Legislation Amendment) Bill 2012 amend the Excise Act and the Customs Tariff Act to provide that, from 1 July 2012, CNG used for non-transport purposes can be covered by the carbon tax because they are no longer subject to the effective carbon price through the fuel tax system. This system will be similar to the structure provided for the aviation industry to administer their carbon tax liabilities. This is yet another tax grab by the government and I cannot support it.
When I look at the amount of money that is being spent here and I try to explain this bill to people in my community, they say, 'We're a growth centre in south-western Sydney and under 16 years of a state Labor government we received very limited support for infrastructure in a growth centre.' There is nothing in this budget for the people of Macarthur. I look at the roads round my area like Narellan Road, Spring Farm Parkway, Camden Valley Road, Bagdally Road, Raby Road. These are all connectors to the growth centre, to Campbelltown city. There is also St Andrews Road, Denham Court and Campbelltown Road. There is not even a reasonable sports centre for Narellan or a PCYC for Gregory Hills.
When I explain these types of bills, which are slush funds for the Greens for investment in projects that are never going to get off the ground, my community say, 'What is going on with this government?' You go doorknocking and people say, 'This is the worst government I have seen in my lifetime.' I am talking to people who are 50 or 60 or 70 years of age who saw the Whitlam government and how bad that was. All of a sudden they are saying to me they have never, in their whole lives, seen a government that has wasted money like this government. The government allow growth centres to occur in north-western and south-western Sydney. The government does not give any funding towards these sorts of projects. They cannot build sustainable communities. There is a distinct lack of infrastructure. Then we give $10 billion away to a bunch of whackos and the Greens that are going to run these programs. The people of my community just go: 'What is going on here? How come they're getting $10 billion and we're getting nothing?' There is nothing in the budget for the people of Macarthur. They walk up to me day in and day out—
The DEPUTY SPEAKER: The member for Macarthur will address the bill before the House.
Mr MATHESON: Mr Deputy Speaker, when you talk about poor policy and poor political parties and when you have a government that is a hung parliament, take a look at the deal that has been struck between the Independents, the Greens and the Labor Party. My community are becoming so frustrated at the lack of funds that are going into building sustainable communities and the lack of infrastructure. When they ask me what is going on I say to them, 'Go along and watch question time. When we ask questions the questions are never answered. When we ask for money, the money is never delivered.'
The south-west growth centre was released for urban development all of a sudden, and then no infrastructure. Nothing in the budget for my community, nothing in the budget for Macarthur. They ask me, 'How does all this occur? There is all the pork-barrelling that occurs with the government and the Independents. All of a sudden there are billions and billions of dollars being given away because of a hung parliament and because people have the balance of power.' Other communities miss out because the Independents and the Greens are reaping all the money that was sown. It is put into their pockets and given to their communities and it is not being equally shared amongst the broader Australian community.
Mr WINDSOR (New England) (12:37): I think we just saw a very good example of why the people of south-western Sydney deserve better. It is a great shame to hear a discussion such as that, particularly given that the basis of this debate that we are having—and the clean energy bills are part of that—is that both sides of this parliament agree on the target in reductions: that of five per cent.
We have this extraordinary circumstance that has developed in this place, and I understand why it has developed; it is because the Leader of the Opposition decided very early on in the hung parliament negotiations that he was going to play the game as if there were a majority government. Rather than become part of a process for various determinations, whether they be about economics, regional development or clean energy, he decided—and his apostles have followed quite blindly; and I think that the speech we just heard is a classic example of that—that this was an issue where even though they agreed with the absolute target—the five per cent reduction and 1990 levels by 2020—that he would play the game of majority government and minority opposition. So rather than be part of a constructive process they have set out to develop a process that sounds as though they deny that climate change exists. And there is some discussion about that at the moment. Their policy position is that climate change is occurring, that as a nation we should do something about it and the target level is identical to the government's—that of five per cent. The method of achieving the reduction in the emissions is different.
I am a farmer; I have been working with soils all my adult life and if there is one thing that I think I might have a little bit of knowledge about it is soil humus and organic matter and the way in which it impacts on the productivity levels of soil, the ways in which the soil processes work, the infiltration rates of water et cetera and, obviously, the plants that grow in that soil.
I have been an advocate for soil carbon for many, many years—when the opposition just laughed it off, years ago when they were in government. If soil carbon were the answer to this I would be the first to say that the Abbott way is the way to achieve the outcome. Regrettably, it is not. That is not to suggest that we should not introduce—and the package of bills actually does introduce—incentives to encourage changes in farming technologies that do have an impact on soil humus and organic matter levels and that do have an influence on moisture infiltration that will have an influence on drought proofing soils. But it is unproven that in most of Australian soils there is the capacity to develop an increase in soil carbon levels that can be retained through dry periods as well as wet. It is unproven and probably will not be proven that our soils will be able to accumulate vast quantities of carbon and hold it. In some parts of Europe and parts of North America the soils will be able to do that and, hopefully, in the future we will be able to improve on our soils even if global warming ceases to be a debate. We should be trying to improve our soils.
The point I am making is that if you have both sides of parliament agreeing on the target, surely the most cost-effective way of getting to the target would be the way that we would go? The previous Leader of the Opposition, Malcolm Turnbull, could see that pathway. Obviously, he could see that a market mechanism was the way to go. We have this extraordinary juxtaposition in the sense of political philosophies: the party that believes in a market mechanism is arguing against it. Some would say that the party that historically has not agreed with a market mechanism would normally go the other way! So we have this circumstance that has developed where raw politics is being played in this issue—raw politics.
I think it is a great shame that the Leader of the Opposition did not take the opportunity to be involved in the Multi-Party Climate Change Committee. He was invited, or his representatives were invited, to be part of that process. I was part of that process and I was very proud to be part of it. I think there were some enormous issues to be dealt with and, in fact, it is going to be a hung parliament that is actually going to do something about it. The Leader of the Opposition, as I said, decided to play opposition politics in a parliament where he could have become part of the government, in a sense, in terms of the governance of some of the policy issues. The climate change debate is one of those significant issues.
From a regional perspective, and with the nonsense that is being peddled out there to create fear in the minds of people that the sky will fall in on 1 July because of this initiative—the carbon-pricing arrangement—many people are starting to recognise that there are extraordinary opportunities. And this investment fund that we are debating today is part of that. It is not the totality of the opportunities. There are enormous opportunities for renewable energy resources—wind, solar, geothermal, bioenergy; the list goes on. I would like to spend a moment talking about a few examples. Most of those opportunities will occur in regional Australia. They will not be located in the cities—because of landscape issues et cetera. The opportunities of the new clean energy future are going to be in the country. Some of them may be agricultural—biodigestion of waste, bioenergy from biomass and those sorts of processes. In fact, we could see some of our agricultural land turned over to the production of biofuel—not through the production of food and then into biofuel but the production of biomass and then to biofuel. Those are the opportunities that are going to be out there.
I will give you a couple of examples of the sorts of things that I am talking about, the real opportunities that are out there. James Cook University is not in my electorate but it is part of the deal that the last speaker spoke about between the Independents and the government. Part of that arrangement was that some money be put into research of biomass and biofuel. James Cook University has been doing some extraordinary work in terms of algae in water—and I think the minister for regional Australia, who is in the chair, would be aware of this. The university is showing extraordinary leadership in this debate and has been doing so for some years. Some of that money is going towards that research. Originally when they started off they were looking at the possibility of using algae as a source of biodiesel. As the research has gone on and been developed up in terms of the varieties of algae and how to actually farm algae—it is a farming process rather than an industrial process—they have found that the uses for algae are far greater than just biodiesel. The protein in algae can be used for food production. I am sure members have dogs. I imagine that the member for Cook, who is in the chamber, has a dog. He is shaking his head.
Mr Morrison interjecting—
Mr WINDSOR: Anyway, I am sure he has had occasion to have a tin of dog food in his cupboard. When you tip out a tin of PAL dog food the contents remain upright. It is the properties in algae that make it stand upright—
Honourable members interjecting—
Mr WINDSOR: The member for Higgins should make way for that great Treasurer of the past, Mr Costello. The former member for Higgins would not have interjected like that about a product of the future such as algae! Algae can be used for a whole range of products. For those who have not been to James Cook University, it is worth a visit there to see international scientists from all over the world, young people in their 30s, working on our future.
There is a lot of talk about food security into the future—how we are going to produce protein for a growing population et cetera. There is a lot of talk that we need clean energy, we need to reduce CO2 and we need to reduce greenhouse emissions in the atmosphere. There is a lot of talk that we need to clean up emissions from coal fired power stations. Well, this is just one example of how those sorts of things are happening.
As we speak, the people at James Cook University are developing pilot operations at two power stations. Why are they doing that? What they intend to do—and they have done this at quite large trial sites—is use the flue gases from the power station to grow algae in a confined environment. They use massive bladders that are half full of water. They put algae in them and then they harvest the algae. I asked them: what is the potential of this? We have coal fired power stations producing emissions and we are trying to come to grips with that through a whole range of options. Is it possible to capture the CO2 emissions, put that through an algae farm and convert it into protein products? The answer is yes. An algae farm of something like 10,000 acres, in theory at least, could ingest the flue gases of a normal sized coal fired power station.
That is why we need a Clean Energy Finance Corporation. There is an endless list of projects. The minister in the chair is aware of the activities that are going on in the meat processing business to convert their waste—not only the waste from the animals but also the paunch waste et cetera from the animals' insides—into an opportunity, into energy and into fertiliser. That is waste that they may well be charged $23 a tonne for if they have over 25,000 tonnes of CO2 equivalent. They want to turn it into energy, into fertiliser and into cleaner water to be used for other productive purposes.
I think what we need here is some degree of leadership. Those people are out there. They are at the cutting edge of getting some of this technology right and getting it put in place to produce renewable energy for the future, to produce a cleaner future for future generations and to produce the circumstances where food can be produced in a healthy world. We need to give them some leadership, rather than the nonsense that we are hearing in here about global warming and climate change. When both sides agree on the same target, surely we should agree that research for future generations of Australians is a worthy avenue for funding. These short-term political fear tactics have to stop if we want to be part of the future. We have seen a lot of our scientists go overseas in the last decade because of it and we need to stop it now. (Time expired)
Mr FRYDENBERG (Kooyong) (12:53): I rise to speak on the Clean Energy Finance Corporation Bill 2012 and related bills, the Clean Energy Legislation Amendment Bill 2012, the Clean Energy (Customs Tariff Amendment) Bill 2012 and the Clean Energy (Excise Tariff Legislation Amendment) Bill 2012. While the latter bills will see the scope of the carbon tax cover LPG, LNG and CNG, it is the Clean Energy Finance Corporation Bill to which I will give my primary focus.
This $10 billion new initiative, colloquially known as the 'Brown Bank' given its genesis with Bob Brown and the Greens, is fervently opposed by the coalition as it is an indulgent, expensive, misguided, big government idea. Not only will it distort the market in the renewable energy technology space and put a brake on existing players in that market but it will also see the loss of billions of dollars of taxpayers funds at a time when this government's economic mismanagement is driving the country further into debt.
In the time available I want to make the following points. Firstly, I will analyse the inherent contradictions in the explanatory memorandum outlining the key features of the Clean Energy Finance Corporation and shine a light on the devastating impact the CEFC will have on the government's bottom line. Secondly, I will explain how market distortion under the CEFC will actually occur. Finally, I will point to international experience with similar government-supported renewable energy investments as a warning sign of what the Australian taxpayer should expect.
Firstly, to the bill itself. The explanatory memorandum sets out that the Clean Energy Finance Corporation has:
… the power to invest in financial assets for the development of Australian-based renewable energy technologies, low-emission technologies and energy efficiency projects.
It sets out the corporation's power to ensure:
… at any time on or after 1 July 2018, at least half of the funds invested at that time for the purposes of its investment function are invested in renewable energy technologies.
It also has:
… the power to enter into investment agreements itself, and make investments through subsidiaries.
A special account for the purposes of the Financial Management and Accountability Act 1997 is established which will see this CEFC special account credited with $2 billion a year for five years. Funds returned to the corporations from its investment will be available for reinvestment. The explanatory memorandum explicitly states 'the corporation will make individual investment decisions independently of the government'. But this sentence does not sit comfortably with me, with the point made a few lines down in the explanatory memorandum:
The Bill gives the responsible Ministers powers of direction over the broad mandate of the Corporation …
It then goes on to say:
The investment mandate may include, but not be limited to, directions on matters of risk and return, eligibility criteria of investments in renewable energy technologies, low-emission technologies and energy efficiency projects, allocation of investment, limits on concessional investments, types of financial instruments in which the Corporation may invest and broad operational matters.
To any independent observer this must seem an incredibly broad mandate which is at the discretion of ministers. The potential here for political decision making is real and disconcerting. The explanatory memorandum goes on to say that in applying its mandate:
It is expected that the Corporation will apply a commercial filter when making its investment decisions, focussing on projects and technologies at the later stages of development. By adopting a commercial approach, it is expected the Corporation will invest responsibly and manage risk so it is financially self-sufficient and achieves a target rate of return.
Again, there is a contradiction. This commitment to applying a commercial filter does not sit comfortably with the government's explicit intention in setting up the CEFC, as announced by the Treasurer and the Minister for Climate Change and Energy Efficiency in a press release on 12 October 2011:
The objective is to overcome capital market barriers that hinder the financing, commercialisation and deployment of renewable energy, energy efficiency and low emissions technologies.
If the market will not take a favourable commercial decision to invest in these technologies then how can the government apply their own so-called commercial filter and reach a different decision—namely, to invest? It just does not make sense. You are either a commercial entity competing in the private sector or you are a publicly funded entity with non-commercial goals. You cannot be both.
The government goes on to say in the explanatory memorandum:
The Corporation is intended to be self-sustaining once mature.
Why, then, does the explanatory memorandum outline a hit to the fiscal balance of $1,346.4 million over the forward estimates, suggesting:
… a prudent recognition that some investments will not be recovered.
This includes operating costs of the CEFC as appropriated, loss provisions on loans from the CEFC to renewable energy projects and the concessional component of loans to renewable energy projects. If this corporation is to be so-called 'self-sustaining', why is it projected to lose so much money? I put it to this House that $1.346 billion loss may end up being the tip of the iceberg when the losses of this corporation are extended over its life.
This will extend to many billions of dollars falling on the taxpayers' shoulders. This is because even these numbers of $1.346 billion are predicated on the CEFC having a very high success rate with its strategy of 'picking winners'. In testimony before the House of Representatives Standing Committee on Economics on 28 May this year, senior bureaucrats from the Department of Finance and Deregulation said they are predicting that only 7.5 per cent of investments each year are not recovered—when my colleague the member for Moncrieff, Steve Ciobo, put to them that a 92.5 per cent success rate was extraordinarily high and a 7.5 per cent default rate extraordinarily low, they said it was their 'best guess'. We have to remember we are talking about billions and billions of dollars. That will be spent on this new slush fund, and we deserve much more than the bureaucrats' 'best guess'. In fact, the Australian people deserve a lot more scrutiny of these bills than they have been allowed—particularly the bare 150 minutes which was given to the economics committee to debate this new $10 billion body.
When talking about the transparency and scrutiny of the CEFC, it is important to note that the government has hidden the corporation from its budget bottom line, just like with the $50 billion NBN, which was so-called 'off budget'. This $10 billion Clean Energy Finance Corporation is also off the balance sheet because they are treating it as an equity investment in the forlorn hope that the government is going to get a commercial return. I will tell you they will not get these commercial returns.
The second point I want to make is about the distortions that this Clean Energy Finance Corporation will have on the renewable energy market. Both the government and the opposition are united in their support for a 20 per cent renewable energy target. This target has driven and will continue to drive investments in the renewable energy sector. But, by setting up this $10 billion fund to pick winners and assist technologies that the commercial markets will not support, they are basically saying to other players in this market who are existing under the funding constraints that we currently have, 'You will be disadvantaged.' It is these existing players who are going to be the real losers from the CEFC body. What is more, the $10 billion will not produce additional renewable energy other than what this existing 20 per cent commitment is going to. So you are going to have $10 billion spent by this government picking winners with no net environmental gain.
Third, I mention the overseas and domestic experience with governments stepping up to fund and finance renewable energy technologies. In the United States there was the failure of the $700 million Solyndra project, the collapse of Beacon Power after the US Department of Energy gave them a loan guarantee and the unravelling of Solar Trust of America after receiving a $2.1 billion line of credit from the US government. In Queensland there was the ZeroGen project collapse, which received $100 million of co-investment from the Beattie government. There was the $700 million Solar Flagships program, which has failed under this Labor government.
You see this is the government that gave us the Green Loans program. This is the government that gave us the failed Green Start program. This is the government that came up with the wonderful idea of cash for clunkers and the citizens assembly. And there was the daddy of them all: more than $2 billion wasted on pink batts and then another $500 million spent trying to clean up 70,000 roofs. Tell me if you believe that this government with their record should be trusted with $10 billion of hard earned taxpayers' money in picking winners. What about the roads that need to be built? What about the new ports to get our exports off to their markets? What about the hospitals? What about the schools instead of this $10 billion Clean Energy Finance Corporation, which is about picking winners and a political deal?
Finally, in order to understand the context of this announcement you have to understand why it was agreed to in the first place. You have to look back to the formation of the 43rd Parliament, because the Prime Minister did not win an outright majority. In fact, we the coalition were the ones who deserved to form government. So this Clean Energy Finance Corporation is the product of the backroom deal between the Greens and Labor in order to win the Greens vote in this House and in the Senate. That deal is behind the Prime Minister's backflip on 'no carbon tax under a government I lead' and that deal is behind the government's decision to provide this $10 billion for this Clean Energy Finance Corporation.
In conclusion, this is an experiment—a $10 billion experiment—which Australia cannot afford to take. Born out of political weakness rather than a product of a considered policy process, this Clean Energy Finance Corporation will saddle Australian taxpayers with a huge financial burden as billions of dollars are wasted on uncommercial projects in the coming years. International experience shows that governments are not designed to pick winners, particularly in the renewable energy space. What is more, with this bill currently before the House there is scope for unwarranted ministerial direction in pursuit of political not commercial goals; there is the potential to distort the existing renewable energy market to the disadvantage of those players operating under the current constraints; and there is the inherent failure of this initiative to increase the production of renewable energy over and above the already bipartisan commitment to 20 per cent. It is for these reasons, as well as the obvious, blatant political manipulation which is behind the Clean Energy Finance Corporation, that I join with my colleagues in opposing the bills before this House.
Mr CHRISTENSEN (Dawson) (13:07): Looking at these bills, in particular the Clean Energy Finance Corporation Bill 2012, I get this eerie, creepy feeling at the back of my neck, and I am not sure if it is deja vu or a premonition. I get a horrible feeling that this bill is going to be a horrible disaster, and I am sure I have seen this train wreck before. We have a big-taxing, big-spending Gillard Labor government which has managed to turn wasting taxpayer money into an Olympic event and a giant barrel of money—$10 billion worth of taxpayer funds—and I am sure there was a similar situation when Kevin Rudd, the member for Griffith, was Prime Minister. I would have thought that keeping these two things apart would be imperative for the sake of the country, because putting the Labor Party in charge of setting up and looking after such a barrel of money is like letting the wolf guard the flock—sure he is keen to do it, but you would be mad to trust him.
If I were a betting man I would go with the odds, and that means voting against this bill and keeping the wolf out of the lambing yard. Supporting this bill would be like backing a rank outsider—like having a three-legged donkey up against Black Caviar—because we know this nag of a bill is a loser before it even lines up in the barriers. Here is why: the bill itself tells us it is a loser. It sets out in the fiscal impacts the forecast of operating costs and write-downs. There will be failed projects, and this bill admits this before it even comes into effect. This bill is like the kind of horse that stands at the barrier and says, 'There are 13 hurdles out there, and I intend to trip over one; my plan is to trip over one.' This was pointed out very clearly in Senate estimates this week when Treasury confirmed that they expect that 7.5 per cent of loans for investments made in this barrel of money will not be recovered.
The plan is to take $2 billion of taxpayer funds ripped out of families' back pockets with the carbon tax and then to put the money into the Clean Energy Finance Corporation barrel, and Treasury is telling us that it expects to lose $150 million a year. That is even more than the Victorian Labor government lost in Victoria with the Cain-Kirner venture. They had their venture capital fund and they tried to pick winners, but they racked up losses estimated at $110 million. The Renewable Energy Venture Capital Fund already does the job proposed for the Clean Energy Finance Corporation, so this is already a two-horse race. There is also the Emerging Renewables Program, and both of those seasoned runners make their intended loss public. These are not the sorts of horses I want to put my money on either. I do not like to back horses that have no intention of winning.
Two weeks ago, possibly Australia's worst racehorse, a horse called Vote For Lust, attempted to break through for its maiden victory in Mildura after 87 starts and no wins. Even with champion jockey Glen Boss on board, Vote For Lust managed to beat just two runners home. It was a great story about a horse that has a cult following for being a champion loser; but his title is in danger. At least Vote For Lust had a chance and his form is no worse than the bill we have before us today, but the clean energy bank has form that reads something like this: a maiden for little or no talent; needs blinkers, as it loses focus and is easily distracted; prone to changing jockeys mid-race; has no sense of direction; and has a habit of running backwards. Horses that run backwards are very rare.
This bill has a specific aim: it is supposed to create a barrel of money to invest in clean energy so that Australians produce fewer carbon dioxide emissions. But it has been designed by the Labor Party and by the Greens, and they have obviously turned the design template upside down, because the result of the bill will be the opposite of the intended result. This is what the Australian Institute, a friend of the people on that side, said about this bill:
In theory, complementary policies such as the CEFC should do one of two things: (a) realise cheap abatement opportunities that won't be picked up by the carbon pricing scheme; or (b) accelerate the decline in the cost of low- and zero-emission technologies. If a complementary policy isn't achieving one of these two objectives, it is wasting money.
The CEFC doesn't appear to have been designed with these principles clearly in mind.
That comes from the Australia Institute, a left-wing supporter of all things warm and fuzzy and clearly a supporter of the Labor-Greens carbon tax. Even the Australia Institute admits that the proposal in this bill is a waste of time and a huge waste of money.
Business journalist Stephen Bartholomeusz summed things up in the Business Spectatoron 17 April when he talked about the self-defeating nature of the CEFC. He wrote:
The key problem with throwing $10 billion of taxpayer money at subsidies for clean energy while the mandatory renewables target scheme remains in place, however, is that the fund won't actually reduce carbon emissions or lead to more renewable energy capacity being added—it will simply displace what would otherwise have occurred without subsidy. We'll spend $10 billion for no material benefit.
As we speak, there are companies out there in the real world investing in technology—they are investing in clean energy and investing in innovation. When the drunken sailors opposite start throwing around $10 billion on the open market, we have to expect absolute chaos. The CEFC will undercut finance in existing projects and kill off real innovation. Instead of a vibrant market generating creative energy solutions and low-emissions technology there will be a raft of lumbering, inefficient public-purse spongers sucking at the taxpayers teat in innovating ways so as to make sure that the free money keeps coming. Highly experienced and respected economist Henry Ergas wrote in the Australian in October last year a very interesting and informative article entitled, 'Billions will be wasted painting pork barrel green'. He wrote:
Having enjoyed their international junkets, the suits on the CEFC will hardly reject every proposal put to them. Rather, to justify their existence, they will make some high-profile investments, no matter how dubious.
As for the politicians, they will crave the photo ops from contract signings and factory openings. Since the CEFC's mandate includes helping existing manufacturers convert to "green energy", every constituency can have one, presumably with a billboard advertising the government funding. Ever alert, the rent seekers won't take long to cotton on. And with the CEFC excluded from the Productivity Commission's periodic reviews of the government's package, there will be little to slow the gravy train.
So Ergas is saying that no good can come of it—at least, no public good. Then he goes on to talk about cost, and this is really important. He said:
But none of this will come cheaply. Rather, analyses consistently conclude that each dollar spent on this type of government venture simply crowds out one dollar of private investment elsewhere in the economy. But that government dollar both achieves less than the dollar it displaces and costs more, because distorting taxes are needed to raise it. It therefore ends up costing two or more dollars in lost income.
So make that $20bn wasted on painting the pork barrel green.
He means $20 billion will be wasted rather than the $10 billion that Labor is initially putting into it. If the Labor Party is in charge of handing out money we would get a better result by sealing up the barrel and hiding it under the stairs.
Getting back to my metaphor of the form guide, this nag of a government has prior form. At this distance and on this track it is a loser. I refer the House to the Green Loans scheme, which allowed householders a free environmental assessment and interest-free loans of up to $10,000 to purchase energy-saving devices. The Green Loans scheme became a haven for rorting and shoddy service, a monument to bureaucracy and inefficiency.
In Queensland, a state with the misfortune of having a Labor government waste its money for 20 of the last 22 years, the Bligh government presided over the ZeroGen project. Despite clear warnings from the Liberal National Party—and from people on this side of the House—and industry experts, the then Queensland Labor government oversaw losses of $100 million on this project. No wonder the state racked up $85 billion in debt under Labor!
But there is more than just domestic form to go by. We can look at the overseas campaigns of similar nags. The United States, under a program similar to that of the Clean Energy Finance Corporation, backed such spectacular failures as the $700 million Solyndra project, the Beacon Power Corporation project, and Enerl. All of them were spectacular failures.
More recently, we saw the collapse of Solar Trust of America, which had a $2.1 billion loan guarantee from the United States Department of Energy to build a 1,000 megawatt power plant in the Mojave Desert. It was called the Solar Trust of America but what happened to the trust that America put into such a scheme?—collapse and waste.
While I criticise the 'horse' here—that is, the barrel of money that is the Clean Energy Finance Corporation—we really need to look at the jockey and the trainer. There are elements of this bill that would have us believe that the ones who will hold the reins will be the board of the Clean Energy Finance Corporation. But the board will be a puppet of the Gillard Labor Party. That is enshrined in this legislation. This bill stipulates that ministers will issue an investment mandate for the corporation. It says:
The investment mandate may include, but not be limited to, directions on matters of risk and return, eligibility criteria of investments in renewable energy technologies, low-emission technologies and energy efficiency projects, allocation of investment, limits on concessional investments, types of financial instruments in which the Corporation may invest and broad operational matters.
Does it leave anything out? Is there any point in having a board? If this bill sets up a board on the basis of, 'Do whatever you want as long as it is what I tell you to do,' then the lunatics are still in charge of the asylum.
One parameter that is a glaring omission from this bill is a guideline for efficiency. The Clean Energy Finance Corporation would not be required to invest in the lowest-cost technologies to produce the cheapest emissions reduction. It is as if the Labor Party accepts that it has a problem—the first step to recovery for any waste addict—and has written the rules to redefine it as no longer being a problem.
What is truly worrying about this dud of a horse, though, is the trainer, because even the Labor Party could not dream up anything so poorly constructed as this. The whole idea of a Clean Energy Finance Corporation comes from the Greens. We know it and they know it. The corporation comes as a result of lobbying from the Greens MPs and senators on the Multi-Party Climate Change Committee, of which the now Greens leader Senator Milne was co-deputy chair. That alone should be enough to set off warning bells. With the Greens having their two cent's worth—actually, $10 billion worth—we are no doubt locking taxpayer money into technologies that are proven to be hugely inefficient and wasteful.
It is beyond me why the Greens cling so desperately to windmills and inefficient solar technology when they know, deep down in their hearts, that these are extremely costly ways to produce energy. The Productivity Commissioner said so. And what they will not tell you is how much energy is used and how many emissions are produced to generate the materials and to build, install and maintain these monstrosities. If you build your windmill really well and find a really windy spot it might produce just enough energy to build another windmill—perhaps a slightly smaller one—which you could use to produce another one. And on and on it goes. If backing this bill is backing a guaranteed loser, then backing windmills is backing a guaranteed waste of money, time, and effort.
What pains me the most, when I look at how much taxpayer money is going to be poured down this clean-energy drain, is what the Australian families who earned this money will be missing out on. What could we, as a nation, do with $10 billion over five years, instead of putting it all this nag of a horse? We are putting it all on the nose when we know is going to run a dismal last. We could use that $10 billion to pay for—well, a quarter of the funding needed for the NDIS, the National Disability Insurance Scheme, over the next five years. We could use it on flood-proofing all of the Bruce Highway in North Queensland to mitigate extreme weather events. The Mackay ring road could be built with one-twentieth of it. We could supplement local roads funding for every local government in this country over the next decade through a boost to the Roads to Recovery program to $1 billion. But we do not have the chance to debate those lost opportunities here today. Instead we are debating a bill that is not even worthy of a glue factory.
I cannot support this bill because it is a licence to waste money. It is a bill that should never have been brought to the starting gate. It is a bill that is not worth the hay and oats that Australian families will have to feed it. Frankly, if this bill were a horse, I would have to shoot it.
WYATT ROY (Longman) (13:22): I acknowledge the member for Dawson and his eloquent and common sense approach to this bill. I also rise to speak to the Clean Energy Finance Corporation Bill 2012, the Clean Energy Legislation Amendment Bill 2012 and related bills. Every day I am stopped in the street by people in my electorate—small business owners, teachers, parents, independent retirees, single mothers. All of them want to know a simple thing. They want to know why this Labor government seems to be doing everything in its power to make their lives more difficult. They want to know why this Labor government is making decisions that are causing their bills to be higher and the cost of essential everyday items to be more. I speak to families who are facing escalating cost-of-living pressures simply because of the poor fiscal management of, and the bad decisions made by, this Labor government. There is no secret in their minds. They know that their costs are going up because of this Labor government—a government that is plagued by waste and mismanagement. They know that this Labor government has shown itself to be unable to successfully implement any program it puts its hand to or to avoid massive cost blowouts in its failed schemes. The people I speak to have had enough. They want to know when the waste and mismanagement will stop. Unfortunately, I have no confidence, and those opposite have given us no hope, that government waste and mismanagement will ever stop while we are under this Labor government.
We are in this place today to debate a bill proposed by those opposite that is designed to make this situation even worse for Australians. It is a bill that will glorify waste and glorify mismanagement. It will give the cold shoulder to responsible fiscal administration. We are here to debate a bill that has the fundamental promise of sinking $10 billion of taxpayers' money into a massive black hole. Let me just say that again so that we can feel the full impact of what this bill proposes. This bill will flush $10 billion down the drain. That is $2 billion every year for five years, starting on 1 July 2013.
The Clean Energy Finance Corporation Bill 2012 establishes the Clean Energy Finance Corporation that will have the power to invest in the development of low-emission technologies and energy efficient projects that the private sector will not touch. The goal behind this bill is a farce. The premise is that this bill will ultimately increase the amount of renewable energies that make up Australia's energy sources, that there will be better renewable energy options, that there will be more money going into renewable energy research and that somehow this will create better technology. But this premise is fundamentally flawed.
Bipartisan support exists in this parliament for a total of 20 per cent of all Australian energy to come from renewable energy by the year 2020. This is a target that the industry is already working towards. This bill will not increase this target; in fact, this bill pours money into something that will feasibly be achieved by the market without the interference of a government entity such as the Clean Energy Finance Corporation. It is the renewable energy target of 20 per cent that is driving private market investment in the energy sector.
This bill will have no positive impact on this target whatsoever. There will be no new renewable energy generated as a resulted of this bill. Currently the market has been a very effective driver behind the development of renewable energy sources, and now this Labor government is, once again, seeking to meddle. This government is attempting to interfere in the form of a bill that installs an entity charged with the challenge of seeking out technologies that the market has already rejected—the technologies that the market considers to be unproven, too speculative or too risky for commercial financing.
This bill's sole purpose is to seek out those that were the last ones picked on the team, the proverbial pariahs of the renewable energy market, and put them in pole position for the renewable energies race. Not only will the government be effectively backing the losers, it will also adversely affect those existing, commercially-viable investments. What this will be is a subsidy for projects that the private sector will not touch because there is no security and the cost-benefit ratio is not economically sound.
If the market has determined that a technology is unviable then throwing more taxpayers' money at it is not going to help the situation. Throwing more money at it only hurts projects that are viable, that have potential and that already have the support of the market. It discourages, rather than encourages, future investment in the industry. Savvy private investors are not going to put their money into projects that, as a result of this bill, will be at a distinct disadvantage.
Under the framework outlined in this bill, the minister will be responsible for issuing an investment mandate for the Clean Energy Finance Corporation, and the criteria for investment selection and suitability will be determined by the minister and the government of the day, providing the government with what is effectively control over the renewable energies industry.
At what point did governments cast aside their responsibility to spend taxpayers' money more efficiently and wisely? At what point did it become acceptable for a government to choose to believe that it has a right to waste taxpayers' money—to waste money on schemes that not only will not provide a return for the community but actually damage existing commercial industries? As I have said in this place before, it is up to governments, just as it is up to the responsibility of individuals, families and corporations, to live within their budgets and to make wise financial decisions. This is not what we have seen or what we are seeing with this Labor government.
This Labor government has thrown responsible, logical and sensible financial management out the window. We are seeing with the Clean Energy Finance Corporation Bill 2012 that this government wants to mandate that the entity it is creating needs to actually seek out irresponsible investments to pour Australian taxpayers' money into. It is trying to engage in speculative share buying that the market does not support. It is a high-risk move; a significant risk taken with taxpayers' money. In fact, those opposite are not even trying to pretend that this bill will pay off. Their own explanatory memorandum for this bill reads:
The fiscal and underlying cash balance impacts include a prudent recognition that some investments will not be recovered, and interest revenue.
Those opposite are predicting that 7.5 per cent of the $10 billion to be injected into the renewable energy sector is expected not to be recovered. That is $150 million each year for five years, equalling a total of $750 million. Unfortunately, with this Labor government's record on program blow-outs as well as debt and deficit, there is absolutely no certainty that this government could keep it at this level.
It is almost as if this government is seeking out more ways to waste taxpayers' money on failed quasi-environmental programs and increase the debt burden for the next generation of Australians. We have seen pink batts, green loans, Green Start and cash for clunkers, not to mention school hall rip-offs, set-top box cost blow-outs, the debacles of the East Timor and Malaysia solutions, the live cattle export catastrophe and a failed class war. This list goes on, and this government is determined not to learn its lessons.
This government is also determined not to learn the lessons of our friends who have tried and failed in similar programs. Whether it is the United States' Solyndra project, which alone cost $700 million, or Beacon Power, Enerl or even the Solar Trust of America, all of these catastrophes occurred under programs similar to the Clean Energy Finance Corporation and all were massive economic failures. Where others have gone and failed and will not go again, this government is blindly forging ahead.
On our own home soil we have witnessed the devastating failure of the Victorian Economic Development Corporation, which shared many of the hallmarks of the Clean Energy Finance Corporation. This should be a wake-up call for a government that has no intuition. But in the same way that this government disregards the views of Australians, it is dismissing what the market is saying about these technologies and stubbornly ignoring expert advice. Industry experts have offered a clear warning about interfering in the market process. In addition to clear advice against embarking on such endeavours, the industry also categorically rejected the Queensland Solar Dawn project and the Moree Solar Project. And with the help of the former Queensland Labor government, this Labor government has itself stacked up more than $100 million of losses on the failed ZeroGen project. With failures already under its belt, it is beyond comprehension why this government is ready and willing to put itself on the chopping block for yet another failure.
With such compelling evidence against interference in this industry and with demonstrated, proven examples of how pursuing the Clean Energy Finance Corporation and its investments into renewable energy is simply disrespectful of the Australian public, pursuing this activity under these circumstances is nothing more than a flagrant disregard for the hard earned dollars of the people in my local community and in every other electorate in Australia.
If it is not bad enough to be pursuing a project that experts, evidence and prior experience reject, it appears that those opposite are determined to do everything they can to shut the Australian people out of having any say on the Clean Energy Finance Corporation. The government is attempting to push through this legislation without the time for scrutiny by the Australian people, as well as funding the corporation upfront so that the money cannot be withdrawn when the people have their say—and, inevitably, they will say no to this scheme. It is my firm belief that we are here in this place to represent the views of the people, not to exclude them from decision making about the future of our nation.
Senator Milne, the Leader of the Greens, would appear to be proud of these attempts to subvert the say of the Australian people and is even on the record as saying, 'With a legislatively guaranteed stream of funding outside the budget, no future government will be able to undermine it without changing the legislation.' It was interesting to hear what political and economic commentator Ross Greenwood had to say about this initiative. 'Frankly,' he said, 'if they have been rejected by the market in the first place they are going to be rejected by them in the second place also.'
Blind Freddy could see that this decision has no positive impact on the environment or on developing sustainable renewable energy alternatives. If the Labor Party and the Greens truly wanted to achieve these goals, they would have been better off giving tax incentives to private investors for them to invest in speculative energy companies. This would have been a far more mature and logical approach to developing this sector. Such an approach would have ensured that taxpayers' money would not be used to take on the risk of initiatives that the private sector will not touch. Such an approach would have been a far more responsible management of taxpayers' money. The point remains that for all the money spent and the effort and the time that go into this scheme, Australians will see no benefit for the environment. The point remains that the bipartisan supported target of 20 per cent by 2020 will not be positively impacted on as a result of this bill.
As long as I am elected to represent my community in this place, I will fight to defend their fair expectation that their hard earned taxpayer dollars are spent appropriately. This bill is just another tragic example of this Labor government wasting taxpayers' money. It is waste that I do not condone. For the reasons I have outlined I strongly oppose this bill.
Debate adjourned.
COMMITTEES
Economics Committee
Report
Ms OWENS (Parramatta) (13:36): On behalf of the Standing Committee on Economics I present the committee's Advisory report on the Clean Energy Finance Corporation Bill 2012, Clean Energy Legislation Amendment Bill 2012, Clean Energy (Customs Tariff Amendment) Bill 2012, Clean Energy (Excise Tariff Legislation Amendment) Bill 2012, incorporating a dissenting report, together with the minutes of proceedings.
In accordance with standing order 39(f) the report was made a parliamentary paper.
Ms OWENS (Parramatta) (13:36): by leave—The Australian government's clean energy future legislation package in 2011 included a commitment to establish the Clean Energy Finance Corporation to facilitate the flow of finance into the clean energy sector. Following a review by an expert panel, chaired by Jillian Broadbent AO, the government adopted the recommended design and introduced the Clean Energy Finance Corporation Bill 2012.
The CEFC's objective is to overcome capital market barriers that hinder the financing, commercialisation and deployment of renewable energy, energy efficiency and low-emissions technologies. In short, this market failure in Australia means that the private sector is not investing in clean energy technology projects on a scale that is desirable if we are to realise our potential as an innovator and producer of clean energy. The CEFC is a mechanism to bring the finance and clean energy sectors closer together.
In establishing the CEFC, the government is making a significant investment in Australia's clean energy future. While the government will provide the organisation with a broad mandate, the independent CEFC board will be responsible for investing in clean energy projects. All investment decisions will be made through a commercial filter. Finance will be offered on the least generous terms—enough to enable a project to enter the commercial arena, but not to create substantial negative externalities or market distortions. It is envisaged that there will also be co-investment with the private sector.
The CEFC will expect to make returns on investments, but in making its investment decisions will also take into account other positive community and environment benefits that the private sector would not necessarily consider. This commercial approach to investment decisions, combined with its consideration of the positive external benefits, make the CEFC a key component of Australia's clean energy strategy.
The CEFC will complement the carbon price, Renewable Energy Target and other programs and initiatives to encourage and facilitate development of the clean energy sector. The CEFC will be part of an innovation chain, investing in projects and technologies that are at the later stage of development and are viable commercial prospects. Other programs such as the Australian Renewable Energy Agency provide grants at the earlier research and development stage. To give effect to these agency and program relationships as part of the clean energy future package, provision is made for the sharing of appropriate information between the CEFC and relevant agencies.
As part of its inquiry, the committee also looked at the Clean Energy Legislation Amendment Bill 2012, the Clean Energy (Customs Tariff Amendment) Bill 2012 and the Clean Energy (Excise Tariff Legislation Amendment) Bill 2012. Changes in the Clean Energy Legislation Amendment Bill: support the establishment of the CEFC; give effect to other government commitments in relation to the coverage of gaseous fuels—liquefied petroleum gas, liquefied natural gas and compressed natural gas; and make other technical amendments to improve the operation of the carbon pricing mechanism.
In response to calls from the gaseous fuels sector and the recommendation of the Joint Select Committee on Australia's Clean Energy Future Legislation, LPG, LNG and CNG not used for transport purposes will now be covered by the carbon pricing mechanism rather than the fuel tax system. This amendment will mean that it will be easier for industry to manage its cash flow, firms will have more flexibility in managing their carbon liabilities and compliance costs will be reduced.
The treatment of LPG and LNG that is not used for transport purposes will align with the arrangements for liquid fuels under the carbon pricing mechanism. The changes to the coverage of LPG and LNG will take effect from 1 July 2013 to allow transitional and compliance arrangements to be considered, developed and implemented. Bringing non-transport CNG under the carbon pricing mechanism will reduce compliance costs for small producers and reduce administrative costs for government in relation to excise. If the bill is passed, the CNG changes will be able to commence on 1 July 2012 as CNG is produced from a natural gas that is already subject to an upstream price under the carbon pricing mechanism. The excise and tariff bills also give effect to changes to the treatment of non-transport CNG by exempting it from customs and excise duty.
The Clean Energy Legislation Amendment Bill also contains provisions to enhance the operation of reporting entities under the National Greenhouse and Energy Reporting Act by streamlining the nomination of the person responsible for reporting on the organisation's carbon emissions. The bill also seeks to remove the requirement for regulators to publish 'total energy consumption', and retain the more appropriate 'net energy consumption' requirement, as it does not include the transformation of one energy commodity to another. The bill also proposes to enhance the security of the Australian National Registry of Emissions Units, by providing the regulator with additional time—from 48 hours to five business days—to make decisions about giving effect to a transfer instruction and dealing with suspicious transactions.
This bill also includes technical amendments to the Carbon Farming Initiative by simplifying the process of finalising methodology determinations to provide more time to approve the methodologies of existing projects and facilitate their transition to the CFI. I would like to thank the organisations that participated in the hearing in Canberra. I also thank my colleagues on the committee for their contribution to the report.
Mr CIOBO (Moncrieff) (13:42): by leave—I welcome the Chair of the House of Representatives Standing Committee on Economics's contribution with respect to tabling this report. Indeed, it is almost equal to the total time the committee had to actually explore the bills that were before the committee. In fact, another 30 seconds or so and it would have been longer!
Liberal members of the committee that participated in the inquiry were frankly gobsmacked at this government's approach to dealing with the CEFC. Our primary concern rested with the fact that we are seeing invested $10 billion of Australian taxpayers' funds over five years, $10 billion that will be going into the CEFC, for which Liberal members of the committee were allocated just on two hours for a public inquiry. At $5 billion an hour Liberal members of the committee were astounded that the Labor Party would spend $10 billion of taxpayers' funds and in a complete aberration, completely inconsistent with their desire to so-called 'let the light in', as the Prime Minister said, they then shut down the inquiry after only two hours.
Apart from that I rise to raise a number of concerns that were evident to Liberal members of the committee as a consequence of the public hearing. Those relate to a number of comments that have been made and outlined, indeed, by the chair of the committee. These were the actual words that the chair used just now in this contribution that the CEFC will be part of an investment 'chain' supporting 'viable' projects.
It begs the question—and this is what became very evident to Liberal members of the committee—that if these projects were viable then they would be funded by the commercial sector. Make no mistake, the entire rationale of the CEFC as outlined to the committee, which we picked up upon as part of the Liberal contribution to the inquiry, was that these are not commercially viable projects because the commercial sector is not investing in them at the extent required in order to receive 100 per cent commercial support. That underscores the serious concerns that Liberal members have when we see $10 billion of taxpayers' funds being decided upon by the Labor Party to invest into projects that are not commercially viable by definition.
The DEPUTY SPEAKER ( Hon. BC Scott ): Order! The members statement is interrupted in accordance with standing order 43.
STATEMENTS BY MEMBERS
Member for Sydney
Mr SCHULTZ (Hume) (13:45): It does not often happen in this place, but I rise today to thank the Minister for Health, the honourable member for Sydney, for the significant contribution she has made to easing the suffering of one of my constituents. I wrote to her on 27 April about a very serious issue centred around a drug that was not on the PBS, and to her credit she showed the compassion that we should all show to our constituents in this place and did something to make sure that that lady did not have to pay the amount of money that was needed to get the drug. I thank her most sincerely on behalf of my constituent and I thank her most sincerely for doing what needs to be done in this House from time to time—wonderful things done in a bipartisan way.
Tourism: Tasmania
Mr LYONS (Bass) (13:46): I rise to applaud the recent announcement by Jetstar that it will increase its flights into Tasmania. I would like to particularly applaud the announcement of seven additional flights per week to Launceston from 16 August. In November this year, a further seven flights per week between Launceston and Sydney will also be added to Jetstar's flying schedule. This is good news for the tourism industry in Northern Tasmania and for the state as a whole. It will mean that it is easier for people to travel to our wonderful state, with increased flexibility in flights and greater access to our state. I am sure that Northern Tasmanian tourism industries will also join me in applauding this decision to add additional flights into Launceston, especially over the peak tourism periods. The availability of flights with low-cost airlines, such as Jetstar, is strong reassurance for our local tourism industry and businesses. The increased access to the state will assist in boosting confidence in Tasmania for the unique and easily accessible holiday destination that it is. Boosting confidence is important, as our budget support for families does. Labor cares for families and we do care for boosting confidence in communities.
Aston, Mr Geoff
Mr TONY SMITH (Casey) (13:47): I rise this afternoon to recognise a young sporting achiever in my electorate of Casey. Geoff Aston is a clay target shooter. He is 19 years old and lives in Chirnside Park. He is a member of the Melbourne Gun Club and he first began shooting at the age of 15 when his dad, Steve, introduced him to the sport. He has won a host of local, state and national titles including a hat-trick in the prestigious Mackintosh teams event and he has also been a member of the All Australian trap team three years in a row. His success at this year's national titles in Wagga Wagga secured his place on the team for the World Down The Line clay target championships in Wales in July this year. Geoff will change disciplines after the world titles with the aim of representing Australia at future Olympics. He trains 10 hours a week. He spends $250 a week on clay targets and cases of shells. He is a future sporting champion at Olympic level and I want to pay tribute to him in the House today.
Harvey, Mr William
Mr STEPHEN JONES (Throsby) (13:48): I would like to pay tribute to the life of a local legend William Harvey—better known to all as 'Billy Bunter'. Unfortunately Billy passed away earlier this month following a short battle with cancer, and whilst his death was deeply mourned his memorial service paid tribute to a life well lived. They rarely make men of Billy's quality these days. He went to sea at the age of 14, working as a deck boy before making the transition—some say defecting to the other side—to ship's steward. He was a committed Christian, a committed unionist and a proud member of the MUA and the Port Kembla branch of the Australian Labor Party. He was forever on my back about the passage of the shipping industry bills because he was passionate about the restoration of the maritime industry, something that he spent most of his life working in. He was a generous volunteer who gave years of his life to the Port Kembla Mission to Seafarers. Billy was a humorist and a fountain of knowledge and he always gave freely of his time to causes that he believed passionately in. He had a great gift as a fundraiser. He had the ability to squeeze a quid out of the tightest pockets and he sold raffle tickets with a single-minded determination to sell one to everyone in the room and every ticket in the book. Over the years he raised thousands of dollars for various charities and causes around the Illawarra. I extend my condolences to his family and friends. I wish him fair weather and calm seas.
Syria
Mr FRYDENBERG (Kooyong) (13:50): The government's decision to expel the Syrian charge d'affaires is welcomed. In fact it is an action that could have been taken some time ago. The chilling execution of around 100 women and children in al-Houla just days ago will open a new chapter in this conflict. We know that for the Assads and the nearly 13 per cent of the population who are Alawites this is a fight to the death. But what we do not know is how far Russia and China will go in defending the indefensible. For Russia, Syria provides both a naval base and a big acquirer of its arms, so the strategic and economic imperative weighs heavy. China on the other hand may be more amendable to international pressure to step away from the regime, leaving Russia isolated on the UN Security Council. This is where the international community's immediate energies need to be targeted. So too we must expose Iran's deep military and political ties to the Assad regime and hold them accountable for the atrocities taking place. The Shiite and Sunni split is causing a rift over Syria between Turkey and Iran, the Arab League and Hezbollah, but, at the end of the day, we making up the rest of the international community must fall on the side of the innocents and do what we can to prevent greater bloodshed—a level of bloodshed that has not been seen in Syria since the days of Bashar al-Assad's father, Hafez, who was responsible for slaying more than 20,000 people in 1982 in the town of Hama. If the death of so many children is not a game changer, what will it take? I for one do not want to wait to find out.
Square Kilometre Array
Ms PARKE (Fremantle) (13:51): I congratulate the Australian government on successfully bidding for the rights to co-host the world's largest radio telescope, the $2 billion Square Kilometre Array. The Square Kilometre Array will see thousands of small receptors built across Australia, South Africa and New Zealand that, when combined, will cover an area of around one square kilometre and represent a truly international effort to expand our knowledge of the universe and our place in it. This revolutionary new radio telescope will give scientists from across the globe the ability to peer further into space and further back in time than ever before in an attempt to answer age-old questions such as: how do galaxies evolve, what is dark matter, how were the first black holes formed and, of course, are we alone in the universe?
The core Australian site is in Murchison, WA, a radio-quiet zone around 300 kilometres north-east of Geraldton. The SKA will result in around 100 new jobs in WA during the construction phase and a further 100 jobs by the end of the decade, when the Perth based operations facility is due to come online. However, the Square Kilometre Array is about more than jobs. This international project will put WA on the map for astronomy and I expect that it will spark more people's interest in science, particularly young people. As International Centre for Radio Astronomy Research Director, Peter Quinn, told the Sydney Morning Herald, the SKA is like the Apollo of our generation and, as Sputnik once inspired millions, the Square Kilometre Array will inspire billions for decades to come.
Beaudesert Jockey Club
Mr BUCHHOLZ (Wright) (13:53): I rise to inform the House of the concerns that are being raised around the Beaudesert Jockey Club at the moment. This is a jockey club in peril, a jockey club waiting for funds that were committed under the Labor government, and I support the LNP in Queensland's commitment to Queensland Racing. However, it was imperative, once I started looking, to check where some of these funds have gone. Not five months before the election, the board of Queensland Racing Ltd found it within themselves to renew their contracts on five-year terms, knowing that the current polls had Labor destined for decimation. On the day that the LNP took office, these members of the board of Queensland Racing Ltd took their five-year golden handshakes and left the Beaudesert Jockey Club in peril.
I have great concerns that the Clean Energy Finance Corporation, just about to be set up, has off-budget expenditure when it comes to remuneration packages for board directors, as does the NBN. We have made it quite clear with the Clean Energy Finance Corporation that, when in government, we will repeal the carbon tax and we will repeal this body so that it will not do the same as the board of Queensland Racing Ltd in setting themselves up with five-year terms. If 1c of this money ends up with people who are not working in the organisation, I will be disgusted. (Time expired)
Kidney Health Week
Ms BRODTMANN (Canberra) (13:54): This week is Kidney Health Week. It is a week organised by Kidney Health Australia and renal doctors, nurses and patients to raise awareness and improve understanding about chronic kidney disease and what to do to avoid this truly dreadful condition. One in seven Australians, or over three million of us, have some level of impaired kidney function. Chronic kidney disease is one of the fastest-growing diseases and unfortunately some 50 Australians will die today and every other day this year as a result of kidney related disease. This is more than from breast cancer or prostate cancer, yet very few of us are aware of this silent killer.
It is called that as people can lose 90 per cent of their kidney function before realising that they are sick. By that stage it is just too late, and only dialysis or a transplant will keep them alive. Over 10,500 Australians are now on dialysis, and anyone who has been to a dialysis unit knows it is a terrible way to live. However, early detection and early treatment can slow down kidney disease, save lives and reduce the need for dialysis. So during Kidney Health Week I encourage everyone to get their kidneys checked out by their GP. A simple blood test is all that is involved.
Climate Commission
Mr HAWKE (Mitchell) (13:55): I raise on behalf of constituents in Western Sydney to raise their ongoing concern about climate commissioner Tim Flannery's assault on Western Sydney. The travelling roadshow that is the Climate Commission turned up at Parramatta last week to tell residents of Western Sydney that more people will die under climate change—a direct quote from the commissioner. He said:
We know mortality goes up in heatwaves.
He also said that mental health complaints would rise and severe weather events would, in particular, target residents of Western Sydney. This claim was rubbished by James Cook University Adjunct Professor Bob Carter and environmental scientists, who said, 'So what? There are always going to be more or fewer hot days per decade.'
In the debate on the Clean Energy Finance Corporation this week we heard that Professor Flannery's solution for climate change now centres around using a $2 pair of pliers to remove the teeth of dead people, so I ask: is the Clean Energy Finance Corporation considering funding these $2 pairs of pliers for people across Australia to remove the teeth of dead people? Considering that this man, the climate commissioner, is paid over $300,000 of taxpayers' money to come up with this absolute rubbish and present it as climate change solutions, can this parliament be expected to put up with this kind of nonsense anymore from the climate commissioner, telling people they are going to die and then their teeth should be taken because they might change the climate?
Education Funding
Ms PARKE (Fremantle) (13:57): As we know, education is life's great leveller. It is the means through which young people's hopes and potential are made real, and it is the means through which a fair and forward-looking society enables its young people to leave productive and rewarding lives. This government has made the largest capital investment in schools in Australia's history, and it has taken on the difficult task of improving the consistency of national standards and testing, so it is only right that we should now address the biggest challenge of all, which is the fundamental reform of schools funding.
The Gonski report, released in February this year, was the first significant review of how schools are funded in over 30 years. The report concluded that schools are significantly underfunded, with 75 per cent of the shortfall missing from public schools. That is an inequity that we cannot tolerate and that we must address. Last week's McMorrow report on the implications of the federal budget for schools suggested that our current commitments would not meet the growing needs of our education system. This report highlighted the importance of overhauling the current funding arrangements and of making a substantial additional investment in schools. It is for that reason that I welcome the minister's commitment to legislate in response to the Gonski review later this year.
I strongly support the implementation of a new and comprehensive schools funding model as soon as possible, and, while this must be done in partnership with the states, it is clearly a matter for federal government leadership, such as we have shown on a number of key issues in the last 4½ years.
Higgins Electorate: 2011 Australian Student Prize
Ms O'DWYER (Higgins) (13:58): Today I am thrilled to rise to congratulate those recipients of the 2011 Australian Student Prize in my electorate of Higgins. It is a significant honour which is awarded to only 500 students nationally, an award that recognises excellence in academic achievement. Students in my electorate that have received this award include: Sarah Jeffreson of Methodist Ladies' College, Bronte Payne of Lauriston Girls' School, Amelia Hamer of St Catherine's School, Jake Hinton of Caulfield Grammar School, Maple Huang of Melbourne High School, Max Kausman of Bialik College, Stephanie Lightfoot of Sacre Coeur and James Toohey of St Kevin's College.
I also acknowledge the families of these students, the parents and siblings, whose understanding helped these students to achieve their best. I would also like to congratulate and pay tribute to the principals, staff and students of the schools in my electorate, which include Lauriston Girls' School, St Catherine's School, Melbourne High School, Sacre Coeur, St Kevin's College and the King David School. These students and their schools should be congratulated for achieving excellence. I pay tribute to the hard work undertaken by these students, their principals and their teachers, and celebrate with them their significant achievements.
The DEPUTY SPEAKER ( Mr Burke ): Order! In accordance with standing order 43, the time for members' statements has concluded.
STATEMENTS ON INDULGENCE
Syria
Ms GILLARD (Lalor—Prime Minister) (14:00): On indulgence—for more than a year now the Assad regime has been at war with its own people and the world has watched with a growing sense of horror and, I would have to say, with a growing sense of anger too. On Friday, the village of Houla was witness to scenes of unspeakable brutality. More than 100 people were massacred, among them, according to the United Nations, 49 children and 34 women. Some were killed by government artillery and tank shelling of a residential neighbourhood. Many were executed at close range by armed men. Eyewitnesses have told of a brutal intent to murder. Victims were shot in their own home and there were young children with their throats cut. 'They had no mercy,' one told the BBC. 'They went into people's houses and opened fire and killed them all,' another said. We grieve with the families of the dead.
Yesterday, Australia expressed its revulsion by expelling the Syrian Charge d'Affaires and another Syrian diplomat from this country. Around the world, other nations are taking a similar approach.
We understand all too painfully that such actions pale against the measure of the lives lost in Houla. But we will not have any further official engagement with the Assad regime until it abides by the ceasefire proposed by the special envoy Kofi Annan appointed for this purpose. Mr Annan has again visited Syria. Now is the moment to end this violence. We call on Syria to immediately honour its commitments under the Annan peace plan to get the military out of civilian areas, to end the use of heavy weapons and to begin a political process that will bring peace.
Australia will maintain our robust unilateral sanctions against this regime. We will maintain our humanitarian assistance and we will not stop our pressure until this violence comes to an end.
Mr ABBOTT (Warringah—Leader of the Opposition) (14:02): I rise to support the remarks of the Prime Minister and to support, on behalf of the coalition, the decision by Western governments including Australia's to expel Syrian diplomats. It is clear that the Syrian regime is waging war on its own people and there is absolutely no excuse ever for the indiscriminate slaughter of unarmed civilians. Our objective must be to secure a democratic government in Syria that respects the rights of all its citizens and lives in peace with all its neighbours.
QUESTIONS WITHOUT NOTICE
Olympic Dam
Mr ABBOTT (Warringah—Leader of the Opposition) (14:03): My question is to the Prime Minister. I refer her to today's report of the Minerals Council and to recent comments from the chairman of BHP both indicating that the proposed investment at Olympic Dam in South Australia is at risk because of higher taxes, higher energy costs and greater uncertainty. Will the Prime Minister apologise to the people of South Australia for jeopardising investment and jobs by breaking her solemn pledge that there will be no carbon tax under the government she leads?
Ms GILLARD (Lalor—Prime Minister) (14:04): The Leader of the Opposition in his question refers to a Minerals Council report that was reported in today's newspapers and has been the subject of some discussion since. I think it is worth noting that that article, which was in the pages of the Australian and the Financial Review today, was written by Angus Taylor. That name may be familiar to some because he has just been preselected as the Liberal candidate for the seat of Hume at the next election—a very important point.
Is it of any surprise to me that a man who is presenting for election as a candidate for the Liberal Party at the next election is talking the economy down? That is of no surprise to me whatsoever. Is it of any surprise to me that someone preselected as a Liberal candidate for the next election is making absurd claims about carbon pricing? Well, no, that is of no surprise to me either. It is not of any surprise to me that he is actually a very vocal and proud supporter of Work Choices? Apparently he has not got the memo yet that tells members of the opposition to not be truthful about their support for Work Choices.
What the Leader of the Opposition ought to be acknowledging in this parliament are the following facts: our economy is strong—
Mr Pyne: Madam Deputy Speaker, I rise on a point of order. This is the largest mine expansion in the world. It is a very serious issue and the Prime Minister should answer the question, not make light of it.
Ms GILLARD: It is a serious issue. It is too serious for the petty politics of the opposition, far too serious for that. Running the economy is a serious issue. Making sure our economy is the envy of the world has required serious work. Making sure that there are $500 million of investments in the pipeline has required serious work. And at every step of the way, this government has worked with the government of South Australia because we want this Olympic Dam project to go ahead. We worked hard with the government of South Australia to achieve that result. What will not help the achievement of that result is a reckless negativity, talking the economy down and making false claims about carbon pricing. Those things are calculated to destroy jobs and opportunity in South Australia and right around the country.
Budget
Mr CHEESEMAN (Corangamite) (14:07): My question is to the Treasurer. With the budget bills going through their second reading stage this morning, how does this bring the government a step closer to spreading the benefits of the mining boom to help families make ends meet?
Mr SWAN (Lilley—Deputy Prime Minister and Treasurer) (14:07): I thank the member for his question, because I think everybody on this side of the House was proud to stand up in this House this morning and support the 'fair go' budget—very proud to support a budget that was coming back to surplus, very proud to support a budget which is going to spread the benefits of the boom to every corner of our country and certainly very proud to make room in a very tight budget to assist those with disabilities. So everybody on this side of the House is very proud of a budget which will grow our economy and spread the benefits to every corner of our country.
We know those opposite are so reckless and so destructive that all they ever want to do is talk our economy down. What we will do on this side of the House is build up our economy and build up our country. We have confidence in the future of this country. Those on that side of the House, led by this negative opposition leader, just want to talk the economy down every day—day in, day out.
There are substantial benefits in the budget to assist families in Australia: a $5 billion package over five years of additional support for low- and middle-income families in this community. We are very proud of that, and particularly the additional assistance with the costs of sending kids to school. There is also the assistance in terms of the clean energy package, going out to something like three million pensioners—we are very proud of that—and additional assistance to 1.6 million families and, on top of that, tripling the tax-free threshold. That is going to make an enormous difference to many people on low incomes, giving a tax cut to something like seven million Australians on low and middle incomes. Then, of course, there is the assistance for business—the loss carry-back and, of course, the assistance in terms of the instant asset write-off, which will go to something like 2.7 million small businesses.
So we on this side of the House were very proud to stand up and support that assistance for families and business when the Leader of the Opposition was simply running away from it—running away from the families of Australia in terms of the assistance to families to educate their kids, and running away from the assistance to small business. Fair dinkum! You should have seen it in here this morning. It was as if the Three Stooges were back in play, stumbling and bumbling around the corner of the House, and they were joined by a fourth. Shemp over there joined the Three Stooges this morning, running away from the people of Australia and running away from cost-of-living assistance. He is all opposition and no leadership.
Mr CHEESEMAN (Corangamite) (14:10): Madam Deputy Speaker, I ask a supplementary question. The Treasurer has outlined how the budget is helping spread the benefits of the mining boom. Can he explain how this will help local communities like mine and what would be the consequences of not providing this assistance?
Mr SWAN (Lilley—Deputy Prime Minister and Treasurer) (14:10): I thank the member for that supplementary question, because there will be significant assistance to all of the small businesses in the electorate of Corangamite, and of course there will be significant assistance to families—first of all in terms of the clean energy package and then additional assistance for families. There will be assistance to those families with children at school, something like 1.3 million families, and, as I said before, tax cuts for seven million low- and middle-income earners in our community.
Of course, when it comes to each and every one of those, what does the Leader of the Opposition say? He says no. He says no to assistance for families with the costs of education. He says no to assistance for small business, particularly in terms of the instant asset write-off. Of course, we read in the West Australian today that his colleagues are getting very sick of him saying no. This is what one of his colleagues said today:
… people are so fed up with the current situation, they are starting to blame Tony for the decline in public discourse …
The DEPUTY SPEAKER ( Ms AE Burke ): The Treasurer will return to the question.
Mr SWAN: That would be an understatement. Of course, this is what Senator Joyce had to say about the approach of the Leader of the Opposition today.
HOST: Do you think he’s seen as too negative and too aggressive at the moment?
JOYCE: At times that can be the case …
The DEPUTY SPEAKER: The Treasurer will return to the question before the chair.
Mr SWAN: Well, ain't that the case?
Carbon Pricing
Mr TRUSS (Wide Bay—Leader of The Nationals) (14:12): My question is to the Prime Minister. I refer the Prime Minister to Mr Craig Glasby, the owner of an independent service station at Empire Bay in Robertson, whose latest tender from TRUenergy includes a carbon tax component of $13,141, a surcharge of just under 18 per cent on his annual bill. How can the Prime Minister continue to claim that the carbon tax will push up electricity by just 10 per cent?
Ms GILLARD (Lalor—Prime Minister) (14:12): To the Leader of the National Party I would say the following: the regulators for electricity prices in major states around the nation have already spoken. They have already spoken about the impact of carbon pricing, and when they have spoken about the impact of carbon pricing they have said that its contribution to increased electricity prices will be the same as the Treasury modelling at 10 per cent, or indeed less than the Treasury modelling. Now the Leader of the National Party shakes his head, but you cannot shake your head and wish away a fact. That is what has been said in New South Wales. That is what has been said in Queensland. In Western Australia the amount was actually less. Let us remember: not only have these determinations by the electricity price regulators backed in the Treasury modelling, but what they mean is that what the government has been saying to Australian families and pensioners about assistance is absolutely right. People will see assistance coming into their family budgets—3.2 million pensioners—and millions of them will be better off. Families on average will see assistance of $10.10 and will experience price changes of less than that.
On the specific example that the Leader of the National Party has raised, I am more than happy to take a look at it, but what I would say is this: my experience in this parliament time after time, day after day, is that things are brought into this parliament by the opposition and represented as if they were true, and on further inquiry they are found out to be completely false and just another part of the fear campaign coming from this Leader of the Opposition. Let's remember where this fear campaign has got itself to. It has got itself to a point where Liberal-National Party members are now anxious about the relentless negativity of the Leader of the Opposition and his overblown, false claims.
Mr Truss: Madam Deputy Speaker, I rise on a point of order, on relevance. Clearly, the comments by the Prime Minister have no bearing on the question.
The DEPUTY SPEAKER ( Ms AE Burke ): The Prime Minister will return to the question before the chair.
Ms GILLARD: Thank you very much, Madam Deputy Speaker. I think it is relevant in assessing claims by the opposition that we have heard so many false ones: the end of the coal industry, astronomical price increases, electricity going up by 30 per cent and on and on it has gone. These relentlessly negative claims, these destructive claims, will be shown to be untrue following 1 July, and then the issue for the Leader of the Opposition will be that he might be able to run but he will not be able to hide after 1 July.
To the Leader of the National Party, if he chooses to forward that information to my office I will have a look at it.
Mr Truss: Madam Deputy Speaker, I offer to table the document. It demonstrates clearly that there is an 18 per cent increase.
Mr Hockey: You just asked for it!
Honourable members interjecting—
The DEPUTY SPEAKER: Order! The Leader of the Nationals will resume his seat! The member for Goldstein and the member for North Sydney will remove themselves from the chamber under standing order 94(a). I was on my feet.
The members for Goldstein and North Sydney then left the chamber.
DISTINGUISHED VISITORS
The DEPUTY SPEAKER ( Ms AE Burke ) (14:16): I take this opportunity to recognise in the gallery today Mr Stuart Henry, the former member for Hasluck. I welcome him back. I have also been advised that we have the minister for agriculture and forestry from the Kingdom of Tonga visiting us today and I welcome him to our chamber as well.
Honourable members: Hear, hear!
QUESTIONS WITHOUT NOTICE
Budget
Ms VAMVAKINOU (Calwell) (14:16): My question is to the Prime Minister. Prime Minister, what are the facts about the effect of the carbon price and the extra assistance that the government has provided through the budget to help families?
Ms GILLARD (Lalor—Prime Minister) (14:17): I thank the member for Calwell for the question. I know that she in her electorate is working hard to ensure that people are getting the right information about the assistance that they will receive available through our clean energy future package. I do note too that she was proudly in this parliament to support the schoolkids bonus against the opposition from those members of the Liberal-National Party who thought working families did not deserve a break and should not get any money to assist them with the costs of getting the kids to school.
The member for Calwell asked me about how Australians will experience carbon pricing from 1 July and what assistance is available to help people make ends meet. I do understand that working families struggle to pay the bills, and that is why we have made sure that in creating a carbon pricing scheme we will be giving families around the nation, on average, assistance of $10.10 per week, and that will be more than the impact that they will experience from carbon pricing. Six out of 10 households will receive assistance that fully matches or exceeds these costs. Three point two million pensioners are already seeing advance payments of $250 per single pensioner and $380 for pensioner couples, and then in March they will see more assistance and it will be ongoing. Our economy will also see the benefits of investments in a clean energy future.
From 1 July Australians will be able to experience this, they will be able to live it and they will be able to make up their own minds. That ability to make up their own minds will be a very sharp contrast to the relentlessly negative and destructive fear campaign that has been run by the Leader of the Opposition. They will be able to make up their own minds about his claim that price rises will be unimaginable. They will be able to see whether or not whole towns have been wiped off the map. They will be able to see whether or not their fuel bill or their electricity bill goes up by 30 per cent. And they will be able to see that the mainstays of our manufacturing sector are here and stay strong.
From 1 July, Liberal MPs who have joined the Leader of the Opposition in this negative campaign will then be left to wonder whether their relentless negativity has left them at the point of no return—where they will be given the Leader of the Opposition's systematic misleading of the Australian community, on the coal industry, on the cement industry, on jobs, on the cost of living and on electricity prices. We know from this morning that the Leader of the Opposition can run, but come 1 July he will not be able to hide from these claims being revealed to be wholly untrue.
Carbon Pricing
Mr HUNT (Flinders) (14:20): My question is to the Minister for Climate Change and Energy Efficiency. I refer the minister to his statement in the House:
… on-road fuel costs are not increasing under the carbon price and, in fact, off-road fuel costs will decrease. Excise is being cut.
Given that the carbon tax will apply to heavy off-road commercial activity from 1 July 2012 and on-road commercial activity from 1 July 2014, and the government's own budget shows a total increase in fuel excise revenue of $920 million, will the minister explain why he says fuel taxes are going down when, in fact, they are going up?
Mr COMBET (Charlton—Minister for Industry and Innovation and Minister for Climate Change and Energy Efficiency) (14:20): I am very pleased to be asked that question because yesterday in question time I referred to a misleading letter sent by the Leader of the Opposition to local governments around Australia, which erroneously claimed, misleadingly claimed, that the cost of running council trucks is going to go up. He has been dropped into this, assumedly, by the shadow minister, who has not done his homework in relation to this matter.
As I told the House yesterday, this is completely misleading, because the facts are these. In relation to local councils, to which I was referring and to which the Leader of the Opposition had written, their on-road fuel costs will not increase under the carbon price from 1 July. Secondly, and importantly, off-road fuel costs for local councils will actually fall from 1 July. Currently, the fuel tax credit for diesel used by local councils—it is important to listen to the facts occasionally—in off-road activities like road construction and maintenance is 19.0715c per litre. From 1 July the fuel tax credit for these activities will, in fact, rise to 31.933c per litre. That means that the effective fuel tax rate for local councils for off-road diesel use will decrease from 1 July by 12.8615c per litre. If they had had the gumption on that side of the parliament to do their homework, they could have looked it all up on the ATO website. Do your work. Do not come in here and impugn my integrity or go outside. Do your homework!
Live Animal Exports
Mr WILKIE (Denison) (14:23): My question is to the Prime Minister. Prime Minister, one year ago today Four Corners publicised Australian cattle being brutalised in Indonesia. In response, the government introduced some protections for animal welfare, but recent TV footage of more animal abuse in Indonesia proves the government's reforms are entirely inadequate. Prime Minister, will the government support my bill requiring stunning of all Australian livestock shipped overseas and, if not, why not?
Ms GILLARD (Lalor—Prime Minister) (14:24): I thank the member for Denison for his question. I know that he has had a consistent interest in this issue, as have a number of members of parliament on both sides of the House. I know many of my colleagues are very concerned about it too.
I believe all Australians were shocked by the footage we saw on Four Corners 12 months ago. It was truly horrifying footage. At that time we had no ability as a government or as a nation to track what was happening to cattle who were exported live from Australia to Indonesia or to other nations. We responded by introducing a system that enables us to have visibility across the supply chain. Put simply, that means that we are able to track and trace where Australian animals go and where they are eventually slaughtered. That means that we are also in a position, through working with exporters and requiring them to step up to the responsibility, to be able to ensure that there are OIE standards where animals are ultimately slaughtered. They are the international standards for dealing with livestock. That is the approach that we have taken.
The member for Denison is right: there was more footage relatively recently. The tracing system enabled us to know which exporters of live animals were involved—that is, where the animals had come from. Consequently, through the regulation system—the regulator is the Secretary of the Department of Agriculture, Fisheries and Forestry—we were able to take some action in relation to those exporters.
I know that the member for Denison, a number of other members of this parliament and other people would want to see other standards applied than the OIE standards, but we have deliberately adopted the OIE standards because they are the standards that have worldwide recognition. Consequently, we believe they are the right standards for a worldwide system because cattle from our country go to a number of export destinations. Can I say to the member for Denison that we do work with industry and exporters to encourage stunning. We believe that should be a practice which is encouraged and we will continue to work with the livestock industry and live cattle exporters on encouraging the use of stunning for livestock in abattoirs overseas.
Mr Wilkie: Deputy Speaker, I rise on a point of order. During the Prime Minister's answer a member of the opposition called out, presumably addressed to me: 'You should go back to Tasmania and rot!' No wonder the community is so concerned about behaviour in this place. I would ask you to invite that member to withdraw that statement.
The DEPUTY SPEAKER ( Ms AE Burke ): My difficulty is that I obviously did not hear the statement made. If someone would like to be honest enough to identify him- or herself, I would ask them to do so and withdraw the statement because it is unparliamentary. I am going to thank the member for Durack, Mr Haase, for rising and assisting the House.
Mr Haase: If it helps the House, I withdraw.
Carbon Pricing
Ms LIVERMORE (Capricornia) (14:29): My question is to the Minister for Climate Change and Energy Efficiency and Minister for Industry and Innovation. Will the minister update the House regarding the outlook for the LNG industry under the carbon price? What does this mean for communities, workers and households that rely on the LNG industry and why is it important that these communities get the facts about the effects of the carbon price?
Mr COMBET (Charlton—Minister for Industry and Innovation and Minister for Climate Change and Energy Efficiency) (14:29): I thank my colleague the member for Capricornia for her question. As a Queenslander, she has a very keen interest in this issue. We have heard already about the importance of the government's household assistance package to assist people, but it is also important to give careful consideration to the implementation of the carbon price in important industries like the liquefied natural gas industry. The fact is that the LNG industry is experiencing an unprecedented boom and the outlook remains very strong. In its latest report on major resource projects, in fact, the Bureau of Resource and Energy Economics identified seven LNG projects under construction at a value of over $164 billion. In addition, as of last month there were 12 proposed LNG developments undergoing feasibility studies and investors are committing tens of billions of dollars to the LNG industry in the full knowledge of the implementation of the carbon price.
The investment boom in LNG production will flow through to communities with stronger employment growth, increased incomes and improvements in local service and for local families in facilities provided. As an example of that, on 27 April Santos announced that it would invest $200 million into roads, affordable housing and environmental and social projects as part of its Gladstone LNG project. But this must be very hard news for the Leader of the Opposition to hear, it has to be said. He has prophesied:
The carbon tax is a deadly threat to the economy of Gladstone …
That is what he said, and I am glad to see him affirming it. The truth when one looks at these projects is that there is an incredible $56 billion of investment in three LNG projects alone committed and planned in Gladstone. He has predicted the death of Gladstone, that it would collapse as a town and that it would fall off the continent, but there is $56 billion worth of investment in the full knowledge of the carbon price being implemented. The fact of the matter is that there is not just relentless negative comment coming from the Leader of the Opposition; it is relentless deceit. The campaign against the carbon price is a complete fraud. His campaign for the Prime Minister is a complete fraud. (Time expired)
Enterprise Migration Agreements
Mr IAN MACFARLANE (Groom) (14:33): My question is for the Prime Minister. Did the Minister for Resources and Energy talk to the Prime Minister in the week before she left for Chicago and was the proposed Roy Hill enterprise migration agreement discussed?
Ms GILLARD (Lalor—Prime Minister) (14:33): As it happens, I did talk to the Minister for Resources and Energy in the week before I left for Chicago—and the week before that and the week before that and the week before that. I do talk to my ministerial colleagues, including the Minister for Resources and Energy, so I am glad I have been asked about it. On the Roy Hill enterprise migration agreement: as I have said on a number of occasions in this parliament, I received the brief from my office when I returned from Chicago.
Mr Pyne: Madam Deputy Speaker, I rise on a point of order. The question was very specific. It was not about a full briefing. It was about whether in the talks she had with the minister for resources before last week—
The DEPUTY SPEAKER ( Ms AE Burke ): The Manager of Opposition Business will resume his seat. The Prime Minister has concluded. The member for Groom on a supplementary.
Mr IAN MACFARLANE (Groom) (14:34): Thank you, Madam Deputy Speaker. In that discussion, did the Prime Minister raise any concerns about the enterprise migration agreement?
Ms GILLARD (Lalor—Prime Minister) (14:34): No, I did not.
Opposition members interjecting—
Carbon Pricing
Mr NEUMANN (Blair) (14:34): My question is for the Minister for Infrastructure and Transport. Will the minister advise the House on the impact of the carbon price on Australia's transport industry, including the heavy vehicles sector? Is there any misinformation about this and how is the government responding to the misinformation?
Mr ALBANESE (Grayndler—Leader of the House and Minister for Infrastructure and Transport) (14:35): I would ask that the interjection that was just across the chamber be withdrawn. It was about a dead man. I think we have had enough of that and it should be withdrawn.
The DEPUTY SPEAKER ( Ms AE Burke ): Having met with Greg Wilton's sister over the weekend, I am a little sensitive, as many would appreciate, to any mention of my dead friend. I will not have it thrown around this House, as his family is feeling it significantly at the moment. I will have no more. The Minister for Infrastructure and Transport has the call.
Mr Abbott interjecting—
Mr ALBANESE: If we are going to have the Leader of the Opposition say that that was a rebuke of me, the person who said it should withdraw and then we will move on.
The DEPUTY SPEAKER: The Minister for Infrastructure and Transport will resume his seat. I will certainly clarify. I was not making the comment to anyone individually but to the entire parliament. There are quite a lot of references and issues that nobody in this place may think are issues but certainly Greg's family are finding as such. I am just cautioning us all to be a bit more considerate. The Minister for Infrastructure and Transport has the call.
Mr ALBANESE: We are indeed well aware of the destructive negativity when it comes to this Leader of the Opposition and the carbon price. He goes around talking the economy down, he visits businesses and talks them down and he tells workers that they will be done out of a job. One company that has been a victim of this campaign is Nolans Transport, in Queensland. The Leader of the Opposition visited Nolans Transport, in Queensland, to talk up his scare campaign against the price on carbon. The response that occurred as a result of that company's invitation was a talking down of that company, and that company regrets very much its invitation to the Leader of the Opposition.
In this month's issue of Australasian Transport News in an article headlined, 'Nolans fed up over dodgy carbon tax claims', they ping the carbon price campaign and the scare campaign being run by this Leader of the Opposition. In this article, Mr Terry Nolan, the owner of the company, says:
… it wouldn't cost us anything like the $3 million per year claimed in the email. We're sick of people using our business as a political pawn without checking the facts.
Mr Nolan went on to talk about the email that has been distributed talking down this company by saying, 'Whoever sent it, it's definitely for political reasons.'
What we need to do when it comes to the price on carbon is to have a rational discussion about what the facts are. There will be some increases in prices, though heavy vehicles, of course, are excluded from the scheme until 1 July 2014. We need to have a rational discussion including the support and assistance measures that have been put in place by this government.
Last Thursday I indicated that the Leader of the Opposition would be going to Kurri Kurri on the following Saturday. But he was not welcome in Kurri Kurri on the Saturday—he was not welcome to conduct the scare campaign. If you see this Leader of the Opposition coming to your business, I have a bit of advice for you: lock your doors, because this bloke will just talk down your business. He regards it as his role in life to talk down the economic position of businesses, to talk down the Australian economy and to try to scare Australian workers. That is the role he plays.
We are prepared to have a rational debate out there. This Leader of the Opposition is so desperate that he is prepared to tear down the economy and to tear down individual businesses.
Enterprise Migration Agreements
Mrs MIRABELLA (Indi) (14:40): My question is to the Prime Minister. I refer the Prime Minister to her statement on Monday that she supports the Roy Hill enterprise migration agreement to import 1,700 overseas workers. Given this claim, why did she tell union leaders on Friday that she was 'furious' about the announcement by her immigration minister?
Ms GILLARD (Lalor—Prime Minister) (14:40): To the member for Indi: I think I answered a question either identical to or very similar to this earlier in the week. I am passionate about Australian jobs, and I do not care who hears it. I am passionate about Australian jobs. I have conversations about what we can do to support Australian jobs frequently with my ministerial colleagues, with the trade union movement and with employers around the nation. This is a government with a proud track record—
Mr Abbott: Madame Deputy Speaker, I rise on a point of order. It was a very specific question: why did she tell union leaders she was 'furious' with the agreement she now says she supports?
The DEPUTY SPEAKER: The Leader of the Opposition has made his point of order. He will resume his seat. The prime minister has only just begun her answer. The Prime Minister has the call.
Ms GILLARD: As I was saying, I am passionate about the creation of Australian jobs, so, whether it is a discussion with union leaders last Friday or with business people or with my ministerial colleagues or my caucus colleagues, what is always first and foremost for this government is the creation of Australian jobs. We have a proud track record of creating Australian jobs, and we will continue that record of creating Australian jobs. I will always in all circumstances look to see what more we can do to create Australian jobs. We will keep working with the resources sector, with businesses around the nation and with the trade union movement to create Australian jobs, and I am happy to share that passion with this House.
Mr ABBOTT (Warringah—Leader of the Opposition) (14:42): Madam Deputy Speaker, this is a supplementary question to the Prime Minister arising from what she has just told us. Why did she tell union leaders last Friday that she was 'furious' about the Roy Hill agreement which she now claims she supports? She should answer that question and stop being shifty and evasive with this House.
Mr Albanese: Got any more violent language terms you want to use, mate?
Opposition members interjecting—
The DEPUTY SPEAKER: Order! The Leader of the House has the call.
Mr Albanese: Madam Deputy Speaker, clearly that question was out of order. It was not a supplementary question; it was just rhetoric from this Leader of the Opposition yet again.
The DEPUTY SPEAKER: The first part of the question was in order; the last part was not. The Prime Minister has the call.
Ms GILLARD (Lalor—Prime Minister) (14:42): I say to the Leader of the Opposition that I do not recall him being in any meeting that I was in last Friday—and he would never be there, because the meetings I have are about Australian jobs and he does not care about Australian jobs. When we were meeting about the global financial crisis, there was the opposition leader sleeping off a big night out. That is where he was. He is not frequently in meetings about jobs.
Mr Abbott: Madam Deputy Speaker, it was a very simple question: why did she tell union leaders that she was 'furious' about the agreement if she supports it? She should tell the truth to this parliament.
The DEPUTY SPEAKER: The Leader of the Opposition has made his point of order.
Government members interjecting—
The DEPUTY SPEAKER: The Leader of the Opposition will withdraw the last part of that statement.
Mr Abbott: I withdraw.
Ms GILLARD: If the Leader of the Opposition is back in control of himself, as I was saying, meetings that I had on Friday were about—
Opposition members interjecting—
Mr Pyne: Madam Deputy Speaker, that should be withdrawn.
The DEPUTY SPEAKER: I will ask the Prime Minister to withdraw and to come to the answer.
Ms GILLARD: I withdraw. The meetings that I had on Friday—as are many meetings I have—were about Australian jobs. The Leader of the Opposition has never been in one of them so he will never be an eyewitness to what happens in them, because there will never be a time that he spends one moment of his life worried about Australian jobs. All he ever worries about is destructive negativity and fear campaigns. Today, like on most days, we can see it written all over his face.
Carbon Pricing
Mr PERRETT (Moreton) (14:45): My question is to the Minister for Industry and Innovation and Minister for Climate Change and Energy Efficiency. Why is it important for local communities to be provided with factual information in the debate over climate change? How is the government addressing any incorrect information about climate change and the carbon price introduction?
Mr COMBET (Charlton—Minister for Industry and Innovation and Minister for Climate Change and Energy Efficiency) (14:45): I thank my colleague the member for Moreton for his question because factual information in this debate about climate change and carbon pricing is extremely important, especially when there is a deceitful campaign being run against it, with misleading claims being made that cause people to feel fearful, that cause anxiety and cause insecurity that is completely unjustified. It is very important for local communities to hear the facts. We have heard numerous misrepresentations from those opposite, especially from the opposition leader. We have already heard some instances in question time today relating to the issue of local government. We have heard about the fact that Gladstone is going to be destroyed! We have also heard claims that Whyalla will be wiped off the map.
It is not commonly known, but the opposition leader has essentially forecast that the coal industry will cease to operate from 1 July. In fact, nearly $100 billion of investment is coming into the industry. We have heard of unimaginable price increases and that the household assistance will not be permanent or ongoing and will not be indexed. All of that is completely fallacious and deceitful.
Last week, questions were asked about an announcement by Norsk Hydro in relation to the Kurri Kurri aluminium smelter. It was falsely claimed by the opposition that this was attributable to carbon pricing. It is very important that members of the public get the facts about these issues. This is a facility in my own region in the Hunter Valley. A person—a member of the public—has contacted my office and indicated her concern about this issue. She indicated that she has contacted the company to ask for a reply about the causes of the closure of the aluminium smelter. She received a reply from Mr Halvor Molland, who is the vice-president of Norsk Hydro. He said to her, 'I am sorry to see you have based your opinion on Foxtel news and not on what Hydro actually have said.' He went on:
We have been quite specific, saying that the carbon tax is not the reason—but shorter term market conditions and the macro-economic environment.
The decision to initiate consultation with a view to close the aluminium production at Kurri Kurri would have been the same—with or without the carbon tax.
He said, 'But unfortunately our announcement on Wednesday has sparked a political debate outside our control, where the carbon tax is in the middle.' He went on:
Fact is that Kurri Kurri is already losing significant amount of cash every month—before any carbon tax has been implemented.
It is deceit. It is fraud. It needs to be corrected, and you should apologise.
Enterprise Migration Agreements
Mr MORRISON (Cook) (14:49): My question is to the Minister for Immigration and Citizenship. Did the Minister for Immigration and Citizenship speak to the then Acting Prime Minister last week about the proposed enterprise migration agreement for the Roy Hill mine project prior to the decision being made on this arrangement last Wednesday and then announced last Friday? And if so, did the acting Prime Minister raise any concerns about the Roy Hill agreement in that discussion?
Mr BOWEN (McMahon—Minister for Immigration and Citizenship) (14:49): I welcome the question from the shadow minister because I welcome any opportunity to talk about this project and this agreement which delivers 8,000 jobs—6,700 jobs for Australians—2,000 traineeships and a mine which will deliver 55 million tonnes—
Mr Morrison: I rise on a point of order, in relation to specific relevance. My question was whether he spoke about it to the Acting Prime Minister, not whether he wants to talk about it.
Mr BOWEN: A very telling interjection from the shadow minister! He is not interested in the substance, not interested in policy, not interested in jobs being created; he is only interested in muck raking and point-scoring, just like his colleagues.
In relation to timing, it does not matter how many times you ask and in how many different ways, my answer will remain the same. My answer will remain the same in relation to consultations and discussions. I refer the honourable member to my previous answers.
Small Business
Mr SYMON (Deakin) (14:50): My question is to the Minister for Housing, Minister for Homelessness and Minister for Small Business. How is the government boosting confidence for small business in Australia? Is there any misinformation about this and how is the government addressing it?
Mr BRENDAN O'CONNOR (Gorton—Minister for Housing, Minister for Homelessness and Minister for Small Business) (14:51): I thank the member for Deakin for his question and his ongoing concern for 15,600 small businesses in his electorate. The government is boosting confidence for small business by returning the budget to surplus. We have the lowest official cash rate for many a year—lower than at any time under the Howard government. We have low unemployment. We have low debt. We have contained inflation. We have $500 billion of investment in the pipeline, which instils confidence in business, including small business.
Of course, we have payments to pensioners and students, tax cuts to workers, and school bonuses to parents, enhancing consumer confidence, which in turn will enhance business confidence. And the budget, of course, helps cut down paperwork and encourages investment through the asset write-offs and the loss carry-back scheme. The member has asked me whether there has been any misinformation in relation to these matters and whether we have some concerns. Well, we need look no further than the Leader of the Opposition, who has not met a voter he has not tried to scare. The Leader of the Opposition and his cohorts continue to talk the economy down, despite the evidence to the contrary.
Just over a week ago, the member for Higgins claimed online that a business in her electorate was closing down due to government policies, including carbon pricing. Of course, the truth was somewhat different. The owner in question confirmed he was using the premises to sell his stock from his actual store three doors down the road because his tenant had recently vacated. The member, accompanied by the shadow minister for industrial relations, Senator Abetz, claimed the shop was closing down when in truth it was temporarily expanding its shopfront to sell its stock. I, of course, forgive the owner for what he has advised was an attempt at black humour. But I do not forgive the cruel hoax that the member for Higgins and the shadow minister for industrial relations have done to scare small businesses in that electorate and, indeed, electorates around the country.
This is just another part of the scare campaign waged by the Leader of the Opposition on all small businesses across this country. He has no capacity other than to trash our economy contrary to the evidence. He has no capacity to do anything other than talk our economy down, which, of course, affects adversely confidence in small business. Indeed, I tell you: when I talk to small businesses they ask when he is going to say one thing about a positive plan for them and for this country's future.
Mr Pyne: Madam Deputy Speaker, on a point of order: I would ask the minister to table that photograph that says, 'No thanks, Julia' that he was referring to.
The DEPUTY SPEAKER ( Ms AE Burke ): The Manager of Opposition Business will resume his seat. He is abusing points of order. I have told people that this is not appropriate. Anyone caught doing it henceforth will be excluded from the chamber.
Enterprise Migration Agreements
Ms JULIE BISHOP (Curtin—Deputy Leader of the Opposition) (14:54): My question is to the Prime Minister. I refer the Prime Minister to the response by the Minister for Immigration and Citizenship yesterday when he said that he had updated the productivity committee of cabinet on the progress of the Roy Hill enterprise migration agreement on numerous occasions since early 2012. How many times has the productivity committee of cabinet met since the beginning of this year, and how many of these meetings did the Prime Minister attend?
Ms GILLARD (Lalor—Prime Minister) (14:55): The Deputy Leader of the Opposition knows cabinet is confidential. The Deputy Leader of the Opposition has also misquoted the minister for immigration from yesterday. I refer her to his actual answer, which is very different from what she just said to the parliament—another mislead by the opposition. This is all they do in question time—part of the relentless the campaign we see everywhere.
Ms Julie Bishop: Madam Deputy Speaker, on a point of order: I asked how many times the productivity committee met and—
The DEPUTY SPEAKER: The Deputy Leader of the Opposition will resume her seat.
Ms Julie Bishop: and how many times—
The DEPUTY SPEAKER: The Deputy Leader of the Opposition will resume her seat. The Prime Minister has the call.
Ms GILLARD: As I have said, cabinet meetings and cabinet subcommittees are confidential. But I believe it is offensive indeed for the Deputy Leader of the Opposition to come into this place and misrepresent the minister for immigration's answers from yesterday. If she is incapable of reading Hansard, one wonders what she is doing here.
Mr Morrison: Madam Deputy Speaker—
The DEPUTY SPEAKER: The member for Cook, there is no opportunity for a point of order at this stage.
Mr Morrison: Madam Deputy Speaker, I seek leave to table the Hansard from yesterday.
The DEPUTY SPEAKER: The member for Cook will resume his seat. You are seeking leave to table; you have sought your leave; you will resume your seat. Is leave granted to table it?
Leave not granted.
Mr Melham: Read it online!
The DEPUTY SPEAKER: The member for Banks might even up the score very quickly.
Economy
Ms OWENS (Parramatta) (14:57): My question is to the Assistant Treasurer and Minister Assisting for Deregulation. What is the government doing through the budget to make sure hard-working families benefit from the strong Australian economy, and what does this mean for families in my electorate?
Mr BRADBURY (Lindsay—Assistant Treasurer and Minister Assisting for Deregulation) (14:57): I thank the member for Parramatta for her question. She is a very hard-working and passionate advocate for the people of Western Sydney. She is right in pointing to the strength of the Australian economy. It is one of the strongest economies in the developed world, with low unemployment, contained inflation, low net debt and a record pipeline of investment—in fact, half a trillion dollars are coming into the resources sector alone. On top of that, we are returning this budget to surplus and, in returning the budget to surplus, we are determined to spread the benefits of the mining boom—
Mr Tony Smith interjecting—
The DEPUTY SPEAKER: The member for Casey might be looking outside soon.
Mr BRADBURY: to ensure that hard-working families, in electorates like the member for Parramatta's, not only have the opportunity to make ends meet but to get ahead. I am pleased to advise the member for Parramatta that, in her electorate alone, some 9,000 families will be receiving the schoolkids bonus. In addition to that, 45,000 hard-working individuals will receive a tax cut. On top of that, 14,000 families in the electorate of Parramatta will get an increase to their family payments. And of course our responsible economic management is giving the Reserve Bank the space that it needs to cut interest rates, if it chooses to do so, to deliver more relief to working families.
These benefits are not just confined to the electorate of Parramatta but will be spread right across Western Sydney and, indeed, right across the country. I note that, in the electorate of Macarthur, which is also in Western Sydney—
Ms Julie Bishop interjecting—
The DEPUTY SPEAKER: The Deputy Leader of the Opposition has had her fun.
Mr BRADBURY: 12,000 families are set to receive an increase in their family payments and 11,000 families will receive an increase in their payments through the schoolkids bonus. The member for Macarthur likes to stand up for working families—or at least he likes to come into this place and pretend that that is what he does. Just a couple of weeks ago he came in here and said, yes, parents in Macarthur are struggling, they need all the help that they can get. But then he came straight back into the chamber and voted against giving them a schoolkids bonus. He goes back to his electorate and tells people he is here for working families, but then he comes in here and he votes no. Why did he vote no? He voted no because he wants to stand up for those families but the relentless and destructive negativity of the Leader of the Opposition is getting in the way. The Leader of the Opposition says no to increases in family payments, no to increases in the pension, no to the schoolkids bonus. I know they are addicted to saying no, but the member for Macarthur, if he really must say no, should say no to the Leader of the Opposition and come in here and say yes to the relief that we want to provide to working families in his electorate.
Enterprise Migration Agreements
Mr HAASE (Durack) (15:00): My question is to the Prime Minister. I remind the Prime Minister of her promise last week with respect to the Roy Hill enterprise migration agreement that there will be increased scrutiny and if there is an Australian able to do the work, an Australian gets the work. How can the caucus believe the Prime Minister's promise, given evidence from immigration department officials in estimates that there will be no additional resources or staff provided to monitor the implementation of enterprise migration agreements including this one?
Ms GILLARD (Lalor—Prime Minister) (15:01): Thank you very much to the member for Durack for his question. The member for Durack may not be aware, though he ought to be aware if he has been studying Senate estimates, that appropriate provision has been made for monitoring and compliance work. To the member for Durack: this side of the parliament will always work hard and diligently to ensure that Australians are getting opportunities and getting them first. We are a Labor government and that is why we, during the global financial crisis, voted to support Australian jobs and prevailed against the destructive negativity of those opposite. And that is why in this period when our economy is the envy of the world but around the nation there are patchwork pressures, which means that it is possible in one part of the nation for a skilled worker to lose their job but their very skills to be desperately in demand in another part of the nation, we will work as a Labor government to ensure that people know what the opportunities are that are arising from the resources boom.
Common sense tells all of us that it is not possible for everyone to work in the mining industry, that it is not possible for everyone to relocate to where those job opportunities are, that it is not possible for everyone to work in a fly-in fly-out arrangement. But if there are Australians ready, willing and able to do the work and it is available, then I want them to get that work first. That is what we are determined to do. That is what we will use the resources of government to do. That is what we will work hard to ensure, because we want the benefits of the resources boom to be spread right around the country, whether those benefits are in the form of jobs or whether they are in the form of increased family payments.
It is the opposition who want those benefits to be concentrated in the hands of a few. The Leader of the Opposition has been talking about that today to the Minerals Council of Australia. He has been speculating about just how tough it is to be a billionaire. Well, let me say to the Leader of the Opposition that what he should have said to the Minerals Council today is: 'Heaven help working Australian families struggling to make ends meet if this Leader of the Opposition ever becomes Prime Minister,' because his job then will be to rip out of the hands of families the benefits of the boom and to give it back to a few.
Queensland Environmental Assessments
Mrs D'ATH (Petrie) (15:04): My question is to the Minister for Sustainability, Environment, Water, Population and Communities. Can the minister please advise the House on the latest developments in streamlining environmental assessments to avoid duplication with the Queensland government?
Mr BURKE (Watson—Minister for Sustainability, Environment, Water, Population and Communities) (15:04): I thank the member for Petrie for the question. It is an important question for all Queenslanders, given the significant job opportunities that will come from the pipeline of investment that is coming before us in Queensland at the moment. With that in mind, at the last meeting of COAG the Prime Minister and the premiers, including the Queensland Premier, made clear that where we can avoid duplication we want to; when we can streamline processes we want to.
That is why I was astonished yesterday to find the Queensland government adding a layer of environmental duplication on referrals that was not previously there. They did it on the Alpha coalmine project, which will have 990 Queensland jobs when operational, 3,600 Queensland jobs during the construction phase and which was being assessed under a bilateral agreement—a bilateral agreement which matches what people on both sides of this chamber have been talking about for some time, where we get the state level to do a single assessment process so that we do not have a federal process then a state process and at the end of that it goes back to each minister for approvals.
Yesterday the Queensland Coordinator-General released his report. When he released it the Deputy Premier in his media statement said, 'The federal minister for the environment is yet to complete his assessment under the Commonwealth environmental legislation.' There is a reason why I am yet to complete it: until yesterday there was not going to be a Commonwealth assessment. Until yesterday that duplication did not exist. Until yesterday we thought that, under a bilateral agreement, Queensland was going to be serious on eliminating the duplication so we could meet the same environmental standards which we want to hold—no reduction in the standards—but streamline the process as a company goes towards a final investment decision on a project worth $6.4 billion.
While we have been sitting here, the Deputy Premier has stood up in the Queensland parliament and said he has just checked with the Coordinator-General and they did meet all the federal standards. I suggest the Coordinator-General in Queensland reads his own report. On page 198 he acknowledged that he did not only have insufficient information coming back from our department, he did not even wait for the Queensland agencies to comment on whether or not they had met the federal standard. On page 220 of that report he acknowledged that they had not met the survey standards.
Mr Dutton interjecting—
Mr BURKE: The member for Dickson—a Queensland member, of all people—says, 'Hold the front page!' I have to say that if you are delaying and risking and adding to the process, for a $6.4 billion investment and 3,600 jobs, if it doesn't matter to the Queensland members of this parliament it matters on this side. (Time expired)
Enterprise Migration Agreements
Mr ABBOTT (Warringah—Leader of the Opposition) (15:07): My question is to the Prime Minister. To give her the chance to clear this matter up once and for all, did the Prime Minister—
The DEPUTY SPEAKER ( Ms AE Burke ): No, the Leader of the Opposition cannot put in that! The Leader of the Opposition will come back to his question. He will take out the preamble.
Mr ABBOTT: Did the Prime Minister tell the union bosses that she was furious about the Roy Hill enterprise migration agreement? Did she or did she not?
Ms GILLARD (Lalor—Prime Minister) (15:08): I have dealt with that question and the fact that here is the Leader of the Opposition yet again, with all his destructive intent. While this government has been getting on with creating Australian jobs, there he is mired in his petty, petty politics.
The DEPUTY SPEAKER: The Prime Minister will resume her seat. The Manager of Opposition Business on a point of order?
Mr Pyne: The Prime Minister has responded to questions but she is yet to answer the question. The question is: did she or did she not?
The DEPUTY SPEAKER: The Manager of Opposition Business will resume his seat. He is abusing points of order! I advised I would send people out of the chamber if they did so. The Manager of Opposition Business will leave the chamber under standing order 94(a).
The DEPUTY SPEAKER: The Prime Minister has the call.
Ms GILLARD: Thank you very much.
The DEPUTY SPEAKER: The Leader of the Opposition?
Mr Abbott: Madam Deputy Speaker, on a point of order: respectfully responding to what you have just told the House, I think—
The DEPUTY SPEAKER: The Leader of the Opposition will resume his seat. This is not the opportunity to take that up. I did advise that if people continued to abuse points of order I would ask them to leave the chamber. The Leader of the Opposition?
Mr Abbott: Madam Deputy Speaker, on a point of order: I accept absolutely that points of order should not be abused, but I think the parliament should not be abused, either, by ministers and prime ministers who fail to be straight with the parliament.
The DEPUTY SPEAKER: The Leader of the Opposition will resume his seat!
Mrs Bronwyn Bishop: Madam Deputy Speaker—
The DEPUTY SPEAKER: Member for Mackellar, I am taking the same position that former speakers did. I will not be entering into debate about issues at this time. The member for Mackellar will resume her seat. The Manager of Opposition Business will leave the chamber. The Prime Minister has the call.
Mrs Bronwyn Bishop: Madam Deputy Speaker—
The DEPUTY SPEAKER: Member for Mackellar, you are seeking to enter into a debate about an issue. I am not allowing it at this time. The member for Mackellar will resume her seat. The Prime Minister has the call.
The member for Sturt then left the chamber.
Ms GILLARD: Thank you very much, Deputy Speaker. I think we have seen on grand display the lack of interest of the opposition in this serious policy question. They don't care about jobs. Petty politics back and forth, petty politics back and forth—that is all they will ever be about.
Budget
Mr GEORGANAS (Hindmarsh) (15:10): My question is to the Minister for School Education, Early Childhood and Youth. Will the minister inform the House of how the schoolkids bonus is being delivered to Australian parents? What are the facts about how this will benefit families?
Mr GARRETT (Kingsford Smith—Minister for School Education, Early Childhood and Youth) (15:11): I thank the member for Hindmarsh for his question. The passage of the budget's second reading is good news for families around Australia, because in that budget we continue our commitment to supporting education for families right around Australia. Importantly, we continue our commitment on the national partnerships that sees the federal Labor government provide support to the states for specific investments in things like teacher quality, literacy and numeracy, and low-socioeconomic communities.
I was very pleased that the COAG Reform Council reported today that reward payments to the states have been paid by the Commonwealth on these national partnerships—in particular, $147 million in reward payments on literacy and numeracy. This is an important national partnership. We have seen about half a million students benefiting from additional support in schools as they come through primary school, getting their reading, writing and maths under control. We now have many of the schools involved where the kids are performing at above national minimum standards. So that is really good news and the budget provided an additional $250 million to make sure we continue that national partnership.
Of course the budget also included the schoolkids bonus. Here, as I am asked about the schoolkids bonus, I have to reflect on the pressures that families face when they want to get their kids off to school and they have those extra expenses coming. Let us just take an eligible family—a typical family with two kids, maybe one is in primary school and one in high school. They can expect over the course of the year just over $1,200 in support from the schoolkids bonus for the pair of runners that are looking a bit tatty, or maybe it is a new backpack or some stationery needs. It is particularly important that parents are given the opportunity to manage their budgets in this way, because they understand the kind of education costs that they are facing for their kids that have to be met.
In Hindmarsh, about 5,500 families will benefit from the schoolkids bonus. Across South Australia about 96,500 families will benefit from that schoolkids bonus. The only person who led the charge of 'no' against the schoolkids bonus was the opposition leader, who seems to be hard-wired for negativity. So opposed to the idea of parents getting a schoolkids bonus was he that he claimed that the money would be spent on poker machines. I think that says more about the Leader of the Opposition than it does about families around Australia, who know the education needs they face and know that this government is doing something to meet them.
Ms Gillard: I ask that further questions be placed on the Notice Paper.
PERSONAL EXPLANATIONS
Mr ABBOTT (Warringah—Leader of the Opposition) (15:13): Madam Deputy Speaker, I wish to make a personal explanation.
The DEPUTY SPEAKER ( Ms AE Burke ): Does the honourable member claim to have been misrepresented?
Mr ABBOTT: I do.
The DEPUTY SPEAKER: Please proceed.
Mr ABBOTT: In question time today the Leader of the House referred to an email from Nolan's Transport. There was in fact a dodgy email circulating about Nolan's Transport. It did not come from me and the minister should not suggest that it did. As it happens, Nolan's Transport hates the carbon tax, which will cost them $300,000—
The DEPUTY SPEAKER: The Leader of the Opposition will resume his seat! He needs to indicate where he has been misrepresented. The Leader of the Opposition has the call.
Mr ABBOTT: The Leader of the House further suggested in question time today that I had been banned from Norsk Hydro on the weekend. This is also false and they have made it clear to me that I am welcome to visit at any time.
Mr Albanese: I said neither thing.
Ms JULIE BISHOP (Curtin—Deputy Leader of the Opposition) (15:15): Madam Deputy Speaker, I wish to make a personal explanation.
The DEPUTY SPEAKER: Does the honourable member claim to have been misrepresented?
Ms JULIE BISHOP: I do.
The DEPUTY SPEAKER: Please proceed.
Ms JULIE BISHOP: In question time today the Prime Minister in an answer to a question from me said that I had misquoted the Minister for Immigration and Citizenship and she said that I had misled the House as a result. I quote from page 27 of Hansard where the minister for immigration said on 29 May:
The application from Roy Hill came in—
Mr Dutton: Stop being a bully, Albo!
The DEPUTY SPEAKER: Order! The member for Dickson! The Leader of the House has the call.
Mr Albanese: I ask that that be withdrawn.
The DEPUTY SPEAKER: To progress matters I am going to ask the Deputy Leader of the Opposition to indicate where she has been misrepresented.
Ms JULIE BISHOP: The Prime Minister said today that I had misquoted and thereby had misled the parliament, and I take that very seriously. There are two statements by the minister that I wish to read.
The DEPUTY SPEAKER: The Deputy Leader of the Opposition cannot debate the issue she can merely indicate where she has been misrepresented.
Honourable members interjecting—
Ms JULIE BISHOP: Madam Deputy Speaker, I am showing where I was misrepresented. On page 27 it says:
The application from Roy Hill came in, as I recall it, in the few months after that. It was, perhaps, in early 2012 or late 2011. I updated—
The DEPUTY SPEAKER: The Deputy Leader of the Opposition will resume her seat. The Leader of the House is seeking the call.
Mr Albanese: Thank you, Madam Deputy Speaker. I will wait for the Deputy Leader of the Opposition to sit down. I have got the call, so you have to sit down.
Honourable members interjecting—
Mr Albanese: No, you just have to sit down.
The DEPUTY SPEAKER: The Leader of the House will resume his seat. The Deputy Leader of the Opposition will come quickly to where she has been misrepresented.
Mr Dutton: She has got the call!
The DEPUTY SPEAKER: The member for Dickson is not assisting in any way, shape, size or form. The Leader of the House on a point of order.
Mr Albanese: The fact of the matter is that it cannot possibly be in order on a personal explanation to read Hansard. We all get Hansard. The Deputy Leader of the Opposition does not have to engage in this.
The DEPUTY SPEAKER: The Leader of the House will resume his seat. The Deputy Leader of the Opposition will come quickly to where she has been misrepresented and it might be difficult to prove when she is quoting from someone else's Hansard.
Ms JULIE BISHOP: I have been accused of misquoting and misleading, and that is a very serious allegation for the Prime Minister to make. I am proving this by reading that I did not misquote; in fact, I accurately quoted the minister because on two occasions—on pages 27 and 29 of the Hansard—he said he had updated the productivity committee of the cabinet informally in relation to this enterprise migration agreement. The Prime Minister has misled the House.
The DEPUTY SPEAKER: Order! The member for Higgins has the call.
Ms O'DWYER (Higgins) (15:19): I seek leave to make a personal explanation.
The DEPUTY SPEAKER: Does the member for Higgins claim to have been misrepresented?
Ms O'DWYER: I do.
The DEPUTY SPEAKER: The member for Higgins has the call.
Ms O'DWYER: The Minister for Small Business, the member for Gorton, came into question time today and he claimed that I had misled the public and therefore the House over a photo that I posted on Twitter. The tweet said, 'A picture tells a thousand words'. The photo was of a small business person who was standing outside his shop. On his shop he had painted the sign 'Thanks Julia, closing down'. Unlike the Minister for Small Business, I am not afraid to meet with small businessmen and women.
The DEPUTY SPEAKER: The member for Higgins needs to demonstrate where she has been misrepresented. This is not an opportunity for debate or we will diminish the ability for people to make personal explanations. The member for Higgins has the call.
Ms O'DWYER: Thank you, Madam Deputy Speaker.
Honourable members interjecting—
The DEPUTY SPEAKER: Order! The member for Higgins has the call. The Leader of the House will resume his seat. The member for Higgins needs to show where she has been misrepresented and not to debate or I will take action.
Ms O'DWYER: It goes to the point of the photo that has been raised in this place by the minister in question time: specifically I asked the small business owner why he had painted the sign on his store. He said the sign had been painted because of government policies to do with changes to Fair Work, to do with changes to the carbon—
The DEPUTY SPEAKER: The member for Higgins will resume her seat. She is now debating the point. The discussion is now concluded.
AUDITOR-GENERAL'S REPORTS
Audit Report No. 36 of 2011-2012
The DEPUTY SPEAKER ( Ms AE Burke ) (15:21): I present the Auditor-General's Audit report No. 36 of 2011-2012 entitled Development and approval of grant program guidelines.
Ordered that the report be made a parliamentary paper.
COMMITTEES
Selection Committee
The DEPUTY SPEAKER ( Ms AE Burke ) (15:21): I present report No. 54 of the Selection Committee relating to the consideration of committees and delegation business and private members business on Monday, 18 June 2012. The report will be printed in Hansard for today and the committee's determination will appear in tomorrow's Notice Paper. Copies of the report have been placed on the table.
BUSINESS
Federation Chamber
Mr ALBANESE (Grayndler—Leader of the House and Minister for Infrastructure and Transport) (15:22): by leave—I move:
That so much of the standing and sessional orders be suspended as would prevent:
(1) the Federation Chamber continuing to meet today until 8pm or until the adjournment of the House, whichever is the earlier.
(2) the Federation Chamber continuing to meet on Thursday, 31 May 2012 until 1.30pm and Government business having precedence from the conclusion of Members constituency statements until 1.30pm; and
(3) any variation to this arrangement to be made only by a motion moved by a Minister.
Question agreed to.
MINISTERIAL STATEMENTS
Hastie Group
Mr SHORTEN (Maribyrnong—Minister for Financial Services and Superannuation and Minister for Employment and Workplace Relations) (15:23): by leave—For the benefit of members on both sides, I wish to briefly update the House on matters concerning the Hastie Group. The Hastie Group is made up of approximately 44 separate companies, and that number is on latest advice. It employs about 4,000 people across mechanical engineering and electrical plumbing work on construction sites and also services such as refrigeration and mechanical operations.
I have had the opportunity to speak directly with Mr Peter Anderson from McGrathNicol and Mr Craig Crosbie from PPB, who are the appointed receiver and administrator for Hastie. I am advised that a number of the subsidiary organised companies will or may be sold as going concerns, and as such it is hoped that quite a lot of the jobs for electricians, plumbers and metal tradespeople will continue. The Australian Council of Trade Unions, the Electrical Trade Union, the Plumbers Union and others have been in touch with me to ensure that their members' interests are represented.
In terms of the services part of the Hastie Group, I am advised that the 1,300 staff employed in that part of the businesses are likely to retain their jobs. In addition, I am advised that 500 workers in the two refrigeration businesses are likely to retain their jobs. I will continue to talk with the administrator and others during the remainder of this week. I am aware that the CEPU electricians and PPB reached arrangements yesterday that allow redundancy certificates to be issued. That will mean that some employees will be able to gain access to entitlements in a more speedy fashion. I am aware that the plumbers division of the CEPU are in constructive talks to ensure that the plumbing jobs are maintained going forward.
All workers will remain eligible for support through JSA and Centrelink, and the government are doing everything we can to support people. In the event that liquidation is confirmed, employees may be eligible for the GIS scheme. If the administrators believe that they are going to have to liquidate particular operations, we look forward to them informing us at the earliest possible time; thus allowing me to use a discretion. In the event that they are not then we are keen to see who is going to buy the businesses and what will happen to the jobs this week.
The aim of the government is to make sure that people do not remain in uncertainty for days and weeks. The situation is moving very fast, and we know that there are a lot of people trying to work on this issue. At the end of the day, in relation to the subcontractors, the small businesses and the employees who are caught up in circumstances beyond their control, I appreciate that the jobs that they perform will still be necessary in many cases for the construction projects to get completed.
According to initial reports—and I stress 'initial reports'—it is apparent that this unfortunate situation has arisen out of mismanagement, including a multimillion-dollar irregularity in the Hastie Group's accounts. ASIC are investigating the matter and making the appropriate inquiries of directors, administrators and auditors. The government, at the appropriate stage, will consider any policy options arising out of these inquiries, including whether or not mandatory rotation of auditors after a set number of years is required in the future. Members of parliament with any questions should feel free to contact my office.
Ms LEY (Farrer) (15:26): I appreciate the update from the Minister for Employment and Workplace Relations. The circumstances of the collapse of the Hastie Group are now unfortunately becoming all too well known: 2,700 workers have been stood down without pay for 28 days. Job losses and business closures are shocking when they happen.
What I would say is that, while the opposition makes no political comment about a government to blame for this, as we do see more and more company closures, the creeping loss of confidence across the economy is doing nothing to encourage small and medium businesses—especially in the regional towns affected by Hastie; namely, Albury, Shepparton, Bendigo, Mildura and Geelong—to actually take a risk and recruit a recently retrenched worker.
The government has failed to provide the right economic policy settings that would give sufficiently robust local and regional job opportunities to enable these workers to easily find a job. In my own home town of Albury, Watters Electrical had 80 workers stood down on Monday in the car park outside the office. The process of standing them down means they cannot apply for Centrelink or redundancy payments. I appreciate the minister's efforts in encouraging that official retrenchment action take place so that Centrelink and the GIS can step in to assist these workers. For those workers who do lose their jobs as a result of the collapse of the Hastie Group, we need to ensure they are assisted with prompt and appropriate support. So I echo that commitment from the minister to ensure that workers are not left in doubt for longer than 28 days as to whether they have a job or not.
The government needs to work with the administrators to ensure that where some of the subsidiaries can remain in business they are given every assistance to do so. I appreciate the minister mentioning that he has received advice from relevant unions who represent these workers, but I also seek his assurance that those workers or subcontractors affected who are not members of unions also receive the same level of support.
STATEMENT BY THE SPEAKER
Appointment of the Parliamentary Budget Officer
The DEPUTY SPEAKER ( Ms AE Burke ) (15:28): Mr Speaker has asked me to inform the House of the appointment of the inaugural Parliamentary Budget Officer, who will head the new Parliamentary Budget Office. Under sections 64X and 64XA of the Parliamentary Service Act 1999, the Presiding Officers have the responsibility to appoint the Parliamentary Budget Officer, subject to the approval of the proposed appointment by the Joint Committee of Public Accounts and Audit.
I am pleased to inform the House that on 23 May 2012, the Joint Committee of Public Accounts and Audit gave unanimous approval to the appointment of Mr Phil Bowen as the inaugural Parliamentary Budget Officer. Mr Bowen is a highly experienced individual who is ideally suited to this new and important role. Since 2007, Mr Bowen has been an executive director on the board of the Asian Development Bank, representing Australia and a number of countries in our region.
Prior to this, Mr Bowen was a senior Commonwealth public servant who held various senior executive positions, including as a long-serving deputy secretary of Budget Group in the former Department of Finance and Administration between 2001 and 2007. Prior to this, Mr Bowen was a deputy secretary of the Property Group of Finance and has also held senior positions in the former Department of Transport and Communications and the Civil Aviation Authority.
In recognition of Mr Bowen's contributions, he was awarded a Public Service Medal on Australia Day 2006 'for outstanding public service in the development, delivery and implementation of enhanced whole-of-government budget processes'. Mr Bowen will commence on 23 July 2012. I congratulate Mr Bowen on his appointment and, on behalf of all members, I wish him well in establishing this new and important office.
Mr OAKESHOTT (Lyne) (15:30): by leave—On behalf of the Joint Committee of Public Accounts and Audit, I am pleased to also advise the House of the committee's decision to approve the proposed appointment of Mr Phil Bowen as Parliamentary Budget Officer, as referred to the committee by Presiding Officers. The committee welcomes today's announcement by the Presiding Officers confirming the appointment of Mr Bowen as the inaugural Parliamentary Budget Officer.
Mr Bowen's first task will be to establish a fourth parliamentary department—that of the Parliamentary Budget Office. This office will improve the transparency of Australia's fiscal and budgetary frameworks and will help level the playing field by giving all senators and members access to independent policy costings and additional support to scrutinise the budget.
The appointment of the right person to establish and lead the PBO was of the utmost importance to the committee. The committee considered that the appointment process undertaken by the Parliamentary Service Commissioner at the request of the Presiding Officers was thorough and transparent. After meeting with both the Parliamentary Service Commissioner and Mr Bowen, the committee did unanimously agree to the appointment. The committee was impressed by Mr Bowen's strong finance related background and also considered his diversity as a real asset. Following our meeting with Mr Bowen, we were all confident that he brings the whole package: knowledge, skills, experience and ability to communicate all of this in his no-nonsense style.
Since 2007 Mr Bowen has been the Australian director on the board of the Australian Development Bank. In this role he represented the constituency of 11 ADB members as well as worked to continuously improve the bank's operations. Following criticism of the ADB's operations evaluation department, which is responsible for monitoring the billions of dollars of loans made by the bank to Asian nations, Mr Bowen led a review that made significant recommendations to improve the independence and effectiveness of the office. Prior to this international appointment, Mr Bowen held a range of senior positions within the then Department of Finance and Administration directly relevant to the role of Parliamentary Budget Officer, including five years as head of the Budget Group. During this time, as you mentioned, Deputy Speaker, Mr Bowen was awarded an Australian Public Service Medal for his work in developing and implementing enhanced whole-of-government budget processes.
Mr Bowen has held senior positions in the former Department of Transport and Communications and in the Civil Aviation Authority. He has served on a number of boards and advisory committees, including the Australian Public Sector Accounting Standards Board. In addition to qualifications in agricultural science, economics and accounting, Mr Bowen is a fellow of CPA Australia and an alumni of the Harvard Business School's Advanced Management Program.
We only get one chance to get this important new Parliamentary Budget Office right. The establishment of a credible, independent and strong PBO is a unique opportunity for this parliament, and all parliamentarians, I hope, will be working together to ensure we make the most of it.
Along with the selection of the best person to head the Parliamentary Budget Office, the committee considers that decisions made about the location of the office to be fundamental to its success. While ultimately a decision for the newly appointed Parliamentary Budget Officer, the committee is a strong view that it is an absolute priority that the Parliamentary Budget Officer and his key staff have an office located within Parliament House to ensure ready access for senators and members. The committee welcomes its new role as the oversight committee for the Parliamentary Budget Office and looks forward to working with Mr Bowen, as prescribed in the Parliamentary Services Act 1999, upon his commencement on 23 July 2012.
MATTERS OF PUBLIC IMPORTANCE
Carbon Pricing
The DEPUTY SPEAKER ( Ms AE Burke ) (15:34): The Speaker has received letters from the honourable member for Chifley and the honourable member for Cook proposing that definite matters of public importance be submitted to the House for discussion today. As required by standing order 46, the Speaker has selected the matter which, in his opinion, is the most urgent and important; that is, that proposed by the honourable member for Chifley, namely:
The urgent need to provide households with financial relief based on facts surrounding the introduction of a carbon price on July 1.
I call upon those members who approve of the proposed discussion to rise in their places.
More than the number of members required by the standing orders having risen in their places—
Mr HUSIC (Chifley—Government Whip) (15:35): I am pleased the House can consider this matter of public importance. I am also looking forward to the contributions from the member for Moreton and the member for Robertson on this critical issue because we are in the process of taking action on an issue that has been dodged by federal parliaments for successive decades: action on climate change and meeting our international commitment.
It is worth noting that this is an existing bipartisan commitment to meet a medium-term target of reducing emissions by five to 15 per cent on 2000 levels by 2020. Both sides of the House committed to reducing emissions. In doing so, we have sought to do this in a way that will cut pollution and drive investment in clean energy. To ensure that we target this action to those that are contributing most to pollution, all the money that is raised by bringing in a price on carbon will go to jobs, will go to clean energy, will go to households. We recognise too that a lot of other parts of the world are acting on this critical issue. As much as we structure our plans in a specific way, it is important to note as well that, under the proposals put forward by those opposite, families would actually be worse off and would be required to pay more.
In introducing this price on carbon, I would reinforce the point that, in tackling pollution we are targeting the top 500 polluters. But, along the way, we have admitted and have acknowledged that there will be price impacts. We asked Treasury to model that impact—not to do so on hunches or to work off guesswork but to rely on facts and reality. It was a significant body of work in terms of the modelling that was undertaken by Treasury and, in addition, it was then tested further and refined to ensure that this work, which would form the bedrock of work in relation to other initiatives, would be solid. As I said, this modelling forms the bedrock of our plans to provide thorough household assistance as we transition to a cleaner energy future. It is used to shape the type of assistance that is also provided through our Jobs and Competitiveness Program to help industry in the transition process too. Both measures are vitally important for the people that I am proud to represent and champion in this place—and I will come back to that later.
Let me go back to the modelling. On that modelling alone, it is indicated that the impact on prices and the cost of living will be 0.7 per cent. If you contrast that to other major initiatives—for example, when those opposite were in government and introduced the goods and services tax—bear in mind that we predict prices will move 0.7 per cent as a result of a price on carbon, and when the GST was introduced there was a 2.5 per cent lift in prices.
The 500 polluters that are being targeted are the only ones targeted, which again is worth noting. The myths peddled by those opposite suggest that all businesses will pay—every single small business and all businesses in the country will pay. We have 500 of the biggest polluters targeted and, unlike the imposition of the GST—which effectively turned every small business into a small taxation office—ours will only target 500 of the biggest polluters. Again, prices are predicted to go up 0.7 per cent, and it is worth putting it into context. That is less than a cent for every dollar spent. We have estimated, as a result of that modelling, that the overall impact will be $9.90 per week on average, and the assistance we are providing is $10.10 per week to cover that $9.90 per week impact.
All sorts of claims have been made about what impact putting a price on carbon would have on everyday goods and services. I think it is important, as the matter of public importance suggests, that we base this on fact. It is worth noting and bringing to the House's attention some of the movements. In terms of electricity we have had all sorts of claims made as to what impact this would have. Electricity will be up on average 10 per cent, or $3.30 per week. Gas will be up nine per cent, or $1.50 per week. For fruit and vegetables the average price impact is 10c—that is a 0.4 per cent impact. Rents are the same—a 40c increase, or 0.6 per cent. I have already gone through utilities. Pharmaceuticals will go up less than 10c, or 0.3 per cent. In terms of urban transport we have all sorts of claims about what impact that will have in terms of fuel and prices of urban transport. For urban transport there will be less than a 10c impact. Again, we have all sorts of claims made about the impact on airlines and travel—and I want to come back to that further in this contribution—but the impact is about 30c as a result of putting a price on carbon. So again it is important to get the facts on the record. These are the facts and these are the figures, and we have built our household assistance around these figures.
In terms of that household assistance, families who are receiving family tax benefit part A receive an extra $110 per child, and families on family tax benefit part B receive an extra $69. From July 2013, regular fortnightly or quarterly payments will receive a permanent boost. Pensioners receive an upfront lump sum payment over the next few weeks to help now and over the coming months. Again, it is a fact that single pensioners are receiving about $250 and it is a fact that pensioner couples will receive about $380 combined. We will deliver another permanent boost to regular pension payments from March next year. So, overall, singles will get about $338 a year and couples an extra $510. That is on top of the increases we have already delivered. For example, a single pensioner on the maximum rate is now $4,000 a year better off because of what we are doing.
For workers, from July everyone earning less than $80,000 will receive a tax cut, and for most people that tax cut is worth about $300 a year. We are also—and this is a tremendous boost for a lot of workers—tripling the tax-free threshold to $18,200. So, if you are a part-time worker earning $25,000, you are going to have an extra $500 in your pocket every year, and if you earn less than $18,200 a year you will not be paying any tax at all—none, zip, nothing. Self-funded retirees who hold a Commonwealth Seniors Health Card receive an upfront lump sum payment in June to help now and over the coming months. Those are just some of the impacts.
There are around 65,000 taxpayers who live in Chifley—in the suburbs of Mount Druitt, Rooty Hill, Blacktown and Marsden Park—and around 58,000 will receive a tax cut. Out of those 58,000, 49,000 receive a tax cut of at least $300. In total, more than 52,700 people in the electorate I am proud to represent in this place will receive household assistance through income support payments. More than 19,000 will receive extra cash through their family assistance payments. This means, for example, that a typical family with a household income of about $75,000 a year, with two kids in school—and with a price impact of about $549 a year as a result of a carbon price—will, through what we are doing on family tax payments and tax cuts, receive an extra $1,179 a year. They will be $630 better off.
These are facts. This is reality. That is what we are doing: lifting payments, cutting taxes, boosting pensions and lifting the tax-free threshold. The response of those opposite is: extra payments gone; taxes back up; pensions reduced; and the tax-free threshold lowered. A million people will benefit from our lowering of the tax-free threshold—60 per cent of them women. Hundreds of thousands of young people will benefit from that move. As I reflected in the House last week, imagine a political party going to those young people and saying, 'We will actually make you pay more tax so we can cut tax for the wealthiest in this country. 'It is a ridiculous proposition, but it is actually reality because that is what those opposite are saying. This is fact. This is what they said they would do. And what else have they done? Not only have they said they would take away the things we support or we are proposing to do, they are also out there pumping mistruths, peddling myths and relying on fear. Sure, fear gets you someplace fast, but it does not get you very far. At some point, once you have scared people, you have to come up with a solution. And if you are going to meet that bipartisan target that both sides committed to, the solution cannot be the biggest tree-planting program in the country. They have told whoppers—no-one can accuse them of a lack of imagination! We have had the Leader of the Opposition saying that the price rise and the effects of the carbon price will be unimaginable, but he himself has been quite imaginative in making up all sorts of myths about its impact. At some point, he has to stop the self-delusion and get with the reality—not say, again, that the price rises will be unimaginable. Listen to some of the things that the Leader of the Opposition has said:
This will destroy the steel industry, the cement industry, the aluminium industry, the motor industry. It will be, over time, the death of heavy manufacturing in Australia.
Anthony Abbott has morphed into Anthony Robbins, the biggest and greatest motivator of people in this country! Anything that he touches—anything that he turns up to—dies! Apparently, he can go to Whyalla and say, 'We had the AWU in South Australia just today predict Whyalla and Port Pirie would be wiped off the map'. This is what the Leader of the Opposition said: wiped off the map. How does he propose to be the leader of this country and go around the country saying to people that their town will be wiped off the map? It sounds more like a disaster movie—
Mr Fitzgibbon: We'll all be rooned!
Mr HUSIC: Exactly, rooned indeed. Thank you, Chief Government Whip. It is worth noting some of the other myths. I said before that one result of the price on carbon will be to add 0.7 per cent to the costs of living. State-based regulators have confirmed key aspects of that forecast. The Treasury analysis said that electricity prices will be up by 10 per cent. The New South Wales pricing regulator, IPART, confirmed that electricity prices would rise by $3.30 per week. IPART also said the impact on council rates would be 0.4 per cent less than under Treasury modelling. Those opposite have been saying all sorts of things about what the impact would be. It is quite astounding, when you match the reality against the myth, to see what will really be the case.
We have had all sorts of claims made about what effect the carbon price will have on councils. IPART and the New South Wales Minister for Local Government confirm that council rates will rise 0.4 per cent as a result of the carbon price. For average households, how much does that add per week? When it is applied to council rates, 0.4 per cent is just six cents a week—that is all that it will lead to. This has been an incredible attempt to spread fear about the carbon price. The New South Wales government has now confirmed the Treasury forecast, and after all that modelling and all the work that we have done, we are in a position to be able to provide facts instead of the fear that has been provided by those opposite.
What about some of the other claims that we have had? We have had the member for Wide Bay, who at some point is actually going to ask the member for Grayndler a portfolio-related question—
Mr Jenkins interjecting—
Mr HUSIC: You are right, the member for Scullin, it is highly unlikely, but we live in hope. Let us look at the impact on flights. Virgin, for example, has announced that on most flights it will only add $1.50. We had a scare campaign yesterday by those opposite, who said that aviation would be doomed—and rooned—yet we have had Rex put out a release for their 2011 full year results which quotes its Executive Chairman, Lim Kim Hai, as saying:
I am actually more optimistic and confident of the outlook and potential of the Rex Group than I have ever been for the past nine years.
And what about the claims in relation to Brindabella where—and I have never seen this before—we had the shadow Treasurer going to table a document, then folding the document in half, tearing it and handing up the convenient part but leaving out the inconvenient part. These are improvements to the House practice that I have been happy to see as a new member!
It is important, as the MPI states, to rely on fact instead of fiction. It is incumbent on those opposite to not only demonstrate exactly what they intend to do but also, importantly, to represent properly what impact this will have. As well as rate rises, they have talked about the cost of landfills and how that would be affected. The biggest move in relation to increases in landfill costs has come as a result of the waste management levies in New South Wales, not as a result of anything to do with the carbon price.
We have taken action on an issue affecting the nation. In the past, we have had delay—governments have delayed, deferred action on this and put it in the too-hard basket. We have acted. Those opposite agree that we need to act. It is a bipartisan target. It is time to get to work, instead of wilting under the pressure.
Mr ANDREWS (Menzies) (15:50): 'There will be no carbon tax under a government I lead.' Those 11 words—there will be no carbon tax under a government I lead—will haunt this Prime Minister for the rest of this year, for the rest of this parliament and for the rest of her term while she remains in this place. That is because there has been no more blatant refusal to confront the truth than her reversal of this promise that she made to the Australian people prior to the last election: 'There will be no carbon tax under a government I lead.'
This Prime Minister—and her Treasurer—on more than one occasion went to the Australian people prior to the last election and made a solemn promise to every Australian that there would be no carbon tax under the government she leads. And why did she do that? She knew then that the polls were so close and that the carbon tax was so on the nose with the Australian people that she had to come forth and say on national television and to the national media—to be beamed into every lounge room in Australia—that there would be 'no carbon tax under a government I lead'. That is the promise that this Prime Minister made to the Australian people. And that is the promise that she ripped up in doing a deal to maintain her seat in The Lodge and to maintain her seat here at the despatch box in this parliament. In other words, in order to retain her position as the Prime Minister of Australia, she ripped up a solemn promise that she made on a number of occasions to the people of Australia. What would the government have us believe? Let us nail the lie at the heart of this issue. The government and the honourable member for Chifley, who is not such a bad bloke although he is part of this dysfunctional government—he has not been here that long, so I suppose he cannot be blamed for all of their ills—in this motion before the House speak of the 'urgent need to provide households with financial relief'. Why is there an urgent need to provide Australian households with financial relief? Because the government have been saying, if you listen to them, day after day, hour after hour—we heard it again in question time today—that this tax will only be imposed on 500 companies, the 500 biggest polluters in Australia. The government has been saying that ad nauseam. Hardly anybody in this country would not have heard the government's claim that this tax will only be imposed on the 500 biggest emitters—the 500 biggest companies, to put it in other words. If that is the case, if only the 500 biggest emitters are going to have the imposition of this carbon tax upon them, if only those companies are going to be met with the cost, why is there an urgent need to provide households with financial relief? This nails the lie at the heart of this government's campaign.
Ms Marino: Bells the cat.
Mr ANDREWS: This bells the cat, as my honourable colleague says. The reality is that urgent relief is being provided because of the carbon tax. If you have been listening to the radio or watching the television you could hardly not have noticed the ads about the household assistance package. Let me read the transcript: 'Soon millions of Australians receiving government payments will get additional help with their everyday expenses. An initial payment will automatically appear on your bank account from May 2012. It is the first part of the Australian government's household assistance package. This extra assistance will become a regular part of your government payment between March next year and early 2014. For more information …' Why is this required? If the imposition of this tax is only on 500 companies, why is urgent assistance needed for Australian families? If that were the case, it would not be needed. As I said, this is the lie at the heart of this policy proposal.
Everybody knows that when a tax is imposed upon a company, that company will seek to pass on that tax to the purchasers of goods and services from that company. Where they can do it, they will pass on that tax. Where they cannot do it, they will have to try and downsize or cut their costs in other ways. One of the consequences of that would be a loss of jobs in this country, and we are seeing that already. Where those companies are in an internationally competitive position, competing with other companies producing goods or services in overseas countries that do not have this tax, then something has to give so far as the companies are concerned. Anyone with a modicum of knowledge about business, anybody who knows the faintest thing about how taxation works, anybody who has had to balance their own family books, let alone the books of a small business, knows that when there is an additional imposition by way of an additional cost for the business—which this tax is—that has to be passed on in some way, otherwise something has to give within the business.
Do you think that this government will come out and honesty admit to that truth? No, they will not. This increasingly dysfunctional government, led by the chaotic Prime Minister and her office, will not come clean with the Australian people. If they honestly believe that they need a carbon tax, they should say, 'Yes, we need a carbon tax and it is going to cost you.' Why don't they have the guts, the courage, to come forward to the Australian people and say that to them? No, they will not. They want to walk both sides of the street: on the one hand this is a tax applied only to 500 companies and on the other hand we need urgent financial assistance for every family in Australia. The reality is those two things do not add up, and anybody who spends a moment thinking about it can see, as I have described it, the lie at the heart of this policy. Yet day after day after day we get the Prime Minister in here pretending that somehow these realities do not work.
Not only that, this tax is so toxic that they cannot mention it in the advertisements on television and on radio. In Senate estimates it was revealed that the focus groups put together to test the best lines in order to present this to the Australian people found that the toxicity of the carbon tax was such that they did not even bother to put it to the focus groups, knowing what the reaction would be. We know that because of reports coming from government backbenchers, they are afraid to doorknock in their own electorates because people will tell them directly what they think about this carbon tax. If my experience is true, they will also say that they want to get rid of this government as quickly as they can. That is the reality so far as this matter is concerned.
We have two worlds here. We have this unreal world of Treasury modelling—we had the honourable member for Chifley telling us about Treasury modelling and the impact of prices—and then we have the real world in which ordinary Australians live. Let me tell you something about the real world in which Australians live. From the December quarter of 2007 to the December quarter of 2011, four years, what has happened in the real world of Australians? Their electricity prices have gone up by 61per cent. That is even without a carbon tax.
Ms O'Neill: That's right!
Mr ANDREWS: You're saying that's fine and you want to do something about the cost-of-living pressures. This is the unreal world that this government lives in. 'That's fine,' interjects the honourable member opposite, a 61 per cent increase in electricity prices. But that is not all. Gas prices have gone up by—
Ms O'Neill: On a point of order, Deputy Speaker, I think that the honourable member misheard my comment which was, 'That is right; that is correct.' He is attempting to mislead the parliament with that misrepresentation.
Mr Andrews interjecting—
The DEPUTY SPEAKER ( Mr Mitchell ): I am happy to let you have the call when I give you the call, but until then it is probably better to be silent. The honourable member for Menzies in continuation.
Mr ANDREWS: Electricity prices have gone up by 61 per cent. Gas prices over four years have increased on average across Australia by 37 per cent. Water and sewerage rates across Australia have increased by 58 per cent. Petrol prices across Australia are up by eight per cent. Health costs have increased by 20 percent. If you go to the doctor or you need some medical attention, health costs have gone up by 20 per cent across Australia in this government's term. The price of bread has gone up by nine per cent across Australia and the price of food on average has gone up by 13 per cent across Australia in four years. Fruit and vegetables have gone up by 20 per cent and rent, where people do not own their homes, has increased by 25 per cent over the last four years.
We have these two worlds: this totally unreal world that the honourable members opposite are trying to pretend we live in—as if things just go according to whatever Treasury has modelled—and the real world of people who are going to the supermarket, the people who are going to the service station to fill up their car, the people paying for their rent, the people using public transport, the people driving on the freeways—the millions of ordinary Australians and their world. The great English statesman, Benjamin Disraeli, said 150 or so years ago that between two nations there was no connection. At that time he was talking about the rich and the poor. There are two nations here between which there is no connection—between the government and the real people of Australia, because these costs are going up and we have not even got to the carbon tax.
What is the carbon tax going to do to Australians? Just today in question time we had an example of transport. What the government expects of their fuel excise over the next forward estimates is a $920 million increase in revenue. That $920 million is going to get passed on by every transport company that is transporting goods around this country. If we are talking about transport, consider the service station owner who has just tendered out for his electricity under this competitive arrangement and in the tender documents that came back there was a carbon tax component of $13,141. That represented just over 18 per cent on his annual bill, and yet we are being told that it will have only a few dollars impact. This one service station is faced with an 18 per cent increase on what is being projected for the carbon tax.
The City of Sydney will have to collect an additional $921,000 in rates and the cities of Wollongong and Blacktown will need to collect almost half a million dollars extra in rates. If anyone wants to check this, I make this suggestion: ring up your local council and ask them how much are they factoring in for the carbon tax in terms of their expenditure in the next year. I have spoken to my local councils and they are factoring in a very significant amount for what they will have to find. In other words, how much will rates go up because of this carbon tax?
I have mentioned just two things. One is transport costs for every good that is supplied and provided around this country, which flows through to food prices. It flows through to the goods that we buy from the shelves of shops which are usually trucked in from somewhere else around the country, often overnight. The other is the councils. When the street lights are turned on, when the waste is disposed of—all of that attracts a carbon tax. Somehow, these people come in here and pretend that this is not going to have an impact. But, as I said, you cannot be saying it impacts upon only 500 companies in this country and yet come in here with a motion which says there is an urgent need to talk about financial assistance to families—and they are spending $36 million on media advertising to sell this particular proposal—the one in which the carbon tax does not speak its name. It is hidden away in the budget as a nice little line item under the Department of Families, Housing, Community Services and Indigenous Affairs. That is on top of the $70 million this government is already spending on advertising. It is estimated that this government is spending something like $270,000 per day of Australian taxpayers' money in order to advertise this urgent need to provide financial assistance for something they tell us is not going to affect us.
This is a joke. It comes from a government that is not even a joke. This is a government that is dysfunctional and a Prime Minister who evades questions she is asked here in question time. This is a Prime Minister who told the unionists she was furious about a labour agreement and yet turned around and said she knew nothing about it. This is a totally dysfunctional government. I hope that some of the backbenchers in the Labor Party do go doorknocking, because what they will hear is that Australian people are totally fed up with this government, with the lies, with the dissembling and with the dysfunction. They want some security. It is about time we delivered hope and reward and opportunity to people of Australia and that will only come by having an election.
Mr PERRETT (Moreton) (16:05): It pains me in a way to follow the member for Menzies, who I used to share a corridor with and had quite a bit of time for. I was pained because I thought he had actually stolen my speech. When he was talking about the rise in electricity prices of 61 per cent, of water and sewerage by 50 per cent, of gas over the last four years of 37 per cent, I thought he had stolen my speech. It is difficult for me to use exactly the same information in my speech, talking about why we need to provide some relief for families. It is important that we do that in the context of putting in a carbon price on 1 July, because as the member for Menzies—I was going to say passionately—so vociferously put it—
Mr Andrews: Eloquently.
Mr PERRETT: I won't take that interjection. There are a lot of families in my electorate and in the member for Menzies's electorate who are doing it tough. In fact, that is why we have been putting money into the member for Menzies's electorate. In Menzies 6,000 families have received extra money over the last few weeks—more than $1 million for his families going into his communities that can then be spent as his electors see fit. There are 17,000 pensioners in Menzies who are receiving more than $3½ million that will then circulate through those communities, through those community organisations, through those clubs, through the business, all because of the Gillard government's commitment to look after those people who are doing it a bit tough. So if the member for Menzies wants to tell his 6,000 families that he wants to vote no to that money, if he wants to tell those 17,000 pensioners in his own electorate that they do not deserve this extra support in that context of rising electricity prices, he will have some explaining to do. My understanding is that the Commonwealth government does not actually own any power stations and it does not actually deliver any power to people. That is the business of state governments and private enterprises. We do not own any gas-fired power stations delivering electricity, or even any water plants.
But I do understand that when I go around my electorate, when I doorknock, when I talk to people at community functions about the mining boom and how great things are, the people in my electorate say, 'There might be a mining boom on but I am not experiencing it. There might be a guy down the street who works in the mining industry who is getting a new back deck and a new car, but I am not experiencing that.' You talk to builders and they say, 'If you do renovations and you are not building for someone in the mining sector, you are not building.' It is as simple as that. The reality is that it is a two-speed economy. If you are working in the tourism sector in Queensland, you know how tough it is. You go to places like Cairns where there is unemployment north of 14 per cent and you understand that there are households throughout Australia particularly in the patchy parts that need support.
But let us go back a bit and put the overall context for Australia. Let us remember the underlying facts here. We have a triple-A rating from all ratings agencies for the first time in Australia's history. Forget the doom and gloom, the jeremiah ads and the Hanrahans opposite; the reality is that we have got a triple-A rating. The rest of the world, the IMF and the World Bank included, say, 'Australia you are doing great!' It is admitted by those opposite when they are overseas. When they are overseas they say, 'Yes, we have got serious bragging rights. We have got a healthy economy. Things are going well.'
Imagine that conversation with the Spaniards where they have got youth unemployment nudging 50 per cent. Our overall unemployment has got a four in front of it—4.9 per cent. Sure, our cash rate compared to the rest of the world is a little bit different—we have still got a lot of room to manoeuvre—but it is significantly better at 3.75 per cent now than the 6.75 per cent it was one we came to power. The average family with a mortgage is $3,000 better off. The member for North Sydney, with his mortgage, a loan that he forgot to declare—and I think I have some information on his mortgage here; it was written up in the paper as $710,000—is about $7,000 better off per year, thanks to the policies of the Gillard Labor government.
We have got great investment pipelines of half a trillion dollars—and that is a term that you do not see used very often—of development and manufacturing and the like, particularly in mining, coming towards Australia. Retail sales figures came out today—and obviously things could be a bit better there. The balance of trade is the best it has ever been in the history of Australia. There is a bit more work to be done in productivity, but hopefully with some innovations and post the Queensland floods we will see productivity start to head in the right direction, particularly with the NBN. Obviously, that will be an advance in the future, with jobs of the future being via the NBN.
That puts the overall context of what Australia is like, but obviously we do need to do a lot to help households. So how are we doing it? For a start, we say yes to giving money to parents who have school kids, the 1.7 million Australians who have kids in school. There are people in the chamber who have children at school and they know how much this would be appreciated—not that they will be receiving this money. For primary school students it will be $410 each and for secondary students it will be $820 each. If you are a normal family with two or three kids, right now receiving that money will be of great benefit.
For families, if you are receiving family tax benefit part A, there will be $110 extra per child. What did the Leader of the Opposition say? He said no. Families receiving family tax benefit part B get $69 extra. What did the Leader of the Opposition say? No. The 3.2 million pensioners will receive upfront lump-sum payments—a lot of them right now and over the coming months in my electorate will receive the money. If they are singles, they will receive $250; if they are couples, they will receive $380 combined. Again, in March next year there will be a permanent boost to their pension payments. So, overall, the singles will receive $338 extra a year, and couples $510 extra a year. What did the Leader of the Opposition say? He said, 'We will claw that back. We will take that back.' He said no. So a single pensioner on the maximum rate is now $4,000 better off because of this Labor government.
Let us not forget the workers, the seven million Australians who in 31 days time will receive a tax cut. Everyone earning less than $80,000 will receive a tax cut. For most people it will be $300 a year—not to be sneezed at—but, if you are one of the lower-paid people, we are going to triple the tax-free threshold. It is a great thing to do. I thought the party of Menzies and the like would be in favour of tax cuts, but instead the Leader of the Opposition said no.
As for part-time workers, if they are earning $25,000, they will have an extra $500 in their pocket every year, and they will have that in the first week or so of July. When they go to the shops they will have more money in their pocket, more money in their wallet, from the very first pay packet. And, remember, if they earn less than $18,200, they will pay no tax at all.
Self-funded retirees—a very vocal group in my community who make sure that I know their concerns—who receive the Commonwealth Seniors Health Card, will also receive an upfront lump-sum payment in June to help over the coming time, because, as we do admit, the pricing signals associated with this pricing pollution will have an impact on people. We are trying to change behaviour. That is why there will be an impact. But they too will receive $250 as part of the seniors supplement. Obviously, the low-income households on $30,000 a year or a couple earning less than $45,000 a year could be eligible for a yearly lump-sum payment of $300.
In question time today, mention was made of an article in the West Australian by one of the Leader of the Opposition's colleagues, questioning his negativity, his ability to say no, no, no all the time. There was even a suggestion that some of his colleagues want to rehabilitate him in terms of his inclination to say no. Obviously that would be a very big project and obviously they have started that process. They tried to make him go to rehab but he said, 'No, no, no.' That is what he said. He was not even able to say yes to the pensioners in his electorate, yes to the families in his electorate, yes to the people in the low-income households in his electorate, or yes to the pensioners who need this $250 to $380 to help them with cost-of-living pressures. Instead, he relies on no.
Mr TUDGE (Aston) (16:15): I rise to also speak on this matter of public importance. It asks us to discuss the facts about the carbon tax. We on this side of the House are very happy about the facts about the carbon tax. In fact, we will talk about them day in, day out right up until the next election and beyond. The first fact we should know about the carbon tax is that it was introduced based on a lie. Every single one of us in this House, with the exception of the few Independents, went to the election in 2010 saying that we would not introduce a carbon tax if we were elected to this parliament. That was every single member on this side of the House and every member on that side of the House.
The Prime Minister famously said a few days before the last election that, if she was elected Prime Minister, there would be no carbon tax under a government that she led. It will be a statement that will follow her until the end of her political time in this parliament because that is the basis of the lie. This is the first fact that we need to discuss whenever we discuss the facts about the carbon tax.
The second fact that we should be discussing about the carbon tax is that it will have enormous economic pain on this nation at a time when we can least afford it. It will have pain in at least two ways. It will have pain by putting upward pressure on the cost of living and it will cause pain with job losses across the community. Let me address that first one about putting upward pressure on the cost of living for everyday families. You just have to look at the government's own figures. They have tabled the modelling to which the member for Chifley referred, and that modelling itself says that the carbon tax will cause electricity prices to increase by 10 per cent in the first year alone. That modelling says that it will cause gas prices to increase by nine per cent in the first year alone.
There is modelling from other independent agencies that say it will cause Australian made motor vehicles to increase in price by $400. There is modelling by the Master Builders Association that says that it will increase the cost of a newly built house in Australia by $5,000. We know of other modelling that says that rates will go up by at least one to 1½ per cent. In my own electorate, which covers most of the Knox municipality, they have already made the decision to increase rates by $1½ million for the residents of Knox due to the carbon tax. That is a 1½ per cent increase on the rates for every single residence across my electorate.
These price increases are when the carbon tax is at $23 per tonne in the first year. But we know that the carbon tax is legislated to increase to $29 per tonne by 2016 and that it is forecast to go up to $37 per tonne by 2020 and then up to an incredible $350 per tonne by 2050. We talk about the price impact today on electricity, on gas, on rates, on house prices and on motor vehicles, but what about when it gets to $29 or $37 or up to $350? The prices will just continue to go up and up and up and up. The previous speaker, the member for Moreton, said the whole point of this was to put up prices. That is the whole point of the carbon tax regime. It is actually to put up prices. At least the Prime Minister had the honesty to admit this when, back at the beginning of 2011, she said:
I want to be very clear with Australians about what pricing carbon does. It has price impacts, it's meant to—that's the whole point.
That is exactly right. It is the whole point that it puts prices up and these prices will go up across the board and they will continue to go up as the carbon tax goes up from $23 per tonne right up to $350 per tonne by 2050.
I mentioned the impact on jobs. We have also had some economic modelling done by the Treasury departments in Queensland, New South Wales, Victoria and elsewhere. In Queensland, under Anna Bligh's premiership, they did some modelling and said that the carbon tax would cost Queensland 21,000 jobs. In Victoria it would be 23,000 jobs according to the Victorian Treasury modelling. In New South Wales it would be 31,000 jobs.
Let us have a look at the government's own modelling and the aluminium industry figures in the government's package, which says that the impact of the carbon tax will halve the aluminium industry. But, in the government's own figures, perhaps the most astounding number of them all—and the government does not like to talk about this—is that between now and 2050 the carbon tax will decrease our GDP by $1 trillion between now and 2050. To put that into context, that is the equivalent of a whole year's worth of economic output between now and 2050. So, for every single Australian between now and 2050, one of your year's of work will just disappear because of the impact of the carbon tax. To suggest that it will not have any impact on jobs to lose a year's worth of output is, frankly, preposterous. But it is right there in the government's numbers.
Let me go to the third fact. I have pointed out the first fact about it being based on a lie and I have discussed the second fact about it having a tremendous economic impact in relation to cost-of-living pressures and jobs. The third fact in relation to the carbon tax is that the compensation will be insufficient for the carbon tax impact in very many cases. It will certainly be insufficient for all of the other price impacts which this government are having through their various other policies.
We know, for example, that, in their own words, at least 40 per cent of Australians will be worse off as a result of this carbon tax package. That includes, for example, a person who might be earning $90,000 as an electrician and who is married to somebody who is earning $30,000 as a part-time retail assistant. A family with those incomes would receive $306 in compensation, according to the government, but would be hit by $681 by the carbon tax—that is, they would be $375 worse off each and every year. And this, of course, is reliant upon the government modelling being accurate, when we know that in previous years the government's forecasts have been far from accurate. Two years ago they said that this year's deficit was going to be $12 billion and, of course, it has ended up being $45 billion. So we question whether that modelling will be correct.
There are, of course, an array of other areas where the government is putting upward pressure on prices. It is putting upward pressure on prices through the 22 other taxes which it has introduced in the last four or five years. It has been putting upward pressure on families' cost of living by reducing family tax benefits and eliminating the entrepreneurs tax offset. It is also changing the policy settings in child care, in the private health insurance rebate and in shipping reforms, which makes things more expensive. And, of course, in its macro settings it is making the economy less productive overall. The carbon tax, though, is the worst of it all. To address cost-of-living pressures we must get rid of the carbon tax and we must change this government.
Ms O'NEILL (Robertson) (16:25): I just want to put on the record that, while the member for Aston has spoken against the assistance that is going to families, for my part, in the seat of Robertson, I actually believe that my families really do want this money. I know that those who have already received it are extremely appreciative of the support from the federal government.
The member for Aston, opposite, has actually just made a speech against 9,000 families in his own electorate. That is 9,000 families that the member for Aston says do not need assistance with the cost of living. Now, I did hear some facts—a few facts—in the speech we have just heard about the real pressure that there is on families. We do acknowledge that there are cost-of-living pressures. That is why we are actually doing something about it and practically helping those people—even the 9,000 families in the member for Aston's seat, whom he seems not to want to help in any way.
Yesterday we started delivering extra money to more than 16,000 pensioners from that same electorate. I am sure that those pensioners will be very, very happy to receive that assistance to help them with cost-of-living pressures. I would like to make a comment about the small businesses in the seat of Aston, which could find that the pressure being taken off local families and off local pensioners actually does something—dare I hope for this—to inspire a little confidence and put a little positivity back into the public place instead of the carping, mindless negativity and the permanent nay-saying—the no, no, no, no—that we get day-in and day-out in this place from the Leader of the Opposition.
So let us get the facts straight—because this is a debate about facts, not hysteria. The member for Aston is telling 9,000 families and 16,000 pensioners in his electorate that they do not deserve extra support to make ends meet. He is telling them that if the coalition parties actually get into government that he and the Leader of the Opposition will rip off them every single cent that they have seen in their accounts this week. That is the fact. There is a very, very big difference between those on the other side—the take-it-away Tories—and the Labor Party, who are actually supporting people who live real lives in real seats like yours and mine, Mr Deputy Speaker.
I am delighted to speak today on the urgent need to provide households with financial relief based on facts surrounding the introduction of a carbon price on 1 July, and I very much thank the member for Chifley for putting this matter of public importance on the record. The Gillard government is building a strong economy for all Australians. We are making tough decisions that have to be made when you are in government. Sometimes in my role as a parent I do not always want to make tough decisions but, in the long term, there are moments where you have to make a choice. And we have made decisions that will ensure that we remain the strongest-performing economy in the world.
The facts are that unemployment is very low, inflation is very low and official interest rates are very low. In fact, for the first time in 40 years all of those indicators are under five per cent. That is a definite sign of a very strong economy, an economy in which Australians should have confidence and hope. But, while they are having a bit of trouble with managing the cost of living, we are going to help them—and we are going to do this despite the whimpering, the whining and the wrecking of those opposite. The thing that marks us out as so different from those opposite is that we actually do understand that families and pensioners are feeling the pinch. We understand that the relentless negativity campaign has only served to benefit the few—those on the opposite side who want to whinge day in, day out—while it has hurt business and consumer confidence. There is nothing good about that for businesses in my electorate and there is nothing good about that for ordinary families, pensioners and self-funded retirees in my electorate.
I am very proud to be a member of the Labor Party and the Labor government committed to helping Australians with the reality of cost of living pressures. We stand in stark contrast to those opposite, who assail the public with the same platitudes and negative comments, trash-talking the economy day in and day out. We understand that, by putting a price on carbon, 500 polluters are basically going to pay to put out the trash. That is the sort of trash that we should be paying attention to, not the trash-talking of the opposition. They are polluting, so they are going to pay—500 of them.
We know that businesses do pass on costs. That affects prices. The Treasury has made it very clear that there will be a 0.7 per cent price impact. Let's get this fact straight: we are making polluters pay. Let's get this fact straight: we are helping families in electorates right across this country, even if the members who represent them do not want them to have that money. We know for a fact that families in Robertson, my electorate, and all across the country deserve support. They do not appreciate all these hollow media stunts. We are giving the support—that is a fact. Another fact: how many households are we going to help? Under our clean energy future package, we are actually going to help six million households, who will get their expected average cost increases fully covered by tax cuts or increased payments, or both. The fact is that there will be changes to tax. So, if anybody is listening to this, remember that you will be benefiting from the tripling of the tax-free threshold. That means that one million people will not have to lodge a tax return after 1 July. Eighteen thousand two hundred dollars is what you will be able to earn before you have to pay one cent of tax. Imagine that. Imagine one million Australians not having to fill in a tax return. This is going to improve their lives, not just because, I am sure, they will be happy to not have to undertake that paperwork but because they will have more money in their pay packets every single week.
Let's get another fact on the record. Because of the Labor government's commitment to put a price on carbon, you get to keep every cent you earn up to $18,200. Another fact: in Robertson I have about 56,000 people who pay tax and about 47,000 of those taxpayers in my electorate are going to receive a tax cut. Of that 47,000, at least 38,000 will receive a tax cut of at least $300. I know that right now probably some mums and dads are on the Central Coast driving around, taking kids to sport—to soccer or AFL, with the Tigers at West Gosford—or maybe they are going to dancing lessons at Erina. One of the things that they will be thinking about is how they are going to make ends meet. They can be assured. The fact is that money is going into their accounts to assist them with the cost of living. Mums and dads who are returning to part-time work after the birth of a child and people who might be semi-retired and still want to work are going to have the factual advantage of money in their pocket because of the changes that we are bringing in.
More than 10,600 families in Robertson are going to receive extra cash through their family assistance payments. This will absolutely make sure that families on the Central Coast will be able to manage their family budgets. We want to take a bit of pressure off the family. We want to give families the best chance to get a good start in life. So we are helping them. That is a fact. Right across the country we are helping them. One point six million families are going to get assistance because of the price on carbon. If families get family tax benefit A, they will get $110 per child. If they get family tax benefit B, they will get $69 per child. In fact, most of the families in my electorate have already received that.
What have we heard from the Leader of the Opposition? He is going to get rid of the carbon price. He says that loudly, but do you know what? We do not hear that, when he does that, he is going to put his hand into the pockets of these millions of families and take away all of the assistance that we are giving them. We are going to see a massive impact if that comes to be, not only through a lack of vision for our country but through a real, practical, negative impact on people in the electorate of Robertson and right around this country.
We know that a price on carbon is the right thing to do. It is a tough thing to do, but it builds a future for this nation that gives us a strong economic base. We absolutely understand, as the member for Chifley stated in his matter of public importance today, that we need to deal in fact, and the fact is: families need assistance with the cost of living and we are delivering that. The fact is in their bank balances right now.
Mr McCORMACK (Riverina) (16:35): There is a word which must never be spoken in this place whenever Labor refers to carbon pricing. It is the word 'tax'. I call on those opposite to just once call this insidious policy what it is: a tax. A tax is a tax is a tax. In the days after the 2010 election, Julia Gillard gleefully shrilled, 'Let's draw back the curtains and let the sun shine in.' She was talking about the openness of government and the importance of Australians being fully informed about the decisions of their parliament and the government of the day. She said Labor was a party of truth tellers. If this rhetoric—this hyperbole, as she would probably call it—applies to anything, it should include the impact of the decision by the Prime Minister to introduce a carbon tax. Just five days out from the election, she said, 'There will be no carbon tax under the government I lead.' The Prime Minister has already broken that 16 August promise, that there would be no carbon tax, but this is no reason for us not to let the sun shine in by ensuring that all Australians understand the full impact of the carbon tax.
I point out the very wording of this matter of public importance. It talks about 'the urgent need to provide households with financial relief based on facts surrounding the introduction of a carbon tax on July 1'—a carbon price, sorry. I have used the word 'tax'. The member for Chifley would not use the word 'tax', but that is what it is. If there is such an urgent need to provide households with financial relief, why bring it in in the first place? Why burden families, farmers, businesses—ordinary, everyday hardworking Australians—with a tax the Prime Minister said, five days before the election, that she would not introduce?
But we all know that this government likes to tax. The regulator in New South Wales has confirmed that, thanks largely to the carbon tax, families and businesses will pay an average 16 per cent more on their electricity bills, adding between $182 and $381 to the average household bill. The federal government knows businesses will pass these extra costs on to their customers—you, me and all other Australians. The government claims to be compensating Australians with additional compensation but even its own modelling shows that millions of households will be worse off. The best way for citizens to know whether or not they are getting enough compensation is to ensure transparency—a word those opposite probably do not know the meaning of—in the price rises the people of Australia are going to be hit with. But there is nothing transparent about this government.
Their latest compensation for the carbon tax is nothing but a con. This is a carbon tax Australians did not vote for. Hardly anybody in this place voted for it. The member for Melbourne certainly came to the election with a view that a carbon tax or an emissions trading scheme—call it what you like—was necessary. I often hear the member for Lyne grumbling behind me and saying, 'It's not just the member for Melbourne.' Maybe he too was in support of it. That is two out of 150 representatives in this place. The rest of us were against it. The rest of us went to the people at the election saying that there would not be a carbon tax under the government we were in. The regional independents have sold out their constituencies by siding with Labor and the Greens and propped up the government. On 24 February 2011 we had that awful press conference where Senator Bob Brown, the Greens leader and quasi-Prime Minister at the time, almost shouldered Prime Minister Gillard out of the way and proudly announced that there was going to be a price on carbon—a tax.
Labor can try to make itself feel better about the burden it is placing on Australia through the introduction of this tax but it should not. Every Labor member—members who claim to represent the disadvantaged members of society and some who even claim to represent regional areas—should be ashamed of the cost they are lumping on everyday, ordinary Australians. They are making people disadvantaged. The best way—in fact, the only way—to ensure that Australians are not crippled by this terrible, insidious tax is to scrap it. The claim that this compensation will assist Australians with the financial pressure they will feel under a carbon tax is sheer nonsense. It is a ridiculous money-go-round. It is wealth redistribution by any other name. Many dual-income families will be worse off once they reach the typical income of a school teacher and a shop assistant or that of a policeman and a part-time nurse. Self-funded retirees who do not qualify for a Commonwealth Seniors Health Card, including all those under the age of 65, will receive nothing. For what? It is not going to reduce the sea levels or change the shoreline by so much as a millimetre. It is not going to drop global temperatures by so much as a degree. It is just a nonsense. The longer this tax is in place, the worse the consequences will be for the economy, jobs, families and, certainly, regional Australia. The compensation simply will not be enough to outweigh the extra costs Australians will be hit with.
Australia will pay the carbon tax through higher electricity prices. The member for Robertson talked about people who would be driving their kids to sport—and they would be. In her electorate of Robertson they would also be driving them to dancing practice and those sorts of things. The member for Robertson represents an area which is under 1,000 square kilometres. My area, the Riverina, is over 60,000 square kilometres and I know that people in my area are going to be paying this carbon tax through the petrol bowser, as will the people in the member for Robertson's electorate. When people travel for sport, dancing classes and all those sorts of things in the Riverina it is not just a little drive down the road. Sometimes it takes hours to get from point A to point B to have a game of footy for the kids or dancing competitions for those young ones who enjoy it. Unfortunately, those young ones who enjoy their footy and their dancing may well not be able to do that, because for some families the cost pressures will be too high.
This carbon tax is going to be paid for by everybody: through the power point, the bowser and—certainly in Wagga Wagga, Coolamon shire and Griffith—through their rates, because their rubbish tips are deemed to be over that threshold limit of 25,000 tonnes. Following this year's deferment by the Treasurer, they are eventually going to be forced to pay a carbon tax through their rates. That is just totally ridiculous. I could do no better than to quote an article from the Daily Advertiser, Wagga's local newspaper. They have called for heavy polluters to be punished, not everyone. As the Daily Advertiser quite rightly pointed out, it is just a load of rot that the local ratepayers are going to be forced to pay a carbon tax because they have to take rubbish to their tip. Wagga Wagga City Council is now going to be put right up there with Orica, BHP Billiton, Xstrata and the rest as one of Australia's biggest polluters. When you think about it, those companies that I mentioned are not 'biggest polluters'—they are job creators. They are taking jobs to the people, taking resources out of the ground and creating wealth for this country, and they are being hammered by the government over there which is only interested in creating class warfare that is not needed.
Recently, Wagga's annual emissions were reduced to 28,000 tonnes per year. This is good news for Wagga because, instead of having to pay over a million dollars in proposed carbon tax payments, they are only going to have to pay $660,000 in the year after next. That is $660,000 that will not be spent on fixing potholes, on children's playground equipment or on libraries. That is ridiculous. As Tim Blair pointed out on Monday 14 May in the Daily Telegraph:
One tonne of rubbish, according to the government, generates one tonne of carbon tax windfall gas. You might want to ask your own council how many tonnes of rubbish it's piling up every year. If the amount is close to the 25,000 tonne tax threshold, you'd actually be doing the council a favour by throwing your old mattresses and televisions in the river. Dump car bodies in the scrub and save the town library.
Is that what we want from this government which purports to be so environmentally friendly? Is that what we want from this government which is cobbled together by the Greens here in the lower house and definitely in the upper house, where they are led by the nose by Christine Milne and all the rest, and Adam Bandt? It is a disgrace that we have to have a carbon tax when the Prime Minister said five days out from the election that there would be no carbon tax under the government she led. It is an absolute con. It is a disgrace, and those members opposite know it.
Mrs GRIGGS (Solomon) (16:45): I rise to talk on this matter of public importance because I think the public does have a right to know exactly what is going on here. What we know is that this government is being very coy with the facts. Let us remember it was this Prime Minister who said, 'There will be no carbon tax under the government I lead'—a solemn promise that she made to all Australians at the last election. Here we have less than a month until we have a carbon tax. This is a government that is spending $270,000 a day—$36 million—on advertisements about the carbon tax. It talks about the cash bribes but does not actually mention what they are about, but the public knows it is all about the world's biggest carbon tax, Labor's toxic carbon tax.
Everyone knows that Labor's toxic carbon tax will cascade right through the economy, and that is why Labor are desperately out there spending up and calling it compensation. Despite Labor's lie that only the big emitters will pay the price, the cost of virtually everything will go up and up and up. We know it is not just the big emitters; it is everyday Australians who will pay the price for the carbon tax. Like many Australians, I am very concerned about the increases in electricity, petrol prices and the council rate increases that Territorians and, indeed, all Australians will face from 1 July because of the Gillard Labor government's carbon tax, which will cause us to have the world's highest electricity prices.
Australian household electricity prices have already increased by 40 per cent since 2007 and are predicted to go up by at least another 10 per cent in the first year of the carbon tax. Fact No. 1: Territorians will be slugged more for electricity because Power and Water, our only electricity provider, was included on the carbon tax hit list. It is considered one of Australia's biggest polluters, providing electricity to 200,000 plus people. From 1 July Territory families will be slugged on average an extra $2.61 a week for electricity under the carbon tax. Territorians will clearly be worse off under the carbon tax, and the carbon tax compensation being handed out will not be enough for many families.
The government's own figures indicate that thousands of Territorian households will be worse off under the carbon tax. Their own figures indicate that 40 per cent of Australians will not receive compensation. Let me share some examples with you. Tiffany V, a constituent of mine, last week told my staff she received a text message to say that she has had $69.35 paid into her account as part of the household assistance payment. This is her quote: 'Honestly, Labor Party, that tiny amount going in to help with your carbon tax? Stop kidding yourselves.' She then went on to say that her latest power bill jumped by $250, her most expensive bill yet—and the carbon tax is not even there.
We all know that the carbon tax will act as the wrecking ball across the Territory economy and Territorians will be paying for it through increased prices, higher energy bills and pressure on local businesses that are already experiencing high cost of living pressures.
I have spoken in this place many times about petrol and how this carbon tax is a tax on remoteness. Everything in the Northern Territory is freighted in. We are completely and utterly dependent on freight and freight companies. Everything from fruit, veg and general groceries to building materials is transported into the Territory by road, rail or air. There is a lot of this freight that comes in by diesel road trains, and we all know that that will be affected by the carbon tax. This toxic tax is definitely a tax on remoteness.
Do not take my word for it. I have a letter here from Toll, which is putting Territorian customers on notice that freight costs are likely to go up because of the carbon tax. This is not going to be a good thing for Territorians. Our cost of living is already high, and Territorians tell me every day that they do not support a carbon tax. They tell me that a carbon tax will not do anything for the environment. It will only push up cost of living pressures—something that Territorians are already struggling with.
Lyn, another constituent of mine, says she is worried about the electricity and whether she will be able to afford the increase of $2.61 a week under the carbon tax. She is married with no children and will not receive any compensation. I have also heard from Palmerston residents Megan and Scott Smith, who have three children, a mortgage and a dog. They have done the figures, and the carbon tax compensation that they get will not cover their costs. They tell me they already forgo meat on a regular basis because it is too expensive, so any further cost increases will be detrimental to them. Then there are John and Sarah, who are a single-income family with two children under five from the northern suburbs. They have worked out that the compensation simply will not be enough to outweigh the extra costs that they will be hit with. Their household salary is $85,000. Or there is northern suburbs construction worker Clint and his public servant wife. They have one son, a mortgage and two dogs, and they are a typical family. Combined income for them is $130,000 a year, so they are not eligible for any carbon tax compensation. Fishing is their favourite family pastime, but they fear that it may be jeopardised because of the carbon tax and the extra increases in fuel. They do not consider themselves rich; they consider themselves average, hardworking Territorians who want a fair go, and they want to be properly compensated by this government. They do not want a carbon tax.
Every day I am told how people in my electorate are worried about meeting their home loan repayments and that the Gillard Labor government is now making people pay more for energy, fuel and food because of the Prime Minister's carbon tax lie. Hardworking families are already doing it tough. How are they going to budget for another few hundred dollars in their spending?
What about small business? Small business is, as we know, the engine room of our economy. The Territory's small business operators are worried that this toxic carbon tax will spell the end for them. Small businesses will receive no compensation for the carbon tax, and they are in the firing line with average weekly cost increases of $15.80 from the carbon price and $13.38 through an increase in power and water charges. Of course, small businesses will be forced to pass on these added expenses to the consumer, and the business owners tell me that they are burdened by a drop in consumer spending.
This government does not understand that, if businesses are hit by the carbon tax, of course they will have to pass it on, and that that means everyday Territorians will be paying extra for electricity, food and fuel under a carbon tax. I have spoken to private airline operators, builders, building equipment suppliers, fish-and-chip shop owners, grocers, butchers, florists and market stall owners, and they have all told me the same thing: this tax will make their costs go up and they will have to pass on these costs to everyday Territorians.
I was very concerned to hear that this tax will be the final nail in the coffin of some businesses. A few weeks ago, a local business operator who employs 13 people and who earns around $85,000 a year wrote to me saying that Julia Gillard's 'lie' will hurt his business. He is 59 years old, and his wife is 70. She cannot receive a pension because he works, yet, like most Territorian families, they still have a mortgage. He wanted to know why he was not eligible for the welfare gift, and he is angry that Julia Gillard and Wayne Swan consider him to be rich. He told me that he does not know how he will manage his operating costs or how he and his wife will survive. These are real-life Territory examples of people who are doing it tough and who are genuinely concerned about the Gillard Labor government's carbon tax promise.
As I have said time and time again in this place, families will be better off under a coalition government because we will remove the carbon tax and deliver real tax cuts. Only a coalition government will give Australia hope, reward and opportunity, because we on this side of the House do not support a carbon tax. Only a coalition government will deliver to Australians an Australia free of a carbon tax.
BILLS
Corporations Amendment (Proxy Voting) Bill 2012
Tax Laws Amendment (2012 Measures No. 3) Bill 2012
Income Tax (Seasonal Labour Mobility Program Withholding Tax) Bill 2012
Tax Laws Amendment (Income Tax Rates) Bill 2012
National Health Amendment (Pharmaceutical Benefits Scheme) Bill 2012
Reference to Federation Chamber
Mr FITZGIBBON (Hunter—Chief Government Whip) (16:55): by leave—I move:
That the bills be referred to the Federation Chamber for further consideration.
Question agreed to.
COMMITTEES
Public Accounts and Audit Committee
Report
Mr OAKESHOTT (Lyne) (16:55): I ask leave of the House to present executive minutes received by the Joint Committee of Public Accounts and Audit.
Leave granted.
Mr OAKESHOTT: I present executive minutes received by the Joint Committee of Public Accounts and Audit relating to: (1) Joint Committee of Public Accounts and Audit Report 428, Review of Auditor-General’s Reports Nos 16 to 46 2010-11 from the Department of Finance and Deregulation, the Department of Education, Employment and Workplace Relations and the Department of Immigration and Citizenship; and (2) Joint Committee of Public Accounts and Audit Report 426, Biannual Public Hearing with the Commissioner of Taxation from the Australian Taxation Office.
BUSINESS
Orders of the Day
Mr OAKESHOTT (Lyne) (16:56): I move:
That Federation Chamber order of the day, Private Members Business No. 26, motion relating to Microbrewery refunds, be returned to the House.
Question agreed to.
Withdrawal
Mr OAKESHOTT (Lyne) (16:57): by leave—I move:
That Federation Chamber order of the day, Private Members Business No. 26, motion relating to Microbrewery refunds, returned to the House in accordance with the resolution agreed to this day be discharged.
Question agreed to.
BILLS
Broadcasting Services Amendment (Digital Television) Bill 2012
Report from Federation Chamber
Bill returned from Federation Chamber without amendment; certified copy of bill presented.
Third Reading
Mr RIPOLL (Oxley—Parliamentary Secretary to the Treasurer) (16:58): by leave—I move:
That this bill be now read a third time.
Question agreed to.
Bill read a third time.
BILLS
Clean Energy Finance Corporation Bill 2012
Clean Energy Legislation Amendment Bill 2012
Clean Energy (Customs Tariff Amendment) Bill 2012
Clean Energy (Excise Tariff Legislation Amendment) Bill 2012
Second Reading
Cognate debate.
Debate resumed on the motion:
That this bill be now read a second time.
Mr BUCHHOLZ (Wright) (16:59): I rise to speak today in relation to the Clean Energy Finance Corporation Bill 2012, the Clean Energy Legislation Amendment Bill 2012, the Clean Energy (Customs Tariff Amendment) Bill 2012, and the Clean Energy (Excise Tariff Legislation Amendment) Bill 2012. Once again the government has sought to mislead the Australian people. I speak on behalf of the people of my electorate of Wright, whom I represent, because I aim to make every effort to ensure that they are made aware of the inherent deception that is the perpetual action of this Gillard government.
The carbon tax was legislated in 2010 in a package of 13 bills—a $23 a tonne tax, rising at 2.5 per cent per year in real terms to be replaced by an emission trading scheme from July 2015. With reference to the trading price, the floor price will come in at $15 and that will take us through to the year 2018. Treasury's own modelling tells us that by the year 2020 the carbon price will be at $37. I bring to the House's attention that I believe that the global price for carbon today is around $4.50. However, may I remind you that the Clean Energy Finance Corporation Bill was not part of this package and has been introduced as a stand-alone piece of legislation. The bill establishes the board of the Clean Energy Finance Corporation, giving it a statutory responsibility for decision making and management of the corporation's investments.
As a parliament we have a duty of care to appropriate funds diligently. The vertical integration of funds—how they will travel through this organisation—will mean that the government will go to the market and raise money from the bond market. That, in turn, will be given to the CEFC. From there it will go on and fund projects. The government tell us that the returns from those investments will then be reinvested back into the CEFC.
I want to bring the parliament's attention to the potential make-up of the CEFC, the board and the directors, and draw an analogy. Because the finance corporation is an off-the-government-books investment, not that dissimilar to the NBN, it is not beyond the realms of possibility that the remuneration packages that are potentially available to the directors of this organisation could be similar to the NBN. For those of you who may not be aware of what those packages are, the No. 1 bloke in the NBN is on a salary package of about $2 million a year, which I think is outrageous. There are eight—
Mr Ripoll: They should be paid the same as politicians.
Mr Turnbull: You've persuaded Bernie already.
Mr BUCHHOLZ: I would be a starter too, if I could get the gig! There are another eight non-executives on an average of $818,000. When we start looking at remuneration packages of $2 million and an average of $818,000, I take real offence at what we pay the office of Prime Minister. Irrespective of whether we believe she is doing a good job, it makes a mockery of that process when we have an organisation running a budget of $10 million as opposed to the economy of the nation.
I draw to the parliament's attention a situation that happened in Queensland, which also troubles me, which we could draw an analogy from to this organisation. About five months before the recent state election the Queensland racing board took it upon themselves to renew their contracts for five years. They wrote into the terms of the contract that in the event that they were disbanded as a board they would be given a golden handshake and the five-year term would be fully remunerated.
I have concerns that when we are going to the market looking for potential directors or people to head up this CEFC, the income coming into that organisation will be over a five-year period with lots of $2 billion per year. So you will get $2 billion in the first year and $2 billion in the second, through to the fifth year—a total of $10 billion. I would be absolutely horrified if we were signing up directors with the intent that they would do the full five years on potential salary packages of $2 million, or at the minimum $818,000 if we use the comparison of the NBN remuneration package.
We are on the public record as a coalition stating that we will rescind the carbon tax . So this organisation will then be disbanded. The revenue streams that will come in in the first year are $2 billion. I would encourage the government, when they are going to the market for these players, not to embarrass themselves and not embarrass the directors by locking them into five-year contracts, because we will shut this show down. And I do not want to be putting my hand into the coffers of hard-taxpaying men and women of Australia to pay out a director's fee of $2 million per year over five years—$10 million—for one year's work.
That is something that may have been overlooked in consideration. How could that have been overlooked? Maybe it was overlooked because we were given 2½ hours consideration at the Economics Committee, when witnesses were called to give evidence. I just make the point that there was not enough time to complete the due diligence that this process deserved.
During the inquiry we were told overwhelmingly that there was extensive consultation. I put it to this House that in the extensive consultation that was supposedly undertaken by expert panels they forgot to ask one group of people whether they wanted the carbon tax. That group was the Australian people. The Australian people were not asked if they wanted to sign up to the carbon tax.
Go back to a couple of days before the last election—it is the Achilles' heel of this government—when the Prime Minister stood in front of the camera, looked down the barrel and said, 'There will be no carbon tax under a government I lead.' Why was that statement made? We all watched the polls. We all know how the polling was going. The polling was heading on a downward trajectory. It was a very close election. That single comment turned the election phase around. Do you know why? It was because the people of Australia trusted this Prime Minister. History has now shown that you cannot trust this Prime Minister.
So, with reference to the remuneration for directors of the new CEFC, I send a very blunt message to the government and to those people who will be sourcing the directors: do not sign up anyone on five-year contracts, because we have made it perfectly clear that when in government we will be dismantling this. The bill gives the Clean Energy Finance Corporation the power to invest in projects for the development of Australian based renewable energy technologies, low-emissions technologies and energy efficiency projects; the power to enter into investment agreements itself and make investments through subsidiaries; and a duty to ensure that, as of 1 July 2018, half of the funds invested at that time for the purposes of its investment function are invested in renewable energy technologies. On the back of that comment, what this organisation will potentially be funding is sub-economic projects. Those are projects that the commercial market has not found to have a suitable risk rating to invest shareholder, bank or merchant funds in. The risk ratings on these are just too high. I understand that the whole concept of this body of funds is to try to attract those higher-risk organisations—but with that comes a risk factor.
When we had the opportunity to question Treasury and the Climate Change Authority on the risk factor, they were rather oblivious. Whilst they had some provision for risk, I think, coming from a commercial background and having seen the number of businesses that have exited this market since 2007, it is timely that as an opposition we put under the microscope what the return on the investment will be.
The bill also establishes the Clean Energy Finance Corporation Special Account and appropriates funds which total $10 billion over five years, with the first instalment of $2 billion due to be paid on 1 July 2013. The account has the purpose of making payments to the Clean Energy Finance Corporation and to the Australian Renewable Energy Agency. The Clean Energy Finance Corporation is intended to be self-sustaining once it matures and therefore any funds returned to the Clean Energy Finance Corporation from its investments will be available for reinvestment. If money is being borrowed from the bond market at, say, three to four per cent, and the government then hands that on to the CEFC, who then invest in the projects, I would suggest that R&D will not give an enormous return on investment. Due to the vertical integration and how this is being set up, I do not see a lot of return on investment coming out of that market. I may be proven wrong.
Mr Ripoll: History may have already done that.
Mr BUCHHOLZ: Go your hardest. What we have been told with reference to this is that there will be a return on investment. My point here in the House is that that will be limited. The government's own bill already envisages a loss to this taxpayer through this investment due to operating costs and write-downs—or, what we would call, failed projects—as set out in the fiscal impacts. With reference to return on investment, I think they are looking to write off forecasted amounts of up to $600 million. In the electorate of Wright, where we were devastated with the recent floods, I could do a lot with $600 million. That amount would take a lot of the pressure off the Toowoomba Range crossing. It would go a long way towards rebuilding the communities of Lockyer Valley, Murphy's Creek, Grantham and surrounding communities. It would help in Mt Sylvia, where the telecommunications network was destroyed, just to get back to where we were. So $600 million seems a big gamble, a big punt.
It would seem that spending $10 billion on renewable energy would get you something. What is proposed here is that the government will spend $10 billion and that that will generate some form of new renewable energy. The problem, however, is that, before this bill, there was a 20 per cent renewable energy target and now, after the $10 billion included in this bill is spent, there will still only be a 20 per cent renewable energy target. We believe that, if we had worked cooperatively and co-invested with the market, with those who were already at commercial stage, we could have met our objectives far more successfully than through pursuing high-risk, low-return programs.
This bill is economically irresponsible and unlikely to achieve its stated aims. I hope for the government's sake that it does reach its aims—I genuinely do. It is an enormous amount of money. But I suggest, coming from the commercial background that I do, that not many of the ducks are lining up on this project. I say that with all sincerity. Not only is the carbon tax a bad piece of policy; it is the product of an unprecedented deceit and it is an impost on the Australian people. This is money that comes from the teachers, carpenters, farmers and nurses from my electorate of Wright—people who work each and every day to pay their taxes. Their money will be wasted on this.
I want to bring to the attention of the House comments from Twiggy Forrest in his recent address at the National Press Club. He likened the government's handling of the carbon tax to a couple of blokes buying a Melbourne Cup racehorse that had the potential to make them millions and millions of dollars and then, rather than racing the horse for the second time to get their dividend, celebrating after the first race by eating the horse. Those words came from Twiggy. Yes, he has a vested interest in the mining resources sector, but it was an interesting analogy for the government's handling of funds.
The government are going to talk about how successful they are and how successful this tax is going to be. But let me remind you, Madam Deputy Speaker, that it was the coalition that created, developed and implemented the mandatory renewable energy target—successfully; it was the coalition which created, developed and implemented the then equivalent of the solar PV rebate—successfully; and it was the coalition which created, developed and implemented the solar hot water rebate—successfully. We have proven ourselves when it comes to handling the commercial and financial decisions of government. The majority of us on this side come from business backgrounds. We come from places where balance sheets are a basic factor in making decisions on a daily basis. When we make a wrong decision, it hurts us in the hip pocket. So we are a lot more diligent when it comes to making decisions on behalf of the nation and spending other people's money. I would suggest that the other side of politics, the Labor government, do not have the same skill set.
In closing, I draw on the words of the previous leader of the Liberal Party, who said one of the problems with the Australian Labor Party is that they have a very shallow gene pool.
Mr VAN MANEN (Forde) (17:14): I rise this afternoon to speak on the bills related to the Clean Energy Finance Corporation—another wonderful boondoggle from this government which will see $10 billion of Australian taxpayers' funds put at risk. I would like to refer to a book titled The False Promise of Green Energy and to paraphrase a little bit from it. The authors make the point that the proponents of green energy would have us believe that if we spend enough money to build windmills, add solar panels to the desert and stuff insulation into buildings there will be myriad benefits for very little risk. The end result is that billions of dollars are borrowed or, in this case, appropriated via the world's most expensive carbon tax from ordinary Australians. They have this confidence that the savings in energy, the environment and health costs will actually be achieved, but given this government's track record I have very serious concerns as to whether that will be the case.
According to the Clean Energy Finance Corporation's website, the objective of the CEFC is 'to overcome capital market barriers that hinder the financing, commercialisation and deployment of renewable energy, energy efficiency or low emissions technologies'. This is not the job of government. The job of government is to get out of the marketplace and let the marketplace sort the wheat from the chaff. This set of bills gives the CEFC the power to invest in financial assets for the development of Australian based, renewable energy technologies. These are projects that by their very nature, and according to what the CEFC website says, are uncommercial in nature. Why would we be putting at risk the hard-earned money of Australian taxpayers—mums and dads, small businesses, corporates—by putting it into projects that have a high or very high risk of failure? The risk is high enough such that our commercial lenders and funders and even private equity investors do not want to touch it.
As the member for Wright pointed out in his contribution to this debate, we should be looking instead to provide support to the people that are already there, that have a proven commercial project and are going to add value to that project and to our economy. Part of the Clean Energy Finance Corporation Bill sets out the parameters for the CEFC special account, which will receive $2 billion per annum in funds for the next five years, with the first instalment due to be paid on 1 July 2013. It has the purpose of receiving the payments that will ultimately be invested into these projects.
I think it is worthwhile to have a look at those who have a track record in this area, and that was the previous coalition government, which committed approximately $20 billion to a comprehensive range of measures to restore and protect our natural environment and invested $3.5 billion in policy actions to address climate change. Those actions included: the implementation of the world's first mandatory renewable energy target, which has stimulated $3.5 billion worth of investment in renewable energy technologies since 2001; the establishment of a $4,000 rebate to help families install solar panels in their homes and then the doubling of that rebate to $8,000, before it was scrapped by the Labor government; the provision of $126 million to establish a national climate change adaptation centre; and the provision of $10 billion for the National Plan for Water Security. We place a great deal of emphasis on a strong and effective policy in dealing with environmental degradation and carbon emissions.
The coalition are committed to a climate change strategy based on our direct action plan to reduce emissions and to improve the environment. The direct action plan would cost an average of $800 million a year for the first four years. This compares with more than $1 billion a year that was set aside for the pink batts program over the two years of that failed program, so direct action will actually cost less than the pink batts scheme. To facilitate direct action, an emissions reduction fund would be established to support emissions reduction activities by business and industry, with a goal of 140 million tonnes of abatement each year by 2020, equating to the five per cent target which is shared by all in this House.
It is interesting to note that under the government's proposed carbon tax, emissions are still going to increase and that in order to offset that increase we have to purchase carbon permits from offshore. As a country that is already a net importer of capital, why would we be looking to purchase carbon permits offshore which rob our future generations of wealth? We would be receiving income from export revenues and then sending money offshore again to buy carbon credits. It makes absolutely no economic sense whatsoever.
The coalition's proposed emissions reduction fund will ensure that every dollar of expenditure goes towards actually reducing CO2 emissions. Direct action will not add any additional costs to households. There will be no new taxes. There will be no pressure on—
Ms Owens: Is that a magic pudding over there?
Mr VAN MANEN: Yours is the magic pudding. As I said, there will be no new taxes as a consequence of the direct action policy. However, under this Labor government we face a new tax, effectively the world's biggest carbon tax and the most expensive one. Taxpayers will also end up paying for a suite of new bureaucracies, one of which is the Clean Energy Finance Corporation. This is because for every dollar of carbon tax revenue collected, only 55c is being returned in compensation. The $10 billion Clean Energy Finance Corporation has been exposed as 'inherently wasteful', achieving 'precisely zero' in terms of real CO2 savings under a carbon tax. This conclusion has come from Centre for Independent Research Studies Research Fellow Dr Oliver Marc Hartwich, who released the report, A waste of energy: Why the Clean Energy Finance Corporation is redundant.Dr Hartwich said:
The physical effect of energy subsidies is precisely zero in an environment where the total emissions are pre-determined by a trading scheme. Not a single gram of carbon dioxide is saved by pumping money into renewables.
Ms Owens: So it's not a tax, then—it's a trading scheme now?
Mr VAN MANEN: No, you are introducing a carbon tax. What we are saying is this $10 billion that you are putting in is going to have no benefit. That is what we are saying. I appreciate the interjections from those opposite, but, as usual, they do not contribute much to the debate.
As we have seen from this government's track record, we do not expect that the $10 billion will be successfully invested and, even if it was, which as I said is highly unlikely, there would be no new renewable energy generated as the target will still be 20 per cent.
In total, through Senate estimates and the government's own documents, we know the Clean Energy Regulator will cost $256 million over the four-year forward estimates, with around 330 staff expected to be appointed. That is on top of the staff and costs associated with the $10 billion Clean Energy Finance Corporation, the $3.2 billion Australian Renewable Energy Agency and the $25 million Climate Change Authority.
The CEFC is also not charged with investing in the lowest cost technologies to produce the cheapest emissions reduction. Its responsibility is to find the technologies which the market considers to be unproven, too speculative or too risky for commercial financing. This will mean that not all investments will produce a commercial return; the CEFC sets itself up for failure before it even begins.
It will not be the first time we have witnessed failures of this nature. For example, the government's $700 million Solar Flagships Program in Moree and the Queensland Solar Dawn projects struggled to gain industry support. The Bligh government presided over more than $100 million of losses in the ZeroGen project, despite clear warnings from both the opposition and experts. Former Queensland Premier Beattie even said that the shadow minister for energy and resources was 'on drugs' for his warning that ZeroGen would fail. But as we all know, the shadow minister was in fact correct. The CEFC also has many of the hallmarks of the Victorian Economic Development Corporation, which left Victoria in a disastrous state only two decades ago.
Programs like these tell a similar story in the United States. The failures of the $700 million Solyndra project, as well as those of Beacon Power and Ener1, occurred under a similar program to the CEFC. These companies were recently joined by the collapse of Solar Trust of America, which had a $2.1 billion loan guarantee from the US energy department. I recently read that President Obama spent $90 billion of his stimulus package on green energy projects, yet at the end of the day only some 16,100 people landed jobs in the so-called new green industry. That is a cost of some $5.6 million a job.
Direct action is what is needed in my electorate of Forde. A carbon tax and a Clean Energy Finance Corporation will do nothing to resolve local issues with respect to the water quality in the Logan and Albert rivers and other environmental issues. I grew up near the Logan River at Waterford and we spent plenty of time swimming and fishing in the river. These are not activities that I would undertake or recommend today, given the recent water quality reports. There is only one way to solve the issues with the water quality in our rivers and waterways and that is by protecting vital areas of biodiversity for future generations. This is a practical, sustainable, long-term measure that can be implemented from the ground up. That is what our Direct Action Plan is designed to do. There is not a single dollar of carbon tax money allocated to practical, on-the-ground environmental projects.
Ms Owens interjecting—
Mr VAN MANEN: I know the member for Parramatta finds this funny. That is a sad indictment on where this government is at. Under a coalition government we have demonstrated that we can deliver practical, on-the-ground solutions for environmental projects. One of those was our successful Green Army scheme. We will look to reintroduce the Green Army to tackle environmental issues, such as the Logan and Albert rivers in addition to planting trees around the nation to improve local environments.
I mentioned during the debate on the clean energy bills that it is the height of ignorance to believe that we as a society can control global climate change via a tax on carbon dioxide emissions. It is just as ignorant to believe that the CEFC will produce one watt more of renewable energy by 2020 as a consequence of this $10 billion being spent. The CEFC also says it will not provide grants. It is intended to be commercially oriented and to make a positive return on its investments. Given we are investing $10 billion of Australian taxpayers' money, I would certainly hope that it is focused on achieving positive returns on its investments and that they are significant, given the uncommercial nature of those supposed investments.
As this bill presents itself as an extension of the carbon tax, we will oppose its implementation. An economy-wide, wealth-destroying carbon tax, along with its suite of bureaucracies that provides no practical, on-the-ground environmental outcomes, is not the solution for the future of this nation.
Mr HARTSUYKER (Cowper) (17:29): I welcome the opportunity to speak on the Clean Energy Finance Corporation Bill 2012 and cognate bills because this legislation before the House tonight epitomises why Australians have lost faith in this government. Since its election to government at the end of 2007 the federal Labor government has presided over one program debacle after another as they have recklessly mismanaged billions upon billions of taxpayers' dollars. We have seen billions wasted and lives lost over the Home Insulation Program. We have seen billions wasted on school halls as infrastructure was priced at up to three times the commercial rate and it was thrust on to schools whether it met their needs or not. We have seen the government commit $50 billion to the National Broadband Network without a cost-benefit analysis, only after their first attempt at a $4.7 billion broadband plan failed to secure a tenderer. Indeed there are a number of similarities between the content of these bills and the legislation relating to the National Broadband Network, but I will return to those matters later in my contribution. But the bottom line is that this legislation has all the hallmarks of what is wrong and dysfunctional with this out-of-touch government.
One would have thought after all of these funding debacles the government would have taken a step back and questioned the way they draft policies and the way they implement programs. But not this government. If you believe the BER program was pink batts on steroids, and if you believe the National Broadband Network is the BER on steroids, then I am sad to say that the Clean Energy Finance Corporation bills are the NBN on steroids when it comes to losing money. The reality is that by tabling these clean energy bills the government has shown it is intent on arrogantly pursuing poor public policy that will leave the long-suffering Australian taxpayer with a multi-billion-dollar debt.
It is also clear that the government is willing to trash democracy and not give the Australian people a chance to vote on a major public policy issue that Labor did not take to the election. The Prime Minister told the Australian people, 'There will be no carbon tax under a government I lead'. Yet on 1 July the world's biggest carbon tax will be introduced and a $10 billion free-for-all will be created without the Australian people having the ability to cast their judgment on it through an election.
It is extremely amazing that the alarm bells are not ringing loud within the government, based on their atrocious record of financial recklessness and mismanagement. It is also negligent for any of the Independents who sit on the crossbenches to embrace the merits of these bills when the legislation has been drafted in a way that repeats all the mistakes that this government has made over the past 4½ years. Under this legislation the Clean Energy Finance Corporation will be established with the power to invest in renewable technologies, low emission technologies and energy efficient projects. It will have the power to enter into investment agreements itself or make investments through subsidiaries. And how much funding is to be set aside for the Clean Energy Finance Corporation? Two billion dollars. Yes, $2 billion will be set aside every year for five years. That is a total of $10 billion. While the government spouts that the Clean Energy Finance Corporation will have to deliver a return on this $10 billion investment, the reality is quite different. In fact, Treasury have officially confirmed to a parliamentary committee that they expect to lose up 7½ per cent of their capital each year. That equates to $150 million per year or up to $750 million in loans and investments over five years being written off, literally thrown out the window. It is beyond belief that this government—in agreement with the Independents and the Greens—could try to push through legislation where the Treasury believes up to $750 million of taxpayers' money could be literally written off. Imagine what this $750 million in waste and mismanagement could be spent on. It could be invested in infrastructure. It could upgrade the Pacific Highway. It could improve health services. It could be used to assist people with disabilities.
There is plenty of evidence, both in Australia and abroad, that government funding for large-scale renewable energy projects is no guarantee of success. For example, in December 2009 the government announced with much fanfare the Solar Flagships Program. In June 2011 the Prime Minister and the Minister for Resources and Energy announced the Moree Solar Farm and Solar Dawn projects, which would receive a total of $770 million in funding for solar flagships. The Moree Solar Farm was to receive $306 million to build a 150 megawatt photovoltaic power plant near Moree. The Solar Dawn consortium received $464 million for a planned 250 megawatt solar thermal gas hybrid power plant near Chinchilla. And what happened to these two projects? Well, it is not a good look. Earlier this year the Moree Solar Farm advised the government that it had failed to secure a power purchase agreement with an electricity retailer—a necessary step for gaining a source of revenue. This forced the energy minister to re-open bidding for the $306 million in government funds. Today the project remains in limbo. The other so-called flagship project—Solar Dawn—although the sun seems to have set before we could have a 'solar dawn'—also struggled to make the numbers add up. The project has received a six-month extension to try to secure industry support and justify the investment.
This highlights two key points. Firstly, it is extremely difficult for renewable energy projects to secure a commercial return. Secondly, because of the high degree of risk associated with these projects, the government is placing $10 billion of taxpayers' money at great risk. But this should come as no surprise. It seems that every time the government tries to subsidise clean energy or carbon emission reduction technology the taxpayer gets burnt, and in a big way. Take the collapse of ZeroGen in Queensland, which was meant to deliver clean coal power. After an investment of $106 million from the Queensland government and $46 million from the Australian government, ZeroGen collapsed in a heap and taxpayers' money went up in smoke. It went up in CO2 probably.
Mr McCormack: A lot of hot air.
Mr HARTSUYKER: Yes, a lot of hot air, Member for Riverina. But the failure of renewable energy projects is not unique to Australia. In the United States we have seen the $700 million Solyndra project and the Beacon Power and Enerl projects collapse, despite receiving funding from a US program very similar to the clean energy finance corporation concept we are debating here in this House this evening. Then we saw the collapse of the Solar Trust of America, which had a $2.1 billion guarantee from the US energy department. I am sure the US taxpayers are looking forward to paying that back over the next years—as if they have not got enough debt. These overseas failures plus the collapse of ZeroGen and the experiences with the solar farm and Solar Dawn should have sent, you would think, a message to the Gillard government. But so beholden are they to the Greens, so beholden are they to the Independents, that they are keen to push on and play Russian roulette with $10 billion of taxpayers' money.
There are concerns about the impact of this huge amount of money on the existing renewable energy marketplace. Current investment in renewable energy is being driven by a bipartisan commitment to a 20 per cent renewable energy target. It is this target which is driving investment in renewable energy at the moment. Many of these investments have secured finance on a commercial basis with little or no government financial assistance. The fear is that the establishment of the Clean Energy Finance Corporation and the creation of a $10 billion funding slush bucket will distort the market and undermine existing renewable energy projects. Technologies which are not commercially viable without a substantial government handout will all of sudden be competing with projects which are currently receiving investment using existing technologies. So the government will not only be rolling the dice on speculative new renewable energy projects but could in fact be discriminating against the viability of current projects. The end result will be a lose-lose for all involved, including major renewable energy projects.
I am also concerned at the way the government have appropriated the $10 billion in funding for the Clean Energy Finance Corporation. Because of the massive debt that this government have racked up in the past four years, they decided to treat the $10 billion in funding as an 'equity investment' in the government's financial statements. By calling it an 'equity investment' the government have been able to remove the funding from the budget bottom line. Given the government's track record, it is indeed a leap of faith to call these projects an 'equity investment'. In an accounting sense, we know that equity is defined as asset minus liabilities, but we all know that based on past performance these projects are likely to be big on liabilities and small on assets. This essentially means they can claim to be delivering a small surplus when really they are spending taxpayers' money like a drunken sailor and that, if you include projects like the NBN and like this one, they will have a huge deficit indeed.
What they are doing here mirrors what the government have done with the National Broadband Network. They are providing funding off-budget so that they can distort a bit of a fiddle, they can distort the financial figures and they can make it look like we have a surplus. It is so small it is not even really a Claytons surplus; it is a mirage.
Mrs Griggs: A figment of their imagination.
Mr HARTSUYKER: A figment of their imagination; an illusion—that is correct. Everyone in the House knows that this legislation is only being debated because of a deal between the Prime Minister, the Greens and the Independents. The $10 billion is nothing more than a pay-off to the Greens for their one vote in the House—$10 billion for one vote; that is a very expensive vote indeed. The fact is that I am surprised that the Independents would ignore the wishes of their electorates, ignore common sense and vote with the government on this farce. It is indeed very regrettable.
What is also extremely disappointing is the cold hard reality that this $10 billion in funding will do absolutely nothing for the environment and reducing carbon emissions. As my colleague the member for Flinders has consistently noted, the $10 billion fund will create no new renewable energy. Prior to the creation of the fund the target was 20 per cent. Now that the fund has been created the target is still 20 per cent. There will be no additional renewable energy because of this expenditure. So all that this taxpayers' money will do is sideline existing renewable technologies, which are currently more expensive technologies, but the renewable energy pie will not grow.
Questions over the environmental benefits of such a huge government spend have also been raised by the Centre for Independent Research Studies. Research fellow of the centre Dr Oliver Marc Hartwich has released a report titled A waste of energy: why the clean energy finance corporation is redundant. He is a very wise man. Dr Hartwich notes in his report:
The physical effect of energy subsidies is precisely zero in an environment where the total emissions are pre-determined by a trading scheme. Not a single gram of carbon dioxide is saved by pumping money into renewables.
We all know that under the carbon tax the government's own figures forecast that emissions will rise. We all know that while we are introducing the planet's biggest carbon tax some of our biggest trading partners are either walking away from carbon pricing or embarking on a major increase in their use of fossil fuels. It is absolute folly for Australia to be risking $10 billion of government money on a Greens slush fund when there is no evidence that it will cool the planet, change the climate or deliver any meaningful environmental outcome. The only thing we do know is that this government has no mandate to appropriate these funds and the Greens will use this as platform in the lead-up to the next election.
What a disgrace it is that the government can use creative accounting to waste so much money and leave such a massive legacy of debt for future generations. The next federal election will be not only a referendum on the carbon tax but also an opportunity for Australians to decide on what they believe should be the priorities for the next government. Australians can decide whether they wish for $10 billion of their hard-earned money to be spent on a speculative pie-in-the-sky renewable technology program which is likely to lead to massive capital losses or whether they want to return to sensible economic management.
This government should be condemned for introducing this legislation and it should be ashamed for placing so much taxpayers' money at risk. It is not only undemocratic; it uses questionable accounting techniques and it gambles tens of billions of dollars on speculative projects. That is why the coalition opposes this legislation and it is why the Independents should vote against this legislation. That is why they should move away from their support of the government and support good old common sense, which is that you do not waste $10 billion and you do not invest money when you know you are going to lose it. It is about time the government came to its senses and abandoned this crazy plan.
Mr HAWKE (Mitchell) (17:44): It is a pleasure to follow the member for Cowper and that passionate rendition of why this bill, the Clean Energy Finance Corporation Bill 2012, will be such a failure for Australia. He is passionate about it because he understands that $10 billion is an expense that Australia simply cannot afford at the moment. When the government is doing everything it possibly can to produce a mythical $1.5 billion surplus, including the removal of $5 billion out of the Defence budget, it is incredible in the extreme that we are in this House today debating a bill off-budget to appropriate $10 billion to hand out to people on projects that may not be viable.
Nothing could underscore that point more than the member for Parramatta scurrying into this chamber before question time in an urgent rush to outline her committee's inquiry into a bill for $10 billion. I think it is very important this House highlights that that committee inquiry for $10 billion of Commonwealth money took just two hours of that committee's time. The member for Moncrieff absolutely demolished this committee inquiry, this so-called sham inquiry, that took two hours to investigate $10 billion of expenditure by the Commonwealth, and he made some excellent points about that. Questions have to be asked about what is going on with the Clean Energy Finance Corporation Bill and the associated bills before us here tonight.
It is the case that the government speakers we have heard on this bill were not persuasive in any way, shape or form. Their arguments do not make sense. They do not make economic sense and they do not make environmental sense. When you listen to the government, they say, 'We have got a carbon tax coming in, we have got a carbon price and we have got all these things happening but, all of a sudden, we also need to add money into the renewable sector because it is not viable.' Why then are we introducing a carbon price on electricity if not to make investment in renewable energy more attractive? That is one of the stated purposes for having a carbon tax in the first place—which you see if you look at all of the gobbledygook in the explanatory memorandum to this bill. I will quote from the explanatory memorandum. Under 'General outline and financial impact' it says:
Australia is a late starter in the transformation to clean technology due to its access to low cost fossil fuels.
What a terrible thing. It goes on:
This transformation will require substantial capital which the private sector alone may not be able to provide. Current global financial conditions, the complex nature of Australia’s electricity markets, the cost of renewable energy, and the preference of investing institutions for listed assets inhibit the financing of the clean energy sector.
A normal person would want to know what that meant. What that means essentially is this is a hideously expensive form of power that nobody in their right mind would invest in and that the government has to subsidise because nobody will look at this as an option in the real world of the private sector. That is the danger that this government is exposing taxpayers to—$10 billion of exposure risk—without any concern or regard for a return or any of this so-called commercial filter the government speakers have spoken about.
In estimates the Treasury has been very clear that 7.5 per cent of a loss has already been factored in. That is just a lazy $750 million—and there is another billion dollars we could have kept in Defence and kept our soldiers in the field in a stronger way. If this government honestly wants to put to this parliament that the loss rate out of this $10 billion will be 7.5 per cent then I would take that—because there is no doubt, when you read the provisions of this bill, about the lack of scrutiny, the lack of oversight and the lack of commercial know-how or nous into how this money will be administered. The actual proposition itself is that you can go around and hand out to these enterprises that are already identified as not viable or not worthy of financing money from the taxpayer and somehow they will become viable.
I think what you understand from all of that is that the Commonwealth does not intend to make a return from this bill. We are actually writing off $10 billion of Commonwealth money today. I am a little old fashioned but $10 billion to me is still a lot of money. I remember when $1 million was a lot of money. It still is today but now we throw around billions like it is going out of fashion. Ten billion dollars, to all those hardworking taxpayers in western Sydney, in my electorate, is too much money for us to be giving away for what is essentially a government commitment to a minor party.
I want to address that because I think it is important in the context of this legislation to understand why the government would hand out $10 billion off budget to a Clean Energy Finance Corporation when all the evidence from around the world tells us that these government corporations handing out cash, without expectations of return—or even when they try and pretend they are going to get a commercial return—do not work. There are so many good examples around the world. Names that come to mind are SpectraWatt from the US, Evergreen Solar, Solyndra and Beacon Power. They have all had huge losses and were completely unviable in their operations in the US. All of the taxpayers' money was totally wasted. The reason we are debating these bill and this legislation is because the government has made an off-budget commitment to the Greens.
We heard earlier today in this chamber, when the member for Melbourne was here, that there is a shortage of government speakers who want to speak on this bill when it is a $10 billion enterprise. I think the evidence here is quite damning. Whenever the government passes a bill of this nature and they have a much vaunted initiative of the Gillard government or the Rudd government, what we see is a procession of Labor speakers saying, 'This will benefit my electorate'; 'This group is going to benefit'; 'The planet is going to be saved'; 'The environment will be better off'; 'All of these companies will be able to make renewable energy so much cheaper and easier for all of us.' But, on this $10 billion expenditure, we have hardly had a government member speak in this chamber. It is their initiative. The shame they feel for this measure is apparent.
But there was one member here willing to defend this project, and that was the member for Melbourne. He came here in he and angrily asserted why this was good idea. I think that is a very telling and revealing situation. The member for Melbourne was passionately saying that this massive state-owned corporation that will be splashing around $10 billion of taxpayers' money to green corporations and green entities that are unviable and unprofitable is a worthy thing and a fantastic thing—but you cannot find a government speaker here today to come and do the same. We know why—it is because they know it is a dog. They know that this money will never be recovered by the Commonwealth. Indeed, we are looking down the barrel here, if we do not form a government, of a massive liability to the taxpayer.
When you continue through the provisions of this bill, you can see the fundamental flaws of this approach to policy and one reason that we must oppose this firmly as a parliament and as a coalition and one reason that we must always, when these things come up, have a very strong examination of why governments should not be behaving in this fashion. That is because, in my view, when a government appropriates or borrows money and then seeks to turn it into commercial money, it cannot function in the same way as the market or the private sector in assessing the risk accurately and taking the risk, because there is no risk to anybody—any person that is putting up the capital. Who is taking the risk in relation to the Clean Energy Finance Corporation? It is the taxpayer. It is 20 million taxpayers. It is the people out there that earn the money. They cannot make a decision about how this money is to be risked or taken.
When you look at the exact provisions here, of course the government does all of the things that it would usually do in relation to setting up a corporation. This corporation is exempt from the Income Tax Assessment Act, for example, so it will not pay any tax. What other corporation could enjoy that? When you look at all of the things that government does using its negation power—that is, by a negative, saying, 'It won't have to pay tax and it won't have to do anything, but we'll give it $10 billion, and here's hoping that something good will come out of this'—and when you go through the provisions of this bill further, there are lots of specifications about procedure, about functions and about what you would regard as a set of financial parameters. But, of course, there are no real explanations of how this will benefit the environment or the economy.
In fact, all through the explanatory memorandum and the provisions, you see that this will make power more expensive. This will actually deliberately make electricity generation more expensive in Australia today—so it becomes a double whammy. You read things like this particular part on page 11 of the section 'General outline and financial impact':
The fiscal and underlying cash balance impacts include a prudent recognition that some investments will not be recovered, and interest revenue. The fiscal balance impact also includes the concessional component of loans. This treatment reflects budget accounting standards and is consistent with the treatment of similar investments.
You just get the sense from this that what they are doing with this Clean Energy Finance Corporation is totally Orwellian and they know it. That is why they are not here in this chamber to defend it. There is no way that the government can behave as a corporation, and it is not the role of government to behave as a corporation. Government is for governing and doing the things that we ask it to use the right to use force to do, and that is not to behave like a commercial entity or corporation. Every time a government has attempted to behave like a corporation or a commercial entity, it has failed miserably, whether it be administering banks or running other kinds of commercial enterprises. It cannot be subject to the same rules of commercial operation, and indeed it is specifically exempted from the Income Tax Assessment Act and other acts that deal with commercial operations.
Instead of creating the settings or understanding that a government is there to create the environment for other commercial sectors and the private sector to flourish, and instead of saying, 'Yes, we could actually encourage renewable energy by relieving them from the Income Tax Assessment Act, for example'—which is a random example that they use for their own corporation but is not good enough for other corporations—'or relieving them from other provisions so as to allow them to be able to compete and do their business more effectively,' the government say, 'No, we're going to borrow or appropriate $10 billion of taxpayers' money and give it to people that are already assessed as not viable by the banks and other investors.' This is a highly, highly risky proposition—one that gives me grave concern. When you look around what all of the members of this place have had to say—I listened carefully to many of those in the debate—even the member for Longman, at the tender age of 22, understands that the government cannot operate this way. He remembers and has learnt that government cannot do this, and every time it has attempted to do this it ends in misery.
I guess this is a pitch from me to every Labor member of this place. We understand that you had to offer the Greens something to stay in government. We understand this was a $10 billion offer to the member for Melbourne and the Greens to keep your shabby government in power. But think about what will happen to this $10 billion of taxpayers' money down the track. Think about all of those people that you come in here and talk about every day. You say, 'We're handing money to families and other people. They need it. They're under pressure. Electricity prices are rising.' Think about what will happen to all of those people who have to pay off this debt for years and years to come—because there is no doubt that debt is going to be the only outcome of this bill.
When you look at some of the arguments that have come forward from the very few Labor members that have come into this place to speak, they say, 'Well, Britain is doing this. We should go ahead and do it. Britain is the model for this.' You look at their claim that the US is doing this. As I raised before, there are very many examples of failure in the renewable energy sector, including solar—the member for Cowper just outlined some—that explain exactly why it is an extremely risky proposition for us to be doing this as a government and with taxpayers' money.
The argument that this is somehow promoting clean energy over dirty energy is a complete and utter misnomer, demolished by the member for Dawson, who explained about the cost in materials, carbon emissions and time that comes with building these renewable energy projects. It is completely Orwellian to describe this as clean and that as dirty. We know that all human activity produces a change to the environment, and all human activity of production, whether it be renewable or fossil fuel based energy generation, produces emissions. We know that these particular wind turbines and other measures, which are often talked about in this House, are complete models of inefficiency in that regard. But there is not any suggestion or any real contention from the government that this will produce an environmental benefit. So, at the end of the day, we are going to be expending $10 billion of hard-earned production and taxpayers' money in a quest for clean energy that is really not going to produce any environmental benefit at the end of all of that.
So, again, why are we doing it? We know why we are doing it, but there comes a time in parliamentary systems and in the parliamentary world when you need to take a stand on a government putting $10 billion off the budget, basically to keep itself in office, to hand out to projects that are completely unviable, without any real thought for recovering the money. That really ought not to be allowed in our democratic system. We should have very tight rules and requirements, as we do on the budget, and scrutiny of government and parliamentary processes that prevent that from occurring.
The government say that they are venturing into the commercial world and are going to apply a commercial filter to this $10 billion, without paying any tax and without doing the things that they are supposed to be doing—
Mr Ewen Jones: Payroll tax.
Mr HAWKE: and without any of the different things, as is being pointed out to me here by the member for Herbert. I just believe this should not be allowed in this parliament. When you look at what the government have argued and the lack of willingness to come in here and put their case, I think we all know what is going on. This is actually a very serious issue. I know that with $37 billion NBNs and other things going around this is only in the top 10 of Labor waste expenditure disasters, but $10 billion is $10 billion, and I am going to stand here on behalf of my constituents and the people of Australia and definitely say no to this government going into any sort of commercial venture.
Mr TEHAN (Wannon) (17:59): I rise to support the previous speaker. This $10 billion bill is one of the grossest wastes of off-budget taxpayers' money that you could ever see. This is the sort of bill where those opposite, after they have voted for it, will need to go and have a shower, because they know that this bill smells. They know that this bill is dirty. They know that this bill is basically a bribe. It is our great negotiator, the Prime Minister's, way of making sure that by any means she continues to keep that faint grip she has on office. But it really goes to the heart of what is wrong with this government. It is all about staying in power and it is not about the long-term interests of the country.
The previous speaker mentioned that the only person who has really come into this place and, with glee, welcomed this bill is the member for Melbourne. We have not seen those opposite from the Labor Party able in all good conscience to bring themselves to come in here and support this bill wholeheartedly—and there is very good reason for that. It is a shabby, shabby piece of legislation. The speed with which it is being rushed through the House demonstrates the embarrassment with which this government holds this piece of legislation. I was called last Friday to see whether I was able to be a temporary member of the House Standing Committee on Economics to examine this bill, the Clean Energy Finance Corporation Bill 2012. When I asked why the haste, they said, 'There's two hours for the House economics committee set aside on Monday to examine this bill and the committee must report by Wednesday.' We have had to rush the report out today so that the bill could be voted on. Let us just consider that: there were two hours for the economics committee to review this piece of legislation. We spent the first hour, roughly, dealing with $5 billion in the bill and the second hour looking at the other $5 billion in the bill.
It is sort of funny—and you have to step outside this place occasionally because $10 billion can sort of start rolling off the tongue a little—but then you look at the way this government spends money. That $10 billion will be added to our net debt position, which will be $144 billion by the end of the year. Today we saw the government shut down debate on us trying to bring attention in this place to the fact that the government wants to increase its credit card borrowing from $250 billion to $300 billion. While all this is going on, here we are, having a bill rushed through which will, off budget, commit the Australian taxpayer to $10 billion worth of government expenditure.
It is worth looking at the mechanism to delivering this $10 billion. The government has set up an investment arm to do this with, the Clean Energy Finance Corporation. During the hearing that we had on Monday, I asked the Treasury officials whether they remembered an organisation in Victoria called the VEDC, which was an investment arm of the Victorian government that helped send the then Cain-Kirner government broke. Sadly, the Treasury officials could not bring it to mind. They could not come to terms with the fact that there have been previous examples of such investment arms being set up which have lost taxpayers—in this case, Victorian taxpayers—large amounts of money. I remember the VEDC because one of the investment projects that they had was for Lake Eildon. They invested in a catamaran houseboat which was going to do wonders for tourism in the region. That half-built catamaran sat on the shores of Lake Eildon for about five years as a constant reminder of what happens when government starts to take the crazy decision that it will pick industry winners, which is exactly what this bill does.
I suppose if we are to say anything good about this bill it is that there is a tiny bit of honesty in it. It recognises that 7½ per cent, to start with, of the money invested will be lost. If there is any honesty in this bill at all, it is that the government has recognised that this Greens inspired piece of legislation will automatically lose 7½ per cent of the $10 billion investment. It might sound crazy, but at least there is a shred of honesty in it.
Mrs Griggs: It's unusual!
Mr TEHAN: It is very unusual. It is interesting to ask, once you delve into these things, how they came about this figure of 7½ per cent. This was a question that was asked during the economics committee hearing. It was asked, 'There must have been some potential investment disasters that government has already been involved in which have made you come up with this figure. What is the basis of your decision that there will automatically be a 7½ per cent loss? Surely, there must be a Solar Flagships program or something else that has led to the 7½ per cent figure.' But they could not come up with anything. So it seems that they have plucked this figure out of thin air, which should be extremely worrying for the Australian taxpayer. They know it is going to make a loss.
An opposition member: $750 million bucks!
Mr TEHAN: Yes, $750 million straight up, it is pointed out to me. And yet, when they were asked how they came to this figure, they did not know. There was no evidence based approach to coming up with this figure for the loss. One might think that this would worry this government. I got the feeling it did embarrass the Treasury officials who were there trying desperately to give some sort of credence to what was going on. You would think that the government would be embarrassed by this, but I must admit that those members of the government who sat on the House economics committee blindly sat there, shrugged their shoulders and went, 'Well, if $750 million is the price we have to pay, that's what we have to pay.' It is a real shame.
Not only that, there was a follow-up question to this which asked, 'Given that there is no substance to this 7½ per cent figure, what happens if it loses more money than that?' Everyone just shrugged their shoulders. No-one knew. As a matter of fact, it seems to be wholly reliant on the board to make sure it does not. The information on how the board and its staff is going to be governed was very interesting as well. The board's salaries are going to be along the lines of those paid to members of the Future Fund board—we are talking of a chair on maybe a $2 million salary. Who will decide the salary of the staff? Will it be the Remuneration Tribunal? No. The board is going to decide what the staff salaries will be.
An opposition member: Like the NBN.
Mr TEHAN: Yes. In this situation is the board really going to care what rigour is put into this? I do not think so. Seven and a half per cent, 9½ per cent, 15 per cent—if those are the losses, I think the board is just going to be sitting there saying, 'Oh well, it's all right—we're not losing from this.' It is the taxpayer who is ultimately losing.
This committee hearing was a real eye-opener and it was even more of an eye-opener when the representatives from the Department of Climate Change and Energy Efficiency were asked: 'But isn't the 20 per cent of renewable energy required by 2020 already delivering investment into renewable energy anyway? Isn't this bipartisan commitment actually delivering this? Do we need the additional $10 billion if our Renewable Energy Target, and the renewable energy credits which are delivering that target, are already doing this job?' There was no answer to that—no answer to the effect that this $10 billion is not needed because we already have a bipartisan mechanism to deliver this anyway.
What we have is $10 billion being spent as a bribe to keep the Greens happy. I would have thought there were better ways to keep the Greens happy than giving them $10 billion, but it seems that is what this government is prepared to do to cling to power. It is an unnecessary $10 billion because, as we heard in the evidence, the Renewable Energy Target—20 per cent of our energy from renewable sources by 2020—is going to deliver this anyway. That is very important because it also means that those companies which have already invested privately in renewable energy technology—in wind, solar and wave—will now see their competitors come in, using this $10 billion fund as a leg-up, and gain a commercial advantage over those players who are already in the marketplace.
I must ask the government, how can this be fair? How can it be fair that existing players in the renewable energy space will now face competition from late entrants who can use this $10 billion fund? What the government is doing is saying to those companies who have made investment decisions based on private enterprise with a little bit of assistance under the Renewable Energy Target: 'We don't care about those investment decisions you have made. We are going to support new entrants into the market which could potentially blow the investment decisions you have taken out of the water.' This bill hammers home another example of sovereign risk and shows that this government does not care. We see time after time that the government does not understand this.
I am in my first term in this place—
Mr Hockey: And you're doing a great job!
Mr TEHAN: Thank you, the member for North Sydney. I have seen some incredibly interesting things in my time—it has only been a brief 18 or 19 months—but I must say sitting in that House economics committee for two hours on Monday was the most disturbing thing I have seen yet. It is alarming that this government is prepared to give away $10 billion, off-budget, of taxpayers' money without any consideration of the opportunities on which it could be spent. I hope all the members opposite know, as they vote for this piece of legislation, that it is the silver offered to the Greens to make sure they continue to support this government. I hope they go and have a long hot bath or a shower because they will need to; this bill smells. It smells to the Australian taxpayer and it smells of what it is about—keeping this Prime Minister in power.
Mr HOCKEY (North Sydney) (18:14): I join with my colleagues in speaking on the Clean Energy Finance Corporation package of bills. These, of course, are part of the government's carbon tax package. They are about extending the reach of the carbon tax by creating a $10 billion fund to undertake investment in renewable energy technologies and energy-efficiency projects. The coalition has pledged, in opposition, to oppose the carbon tax and we will repeal it if we are elected into government. This also applies to this package of four bills. The carbon tax itself takes Australia out on a limb and will create additional financial stress for families and do nothing to reduce carbon emissions. It is bad policy. The CEFC is yet another example of poor policy, which demonstrates the inability of the government to be trusted to spend taxpayers' money wisely.
To oppose this legislation is not to oppose the science of climate change. That is the classic spin that the government applies to everything. Based on the evidence available I believe our climate is changing, and I believe on the evidence available that human behaviour does contribute to climate change. I believe on the evidence available that reducing carbon dioxide emissions will slow down the pace at which the climate is changing. I have held these views consistently for more than 10 years.
The coalition is committed to the same carbon reduction goals as the government. We are committed to reducing Australia's greenhouse gas emissions by five per cent below 2000 levels by the end of 2020. To be clear: that is a bipartisan commitment. Where we differ from the government is the mechanism used to achieve these goals. We do not believe this is solved by increasing taxes and increasing government debt. We certainly do not believe that a $10 billion slush fund is the solution to economic and environmental sustainability. It is economically irresponsible, fiscally irresponsible and environmentally suspect.
This set of bills empowers the government's CEFC with a very broad mandate to invest in risky renewable energy projects. Other than the requirement that at least half the funds be invested in renewable energy technologies by July 2018 and solely or mainly Australia based, the CEFC is given a very wide remit to spend taxpayers' money. The Minister for Climate Change and Energy Efficiency has assured Australians that the CEFC is a commercial venture and that the administration 'will apply a commercial filter when making its investment decisions'. However, this is entirely contradicted by the explanatory memorandum for the bill, which admits that this filter 'will not be as stringent as the private sector equivalent ' and 'may accept a lower financial return'.
The CEFC will be permitted to offer loans at concessional rates. Even worse, concessions can take the form of 'availability, tenor' or, it goes on to say, 'by absorbing additional risk'. Yesterday in the inquiry of the House of Representatives Standing Committee on Economics into this bill it was revealed that the government has already factored in a 7½ per cent loss on capital in unsuccessful projects each year, with Treasury officials describing that 7½ per cent estimate as 'conservative'. Yet somehow these investments are still expected to generate a return close to the government bond rate of four per cent—after all, this is being funded by borrowed money. The reality is that these investments will be highly risky, highly speculative and may not live up to the standards that would normally apply for commercial financing. If these investments were commercially viable, an organisation's first port of call would be a bank or private sector investor, not the CEFC. Even the government admits that 'some investments will not be recovered'. In fact, given the speculative nature of the renewable energy market, it is conceivable that no investments will be recovered. It is uncertain if these new technologies will ever produce a commercial return or a product that will help to create a renewable energy source. Given the risks posed by these investments and the fact that commercial markets would not provide finance to many of the speculative investments, it is hard to believe that such projects could conceivably be termed 'commercial investments'. If these projects were commercial investments, they would not require subsidised support from the government. As such, the government should call the CEFC exactly what it is: a giant, $10 billion slush fund. The Australian people deserve to know exactly how their taxes are spent.
And when it comes to examining the accounting treatment of this giant government slush fund, you would expect that this expense would show up in the government's underlying cash position. But not under Labor. Despite the highly risky nature of the investments undertaken by the entity, the CEFC is blessed with having been given the green light to be accounted for in the same way as that other great commercial entity, the National Broadband Network: they are being treated off-budget. The coalition has long been concerned about the accounting treatment of the CEFC and, indeed, the NBN; and, if there is a change of government, I can promise everyone that I will get to the bottom of exactly why they have been treated in such a way and who advised it.
Back in October 2011, along with the shadow minister for finance, I wrote on behalf of the coalition to the Australian Statistician and the Auditor-General, questioning how the $10 billion CEFC would be accounted for and whether they had made any recommendations as to the accounting treatment of the $10 billion fund. The coalition always suspected that the government was trying to push the majority of the CEFC off-budget. Nine months later, these concerns are realised. In reality we should have just looked at the government's record of treating politically sensitive material like the $50 billion NBN off-budget to justify our concerns.
The government is trying to hide the full cost of the CEFC because responsible economic management is something quite foreign to this government. Treating this program as off-budget means that the vast majority of the spending will not hit the budget bottom line. Only two items will hit the underlying cash balance. The establishment and operating cost of $57 million over three years will be expensed, as will what can only be described as a small provision to recognise that some investments will not be recovered. That is a 7½ per cent loss on capital on unsuccessful projects. Operating costs are nearly $20 million a year. Bear in mind that the Inspector-General of Taxation has an estimated cost of $2.634 million for 10 employees to cover the entire taxation system as an inspector-general, yet this is going to cost around $20 million a year to run. The government acknowledges that some loans will be granted to renewable energy projects at concessional rates. Senate estimates this morning confirmed that this would be the difference between the expected market return of 14 per cent and the government borrowing rate of an average of 5.3 per cent. The impact of this concessional component, along with the operating expenses and the 7½ per cent provision for losses on capital for unsuccessful projects, means that the fiscal balance will be hit with an additional $1.3 billion over the forward estimates. Only this government would provide money for investments that the private sector would not touch with a barge pole and then turn around and call them 'commercial'. What an absolute, damned affront it is to call them 'commercial' investments! Only this government would budget for potential investment losses, charge concessional rates of interest and call the investments 'commercial', and then turn around and deem them 'equity investments' in order to avoid having the expenses hit the budget's bottom line. It smacks of Tricontinental and some of the other things I saw from Labor in the eighties, such as Beneficial Finance and all of their partners.
What is worse, this expenditure is being made at a time when a budget surplus is looking less likely by the day and when the debt burden continues to grow. All in, taxpayers will be borrowing more than $10 billion in headline investment to fund the CEFC, which will only serve to add to the legacy of this government's debt. We do not have the capacity to repay this debt by asset sales—there is no Telstra, there is no Qantas and there is no Commonwealth Bank to sell in order to address the debt burden. These entities, the CEFC and the NBN, are not going to be worth crackers, because they are barely commercial. On the basis of any common understanding of the meaning of the word 'commercial', they would be considered uncommercial. This will be the legacy of Labor, and it will hang around their necks for as long as I am in this place.
Apart from pointing out the lack of credibility on the accounting treatment of the CEFC, it is important to point out that this legislation allows for the use of derivatives in order to, amongst other things, 'indirectly achieve exposure to financial assets'. After all the rhetoric of the Labor Party and its war on capitalism as initiated by the previous Prime Minister's arguments about the impact of derivatives trading during the course of the global financial crisis, they are now so opposed to derivatives trading that they are setting up a $10 billion fund that can engage in derivatives trading! Of course the coalition has major concerns about the application of this legislation and about the risks to which such financial products could expose the government and taxpayers.
Will the investments be effective? There are serious concerns. The CEFC may have distorting impacts on the market—and of course it will. When someone is in there with subsidised loans, of course it is going to have an impact. It is widely commented by renewable energy participants that the introduction of the government's CEFC will have an adverse impact on existing renewable energy projects. Of course it will, because this 800-pound gorilla, subsidised by taxpayers to make losses, is coming into the marketplace. Of course it will undermine any commercial ventures that are out there—and that, of course, will lower the tide for everyone. Also, it is widely accepted that the newcomers to the sector will be affected if they are not to get access to the fund. You are lucky if you are hand-picked by the CEFC, because you will have the benefit of a direct subsidy. But what happens if you cannot get it? What happens if you do not like the terms? There is that 800-pound gorilla in the marketplace which is going to undermine the market itself, and when the failure occurs taxpayers will pick up the tab because otherwise they will lose their money or equity investments.
The CEFC is not charged with investing in the lowest cost technologies to produce the cheapest emissions reductions; its remit is to fund the technologies which the market considers to be unproven or too speculative or too risky for commercial financing. Although the CEFC will be established as an entity separate from the government, it is clear that its functions will carry out government policy. Its functions seem analogous to and to overlap with other government programs such as the Clean Technology Innovation Program, the Renewable Energy Venture Capital Fund and the Emerging Renewables Program. All these programs appear to be similar in nature to and to fit within the broad investment mandate of the CEFC, yet they are fully accounted for in the budget and nowhere near the sheer scale of the $10 billion energy slush fund.
The government has a terrible record with energy projects. Its $700 million Solar Flagships program in Moree and the Solar Dawn projects in Queensland struggled to gain industry support. Along with the Bligh government, this government presided over more than $100 million in losses from the ZeroGen project despite clear warnings from the opposition and a number of industry experts. In fact, in response to the member for Groom's warning that ZeroGen would fail, the Queensland Premier said that he was 'on drugs'. Whatever drugs they may have been—and I can assure you that he was not on drugs; there was absolute clarity in his observation—he was proven right. Programs of this nature have similarly experienced massive failure and controversy in the United States. The failure of the $700 million Cylindra project as well the failures of as Beacon Power and Enel occurred under similar programs. There is also the recent collapse of Solar Trust of America, which had a $2.1 billion loan guarantee from the US government.
Finally, I put on record my concerns about the comments made by Jillian Broadbent from the CEFC. Ms Broadbent wrote to me on Wednesday, 11 April at 11.44 am asking to meet with me in Canberra at a time of her suggestion, 17 April. Andrew Robb responded on behalf the coalition on 16 April. At that time I was overseas meeting with the Chancellor of the Exchequer and officials in Europe, and, when we did not meet the timetable set by Ms Broadbent, she went on ABC radio on 17 April saying that the coalition, 'haven't been very interested in speaking to me, despite my preparedness to do so', She did this even though, as I understand it, she had already met with Malcolm Turnbull, she had already received a response from Mr Robb, she had met Mr Hunt and I was unavailable at that moment. If that is the way they are going to play the game, then there is all the more reason for us to get rid of this bad idea.
Mr EWEN JONES (Herbert) (18:29): It is always a pleasure to follow the member for North Sydney. His contribution basically wrapped it all up. But I rise today to speak on the Clean Energy Finance Bill 2012 and the suite of bills.
These bills seek to establish the Clean Energy Finance Corporation—the CEFC—giving this corporation the ability to invest in financial assets to develop Australian based renewable energy technologies, low-emission technologies and energy efficient projects, and the power to enter into investment agreements and to make investments through subsidiaries. It has a duty to make sure that half of the funds invested by 1 July 2018 are invested in renewable energy technologies.
These bills will also create the Clean Energy Finance Corporation special account, which will give $10 billion over five years to the CEFC. It is this government's intention that the CEFC will be self-sustaining once it has reached maturity and any returns to the fund would then be reinvested! We laughed and we laughed and we laughed! In reality this bill simply creates a $10 billion slush fund used to bribe the Greens over to the government side. It was the 25 pieces of silver they had to pay.
In stark contrast to the idea of a self-sustaining fund the bill forecasts a financial loss as a result of operating costs and failed investments. Treasury officials will tell you that the loss is around 7½ per cent. What they do not tell you is that that loss of 7½ per cent is $750 million, which they are prepared to walk away from on day one. Add to that the government's borrowing rate of 5.3 per cent on $10 billion and that is $530 million a year. So, straight up, at the beginning of the year, you drop one billion dollars every year. So away you go!
The coalition has long supported the renewable energy industry and the pursuit of making renewable energy an affordable and reliable source of power. The renewable energy target of 20 per cent has bipartisan support in this House, but this bill runs the serious risk of distorting the renewable energy market and spending $10 billion of borrowed money to not produce any results.
We already have our 20 per cent target for renewable energy by 2020. This target is driving investment in renewable energy. Regardless of how much this government spends on a renewable energy slush fund the target will still be 20 per cent. So we will still end up with 20 per cent renewable energy. Any renewable energy investment from this fund will simply replace other private sector investment in renewables. That means $10 billion will be spent on achieving nothing.
I hate to harp on the point, but this government has not had the greatest track record in running anything so far, let alone a $10 billion slush fund. Mind you, no-one gives money away like this government, with no hope of a productive return. This could be the hook on which this government hangs its hat: 'We are the best at giving money away with no consequences. We are No. 1!' Now, that will cause pride when you guys are sitting on the verandas under your blankets in the old pollie home!
These bills also seek to provide for the CEFC to hand-pick investments based on comprehensive criteria. The result is that, contrary to the thinly veiled appearance of independence, the minister and this government has a high degree of control over who does and who does not get money from this fund. Couple that with no economic or financial basis for decision making, what could go wrong?
There is a serious concern that these bills will distort the marketplace for renewable energy. We already have many companies around the country successfully running businesses in the renewable energy sector. They have found their market, created a good business plan, and are turning a profit. Now they have to compete with technologies and ventures that should be less competitive but will be given a hand-up by a selection panel. Instead of the market investing in efficient technology and well-structured businesses, the government will be investing in businesses that could not convince anyone else to spend the money on them. If you force cash into any market you will distort that market. In effect, you will place greater pressure on the existing businesses by doing this. I just do not see why this government cannot see that. You are running a real risk of shutting down an industry.
The CEFC has not been required to consider low-cost technology when hand-picking projects. Not only is this money giving an unfair leg-up to the fortunate few, it will be supporting the projects that the market has deemed too risky to finance itself. Even the explanatory memorandum acknowledges, in identifying the fiscal impact for this bill, that some investments will not be recovered. That is code for taxpayer loss on top of borrowed money. This is destined to be yet another expensive failure where the end result will be that the taxpayer will cop it in the neck to the tune of $10 billion and those businesses which have forged a market and products with hard work, will have to deal with the stink and taint this set of bills will no doubt leave behind. You really are running the risk of destroying an industry.
Time after time we have seen that it does not work when government's try and hand-pick renewable energy projects. We had the Solar Flagships program in Moree and the Queensland Solar Dawn project that the member for North Sydney was speaking about earlier. I remember reading about it in the paper and seeing Peter Beattie on TV telling the member for Groom that he was on drugs if he thought this would fail. Yet, there we were, a little way down the line. Peter Beattie, to this stage, has not rung the member for Groom and apologised. The Queensland Solar Dawn project, struggles to gain industry support despite $700 million from the government. Of course, I am talking about ZeroGen there.
When will we stop pretending that we can force the market? These bills are yet another Labor commitment funded by debt—$10 billion, and then we start to pay the interest. We have seen this Treasurer boasting about a budget that contains a surplus. Meanwhile they are using accounting systems to push through lavish and reckless projects without having to put them on the budget and present them to the Australian people.
I have an idea. Why don't we take the defence spend off budget? That way you would have a $25 billion surplus! It would be easy! We could just take it all off budget and increase the debt. We could raise the debt level to $3 trillion and be done with it; run it all off budget. We could bring forward money out of the debt level to create that surplus so that everyone can feel warm and fuzzy. But it does not produce the right picture.
You guys—this government—are leaving it up to the next generation to pay for a policy that is designed to fail, knowing full well that it will be spent on projects that nobody in the private sector trusted and on many that are bound to fail. Just like the NBN, this is a huge expense that this government do not want to be held accountable for at budget time. There are huge salaries at the NBN, and in this organisation, being paid out to people and we have no control over who they are.
If this government genuinely had a commitment to renewable energy it had many chances to get on board, even in North Queensland. The CopperString project was aimed at bringing Mount Isa onto the National Grid. They were seeking $300 million in federal government funds to build the line to Mount Isa. If this was done, the impact on renewable energy would be huge. The North West Queensland Mineral Province is also home to one of the world's most exciting renewable energy corridors, with projects such as the Kennedy Wind Farm, with 700 turbines producing electricity at a projected $48 per kilowatt hour. The Kaiwedera Solar Project is another project which was to produce quality renewable energy.
One thing you have to remember is that, as the member for Dawson so succinctly put it, renewable energy is not clean—you still must invest in all sorts of stuff to create the equipment that makes it. A huge amount of pollution goes into making the mirrors, the turbines and the fans, and transporting them. As the member for Mitchell said, every human endeavour affects the environment.
The fact that the Kaiwedera Solar Project, which currently operate along the corridor and burn diesel for power generation, should have had this government and the Greens running to their aid. I do not blame Mount Isa and Xstrata for going on their own and building their own new power station. The messages they were receiving from both the federal and the state government were too weak and mixed for them to wait any longer. In short, the government talks a good game but it never, ever delivers. It could it be that they could not commit to infrastructure in North Queensland if it was to appear on budget. Maybe it was just not sexy enough for the Greens. Maybe it was not in the right part of the world. Maybe if it was in inner-city Melbourne and it was about turning mung beans into cafe lattes, we would be throwing some money at it.
Why doesn't this government support the MBD algae project more? Here we have a science based, high-skill project ready for commercial application which is being starved of funds by this government. It will take pollution out of any system to which it is applied and turn it into a protein source, a biodiesel, and sequester carbon. Tests at Tarong Power Station in the South Burnett have been very positive, with massive reductions in pollution—up to 40 per cent. If we integrated the MBD algae project into the design of a coal or gas fired power station, we would have cheap baseload power with zero emissions. Why isn't this government all over this project like it was 102 degrees in the shade and they were prickly heat? It beggars belief. Again, are they only interested in projects where the Greens decide what we will do? Are they only against it because it would have to be on budget? I am not a huge believer in conspiracy theories, but the more I watch this Labor-Greens government, the more I am convinced that there is another completely separate agenda here.
This legislation is not about supporting renewable energy; it is about supporting the Greens. The fact that they can on one hand claim a budget surplus and then on the other try and slip through a $10 billion off-budget slush fund, and that they can claim to be in favour of renewable energy and then sit back as the CopperString project stalls, shows the hypocrisy of this government. We all want to see a strong renewable energy future; that is what we have the renewable energy target for. But splashing around $10 billion on projects that the market has rejected is an insult to taxpayers. This legislation is about a select group of latte-drinking, Vespa-riding, black-skivvy-wearing people picking winners at our expense. It is easy to punt big if you do not have to cop the losses. I suggest we send this mob to Randwick on the weekend with their own money and see how they go. Let's see how good they are on the punt—because that is what they are doing. But they should do it with their own money.
This legislation is irresponsible, it is destined to fail and I do not support it. What this country needs is a government which will, in the first instance, do no harm. Secondly, we need a government that will get out of the way of the private sector and keep their hands out of the pockets of the people who are making a difference. We need a government which offers hope, reward, and opportunity for all, not just a select few. Think of the interest alone on this thing, the money that you are prepared to lose on this, that you are prepared to throw away. In the meantime you have 21-year-old soldiers stationed in Darwin that you are pulling a return airfare off once a year.
The government shows its hypocrisy on these issues. The fact that you are prepared to make the average person pay and you are prepared to let the Greens run this show is horrendous. This is my first term, as it is the first term of the member for Wannon, who spoke before. We all come in here thinking of Mr Smith Goes to Washington, thinking we can change the course of the debate. But when nobody is listening on the other side, when you are in the back room and you have to cut the deal, you will do whatever it takes. That is what is wrong with this place and that is what is wrong with this government. They are not prepared to make the hard decisions. They are not prepared to stop these people from doing this.
This is $10 billion. I scratched $1,000 once and thought all my luck had come at once—I never won another single cent. This is bad legislation. It should be shown up for what it is. I will fight against it all the way through. When we are in government, we will repeal the carbon tax fully, we will get rid of this slush fund and everything that goes with it, and we will find out why the advice was what it was.
Mr CHESTER (Gippsland) (18:44): I have great pleasure in following the member for Herbert and his impassioned speech. Speakers on this side have covered a lot of territory here this evening and expressed a great deal of reservation about this legislation, the Clean Energy Finance Corporation Bill 2012, and with very good reason. In joining this debate I want to reflect on the complete lack of trust which exists between this Prime Minister, this government and the Australian people. There is a long list of reasons—and we have already heard many of them tonight—why the coalition are not supporting this legislation, but the most compelling one of all is the issue of trust. We simply do not trust this government to be able to deliver value for money under its Clean Energy Finance Corporation. Quite simply, I could not trust this Treasurer with 10 bucks, and I certainly will not trust him with $10 billion of taxpayers' money. This does feel like deja vu all over again. As the member for Cowper remarked earlier this evening, this legislation has all the hallmarks of Labor's other financial disasters.
People listening to the broadcast of this debate at home or in their cars might be thinking: how did we get to this judgment? Are we being a little bit too harsh on the Labor Party? I just say to people listening to this tonight: let's start with the Rudd and Gillard government's track record in delivering major projects and their financial mismanagement. I want to begin with prior convictions, if you like, so I will start with the home insulation debacle. That scheme saw the tragic loss of four young people killed in the rush to implement the scheme. We had homes burnt to the ground and others severely damaged by fire. We had a legitimate industry destroyed as confidence was eroded amongst the Australian public in the whole home insulation industry and we had jobs lost. That was one of the greatest debacles in Australian political history, all at the hands of this government, shovelling money out the door in a so-called quest for clean energy.
Then we had the Green Loans Program, which is one that a lot of people have forgotten about, and the training of assessors. I am testing my memory but I think the government intended to train about 1,500 assessors. But someone forgot to tell training organisations, so 10,000 Green Loans home assessors were trained. That would not be so bad, I suppose, if it did not come at any cost to the people involved, but people actually lost their hard-earned money to undertake that training. Those poor people put up amounts of $2,000 to $3,000 each to become assessors in the false hope that there was a job at the end of it. This government completely mismanaged the program so, unfortunately, these people were training for jobs that never existed. Again, it was a complete financial disaster, but at least in this case, as far as I am aware, no-one died in the government's mismanagement of that program.
But the grand-daddy of them all is undoubtedly the government's Building the Education Revolution. This program, which amounted to about $16 billion, as I recall, was plagued with problems from the absolute start. In fact, it has got to the stage now throughout regional Australia that BER stands for 'builders early retirement'. Builders were in a position where they could inflate their prices to suit the market, they could move from the cities into regional areas, do a job and not necessarily take much care because they were never coming back to that town in their life, and the government picked up the tab. I think this program is the worst example of government mismanagement that I have ever been made aware of. Not only did it involve $16 billion, but the greatest concern of all was that the government refused to listen to local communities.
This program was not based on need, on whether the school community needed an upgrade. It was the government's version of that old sideshow alley call 'Every child wins a prize'. In this case every school got a building, regardless of whether they needed it or whether they needed the template design, because that was what they copped. The only time there was value for money out the program was when the independent schools had control of some of the money.
I will just reflect on comments made by the former head of Treasury, Dr Ken Henry, who told the ABC last week that value for money was only a second or third order concern, on that particular program, in terms of the government's stimulus package. I think that sums up this government: value for money was only a second or third order concern. But for the people who were having their hard-earned tax dollars spent in this manner, I can tell you now that value for money is the No. 1 priority they expect from us in this place. Value for money is what they want to see at every opportunity.
The member for Cowper went through a long list of renewable energy failures in his speech tonight, and I will not go through them again, but he made the point that this government has not learnt from its own bitter experiences, let alone experiences throughout the world when it comes to clean energy programs. It is simply going out to the marketplace and saying to the Australian people: 'Just trust us, we will deliver.' Unfortunately, there is a huge deficit of trust in the Australian community when it comes to this government, and it starts at the Prime Minister's office. It starts with her now infamous line when she told the Australian people: 'There will be no carbon tax under the government I lead.' Every bit of legislation to do with the clean energy future, including the legislation we are discussing tonight, comes back to that line from the Prime Minister: 'There will be no carbon tax under the government I lead.'
I have said before and I repeat now that the Prime Minister has been partly true to that line because there is no carbon tax under the government she leads. There is a carbon tax under the government that Bob Brown leads and now Christine Milne leads. It is the grubby deal with the Greens which has forced this government into this position. I do not believe members opposite are actually being true to themselves in this regard. I do not think they believe a lot of the information they are forced to propagate throughout the community. I believe it is just because they have done a deal with the Greens that they are forced into this position, because I do not believe that members of the Labor Party could be so stupid. This Clean Energy Finance Corporation is a pay-off to the Greens, at vast expense to Australian taxpayers.
In addition to the $10 billion, there is another little project we are not hearing much about at the moment, so it is good to see the Minister for Climate Change and Energy Efficiency is in the chamber. This project is called Contract for Closure—and at the mere mention of this policy the minister has left the chamber. I think this Contract for Closure links very nicely into the debate tonight because of this government's obsession with pandering to the Greens. I am not sure many Australians understand what this Contract for Closure policy is all about. What the government has promised to do is to retire 2,000 megawatts of coal fired power generation in Australia. Basically, the companies are going to be bought out by the government—by taxpayers, who are going to cough up all the money once again—so the companies have been invited to express their interest in being part of Contract for Closure. What we have seen, though, since this was announced and the expressions of interest closed is that the government has gone strangely quiet on this process because, as I understand it, the negotiations are going absolutely nowhere. You always know when the Labor Party is in a bit of strife because the dorothy dixers put up in question time by the Labor Party backbench just stop. There has not been a mention of Contract for Closure, as far as I can recall, in months, because it is a dud policy. The Minister for Resources and Energy, who is not here tonight, knows it. He can barely even say the name of the policy, he hates it so much. He knows it is a disgrace. The minister for energy is the only one I have seen, actually, who has had a little bit of credibility. He has given himself a bit of wriggle room. He has backed away from the policy a bit, because he is on the record as saying there is actually no guarantee that it will go ahead if they cannot negotiate a price that suits the government. So the minister for energy has given himself a bit of wriggle room.
The Minister for Climate Change and Energy Efficiency joins me again. Contract or Closure we are talking about, Minister, just in case you had not heard the words for awhile.
Mr Combet: I have heard of it.
Mr CHESTER: I understand. The minister has heard of it. But no-one is talking about it, Minister—because it is a dud.
Mr Combet: It is commercial-in-confidence.
Mr CHESTER: Oh, because it is commercial-in-confidence!
The DEPUTY SPEAKER ( Ms Rishworth ): Order! I will make sure the speaker continues to make his remarks through the chair.
Mr CHESTER: Thank you, Deputy Speaker Rishworth, I accept your admonition. The Minister for Resources and Energy has backed away from it and he is not talking about it, saying unless we negotiate a deal that suits the government. But I think that really is the minister's code for, 'Oops, we've stuffed up. We didn't realise how much this would cost to pay out the owners of the power stations. We'd really like to go quiet on this one. We would like to just sneak out of this one and let no-one really notice that we ever talked about Contract for Closure.' The mere threat of Contract for Closure has been a social and economic disaster for a region like mine.
I know the minister at the table understands coal communities, but this policy of Contract for Closure has destroyed confidence in my region already, at a time when the economy is already soft. The government likes to blame that softness on other factors—and these are genuine factors: the high dollar, the European financial crisis, and high transport and wage costs. All of those are having an impact on heavy industry and on the manufacturing sector. But the question I continually put to members opposite—and I have yet to receive a decent answer to—is: Why are you making it harder? Why are you making it harder for Australian manufacturers? Why would any Australian government at a time like this do anything, anything at all, that would make it harder for Australians to compete on world markets? And I get silence like I have yet again tonight. Silence once again. Not one member opposite has got any explanation at all for why you would introduce a carbon tax and make things harder for Australian industry at this difficult time.
Mr Ciobo: Because they promised they would.
Mr CHESTER: No, the Greens promised they would. Government ministers claim to stand up for local jobs; they do claim to stand up for blue-collar workers. Then they like to say that members on this side are overstating the impact of a carbon tax.
I would like to refer briefly, in the time, I have left to a letter I received this week from a gentleman in my electorate who actually wrote to the Minister for Resources and Energy. This is a letter from Angelo Gaudiano. I have not got time to go through the whole letter, but I did get the opportunity to table it the other day thanks to the government's goodwill. Mr Gaudiano said:
Since the formation of Energy Brix Australia in 1993 we have worked hard to survive. We have had to cut back in numbers and have sacrificed pay rises just so the company would remain viable. The company has also spent a lot of money and resources on the plant over the years to make it more reliable and efficient. The company and its employees have endured many hurdles and have turned a loss making business into a profit making business with a future.
Since the introduction of the Carbon Tax, the Company has endured financial difficulties due to low electricity prices. Due to this financial strain on the business the maintenance on the plant has been reduced which has caused a downturn in production due to breakdowns. Once the carbon tax comes into effect at the start of July the business will be unviable. It will have to shut. Over 200 workers will lose their jobs and the community will be greatly affected with families leaving the area.
… … …
The Prime Minister promised that no one will lose their jobs or be disadvantaged by the Carbon Tax. The Union (CFMEU) promised that no one will lose their jobs or be disadvantaged by the Carbon tax. The Union promised it would work with the Government in ensuring alternative base load power stations be constructed in the area so that it will provide jobs for the long term. So far nothing has been done. ...
… … …
… I worry for the future of my family and I fear for the future of the community that I live in and have invested in as I know it is going to suffer greatly in the very near future and take many years to recover from the effects that this unpopular carbon tax legislation will bring.
I am also tired talk about clean energy transition by local governments and groups. Talk does not produce jobs. We need positive action now. So please take my letter seriously, I am very frustrated and scared about my future.
Angelo is a boiler turbine operator who informs me the minister has not responded to his letter. What a surprise! What a surprise that people like Angelo simply do not trust this government! And why would they?
Today I had the opportunity also to ask questions to the Minister for Regional Australia, Regional Development and Local Government. I asked him some questions about the Regional Structural Adjustment Assistance Program. This little beauty is a $200-million program to assist communities strongly affected by carbon pricing! But, remarkably, given that the carbon tax comes into effect on 1 July—that there are going to be announcements, supposedly, on Contract for Closure, on 1 July—the minister informed me that the guidelines for this program have not been developed yet. What are we waiting for? It is less than five weeks away and the guidelines for the $200-million structural adjustment package for regional communities have not been developed yet. This Contract for Closure is a dud policy from a dud government and this Clean Energy Finance Corporation just adds to the long list of policy failures from a government that has forgotten who it is meant to represent.
The Labor Party of old used to stand up for blue-collar workers like Angelo Gaudiano. Now it stands for staying in power at all costs, and it is doing pathetic deals with the Greens, who have never created a job in regional Australia and are a direct threat to jobs in a wide range of regional industries.
I have mentioned before in the House, and I will say it again tonight: there is an absolute crisis of confidence in regional communities directly linked to the uncertainty this government has created through its reckless decision to legislate for the world's biggest carbon tax. As long as this carbon tax hangs over the heads of Australian businesses it is hard to see that confidence being restored. Until this government actually asks the Australian people for their permission to introduce a carbon tax, they will never be trusted again.
It simply staggers me that this once grand old party that claimed to represent blue-collar workers could come in here every day and still pretend that it represents the workers of this nation, when it has a policy in place to sack hundreds of blue-collar workers in power stations throughout Australia and has no plan whatsoever on the table to actually compensate those communities or provide alternative arrangements. The carbon tax will come into effect on 1 July and once this Contract for Closure policy is announced there will be more jobs lost in communities like mine. This government assures me—the minister assured me today—that the guidelines have not been prepared yet. The Australian people simply do not trust this government and its assurances, they do not trust this Prime Minister with their jobs and I would love to see her show the same passion for their jobs as she has shown in fighting to keep her own. (Time expired)
Mr CIOBO (Moncrieff) (18:59): I rise to speak about the Clean Energy Finance Corporation Bill 2012 because this is quite an extraordinary bill. This is a bill that is delivering $10 billion of taxpayer subsidies through the Clean Energy Finance Corporation to deliver so-called viable clean energy technologies. The extraordinary thing about it though is that the bill in reality does not deliver viable clean energy technologies; it provides a taxpayer subsidy to those operators that seek to commercialise clean energy technologies. What we know, and this is a direct consequence of the House of Representatives Standing Committee on Economics inquiry into this very bill—
Debate interrupted; adjournment proposed and negatived.
Mr CIOBO: I am mindful of the time of night, so I will keep my remarks fairly succinct. What we know is that it is forecast that as a direct result of the operation of the Clean Energy Finance Corporation taxpayers have a default rate of 7½ per cent of the forecast expenditure by CEFC. Seven-and-a-half per cent of the forecast expenditure equates to $150 million a year of losses. Two billion dollars has been allocated to CEFC each year over five years—that is a $10 billion investment. Of that $10 billion it is predicted that at least $750 million of taxpayers' money will be lost as a result of defaults. That is the starting point—$750 million of taxpayer losses. I would say that if you go into a deal where the government says right up front, 'We're going to lose $750 million of taxpayers' funds and that's our starting point', then it gives some indication of this government's cavalier approach to the industry. But the way they try to defend it is to say, 'Yes, but we're probably going to seek to have a bond rate return on the total pool of investments'.
We had the opportunity as part of the committee inquiry to test the basis on which the government makes its forecast. We looked at two crucial elements. The first question was: where does the 7½ per cent default target rate come from? The answer: 'We do not know; it is effectively a direction from the government'. I would love to hear the minister account for this because the 7½ per cent default rate is not based on best practice, it is not based on international benchmarks and it is not based on prior experience. It is only based on a direction from the government to the departments of Treasury and climate change. The second question was: on what basis is the benchmark made of a bond rate return, of three or four per cent return on the total amount of pooled funds? Where does that come from? Lo and behold, it comes from the same source. It is not based on international benchmarks, it is not based on global experience, and it is not based on any kind of analysis or modelling. Rather, it is a consequence of direction again from the executive arm of the parliament down to the departments that that will be the forecast rate. So the reality of the operation of the CEFC is that there actually could be substantially higher losses. Instead of being a starting point of $750 million of lost taxpayers' funds, it could amount to being billions of dollars of lost taxpayers' funds. Instead of the return being a three or four per cent return it could in reality be a return of negative three or four per cent, because the only people who have made this decision thus far are the minister and I guess a coterie of people around him. And that is it!
Australian taxpayers need to understand that the Australian Labor Party is committing them to a $10 billion level of expenditure for the government to pick winners when it comes to clean energy technology. That should ring alarm bells. It rings alarm bells with the opposition. It rings alarm bells with the Liberal members of the House of Representatives Standing Committee on Economics who participated in the inquiry, but it does not ring alarm bells on the opposite side because it is just business as usual. It is just standard, typical practice from a government that has become fat and lazy when it comes to dealing with taxpayers' funds. That is the concern that I and others have.
But more than that, make no mistake, the whole basis on which CEFC will operate is fundamentally flawed because, again from the evidence before the inquiry, it is clear that the sole purpose of the operation of the CEFC is to provide a taxpayer subsidy for clean tech that otherwise will not be commercially funded. They are called barriers to entry or barriers to investment. The Labor Party cannot have its cake and eat it too. You cannot say, 'Well, there is a market failure here, there is a reason why these start-ups, these commercialised entities, cannot receive private sector finance and that is because it is too risky and too pricey for these ventures to be funded. That is why we are going to suddenly come in like the cavalry with a $10 billion fund,' but then at the same time say, 'No, there's not a heightened level of risk, it's okay'. The reality is this is a risky venture right from day one, which is why the Labor Party says, 'We expect a 7½ per cent default—that is, we expect taxpayers to lose $750 million, which could actually be substantially higher'.
This is a government with a bad track record. It is a government that now thinks it knows better than the private sector when it comes to investing in clean tech. It is a government which, as the very basic starting point for CEFC, acknowledges that these institutions, companies, or whatever they might actually be, cannot secure private sector funding at the level required to make a go of it. That is the whole rationale for this $10 billion fund and that is the reason why the coalition will rip it apart, because it is bad policy, it is bad use of taxpayers' money and it is Australian taxpayers that wear the risk of this investment, not the private sector. I am very pleased to say that we do not support this jaunt. We do not support risking $10 billion of taxpayers' money and we do not support a starting point that says we are going to lose $750 million—a figure that has just materialised out of thin air and is not actually based on international benchmarks.
The final point lies with why this is actually taking place. I said I would be relatively brief, so I will finalise on this point. It is the opportunity cost associated with the operation of the CEFC. We already know the government is taking it off budget. We know the government has used tricky legislative implementation to ensure that they make it as difficult as possible for a subsequent government that would seek to repeal this particular agency. It is Australians who will have to finance this through borrowed funds. So this little jaunt down the road of being venture capitalists, which is effectively what the CEFC will be, this little jaunt at the direction of the minister at the table, the Minister for Climate Change and Energy Efficiency, will see Aussie kids for the next 20 years having even more debt to pay off to pay for this little venture capital expedition that the minister and others want to go on. They are the ones in whose apparent cause we are trying to do our little bit to clean the environment, even though the rest of the world is continuing to pollute. It is in their interests, apparently, that all this is taking place, yet they always seem to avoid the little asterisk at the end of that sentence, which is that the next generation of Australians will be paying all the debt and interest associated with this $10 billion junket.
I am pleased to stand opposed to the CEFC. It is a bad decision. The government should not be in the business of thinking that it is smarter than the private sector because, if there is one thing that we have learned time and time again, it is that governments are not. I have absolute knowledge about one thing, and that is that this government certainly is not.
Mr COMBET (Charlton—Minister for Industry and Innovation and Minister for Climate Change and Energy Efficiency) (19:08): The House has been debating the Clean Energy Finance Corporation Bill 2012, the Clean Energy Legislation Amendment Bill 2012, the Clean Energy (Customs Tariff Amendment) Bill 2012 and the Clean Energy (Excise Tariff Legislation Amendment) Bill 2012. This is a very important package of legislation, and it continues to implement the Gillard government's historic reforms to build a clean energy future.
I thank all members for their contribution to the second reading debate on each of these bills and the associated legislation, although I should observe that some of the contributions really have been quite misleading and misrepresentative of the purposes of the legislation. One only has to consider the accusation of governments picking winners to recognise what nonsense has really been spoken by some of those on the other side of the House. In fact, the opposition has a policy called Direct Action, which is picking winners. What we are doing here with the Clean Energy Finance Corporation Bill is establishing a corporation, vesting it with funds that will operate independent of government according to an investment mandate and make investments on a commercial basis. To suggest otherwise just completely misrepresents the legislation.
I would also like to thank members of the House Standing Committee on Economics, particularly the chair, the member for Parramatta, for the inquiry that has been conducted into the legislation which built on the extensive consultation that the expert review panel, chaired by Jillian Broadbent, a Reserve Bank of Australia board member, undertook from October last year to March this year.
The Clean Energy Finance Corporation is a very important part of the government's clean energy future plan. It will encourage private investment and help overcome financial barriers that were clearly articulated in the review report that was chaired by Jillian Broadbent to commercialising and deploying cleaner energy technologies. The fact of the matter, as was identified in the review report, is that investment in clean energy technologies often faces a range of obstacles in attracting financing. I outlined those obstacles in my second reading speech.
The corporation will capitalise private finance into Australia's clean energy sector, renewable energy and low emissions technology using financial products and structures that address those financial barriers. They could include the provision of loans, loan guarantees or equity investments, but the corporation will operate on a commercial basis. The corporation, as I indicated earlier, will operate independently from government also, and it will focus on bringing private finance into the financing of renewable energy and low emissions technology investments. It is not expected to be the sole financier. In this way, it will build investor confidence in the clean energy sector.
It is also important to note just in summary that the Clean Energy Finance Corporation, the carbon price mechanism and the renewable energy target have all been designed to complement each other and, in order to facilitate the investments that need to be made in renewable energy, in low emissions technologies, in clean energy and in energy efficiency, to work together so that we achieve the goal of reducing our emissions, meeting our international obligations and achieving a 20 per cent renewable energy target by the year 2020 at lowest cost to the economy. These components of policy will work effectively together.
Finally, in relation to the Clean Energy Legislation Amendment Bill and the two other associated bills, it is important to note that the amendment bill will provide for something that the gaseous fuels industry has been asking for and consulting with the government for quite a period of time. It is something that came out of the inquiry into the clean energy bills last year—that is, to facilitate the opportunity for LPG, LNG and CNG to come underneath the carbon price mechanism rather than fuel excise arrangements. CNG, according to this bill and consequent upon its passage through parliament, will come under the carbon price mechanism from 1 July this year, and LPG and LNG will come under the carbon price mechanism from 1 July 2013. The amendments in the amendment bill and the associated bills principally deal with that issue.
With those remarks in summary, I commend the bills to the House.
The DEPUTY SPEAKER ( Ms AE Burke ): The question is that this bill be now read a second time. Just for the information of the House, there will be a series of one-minute divisions after this, so I suggest nobody gets up and runs away.
Bill read a second time.
Message from the Governor-General recommending appropriation announced.
The House divided. [19:18]
(The Deputy Speaker—Ms AE Burke)
Third Reading
Mr COMBET (Charlton—Minister for Industry and Innovation and Minister for Climate Change and Energy Efficiency) (19:23): by leave—I move:
That this bill be now read a third time.
Question agreed to.
Bill read a third time.
Clean Energy Legislation Amendment Bill 2012
Second Reading
Debate resumed on the motion:
That this bill be now read a second time.
Bill read a second time.
Message from the Governor-General recommending appropriation announced.
The House divided. [19:25]
(The Deputy Speaker—Ms AE Burke)
Third Reading
Mr COMBET (Charlton—Minister for Industry and Innovation and Minister for Climate Change and Energy Efficiency) (19:26): by leave—I move:
That this bill be now read a third time.
Question agreed to.
Bill read a third time.
Clean Energy (Customs Tariff Amendment) Bill 2012
Second Reading
Debate resumed on the motion:
That this bill be now read a second time.
Bill read a second time.
Message from the Governor-General recommending appropriation announced.
The House divided. [19:28]
(The Deputy Speaker—Ms AE Burke)
Third Reading
Mr COMBET (Charlton—Minister for Industry and Innovation and Minister for Climate Change and Energy Efficiency) (19:30): by leave—I move:
That this bill be now read a third time.
Question agreed to.
Bill read a third time.
Clean Energy (Excise Tariff Legislation Amendment) Bill 2012
Second Reading
Debate resumed on the motion:
That this bill be now read a second time.
Bill read a second time.
The House divided [19:32]
(The Deputy Speaker—Ms AE Burke)
Third Reading
Mr ALBANESE (Grayndler—Leader of the House and Minister for Infrastructure and Transport) (19:33): by leave—I move:
That this bill be now read a third time.
Question agreed to.
Bill read a third time.
ADJOURNMENT
Mr ALBANESE (Grayndler—Leader of the House and Minister for Infrastructure and Transport) (19:34): I move:
That the House do now adjourn.
Second Sydney Airport
Mr MORRISON (Cook) (19:34): Sydney airport is a key driver of our local shire and economy, providing jobs for thousands in aviation and related industries. My constituents have a great interest in securing the airport's ongoing success, and planning for future infrastructure needs will be critical to that success. We have now reached the point where a second Sydney airport is no longer a bold vision, like the Sydney Harbour Bridge was when it was planned and built, but an overdue necessity.
The Joint study on aviation capacity for the Sydney region report details two alarming warnings for my electorate and the Sydney community. Without a supplementary second airport there is no ability for Sydney to grow our aviation capacity to realise our future opportunities and noise sharing at KSA will effectively be impossible within 18 months. In order to sustain Sydney as the aviation hub it is today, a second supplementary airport is critical to ensuring Sydney's continued dominance and prominence in aviation. Even on conservative estimates, demand for aviation services in the Sydney region will double to nearly 88 million passenger movements by 2035 and to 165 million passengers by 2060. International experience suggests that for every million passengers airports generate a thousand jobs. The most immediate employment benefits fall within the local area. Yet, without a second supplementary airport, on its current trajectory KSA's ability to grow new services will leave Sydney short.
The status quo is not an acceptable solution for the airport needs of a major city of Sydney's global stature in the 21st century. If future aviation demand cannot be met, by 2060 we will have lost almost $60 billion in forgone expenditure and $34 billion in forgone gross domestic product. The New South Wales economy alone would forego $17.5 billion in gross state product. We are running out of time. Even if the site was fixed upon tonight, the timeline for developing and building something of this magnitude could be in the order of 15 years.
It is imperative this government makes a decision on a site for a second supplementary airport for Sydney before the next election. It is a federal decision, not a state decision. Once decided we must work positively with the state government and not seek to fit up that government with all of the associated land based transport infrastructure costs. Seeking a blank cheque commitment in advance from the New South Wales government for a site yet undetermined by the federal government is not practical and not helpful. No wonder the New South Wales Premier is proposing that the second Sydney airport not even be in the same state let alone in the same city. He has some experience in being fit up by this government for major transport projects.
Without a second airport our capacity to share aircraft noise in Sydney would also be compromised. It is bewildering for my constituents why, when we are blessed with a coastline and a swathe of national park, aircraft on rivet 9 flight path still fly over Caringbah, Lilli Pilli, Grays Point and Cronulla, or oceanic arrivals fly loops over our southern suburbs before 6 am, or Boree 4 flights take the land rather than the water leg when they could route over vacant parkland or sea instead without disturbing anyone.
The long-term operating plan introduced by the Howard government, supported by the legislated cap and curfew introduced by the government, has been a productive initiative to share aircraft noise and maintain community support for our airport. It is a critical component of the compact with the Sydney community to deliver peaceful and prosperous coexistence between the airport and local communities. LTOP rates rotate 10 different modes of runway use through the day to offer a reprieve to residents under the flight paths. Ministerial direction includes that the proposed changes to the elements of the plan should be tested with the public through the Sydney Airport Community Forum before being implemented. In this respect, I want to pay tribute to Mr John Woods and the special community representative, Kevin Hill, who serve on that forum. I was therefore particularly disturbed by the joint committee's recommendation that LTOP be reviewed to determine new, more effective measures of aircraft noise impacts and respite rather than the current runway-end movements.
LTOP is clearly over. The report admits growth and operations at KSA will lead to loss of the capacity to share noise and provide respite. By 2015 nine hours of the weekday will have demand levels exceeding 55 movements per hour, the approximate point beyond which the LTOP noise-sharing modes can no longer be operated and parallel runway operations are required. By 2020 the report forecast that demand at all hours between 7 am and 8 pm, save for two hours in the afternoon, will exceed that aircraft movement limit. The only opportunities for respite would be after 8 pm and a small window on the weekend.
Details of this review process are still unavailable. The last thing anyone wants is a return to the days when parallel runways were used, as the former transport minister Mark Vaile said, like the deck of an aircraft carrier in a war zone. With or without a second airport, we need to set our minds to developing LTOP mark 2. We need a new deal and a fair deal for all Sydney communities and we need a decision on a second supplementary airport as soon as possible . Both of these initiatives have my very strong support. (Time expired)
National Reconciliation Week
Mr NEUMANN (Blair) (19:39): As a federal MP with a large Indigenous community in Ipswich and Somerset, and as Chair of the House of Representatives Aboriginal and Torres Strait Islander Standing Committee, I would like to bring to everyone's attention to National Reconciliation Week, which started on 27 May and continues until 3 June.
The date commemorates two significant milestones in the reconciliation journey of our country. 27 May 2012 marks the 45th anniversary of the 1967 referendum which gave the Commonwealth the power to make laws for Aboriginal and Torres Strait Islander peoples and recognise them in the national census, which had the flow-on effect of allowing them the right to vote. The 3 June 2012 will mark the 20th anniversary of the Mabo decision of the High Court of Australia which legally recognised that Aboriginal and Torres Strait Islander peoples have a special relationship to the land, that existed prior to colonisation and still exists today. National Reconciliation Week is an important annual event which encourages all Australians to talk about and celebrate Australia's Aboriginal and Torres Strait Islander peoples who have lived in this great country for over 40,000 years.
Reconciliation is more than just a word—it is about actions. Closing the Gap is about actions not just rhetoric. National Reconciliation Week extends over the course of a week to encourage Indigenous and non-Indigenous people to think about reconciliation and what it means to them. 2012 is a time to reflect on what actions we are carrying out in this parliament that demonstrate our respect for Aboriginal and Torres Strait Islander people.
The opening proceedings of the new parliament in 2008 incorporated a 'welcome to country' ceremony. This was initiated by this federal Labor government and it was the first time it had ever been done. It is now a permanent feature in all future federal parliamentary openings. In 2010, an acknowledgment of country was incorporated into the standing orders for the Speaker to read out before the usual prayers at the start of each sitting day. An acknowledgment of country is a way of showing our respect to Aboriginal and Torres Strait Islander peoples. It demonstrates an understanding and respect of the traditional owners' connection to the land or sea, and their history and culture.
The House of Representatives ATSIA Committee includes an acknowledgement of country at the start of every private and public meeting it holds across the country. Currently we are running an inquiry into language learning in Indigenous communities. The committee has heard repeated evidence about the importance of the role of language and what it plays in terms of strong connection to land and culture and improving the wellbeing of Aboriginal and Torres Strait Islander peoples. The inquiry has highlighted the fact that Indigenous languages have been spoken in Australia for over 40,000 years and this is something of which all Australians should be proud.
However, Aboriginal and Torres Strait Islander languages are in sharp decline. Today there are about only 30 considered to be vibrant languages. At the time of white settlement about 250 Indigenous languages were spoken in Australia. The committee has been investigating programs and projects which aim to support the maintenance, transmission and revival of Indigenous languages. There are many dedicated people across the length and breadth of Australia working on projects to improve the vitality of our Indigenous languages. As a committee we have been looking at how we can work to improve Indigenous languages and assist these people as well to improve competency in English in communities, because that is the way for good education as well and good outcomes in terms of vocation.
In Newcastle the committee visited the Miromaa Aboriginal Language and Technology Centre, which has been a key feature and figure in developing support for language preservation and reclamation through technology, particularly through the development of their computer program Miromaa. The word Miromaa literally means 'saved' in the Awabakal language and refers to an ease and also the way in which databases can be helpful in maintaining the organisation, analysis and production of material to assist language. The program supports about 150 Australian language projects and is being used internationally.
From Halls Creek to Darwin, from the Utopia homelands to Sydney we travelled. Later this year we will have our report and over 150 submissions have been authorised by the committee. We look forward to handing down our report and its contribution to promoting Indigenous languages. (Time expired)
Bennelong Electorate: Traffic Congestion
Mr ALEXANDER (Bennelong) (19:44): As the representative for the people of Bennelong, I have spoken in this place about a large range of issues of concern to my constituents: cost of living, aircraft noise, economic management, leadership, education, private health insurance, animal welfare and local developments to name a few.
The single issue that is brought to my attention every day, both from constituents and through my own experience, is an issue that causes incalculable stress in my community. That is the never-ending daily grind of traffic congestion. Bennelong incorporates four of the 10 most congested roads in New South Wales. Every person and business in our region is impacted on in some way by this unacceptable situation.
There is a combination of reasons for this problem, many of which have their foundations in broken promises from both state and federal governments. For more than 12 years the former New South Wales Labor government promised the construction of the Epping to Parramatta and North West rail links. These two railway lines would allow tens of thousands of commuters who currently have no option but to use our road network to travel from the fastest growing region in the nation to Sydney CBD, and also between our city's next two biggest CBDs of Parramatta and Macquarie Park. Ten days before the 2010 election the Gillard government pledged $2.1 billion to build the Epping to Parramatta rail link. This money was listed in the 2010-11 MYEFO papers, but has since disappeared from sight. There have been no announcements and no information about pre-construction activities, and no mention of any costs of this project in this year's forward estimates, which take us through to 2015-16. This is in sharp contrast to the New South Wales government, which promised construction of the North West Rail Link during the 2011 state election, allocated $2.8 billion in the 2011-12 budget and immediately commenced pre-construction activities, including community consultations and environmental assessments.
In a perfect symbol of the Gillard government's politicisation of these important infrastructure issues, they have rejected a request to make a financial contribution to the North West Rail Link. This is despite the New South Wales government submitting a 2,200-page impact statement that outlined the creation of 16,000 jobs and injection of $25 billion to the state's economy through massive productivity increases from tens of thousands of commuters not wasting hours every day stuck in traffic travelling through Bennelong. In contrast, when the announcement was made to build the Epping to Parramatta rail link, this project did not exist anywhere in the state government's 10-year infrastructure plan and the only submission received by the federal government was a five-page document.
It would seem that if the NBN can be committed to from a few squiggles on the back of a drink coaster, then perhaps five A4 pages is overkill for a $2.1 billion rail network! Traffic congestion in Bennelong is also exacerbated by the costly 'point-to-point' tolling on the M2 Freeway, pushing thousands of cars onto local roads, and the lack of connectivity between the F3 and the M2, with flow-on effects throughout the region.
Recently I joined my colleagues the members for Bradfield, Mitchell and Berowra and Senator Sinodinos to form a Missing Link Action Network to fight for the prioritisation of the F3-M2 link. Despite the government admitting this is a vital piece of infrastructure, no funding has been listed for this in the budget.
Our roads are victims of poor planning and cooperation is required across governments to resolve bottlenecks. I host the regular tri-level government meeting to ensure cooperation and communication between all three levels of government in our region. Our June meeting in a couple of weeks will include a presentation from a senior manager of New South Wales Roads to continue this conversation. Short-term thinking has left Bennelong with a significant infrastructure deficit. Only genuine policy commitments that are prioritised by community need, not the political stripe of the particular electorate, will get commuters out of their cars, will clear our local roads and regain lost productivity, and will get our local community and our nation back on track.
Second Sydney Airport
Mr MURPHY (Reid) (19:49): Madam Deputy Speaker, you have just listened tonight to the member for Cook's speech calling for a second airport for Sydney. I am heartened by the member for Cook bringing this to the parliament because I agree with him that the status quo cannot continue, but that is where my agreement with the member for Cook stops. All this humbug, cant, hypocrisy and double standards about the second airport has to stop. Very recently the Premier of New South Wales suggested that the second airport for Sydney, the gateway to Australia, should be here in Canberra in the national capital. This is outrageous. He suggested we can build and would like to have a very fast train. But, of course, he had no regard for the cost of something in the order of $20 to $30 million per kilometre for a fast train, as if that would resolve the problem of a second airport for Sydney.
The Premier is living in fantasyland. I suggest that the member for Cook get behind the member for Grayndler—who knows something about aircraft noise and happens to be the transport minister—in supporting the push for a second airport to be sited at Wilton, some 20 kilometres south of Campbelltown. It is an appropriate place for a second airport, subject to a rigorous EIS. Badgerys Creek is not an option for the Labor Party for a second airport for Sydney.
Alarmingly, the member for Cook wants to have the long-term operating plan revisited. Tonight he advised that chamber that he wants a long-term operating plan Mark II. You would have heard me speak in this chamber over the last almost 14 years on many occasions about the Howard government's long-term operating plan which they went to in the 1996 election and the 1998 election and which committed to aircraft movements to the north of Sydney airport at 17 per cent. The people I represent and the people the member for Grayndler represents—and I notice the member for Sydney here in the chamber tonight, and I notice the previous speaker, the member for Bennelong—have to endure air-traffic movements double what was promised under the Howard government, and they never, ever had any intention of honouring a commitment to the people of Sydney that they would do something to alleviate aircraft noise.
For almost 40 years now, since the MANS report, we have been talking about the need for a second airport in Sydney, and we cannot get bipartisan support. Worse, I have just had to suffer the member for Cook coming in here tonight, and the member for North Sydney was also there—he is a former chair of the Sydney Airport Community Forum, he understands the issues and he knows that there has to be a bipartisan approach to this because by the year 2020 Sydney Airport is going to be stuffed. We need a second airport, not only in the economic interests of the state of New South Wales and our great country but also to alleviate the unbearable burden of aircraft noise, particularly over the inner-west of Sydney. It is having such an injurious effect to the people not only who I represent but also those who the member for North Sydney, the member for Bennelong, the member for Sydney and the member for Cook, to the south of Sydney Airport, represent that something has to be done.
I have a message for the member for Cook, and he can convey that to Premier Barry O'Farrell: he has to stop the politics, wake up to himself and get behind the member for Grayndler and transport minister in supporting a rigorous EIS for a second airport at Wilton, because that is the obvious place to have a second airport. With the way we are going with the coalition they will never get an airport in Canberra; they will have a second airport for Sydney out at Broken Hill. It is absolutely farcical! I applaud the efforts of the member for Grayndler in pushing for the second airport because the Sydney—(Time expired)
Enterprise Migration Agreements
Mr CHRISTENSEN (Dawson) (19:54): Last week the Gillard Labor government gave approval for over 1,700 foreign workers at the Roy Hill project in the Pilbara. It was an absolutely bungled decision, and we still do not know exactly what the Prime Minister knew or did not know about that decision. Now we see knee-jerk reactions from this government in response to their own stuff ups, which may result in increased cost burdens for the resources sector. At a time when the Minerals Council of Australia is reporting that it is 75 per cent more expensive for iron ore projects here in Australia compared with West Africa, it is not in the national interest to add more costs.
I support the sensible use of 457 visas where businesses struggle to find home-grown workers. In the Mackay region we would have businesses in serious trouble without 457 visas. We have many great Filipino and South African 457 visa workers in Mackay who have gone on to migrate here permanently—foreign workers who have become Aussie workers. However there is a disconnect, particularly when we hear mining companies say that they cannot find workers while people in my electorate on the doorstep of the Bowen Basin tell me they are desperately looking for work and are unable to find it. I know that there are many more jobseekers in capital cities. A number of locals have talked to me about the great expense they have incurred personally to get training but that they have not been able to secure a job in the resources sector. That is why there needs to be more rigour in the enterprise migration process to ensure that Aussies get the jobs before we open it carte blanche to foreigners, as this government has done.
And a jobs board is not the answer. An extra page on the JobSearch website does not solve or absolve this government of its Roy Hill debacle, but at least the Prime Minister and others opposite will have somewhere to pin their resumes after the next election. We also know that cash incentives to relocate do not work on their own. The government scheme to offer $9,000 cash to relocate to where jobs are has already failed, with only 37 people taking up that offer.
What will work is a comprehensive approach, such as the one pursued by the Nationals, which combines incentives for relocating to regional centres for employment with disincentives for doing nothing. The Nationals' regional investment strategy also includes tying skilled migrants to regional areas and providing tax incentives for businesses. Young, mobile welfare recipients who refuse to take up gainful employment in the regions should not expect to continue to receive unemployment benefits.
While this is not Nationals' policy, I agree with what hard workers in the resource industry in my electorate tell me about the idea of mandatory drug testing for welfare recipients. If it is good enough for a hard-working miner, who pays taxes, to have to undergo a mandatory drug test then it is good enough for the person who receives those taxes via welfare. To argue against drug testing for Newstart recipients is to foster illegal activities while undermining the economy and the self-respect of future generations. If we are to be serious about keeping Australians in jobs, we must provide those incentives to get the unemployed to the employment and provide disincentives for doing nothing.
One thing that may make people think twice about pursuing a career in the resources sector is the spectacle of a public dispute as we are now seeing in the Bowen Basin. I call on the CFMEU and BMA to come to the table and sort this out urgently, because every day this goes on is another day Mackay families have less money in their household budgets. Unions should accept the fact that they are not management and drop all ambit claims to management functions. They should stop their push to squeeze subcontractors off BMA sites.
But BMA should accept the more sensible union suggestions by agreeing to family-friendly rosters, and adding an extra half-hour crib break for shifts longer than 10 hours. We need to keep mining strong, with unions and mining companies working together, and where a good Liberal-National coalition government is working to get Australian jobseekers into mining jobs—not causing job insecurity through a great big new mining tax and a great big new carbon tax.
Turnbull, Rev. Lawrence
Mr TUDGE (Aston) (19:58): Just in the short minute or so that we have remaining, I would like to inform the House today that a very significant man in our local community passed away a couple of weeks ago, the Reverend Lawrence Turnbull. He was the minister at the Holy Name Church in Vermont South as well as at St John's in Wantirna South. He happened to be my family's minister also.
He was a remarkable person, who gave great love and spiritual guidance to many dozens, if not hundreds, of people over the years. He has certainly been a very significant influence on me and my family, providing us with tremendous support and guidance and being a person who I could turn to when required.
For many other people in our local church he has been one of the most important people in their lives. We had a very special service last Saturday for him and there was a funeral for him the previous Monday at St Paul's Cathedral in Melbourne, where we properly honoured him and honoured his contribution to our community. I know that he will be with the Lord, as he knew where he was going. We think about him and pray for him, as we do for his now-widowed wife, Faye, and the rest of his family and parish.
The DEPUTY SPEAKER: It being 8 pm, the debate is interrupted.
House adjourned at 20:00
NOTICES
The following notices were given:
Mr Shorten to present a bill for an act to amend the Social Security Act 1991, and for related purposes.
Mr Shorten to present a bill for an act to amend the Fair Work (Registered Organisations) Act 2009, and for related purposes.
The DEPUTY SPEAKER ( Mr S Georganas ) took the chair at 9:39.
CONSTITUENCY STATEMENTS
Aston Electorate: Sports Infrastructure
Mr TUDGE (Aston) (09:39): Sport is a massive part of our culture. We watch it, we follow it and we participate in it in great numbers. In my electorate of Aston we participate in all types of sport in enormous numbers. It is one of the real strengths of our community, because big sporting clubs, in concert with the churches, are the major social hubs where people of multiple generations come together and where young people are kept active.
But we have a problem in Knox with our core sporting infrastructure, which is not universally keeping up with demand.
A division having been called in the House of Representatives—
Sitting suspended from 9:40 to 10:08
Mr TUDGE: The problem is with our core infrastructure not universally keeping up with the demands. This problem is in part caused by population growth with more people wanting to participate, but it is also caused in part just naturally, because a lot of the infrastructure was built 30 or 40 years ago when the suburbs were being built and their time for renewal has come. Helping to build the sporting infrastructure in Knox to cater for the demands should be a priority for us. I know in Knox Gardens, the Knox Falcons Football Club, for example, is seeking to improve their second oval for the junior football club. I have spoken at length to Lee Metherell and Mark Fisher about this. Similarly, at the Scoresby Oval there is a desire for improved lighting so that they can extend the use of their great facilities there. I have spoken at length to our largest junior football club, the Rowville Hawks, and its president, Darren Humphries, about their expansion plans, and similarly with the St Simons Knights' facilities. Bayswater, Boronia and Wantirna South clubs all have some pretty good facilities right now but of course they always have further plans. A new club, Lysterfield Wolves, wants to get further established.
Similarly, with the soccer clubs, they have grown rapidly and they do not have the facilities which can cater for their capacity at the moment, and this includes Knox United and the Knox Churches soccer clubs. On the weekend, the vice-president of the Rowville Netball Club, Grant Atkinson, was speaking to me about his desire for all-weather facilities for the netball club. I could keep going.
A division having been called in the House of Representatives—
Sitting suspended from 10:10 to 10:23
Mr TUDGE: There are too many projects to do overnight, and I have not mentioned them all today. We need to continue to remind governments at all levels that these facilities do not just provide benefit to the direct users but have extensive flow-on effects for the entire community in terms of keeping people active and younger people engaged. For that reason, I will continue to fight to ensure that we have the infrastructure capacity in Knox to meet the growing demand.
Isaacs Electorate: Manufacturing
Mr DREYFUS (Isaacs—Cabinet Secretary, Parliamentary Secretary for Climate Change and Energy Efficiency and Parliamentary Secretary for Industry and Innovation) (10:24): On 15 May I participated in the South East Melbourne Manufacturers Alliance, SEMMA, industry forum held at Dandenong's Drum Theatre. Over 50 manufacturers representing businesses from across south-east Melbourne joined the federal Minister for Industry and Innovation, Greg Combet, the federal member for Bruce, Alan Griffin, and me in a lively and productive discussion regarding the issues facing manufacturing in Australia. The discussion covered the challenges facing businesses locally and across Australia as well as the support available to manufacturers under the federal government's clean technology programs and other initiatives. With 40 per cent of Victoria's manufacturing occurring in Melbourne's south-east, the future of manufacturing is central to the lives of many people living and working in my electorate and the surrounding areas, where manufacturing supports just under one in five local jobs. The positive feedback from the forum emphasises the importance of government and manufacturers working together to ensure the long-term viability of manufacturing in Australia. The SEMMA forum is part of an ongoing dialogue between the manufacturing sector and government that will ensure that the right policy decisions are made to enable Australian businesses to innovate and grow.
I want to mention a manufacturing company in my electorate that has worked hard to innovate and respond to the global environment. I recently visited Replas Recycled Plastic Products in Carrum Downs. They take plastic waste which would otherwise go to landfill and turn it into tough sustainable plastic products, including tables, chairs, boardwalks, bollards and play equipment. Products produced by Replas can be seen locally in the form of outdoor signage at Carrum Downs Secondary College, a boardwalk on the Frankston foreshore and signage on the nearby EastLink freeway. Further afield, Replas has provided boardwalks to the Northern Territory, to Parks Victoria, to the Mackay Regional Council in Queensland and to the Bega Valley Shire Council in New South Wales. Replas has the largest recycled plastics distribution centre in the Southern Hemisphere. I congratulate Replas on their commitment to the principle of the three Rs: reduce, re-use and recycle.
Labor is the party of manufacturing. We are committed to a strong and vibrant manufacturing sector. That is clear from the budget announced last month, which includes a surplus to take pressure off interest rates as well as providing significant new investment in skills and training to ensure that our workforce remains the most highly skilled in the world. We are not going to walk away from manufacturing when the going gets tough. We know the importance of the sector to our economy and to our country. We will keep fighting for manufacturing so that businesses like Replas continue to flourish.
Parkes Electorate: Toomelah
Mr COULTON (Parkes—The Nationals Chief Whip) (10:27): Last night on its 7.30 program the ABC ran a very powerful piece, which I think is to be concluded tonight, about the village of Toomelah. Toomelah is a small Aboriginal community in the northern part of New South Wales at the top end of my electorate. Unfortunately, the horrifying images that were shown on 7.30 last night are very close to what is happening there now. In the year 2012 it is an absolute disgrace to have people living in those conditions in Australia and it is something that we as a country should be ashamed of. Having said that, I am not trying to lay the blame at anyone's feet. Government departments, both state and federal, over a large number of years, with the best intentions, have put a lot of resources into Toomelah. But unfortunately we have got to a point where, if the community of Toomelah does not have the ability to turn the situation around from within, I believe we are going to need a combined effort to help those people.
We have seen programs go in there. The last thing we need to do at Toomelah is put in place programs where people are being paid to mow their own lawns. Most of the residents there have a certificate to use equipment such as bobcats and backhoes, but no job. There has been a focus on training but, if there is no job at the end of it, what is the use?
It is not as though Toomelah is in the middle of nowhere. It is within a half-hour's drive of the regional town of Goondiwindi in southern Queensland. Indeed, that state border is one of the problems that confront us. I think we need to have an approach that involves the Queensland government, the Goondiwindi Town Council, the Moree Plains Council, the New South Wales government and the federal government.
I spoke to Minister Macklin's office a couple of weeks ago. I offered my services to coordinate this, to work with the government and take the politics out of it. I am prepared to be the one who is the bearer of news that may not be well received. But the time is past for avoiding this, shutting our eyes and pretending that the issues at Toomelah will go away. I know these people. I know most of the residents personally. I am very fond of them. They are wonderful people, but they are living in a very troubled society. While it may be fair for adults to choose how they live, the children that live in that community have no say as to the poverty they are brought up into, and they need their safety secured. (Time expired)
Richmond Electorate: Renewable Energy
Mrs ELLIOT (Richmond—Parliamentary Secretary for Trade) (10:30): I rise today to speak about renewable energy projects in my electorate and specifically to commend the Tweed Shire Council for some of their outstanding work in this area. Recently I was very pleased to announce that the federal government was delivering $586,500 for a project called Increasing Soil Carbon in Tweed Valley Farmland. The project improves the viability and environmental capacity of the Tweed's farmlands. The three-year project proposes to implement a nutrient recycling program on 30 local farms across six industries: sugar cane, banana, vegetable, orchards, dairy and beef. Both conventional and organic methods are proposed, with the aim of increasing soil carbon whilst reducing farm greenhouse gas emissions.
The project will provide a platform to trial the production of local carbon-rich soil-amendment products by recycling local resources. The new project builds on the assistance that the council has received since 2009 from the federal Labor government's Caring for our Country program, which enabled the council to undertake a round of trials on 30 farms and which showed very promising results. This is a great achievement for our local community and I congratulate them thoroughly. They really show what can be achieved when the community works together to achieve real results.
Another great project is the Tweed Shire Council's waste facility at the Stotts Creek Resource Recovery Centre, which captures greenhouse gases including methane from the landfill site and converts the captured gas into electricity. This facility captures and burns approximately 600 tonnes of methane gas per annum, which is equivalent to 15,000 tonnes of carbon, and the electricity generated from the facility is in the order of 3,000 megawatt hours per year, which is enough to power about 400 homes. Since opening in 2006, the facility has produced 18,000 megawatt hours of electricity and captured over 11 million cubic metres of gas, about half of which has been methane. This has reduced the emissions of the facility by about half, meaning that emissions for Tweed Shire Council from this facility are well below the government's carbon threshold, and they will therefore not incur any liability. So congratulations to Tweed Shire Council for that fantastic effort. It is great to see.
What these projects show is that Tweed Shire Council is at the forefront of transitioning to a clean energy future. They certainly understand the need to be doing that, and congratulations to them for this fantastic effort. I would like to take this opportunity to congratulate everyone at Tweed Shire Council—in particular the mayor, Barry Longland. I would like to congratulate Mr David Oxenham, the director of the Community and Natural Resources section, who has really driven these projects, particularly the one at Stotts Creek. Congratulations to everyone involved on these great projects.
Square Kilometre Array
Mrs PRENTICE (Ryan) (10:32): In my maiden speech I spoke about those issues which unite all members of parliament and noted in particular the SKA project. On 25 May the International Square Kilometre Array Organisation announced that the International Centre for Radio Astronomy Research in Western Australia had been successful in its bid to host the world's biggest and most powerful square kilometre array radio telescope. This is fabulous news, although it has been a long time coming since they began their bidding process in 2005.
In the spirit of global research cooperation the SKA will be split between sites in Western Australia and South Africa. Australia's mid-west will hold two key components. The technology will be deployed at the Murchison Radio-Astronomy Observatory, where there will be a group of dishes with Australian-designed multi-pixel radio cameras. There will also be what is known as an aperture array, composed of vast clusters of antennae spread across thousands of kilometres and linked together to form a single telescope, measuring a million square metres. The precursor infrastructure at the site, including the Australian SKA Pathfinder and Murchison Widefield Array, was originally designed and developed by the CSIRO. Now that approval has been granted, the new SKA facility at the Murchison centre will be about 50 times larger than what exists at the site at the moment.
These technologies will make maps of the sky and then make expeditions or detailed investigations of what objects in the sky they uncover. Once the site in Australia has done wide-ranging, low-frequency expeditions, the South African site will then use its smaller, dish-shaped telescopes, known as MeerKAT, which will observe and analyse smaller sections of the sky in a much higher frequency and as such in much more thorough detail. The SKA will serve as a significant investment in Australia's scientific infrastructure and expertise in the already world-leading fields of Australian engineering, information technology and astronomy. As Professor Peter Quinn said, once the telescope is completed we will be able to explore the universe in 10,000 times more detail than ever before. The telescope could even pick up a mobile phone call from Neptune. The task they face will be both challenging and rewarding. Their investigations may further uncover the true history of the universe, as they examine hydrogen gas clouds from the so-called dark ages of the early universe after the big bang. The technology will allow scientists to pick up and differentiate between signals emitted throughout the universe over billions of years and whether such a signal may have been artificially generated by extraterrestrial life.
Mr Anthony Schinckel, of the CSIRO, expressed the enormity of their task when he said:
We'll be seeing if we can work out where we came from, how life evolved on this planet, and whether it might have evolved somewhere else.
The result for both Australia and South Africa is the best outcome possible. It means that scientists in Western Australia can utilise previous investment and play to the strengths of Australian scientists in the field of astronomy. This will be a fantastic opportunity for Australia to host one of the great science projects of the 21st century and will benefit Australia's scientific community for decades to come. I congratulate Professor Peter Quinn and the dedicated team who have made this project possible. (Time expired)
Enterprise Migration Agreements
Mr KELVIN THOMSON (Wills) (10:35): I welcome the plan to establish a subcommittee of the federal parliamentary Labor Party to examine issues relating to enterprise migration agreements. I hope this subcommittee will be able to investigate and get to the bottom of what are clearly contested issues of fact concerning these proposed agreements. The issue of pay rates is contested. We are told migrant workers are required to be paid the same rates as Australian workers, but the Construction, Forestry, Mining and Energy Union insists that in the Pilbara the best part of 200 Chinese workers are being paid 50 to 60 per cent of Australian worker wages, and that companies use devices to pay lower wages, such as bringing workers to Australia as tradesmen, but then paying them as labourers.
It is also a contested issue of fact as to whether there is or is not a shortage of Australian workers prepared to go to the mine sites to do the work. On the one hand, the mining companies claim there is a shortage. On the other hand, unions such as the Australian Workers Union say they have many workers ready, willing and able to do this work. One of my constituents has supported this view, saying he is a fly-in fly-out worker to a mine in Queensland. He spent $30,000 and five years studying part time to be a surveyor to move into the mining industry and earn a decent wage. He says the idea that there are not enough people willing to work in this industry is laughable as:
I have been trying to break into my first job for over 12 months and I am qualified in a field that is apparently in short supply. I have previous experience in management, I'm highly computer literate and I have the highest marks available for my degree, yet I never got a response from many job ads.
He says that, having worked in the mining industry for a few months now, he sees enterprise migration agreements as:
… a way to reduce wages and increase profits at the expense of local workers and safety … If a company knows that they can get access to cheaper labour they will offer the initial work at a wage or on terms that no-one here is interested in. Working remotely away from your family and friends should be rewarded, but some companies will start reducing wages or not paying employees for days that are rained out in order to drive interest away.
He concludes by saying:
Hopefully this email provides some perspective from a mining worker and encourages you to get companies to pursue all the opportunities here before we ruin an opportunity for many Australians to prosper rather than just the company bosses.
The fact is that we need to ensure that training is provided for Australian workers, particularly Indigenous ones. I know it is claimed that Australian workers do not have the necessary skills and are not ready. But neither is the project. If you go onto the Roy Hill website at www.royhill.com.au/employment and look under 'employment opportunities', there are none. It is pretty hard for the company to claim that it cannot find Australian workers to do this work when it has not even advertised yet. It has not tried.
Longman Electorate: Biggest Morning Tea
WYATT ROY (Longman) (10:38): Last Friday I hosted Longman's Biggest Morning Tea, one of many Biggest Morning Tea events held around the country in May to raise support and awareness for the work of the Cancer Council. Each day 275 Australians are diagnosed with a life-threatening cancer. I was surprised to recently learn that, by the time we turn 85, one in two Australians have suffered from cancer. Cancer is, in fact, the leading cause of death in Australia and all of us have been touched by cancer in some way with someone we know. It was for this reason that I decided to host a local Biggest Morning Tea. So on Friday, 80 members of my local community came together for a small feast of pancakes and to share their thoughts, experiences and support with the families, friends and loved ones of cancer recoverers as well as those suffering from cancer themselves. It was a great morning and the event raised hundreds of dollars to go towards finding a cure for cancer and helping those with their difficult journey of cancer. Thanks go to Gemma from the Cancer Council for coming out to our morning tea to speak about what the Cancer Council is doing and what the money raised will go towards.
There were many inspirational stories shared on Friday; stories of hope and stories of sacrifice. I spoke to many spouses who have dedicated their time to the many doctor visits and treatment programs. I was particularly inspired by the story of one of the ladies who attended the morning tea. She was a brave lady by the name of Debbie Lucht. Debbie had previously been diagnosed and had overcome kidney cancer, only to get the news on the 10th anniversary of her remission that the cancer had returned. Debbie is not one to take such news lying down. Debbie's perpetually positive attitude not only sees her strong fighting spirit to face her disease but also uplifts others, providing hope to everyone she meets. Debbie's words, 'I am not sick; I just have cancer,' are a striking demonstration of her inner strength and resolution. We could all learn much from Debbie's approach to life and I wish her the very best in her fight with this terrible disease.
I thank the many locals who turned out on Friday morning for Longman's Biggest Morning Tea, particularly as the weather was not quite the perfect Queensland weather we are used to. It was a privilege to meet many who have been personally touched by cancer and have, with great strength, persevered and fought cancer to go on to live full lives. I also thank the efforts of the two wonderful ladies from my community, Sandy and Mac, who volunteered their time to assist with Longman's Biggest Morning Tea. Without their help in preparing and serving morning tea and then cleaning up the event would not have been possible.
I take this opportunity to once again thank my community for their generosity and support for others. It is an honour to represent a community that is so willing to give so deeply when they, themselves, are facing difficult times.
Lyne Electorate: Clean Energy Forum
Mr OAKESHOTT (Lyne) (10:41): To pick up on some comments from a previous speaker about the Square Kilometre Array, I want to put on record that that is one of the most significant things to happen in Australian public policy in the last couple of weeks. I was recently at Coonabarabran at the Siding Springs facility meeting with a fascinating man, Rod McNaught, who has a comet named after him. There will be a lot of excitement about the reinvestment in astronomy generally in Australia and, hopefully, we can contribute to answering some of those mind-blowing questions such as: what is dark matter, and the place of earth in the universe? So, the Square Kilometre Array project is significant and will make a difference.
That is not the reason for getting to my feet. My reason is to promote a clean energy forum on 14 June in Port Macquarie. I am one who does believe the science and the economics in regard to the most appropriate response to the science. As well, I am one who in politics at both the 2008 and 2010 elections was an advocate for emissions trading schemes and said that I would work for them. I am pleased that we are finally at the point of now having one delivered in Australia.
On 14 June the public forum in Port Macquarie, which is free, will have Nathan Fabian from the Investor Group on Climate Change attending. That is significant. Nathan leads an investor group that, all up internationally, has about $1 trillion under investment in emissions trading schemes. That is a fair amount of money, and he is now looking in Australia for opportunities via an emissions trading scheme being developed. Locally there are co-benefits that come with this policy and trying to access not only some of that $1 trillion under investment around the world but also the co-benefits. For example, through the recent biodiversity funding round the local Port Macquarie-Hastings Council got a three-quarters of a million dollar grant through. As well, there are business opportunities that now come through the risk reward model of the trading scheme. There are a range of opportunities for natural resource managers, for business and for a bit more understanding throughout the community as to what this policy is, why it is happening and why we in Australian public policy are investing in science and are investing in economics to achieve what is a sensible policy for the long term with plenty of opportunities for local communities such as Port Macquarie.
Wright Electorate: Tamborine Mountain State High School
Mr BUCHHOLZ (Wright) (10:44): Recently I had the opportunity to visit the Tamborine Mountain State High School to present leadership certificates and badges to the school captains. The school opened in 2001 and was built to house 300 students. The grounds around the school were built in a lush tropical rainforest setting. For those of you who do not know where Mount Tamborine is, it is set in the western hinterland of the Gold Coast, a beautiful part of my electorate. I am glad I was able to share that for the benefit of the chamber. I was met by Tracey Brose, the school principal, who has been at the school since it opened—a young, focused, driven principal who has been guiding the students and teachers in a remarkable way. Tracey led us to the school hall, where the leadership presentations took place and I presented the certificates and badges to the captains, Jessie Middleton and Patrick Walters, and the student council president, Ali Guy.
When looking around the hall I could not help but notice that there were students sitting still. They were quiet and they were listening respectfully to the teachers, and they were actually all in their uniforms. After the assembly I was speaking with Tracey and commented on the students' behaviour, and Tracey explained that the school and the students particularly take great pride in their responsibility. Their motto is, 'Courage, respect and discipline.' The students quite often will self-discipline and come forward automatically if they feel they have done something not quite right. There was a situation where a kid was getting onto the bus and knew that he had done something wrong. He did not want to get dobbed in by the monitors the next day, so he fronted up to the school principal's office and said, 'Listen, I think I'm going to be in some strife; I may as well just hand myself in.' It is the whole culture of the school. It is an outstanding enforcement of discipline in a Gandhi-type way. Tracey explained that the rules of the school are explained quite plainly to the first-years and the older children mentor the younger and newer ones. It has been quite successful. There are two other rules which stood out: there will be no piercings at the school and no hair colourings other than the natural colour.
I met with Graeme Locastro, the acting deputy principal, who coordinates the Indigenous program at the school, to discuss with him ideas for funding for some of the programs taking place at the school, which is also very progressive. The school was built for 300 students, and at the present time there are 700 students and 80 dedicated staff. One of the impositions that challenge the school at the moment is that, because the school is not designed for the numbers that it has, it has to get septic-pumping people in there every single day to pump out the septic, an ongoing cost which the school will not be able to escape until more capital money can be invested in the school. I encourage the state to be mindful of that.
I would also like to thank Cameron Ross, the student coordinator, who arranged the visit and took the photos, and also Tracey Brose, who took time out of her very busy day to show me around. I would also like to acknowledge the fantastic work that the school leaders do up there in leading that community and leading the next generation of leaders.
Shortland Electorate: Surf Lifesaving
Ms HALL (Shortland—Government Whip) (10:47): I would like to use my time to pay credit to the wonderful surf clubs in the Shortland electorate. There are five surf clubs: Redhead, Caves Beach, Swansea-Belmont, Catherine Hill Bay and Lakes Beach surf clubs. These surf clubs are fantastic organisations of volunteers who serve their community without any thought for themselves, but along the way they have a wonderful time. Surf Life Saving Australia is the largest volunteer organisation in Australia, and I must say that the clubs in the Shortland electorate are absolutely fantastic and are totally dedicated to the protection of life. On many occasions they have been called out in some very, very difficult circumstances to find bodies when rock fishermen have been washed off the rocks, and they are always there. The beaches in the Shortland electorate are always patrolled.
As well as the senior surf-lifesaving clubs, there are the junior surf-lifesaving clubs. The clubs embrace all young people and encourage them to become involved in surf-lifesaving to prepare them for their adult lives or their teenage years, when they will be going to the beach and they will understand water safety. My own grandson attended Caves Beach Surf Life Saving Club this year. Whilst he was not the fastest on the beach or the fastest in the water, he really learnt a lot about beach safety and what it is to be involved in the surf-lifesaving movement. Over the last two weekends I attended presentations at two of the surf clubs. On 19 May I attended the presentation at Redhead Surf Lifesaving Club. Once again, I was overwhelmed by the dedication of those involved in the club. The patrol person of the year was Owen Evans and an award for diligence and service went to Jeff Rodway. These are two of the club's major awards and they recognise the contribution that these people have made over a number of years to Redhead surf club.
Last Saturday night I attended the Caves Beach surf club presentation. The club's Person of the Year was Brett Main, the president of the club, who has dedicated every spare moment to the club. I congratulate him. The associate member of the year was Ross Bowmaker, a former president, who has promoted the interests of Caves Beach surf club and surf safety within the Shortland electorate.
The DEPUTY SPEAKER ( Ms AE Burke ) (10:51): In accordance with standing order 193, the time for members' constituency statements has concluded.
BILLS
Broadcasting Services Amendment (Digital Television) Bill 2012
Second Reading
Debate resumed on the motion:
That this bill be now read a second time.
Mr ZAPPIA (Makin) (10:51): I speak in support of the Broadcasting Services Amendment (Digital Television) Bill 2012. The bill amends the Broadcasting Services Act 1992 to include the regulatory framework for digital television services. Importantly, it will facilitate earlier access to services licensed under section 38C, known as viewer access satellite television, or VAST, for viewers in areas which will not be able to receive adequate digital reception after digital switchover and gives the minister greater flexibility in varying the dates in switchover determinations.
These amendments will benefit television viewers in regional and metropolitan areas who do not receive adequate commercial digital television terrestrial reception. Currently, viewers in Australia who do not receive adequate commercial digital television terrestrial reception are not eligible to access the VAST service until six months before switchover in their licensed area. The proposed amendments to the conditional access scheme will establish a means for those viewers whom the commercial broadcasters do not intend to serve terrestrially to obtain early access to the VAST service.
On 2 November 2009 the minister made the Broadcasting Services (Simulcast Period For Metropolitan Licence Areas) Determination (No. 1) 2009, which determines when the switchover would occur. Switchover for Brisbane TV1 and Perth TV1 licence areas will occur on 30 June 2013. Switchover for Adelaide TV1, Melbourne TV1 and Sydney TV1 licence areas will occur on 31 December 2013. Following further consultation with broadcasters it is apparent that the switchover dates in all of the metropolitan licence areas are likely to require change. These variations in the switchover dates are to facilitate a staggered approach to the transition to digital television in metropolitan areas to ensure both government assistance schemes and broadcaster engineering resources are available and appropriately managed to achieve digital switchover by the end of 2013. In some cases the amended dates could fall outside the legislated six-month variation window where a determination can be varied up to three months earlier or three months later than the determined date. This means that setting the dates in some metropolitan areas could not be made by a simple variation to the Broadcasting Services (Simulcast Period For Metropolitan Licence Areas) Determination (No. 1) 2009.
The amendments allow the minister to vary the date of the switchover determination to a new date that the minister specifies, provided that the date determined is before 31 December 2013. Current restrictions do not provide the minister with sufficient flexibility to do this. Current restrictions do not provide the minister with sufficient flexibility to do this. Similarly, legislative provisions governing the making of digital-only local market areas determinations to allow the minister to vary the timing when a local market area becomes a digital-only market area are also being amended.
Failure to pass the bill during the winter 2012 sittings will delay earlier access to VAST services for some viewers in digital television blackspots in the major population centres of Adelaide, Brisbane, Darwin, Hobart, Melbourne, Perth and Sydney. Failure to pass the bill during the winter 2012 sittings will also prevent the minister from varying the switchover dates in metropolitan areas to ensure that switch-over occurs progressively throughout the year and that the switchover dates are varied in time to provide certainty to both viewers and the broadcasting industry.
This is an important consideration for people who live in my electorate of Makin. One of the proposed variations in the switchover dates requested by the broadcasting industry was to determine the switchover date for Adelaide in the first half of 2013. This would be welcomed by people living in Makin and other residents in South Australia.
This is a matter that is of real importance and would be very much welcomed by the people of the electorate which I represent—the people of Makin. My electorate is located along the Para Escarpment, which is predominantly what would be referred to as a 'hills face zone'. For decades, people living in that region have not received good television reception. That is because the TV towers of the main channels are located on the top of Mount Lofty above the area of my electorate. Many homes do not receive the signals because they are not in direct line of sight from where the signals are sent. Homes in some of the valleys, or which are obstructed by some of the local hills from the direct line signals, receive very, very poor service. This has been a longstanding problem.
Of course, in recent years the installation of cable TV, such as Foxtel, has helped out. But unfortunately not all people can afford pay TV. Even with some retransmission facilities that have been constructed over the years, the service to some parts of the electorate is still very poor. And it has been made even worse by interference caused by the roofs of some very large buildings that have been constructed in the area in recent years. Services whereby the TV screen becomes snowy or fuzzy, or in some cases where there is no service at all, or where you have what is referred to as 'ghosting' are commonly brought to my attention. I can recall having a long discussion with Mr Ian Hunt, a local resident of Salisbury East, who spent some time looking into this matter and the causes of the poor reception to people in the region. We had a discussion about what those causes were and what some of the solutions might be. It was interesting to speak to him because he certainly has done some really good work in respect of analysing what the problems were.
This legislation is therefore most welcome because for so many people in my electorate it will mean that finally they might be able to get some good television reception. In respect of that I have heard stories of people who have spent considerable amounts of money replacing their television set, constructing different types of aerials—sometimes at considerable cost—putting in new set-top boxes and the like, and yet they have still failed to get a good reception.
The importance of this legislation is simply this: firstly, digital TV should provide better reception to all. My understanding is that the digital signal is much more effective. Secondly, the digital switchover in Adelaide may be brought forward to the first half of 2013, and that is also good news. Thirdly, it now means for those people who have been waiting so long to get good television reception that they will be able to do so as a result of the flexibility that this legislation provides to the minister to enable people to access the satellite VAST service much sooner than they otherwise would have been able to do. It is the access to the satellite service that I believe is absolutely important with respect to this particular legislation.
I represent an electorate where there are a considerable number of aged people. For aged people today, access to their television set and having a good picture is very, very important, particularly if they are aged people confined to their home or who have other mobility problems. Television today is not simply a luxury anymore, as it might have been in years gone by. It is an important facet of life because people get so much information through the television set. It provides entertainment to those who cannot leave their home and, to many people who are living alone, it also provides a sense of company. For those reasons it is important for them to have good television service. Some of the people who have, over the years, raised with me their concerns about the poor service they are receiving are, in fact, elderly people.
This is good legislation because, for all of those people who have been waiting decades to get good television service, it looks as if they will be able to do so much sooner than they otherwise might have been able to. For those reasons I commend the legislation to the House.
Mr RANDALL (Canning) (11:01): I am pleased to speak on the Broadcasting Services Amendment (Digital Television) Bill 2012 because it has an effect on many in my electorate, which is an outer urban electorate. This bill effects changes needed to improve the processes around the switch to digital-only TV. In particular it makes VAST, Viewer Access Satellite Television, services available earlier for viewers who will never receive a reliable terrestrial signal.
By the end of 2013, all analogue TV broadcast will cease and all free-to-air television will be broadcast in digital format only. Some areas on the eastern seaboard have already made the switch, but in Western Australia we will see this occur sometime after June 2013. The coalition supports the bill and the switch to digital television but wants to ensure the rollout is effective, that digital coverage is adequate and that the rollout times are achieved.
Canning electorate is 6,500 square kilometres. Much of it is rural and has a topography which sometimes affects television signals. This legislation is very relevant to some of the outlying towns in the electorate. Two of those towns are Boddington and Waroona. Boddington is the home of the Newmont Gold Mine, which is going to be the largest gold mine in Australia, producing some 850,000 ounces of gold a year. There are a number of people moving to Boddington and Waroona, and their populations are due to increase as a result of that large mine. Boddington, as I said, is listed to possibly receive the Satellite Subsidy Scheme, the SSS. The scheme will provide a subsidy for eligible households to switch to digital TV via the Viewer Access Satellite Television; however, we need to see that this Labor government is not leaving people in rural and regional areas at a disadvantage with regard to the switchover.
The western VAST service, in other words the service for Western Australia, started in August 2011 to provide digital free-to-air channels to those who require a satellite service for digital TV. One of my constituents, Mr Peter Shoudra of Boddington, told me he thought it was unfair that country people need to get the VAST service to access digital TV and then have to pay for the connection of the technology while their city counterparts do not.
Although I expect the Satellite Subsidy Scheme will be applicable to Mr Shoudra in Boddington—and this is yet to be confirmed, unfortunately—he will still have to contribute something like $200 to $350 towards getting this service. As I said, this seems unfair for somebody living in the bush when their city counterparts do not have to. This is a big cost for families struggling with the rising costs of living and even more so for pensioners.
Furthermore, although the VAST service started in Western Australia in August last year, people in the Boddington area, according to the Digital Ready website, are not yet able to apply for subsidies under the Satellite Subsidy Scheme, with the application open and close dates yet to be determined. So how can Western Australians apply for them if they do not even know when they are available to be applied for?
Western Australia has the most towns of any state listed as eligible to receive a subsidy under the Satellite Subsidy Scheme, but it is the last state where you will have the opportunity to get it. There is something funny about that—it is a long way from Canberra, so out of sight, out of mind. Once again, as I said, the further away we are from Canberra, the more insignificant we are to the Canberra based bureaucrats—and I see them sitting over there.
One of the specific provisions in the bill should make this situation better—that is, 'to facilitate early access to the VAST service for viewers who will never be able to receive an adequate terrestrial television signal.' Currently, some viewers need to wait six months for the analog signal to be switched off in their area before they can access VAST. In other words, they have to wait six months before they can apply.
Clarifying arrangements for determining whether a resident is eligible for the VAST service is also a key component of this bill. For example, areas that have a self-help transmission tower are being asked to give the government sufficient notice of any decision to switch off the tower or convert it to digital.
These towers are sometimes owned and maintained by the local government authority—in this case, the Boddington ShireCouncil—so you can imagine the cost of converting them to digital. It is a cost that a small council the size of Boddington just cannot afford.
For that reason you can imagine that most local government authorities with these towers will just turn them off. Yet the federal government is sitting back, saying: 'You tell us what you are doing'—which is just an easy way to put the blame back on the council when the rollout is late. The onus should not be on the council; it should be on the government which is switching off this service to liaise properly with them so that they can coordinate the switch-off and the rollout of the digital signal.
The government's rollout of digital TV must be closely monitored. I wish to provide this feedback from Canning constituents who are having some issues with the digital service. For example, Colin Lankford, from Kelmscott, recently switched to digital TV. Since then he has only been able to access two channels, despite being able to access all other channels when he had analog TV. He has had aerial technicians come to his house to check the issue, but they have said that the location of the house means that there is very poor reception throughout the region, which has also been confirmed by the Australian Communications and Media Authority. He inquired about getting the VAST service and accessing the Satellite Subsidy Scheme, but he is not eligible as he is living in a metropolitan area. He is still in my electorate and, dare I say, on the south-east corner of the metropolitan area and only a kilometre or so from the bush. That is how close he is to being out of the metropolitan area. He has no other options available to him.
Pam Herbert, also from Kelmscott, said that she has the same issues as Mr Lankford—in other words, once she switched to digital, not getting the channels she should. Graeme Leach and Ken Lee, who both live in Erskine, which is further south towards Mandurah, have the same issues as I have listed regarding the signal. They are also not eligible for the subsidy. That is the trouble with outer metropolitan electorates. The metropolitan arbitrary line is drawn such that, when it suits government and government agencies, these areas are deemed as metropolitan and if they are a bit further out they are still deemed to be metropolitan, if it suits them—for example, in terms of the provision of aged care. But in this case, because they are after proper treatment through this digital rollout, they can be considered to be not within a rural or regional area but metropolitan. They are in a very grey area.
The key point that I am making is that there are clearly ongoing issues with the digital TV rollout, which are going to be exacerbated once the complete switch-over takes place next year. The federal government and ACMA, seemingly, are unwilling to provide any assistance, only offering the VAST Satellite Subsidy Scheme to those in rural or remote regions. As I said, this offer is clouded in uncertainty and fraught with technical difficulties, which many of my constituents are extremely frustrated about. The minister has only answered these concerns with four suggestions—can you believe this? The response from the minister was: 'How about telling them to turn their aerials in a different direction,' or, 'Ask an aerial technician to assess the problem,' which they have already done. These people have already tried these options, but it is becoming a growing inconvenience and expense when they have to call out the TV repairman.
When you put this together with the government's initiative two budgets ago on set-top boxes, it just makes you realise how shambolic and symptomatic this is of a government handling an issue like this TV switch-over. The set-top box situation is just ludicrous. In fact, I have a number of set-top boxes that I cannot even give away to constituents because they do not want them. Attaching a set-top box to an analog TV for a pensioner is not the cheap, $350 option, because you then have to get out a technician to connect it and do something with the aerial. They would be far better off getting the same amount of money to allow them to go to JB Hi-Fi or Harvey Norman and just buy a proper digital TV for probably less money. You can get a good 32-inch digital TV at any of these places for about $350. This thinking is about as clever as some of the other brain snaps like pink batts, green loans and cash for clunkers that this government has come up with, and it does not solve the problem. The government needs a more orderly and structured process when people like those I have mentioned in my electorate are having extreme difficulty with this signal, whether it be for terrestrial reasons or due to the location of the tower—in his speech the member for Makin mentioned the shadow of the signal. All those sorts of issues need to be dealt with because people in outer urban electorates are just as important and just as equal as those in metropolitan areas. They deserve better.
Ms HALL (Shortland—Government Whip) (11:12): I must share with the House that I have had similar problems with constituents in my electorate. It will be resolved in the future, and maybe I could meet with the member for Canning later and tell him what is happening in my area. I rise to support this legislation to improve the regulatory framework for digital television services. In particular, it will facilitate earlier access to services licensed under section 38C, known as VAST, for viewers in areas which will not be able to receive adequate digital reception after digital switch-over. It gives the minister greater flexibility in varying the dates of the switch-over determinations.
The Shortland electorate straddles two switch-over areas. The Hunter region switches over on 27 November 2012 and the Central Coast part of Shortland electorate, which is in the Sydney broadcasting area, will switch over in 2013. The legislation will allow for the management of the switch-over process by broadcasters and it will ensure the government's assistance schemes are delivered in a timely manner.
Shortland electorate has areas with significant digital signal problems. One area in particular is the suburbs of Belmont North and Jewells. They are very similar to areas that the member for Canning mentioned; they will not qualify for satellite and the subsidy that goes along with that. Also, many parts of the Central Coast area are affected, but the biggest problem on the Central Coast relates to the ABC. The signals are basically clashing and interfering with reception. That needs to be dealt with by the ABC. In relation to the problem in Belmont North and Jewells, there is going to be a new tower built that will circumvent some of the difficulties that are present in that area. If the member for Canning visits the website that shows where new towers are to be built, he will see if his area is missing out on one of the new towers. There has been lengthy community consultation, and I made sure that the residents in my area had all the information. It sounds like a very similar problem to the one that they were having. As a consequence of the intervention and presenting the information, Broadcast Australia has put in a proposal for a new transmission site, which will most likely use existing mobile phone towers. They put the technology onto that, and then that helps with the problem that is being experienced with reception.
The proposal has the new transmission site located on Violet Town Road at Belmont North, at the junction of Violet Town Road and the Pacific Highway. That will assist with the problem. The transmission will commence from that site about six weeks before the switchover. It will be completed in time for the switchover so that the people who would not have the ability to watch digital TV will have reception. The new transmission site should resolve all reception difficulties in the northern part of my electorate. I suggest that, if the member for Canning can link into a similar situation, then his problems will be resolved. I know there are a number of new transmission sites that are being constructed throughout the country. I am very pleased that the problem area I had at Belmont North and Jewells will be resolved. People who are experiencing problems should go to the mySwitch website and check how the improvements will affect them. Once again, if the member for Canning has a look at that site, he might find that it is going to help his constituents. The problems on the Central Coast are twofold. There are problems caused by topography, which is quite significant, and problems caused by signal clash of the ABC's single frequency network.
The legislation will allow commercial broadcasters to take a considered and managed approach to the massive task of switchover in metropolitan areas. Further work needs to be done on the Central Coast by commercial broadcasters to audit the reception problems and to plan solutions for the problems. That is something that I am going to be following very closely, because once the digital switchover takes place we need to ensure that people can receive television. It is not a very good situation if we have people who are not eligible for any sort of subsidy and cannot receive reception on their television sets. It can be resolved, as I have shown, and has been resolved at Belmont North and Jewells.
The big problem is in the ABC transmission and how the ABC intends to resolve the clash of their network. That is the biggest problem on the Central Coast. The other will be resolved but I think we need to resolve that issue with the ABC. I have made representation to the ABC about that. Some areas of my electorate are able to receive an ABC transmission from three sources: from Sydney, from Mount Sugarloaf and from the Central Coast. For many, many constituents this results in a signal clash and is very difficult for individual households to resolve. They turn their aerial one way and then the other, they raise their aerial and do many things but still do not resolve the problem. I would really encourage the ABC to resolve that issue on the Central Coast. It is very important to the constituents I represent in the parliament. But I am very, very pleased with the resolution found to the problems experienced by residents at Belmont Beach north of Jewells Beach in the northern part of my electorate. Those residents will be able to receive digital reception once the switchover takes place because of the action that the minister has facilitated through community consultation leading to Regional Broadcasting Australia putting in a proposal to upgrade the site and to ensure that digital television access is available.
Mr ALBANESE (Grayndler—Leader of the House and Minister for Infrastructure and Transport) (11:21): I would like to thank the members who have contributed to the debate on the Broadcasting Services Amendment (Digital Television) Bill 2012. The bill contains a number of measures to improve the regulatory framework for digital television services. In particular, it will facilitate earlier access to services known as the Viewer Access Satellite Television service, or VAST, for viewers in areas unable to receive adequate digital reception after switchover. The bill will enable the conditional access scheme administrator for the VAST service to specify open-access areas to allow viewers in these areas immediate access to VAST. The bill also broadens the definition of applicable services used by the scheme administrator to assess eligibility to access VAST. As at 2 May 2012, over 68,400 households in remote and regional Australia had already been connected to VAST.
The bill also gives the Minister for Broadband, Communications and the Digital Economy greater flexibility in varying the dates in switchover determinations. It allows the minister to vary the date for a licensed areas digital switchover to any future date the minister specifies, provided that date is before 31 December 2013. Similar amendments will be made in respect of digital-only local market area determinations.
The amendments in this bill will provide the government and the broadcasting industry with the necessary flexibility to deliver a managed and efficient final stage of digital switchover. I thank all members who are supporting this bill's proposals, and I commend the bill to the House.
Question agreed to.
Bill read a second time.
Ordered that this bill be reported to the House without amendment.
Appropriation Bill (No. 1) 2012-2013
Consideration in Detail
The DEPUTY SPEAKER ( Ms AE Burke ) (11:22): The Federation Chamber will now consider the bill in detail. In accordance with standing order 149 the Federation Chamber will first consider the schedule of the bill.
Mr CREAN (Hotham—Minister for Regional Australia, Regional Development and Local Government and Minister for the Arts) (11:23): It might suit the convenience of the Federation Chamber to consider the items of proposed expenditure in the order and groupings shown in the schedule which has been circulated to honourable members. I indicate to the Federation Chamber that the proposed order for consideration of portfolio estimates has been discussed with the opposition and other non-government members, and there has been no objection to what is proposed.
The s chedule read as follows—
Regional Australia, Local Government, Arts and Sport—Regional Australia, Regional Development and Local Government
Regional Australia, Local Government, Arts and Sport—Arts
Agriculture, Fisheries and Forestry
Infrastructure and Transport
Immigration and Citizenship
Human Services
Sustainability, Environment, Water, Population and Communities
Defence—Defence
Defence—Veterans Affairs
Attorney-General's—Attorney-General's
Attorney-General's—Emergency Management
Climate Change and Energy Efficiency
Treasury—Financial Services and Superannuation
Treasury—Treasury
Resources, Energy and Tourism—Resources and Energy
Resources, Energy and Tourism—Tourism
Broadband, Communications and the Digital Economy
Health and Ageing—Health
Health and Ageing—Mental Health and Ageing
Families, Housing, Community Services and Indigenous Affairs—Families, Community Services and Indigenous Affairs
Families, Housing, Community Services and Indigenous Affairs—Disability Reform
Families, Housing, Community Services and Indigenous Affairs—Housing
Families, Housing, Community Services and Indigenous Affairs—Homelessness
Industry, Innovation, Science, Research and Tertiary Education—Tertiary Education, Skills, Science and Research
Industry, Innovation, Science, Research and Tertiary Education—Industry and Innovation
Industry, Innovation, Science, Research and Tertiary Education—Small Business
Education, Employment and Workplace Relations—School Education, Early Childhood and Youth
Education, Employment and Workplace Relations—Employment and Workplace Relations
Foreign Affairs and Trade—Foreign Affairs
Foreign Affairs and Trade—Trade and Competitiveness
Finance and Deregulation
Prime Minister and Cabinet—Prime Minister and Cabinet
Prime Minister and Cabinet—Social Inclusion
The DEPUTY SPEAKER ( Ms AE Burke ): Is it the wish of the Federation Chamber to consider the items of proposed expenditure in the order suggested by the minister? There being no objection, it is so ordered.
Regional Australia, Local Government, Arts and Sports Portfolio
Proposed expenditure, $1,408,531,000
Mr CREAN (Hotham—Minister for Regional Australia, Regional Development and Local Government and Minister for the Arts) (11:25): The appropriations that were made in this budget were of significant benefit to regional Australia and to the arts community. I might say in relation to regional Australia that no government has made a greater commitment to strengthen regional development opportunities. We understand the importance of it with an economy in transition and with the regions representing the patches in the patchwork economy. Last year, we saw the record investment committed over four years in the forward estimates of $4.3 billion to the regions. This year, this budget—building on that investment—saw $475 million for regional hospitals, $80 million for dentists moving to regions and $35 million for doctors moving to the regions. We saw the NBN rollout. The next three-year rollout identified 238 regional centres that will be beneficiaries of the rollout. The schoolkids bonus and the family tax benefits are obviously of significance to regional Australia. The commitment to the National Disability Insurance Scheme and the aged-care initiatives are also of significance to the regions. Seventy-five per cent of the federal roads budget went to regions. We saw a massive new investment in remote jobs and skills packages.
In relation to the arts, the budget saw almost $65 million over four years committed to secure jobs in the arts, in cultural heritage and in the creative industries—in particular, to bolstering the capacity of our national collecting institutions. This has laid an important foundation for the development of the government's commitment to a national cultural policy. That has to take into account not only expenditures but the structural changes that have been recommended in relation to the Australia Council and the partnerships that we have been developing with the private sector, with philanthropists and with state governments.
I make the point that those appropriations—those commitments in the budget, were done in very tight fiscal circumstances. We still were able to produce a surplus in the coming year and every subsequent year for the nation. Why is that important? Because a government that acts responsibly in terms of fiscal policy leaves more room for the Reserve Bank to move on monetary policy. Just in the lead-up to the budget, where we were selling the message of the importance of getting fiscal rectitude into the budget, we saw a 50-basis-point drop in interest rates. That downward pressure on interest rates is of huge importance to all Australians, but in particular to regional Australia.
I might also make the point that, as difficult as the fiscal circumstances were, we are able to allocate these amounts for distribution into regions and the arts because we have such a strong economy. The reason we have a strong economy is measures that this government has taken since it came to office—the stimulus in particular—and also the major reforms that were initiated by previous governments to open up the Australian economy. I simply make the point that you cannot do these sorts of distributions and these commitments to important nation-building agendas unless what we are doing is strengthening and growing the Australian economy. Much of what we are doing, not just for regional Australia but for the nation as a whole, is about investing in those things that drive productivity, improve competitiveness and underpin creativity. The regions are going to be major beneficiaries of that. We want to see that, because they have a key role to play. The more we strengthen our regions, the more we strengthen the nation.
Mr IAN MACFARLANE (Groom) (11:29): My question to the minister is in regard to RDAs. The RDA guidelines say that round 2 of the RDA Fund will be announced in May. When can we expect to see the results of that round?
Mr CREAN (Hotham—Minister for Regional Australia, Regional Development and Local Government and Minister for the Arts) (11:29): I am in receipt of recommendations as we speak in relation to round 2. We hope to be announcing those shortly. I would like to flag on this occasion that we probably will not be putting out all the announcements at once. Last time, putting out the 38 all at once got lost on the day, so we will be staggering those announcements somewhat to get major effect.
Ms Saffin: Mine didn't get lost!
Mr CREAN: I know that the member for Page's did not get lost—she was a very strong advocate—nor did those of other members at the table. But it is important that we understand the significant investment in this. The $150 million that we put out in the first round actually leveraged almost three times that amount in terms of other investments. I think the message has got through about the importance of partnership and the leveraging of funding from the other levels of government—state and federal—from not-for-profit organisations or the private sector. When we see the coming announcements I think we will see that message has been picked up in important ways.
Importantly, if you look at the mix that was in the first round you will see there was an important commitment to those initiatives that supported not only economic development and economic diversification but also social diversification—the social needs of communities and the livability of communities. That is terribly important. We will be announcing the rounds over the coming weeks. We also put another $50 million into that round and $250 million will be in this round.
Mr IAN MACFARLANE (Groom) (11:32): Madam Deputy Speaker, I expect the member for Blair has a burning question. I know he does not have access to the minister normally, so he will take advantage of this situation. Can I just follow on from that and ask the minister whether the funding agreements for all 35 projects approved under round 1 have been finalised and, if not, which projects have not had their funding agreements finalised?
Mr CREAN (Hotham—Minister for Regional Australia, Regional Development and Local Government and Minister for the Arts) (11:32): I am advised that all of them have been finalised, but I will double-check that. If there is any variation I will let the member know.
Ms SAFFIN (Page) (11:32): I have a question, but I would like to premise it with a bit of a statement. In talking about the number of projects here that got up in round 1, two projects were successful in my area. I want to say a little bit about them. The first project is at Lismore City Hall, which is home to the Northern Rivers Performing Arts group, NORPA, which is a nationally recognised group. It was set up quite some years ago and has been very successful. When the hall is upgraded it will be for commercial independent productions music. I was there recently having a look around and I know what a great difference it will make to the region. Also, the hall upgrade will allow performances to come to the region—
Mr Tehan interjecting—
Ms SAFFIN: Can I have my go; you can have yours later?
The DEPUTY SPEAKER ( Ms K Livermore ): Order! The member for Wannon will sit in silence. The member for Page has the call.
Ms SAFFIN (Page) (11:34): Thank you, Madam Deputy Speaker. It will make a huge difference not only to the hall but, as the minister just said, in terms of adding to the economic and social development of the region. That is a really important thing. The other project was at the Ballina/Byron Gateway Airport, operated by the Ballina Shire Council. The airport is an important gateway to the region and has grown considerably—as the traffic through it has grown considerably—over the years. Ballina Shire Council, like Lismore City Council, put up funding themselves for projects. They are absolutely project ready so that, when they put their applications in and go through the assessment processes, they have already done a lot of the groundwork, the grunt work, and the projects are not just ideas on paper. That is really important. I have five local government areas and I work closely with them and with the organisations beyond so that everybody is prepared and ready to take advantage of the opportunities when they come along.
I think that is an important role that we can, should and do play as local members, to make sure we are on the front foot. It does not mean that we will get everything we want, because we all want everything for our own particular seats and regions. But we can be out there leading and supporting, and sometimes leading from behind—it does not always have to be upfront—
Mr Griffin interjecting—
Ms SAFFIN: Stop it! So there are different forms of leadership and they are all appropriate—that is my point. It is about working with the communities. That leads me to my question—
Mr Tehan: That's five minutes of my life I'm never going to get back.
The DEPUTY SPEAKER ( Ms K Livermore ): Order! The member for Page will continue with her remarks.
Ms SAFFIN: The question is: Minister, would you please advise how the government is contributing to building important local infrastructure in the regions under the Regional Development Australia Fund? Hopefully you will be able to comment a little bit on the arts and also on some of the smaller projects in the smaller regions and areas, because sometimes it can be a bit harder for them to get a look-in. Secondly, how has the government's policy approach to regional development given expression to local priorities? Thank you, Minister.
Mr CREAN (Hotham—Minister for Regional Australia, Regional Development and Local Government and Minister for the Arts) (11:37): I thank the member for Page for her question. I know how dedicated a local member she is, not just in terms of the community infrastructure, and the example that we have just heard is just one of them. I was also with her in September last year when we opened the Casino Community and Cultural Centre, which was a wonderful addition to the community and, again, would not have been there but for a Labor government supporting it. This was supported through the Regional Development Australia Fund, which the member refers to. The fund is a fundamental part of what we are doing in terms of revitalising regional Australia and helping not just to diversify its economic base but to realise the importance of livability, community aspiration and community access to a range of services as well as cultural and community experiences.
You have heard about the Lismore City Hall, Madam Deputy Speaker. The other initiative in the member's electorate was the upgrade of the Ballina airport. It is interesting that yesterday in the House we had that shameless exhibition by the member for North Sydney, riffing off a press release about how regional air services were being reduced, when people who actually live in the regions know that the services are in fact being increased. It is true that Brindabella was changing its business model to take advantage, quite frankly, of the huge growth in fly-in fly-out business, in particular in the mining sector, which the opposition said would stop investing when the carbon tax was brought in. Far from not investing, they are going gang busters. Regional airlines, amongst other things, are changing their business models, but the airports themselves are having to upgrade significantly, and the Regional Development Australia Fund has been helping in that regard.
I am reminded by the member for Blair that one of the smaller initiatives that we were able to support was in his electorate. The Somerset Civic Centre received a grant out of the first round, and that was a terribly important rebuilding exercise for that community after it was devastated so badly by the floods in Queensland. It was not just a question of repairing what had been lost; it was a question of building a new heart, new commitment, new meaning to the region and giving it that community base.
I said before that we are about to announce the second round. The point I would go on to make to the member is this: that those two rounds are two of five rounds that the Regional Development Australia Fund will commit to before the next election. There are now another three rounds in RDAF, because we have got the parliament to pass the MRRT. But those rounds will disappear if those who sit opposite have their way They oppose the very mechanism by which you can inject back into communities, because the funding for the next three rounds comes from the minerals resource rent tax, which they do not get. It is distributing the benefits of the mining boom and enabling communities to diversify their base and build their community amenity.
We are delighted with the success of this round. We are delighted with the way in which communities have been responding to it in a constructive and strategic way—where communities have been prepared to look across their traditional borders and see what benefits the wider community, where they have followed the message and, as the member for Page has said, tried to get the leveraged funding that was associated with the town hall at Lismore by getting other levels of government to contribute.
It is that leverage that becomes so important, because it can potentially turn the billion dollar fund into $3 billion of injection into regions. If you look at the first round, having multiplied the $150 million of ours, you can just imagine what the rest of it will do. So I would urge those who sit on the other side—and I know they are interested in this fund, because they have got applications in and, when I have my drop-in centres, they come around all the time urging me to consider them—to get behind the fund. But you cannot do it unless you are prepared to put the appropriation in.
Mr CHESTER (Gippsland) (11:42): I would like to thank you, Minister for Regional Australia, Regional Development and Local Government, for being here today. I appreciate your interest, but also to thank you for your attendance in the Latrobe Valley as we deal with some of these issues relating to your carbon tax policy. I want to refer specifically to the Regional Structural Adjustment Assistance Program, which, as you would be aware, is a $200 million fund to provide assistance to those regions strongly affected by carbon pricing. I note from one of your statements on your website:
The Department of Regional Australia, Local Government, Arts and Sport will monitor the impacts of carbon pricing on regions to identify regions that may require structural adjustment assistance.
And further:
Where structural adjustment assistance may be required, the Government will work in close consultation with communities through a coordinated, whole of Government approach …
It is against that background, Minister, that I ask my questions. How are you actually going to monitor those regions and what procedures are actually in place to evaluate which regions are most adversely affected. Changes are occurring right now in Latrobe Valley as a result of carbon pricing, which I think you would understand is some cause for concern in my community. In particular, we need to address the issue of confidence in the community at local, state and federal government levels. I would be interested to know whether the bulk of that $200 million will be allocated to the regions that are most adversely affected and how you will make that evaluation.
The other questions relate to contract foreclosure, which I am sure you understand is very close to and relates to this whole issue. I wonder whether you could provide me with an update on the progress of negotiations in relation to contract foreclosure? I understand there has been very little discussion, if at all. We are only weeks away from supposedly making an announcement as to which stations will be closed. My understanding is that a power station such as Hazelwood generates $130 million annually in terms of wages to the Latrobe Valley community, but we are talking about a $200 million structural adjustment package. If the Hazelwood power station were to close, it would dwarf the whole $200 million package. I do not think there is any suggestion from government that the Latrobe Valley will get the whole $200 million. My concern is that the impacts will be very severe and that the allocation in terms of structural adjustment will be nowhere near enough.
The only other question I would like to ask the minister relates to this whole-of-government approach. You may recall that there is an active application from the Latrobe Regional Hospital for $65 million. I put it to you that, in terms of a whole-of-government approach, that would be the type of project that would benefit the Latrobe Valley and the Gippsland community more broadly. Given that that actual program has now been exhausted, are there any other avenues that you can see where the Latrobe Regional Hospital should apply to try to secure $65 million in the future, keeping in mind that I do acknowledge the state government will need to come to the party at some stage in that process?
Mr CREAN (Hotham—Minister for Regional Australia, Regional Development and Local Government and Minister for the Arts) (11:44): I thank the member for Gippsland for his question. He has attended a number of the forums that we have held in the Latrobe Valley to look at the challenges that are presented down there but most of all to identify future opportunities. I just make this point about what we have done in the Latrobe Valley. It is very interesting that we have been able to secure an agreement with the Victorian government, who opposes what we are doing with carbon pricing, to work in partnership for the economic development and diversification not just of the valley but of the whole Gippsland region. Partnership agreements with the states are absolutely fundamental, in my view, if we are to get this model of regional development right. We can put up the funds that I talked about before, but on their own they are not going to be enough. We have got to leverage the other funding and we have got to encourage regions to join the dots, so that they do not just look through the silo of a regional development fund, or for that matter the $200 million Structural Adjustment Fund, but look to the opportunities, for example, in the Education Infrastructure Fund and in the Health and Hospitals Infrastructure Fund—which I think the member just made reference to in relation to the Latrobe Regional Hospital.
I am terribly proud of having been able to negotiate that agreement and that framework and also establish the committee that is working to identify opportunities. The guidelines for the Structural Adjustment Fund for the regions most affected by the carbon pricing initiative are still being considered and, in any event, they were always going to be contingent upon impact once we knew where the contracts for closure were going to occur. On that question, the member for Gippsland has asked me about progress. This is really an issue that should be addressed to the Minister for Resources and Energy, because he has responsibility for it. We have called for the expressions of interest for contracts of closure. They are going through their process at the moment. He has made the point that the effects of the closure of Hazelwood would dwarf the $200 million assistance, and even if a fair slab were allocated to the Latrobe Valley it may not be enough. I do not agree with that. I have just recently been involved in negotiating, in partnership with the Tasmanian government, structural adjustment initiatives for job creation activity in Tasmania. As you know, with the forest issue down there, there is a potential $120 million available to Tasmania, but it is conditional on getting an agreement. To show good faith, we made the first $20 million not conditional.
We have allocated all of that money. Quite frankly, the $20 million that we have allocated has the potential over coming years to create 4,000 jobs. This is the opportunity. You do not need, in my view, a lot of money to make these things happen. What you need is a lot of good ideas. You need businesses prepared to make the investment, with governments coming in to fill the gap. Whether it is a gap in terms of infrastructure, whether it is a gap in terms of training, that is the sort of thing we have got to be doing. That is what I want to develop in the Latrobe Valley. That is why we have got not just the state government framework but we have got all the local councils involved. We have got regional input. We have been using the university to help identify opportunities. In the Latrobe Valley, forget about the carbon price that is going to be put on; what about the opportunities in the electorate of Gippsland for carbon farming? They have some of the richest farmland in the country, and the opportunity to enrich and improve soil productivity, capture the carbon and trade the credits creates the opportunity for another income stream. They have also got the big potential for growth in the dairy industry and the food processing industry. There are funds that enable that to happen. I think we have got to look beyond the silos in terms of considering the opportunities down there, because they are enormous.
Mr NEUMANN (Blair) (11:49): Minister Crean, thank you very much for the $2 million in funding for the Somerset Civic Centre, a $4.5 million project. The area was ravaged by the floods, and the council administration block was destroyed when the waters of Redbank Creek went through. The funding is much needed. The project will create jobs in the area, and the centre will create a home for the local arts community.
I have two universities in my electorate, the University of Queensland Ipswich campus and the University of Southern Queensland Springfield campus. Last parliament I had the University of Queensland Ipswich campus and its Gatton veterinary science and agricultural centre. I am pleased that we have provided about $48.9 million in federal government funding for the University of Southern Queensland, which recently purchased its campus from the Springfield Land Corporation as part of a total injection of about $100 million for the USQ.
Why is that so important? Because children from low-socioeconomic backgrounds in the Ipswich and West Moreton region, the western corridor, can go to university, many for the first time. I am struck when I go to graduations, by how many children and young people have told me they have never gone to university and that members of their families have never gone to university. I appreciate that funding, which will make a big difference. Partnering with Bremer TAFE will be the Queensland Tertiary Education Participation network which will be very important for my region as it continues to grow and develop.
One of the good things about the funding we have provided is the construction of the education gateways building on the campus. It means that we will have a new digitally connected learning environment, stimulating learning laboratory spaces and new offerings in allied health, nursing, engineering and construction.
In the previous parliament, my electorate received funding under the Education Investment Fund that made a big difference. I lobbied very hard to get $47.2 million from the fund for the University of Queensland Gatton campus.
Opposition members interjecting—
Mr NEUMANN: It was part of a $71 million-fund made up of a contribution from the government to which alumni and other donors contributed. There are dozens and dozens of people in Ipswich who go to that campus, which is a vital boost for the Lockyer Valley and the whole region. Eighty per cent of the students who go to the University of Queensland Gatton campus School of Veterinary Science are females. We have provided further education funding to the University of Queensland Gatton campus sports complex. This is one of the fastest-growing areas in South-East Queensland. I am very keen to see further funding put in—
Dr Stone: On a point of order, Madam Deputy Speaker Livermore, in this in-committee stage of the appropriation bills, I understood that remarks should be addressed to the portfolio in question. This one is about regional Australia.
The DEPUTY SPEAKER: The member for Murray has made her point. The member for Blair will come to his question of the minister.
Mr NEUMANN: I am asking questions about university education in the regions, which is particularly relevant. If the member for Murray ever came to my electorate she would see there is lots of agricultural land in my electorate. We do not live in Sydney or Melbourne or Brisbane. Tertiary education funding for TAFEs and universities is particularly relevant to my seat. I am looking forward to lobbying the minister for funding for the regions, such as tertiary funding for Ipswich, the Lockyer Valley, the Brisbane Valley and the whole of South-East Queensland. Minister, what have we done and what do we intend to do to assist young people and mature-age students in regional areas in South-East Queensland and beyond in terms of funding from your portfolio?
Mr CREAN (Hotham—Minister for Regional Australia, Regional Development and Local Government and Minister for the Arts) (11:54): I thank the member for Blair because he has given not just a very good indication of what has been done in his electorate for educational opportunities but also exposed, by virtue of the interjections, the silo mentality that still presides on the other side of the chamber when it comes to regional development. I have made the point that if we simply look to the silo of the Regional Development Australia Fund for the purposes of impact on regions we miss the point. We are great believers in the fact that you have got to invest in educational opportunity, particularly higher education opportunity in the regions, because all the evidence shows that if you train people in the regions they will stay in the regions. That is why this budget—
Mr John Cobb interjecting—
The DEPUTY SPEAKER: The member for Calare will sit in silence.
Mr CREAN: I know that they do not like hearing this, but they do like the results—all those drop-in centres—because they are lined up at my door every Wednesday afternoon asking: 'What can you do for us, Minister? Can you support this one, Minister? Can you give us a leg up?'
Mr John Cobb interjecting—
Mr CREAN: I tell you what, you go back and tell your Leader of the Opposition to stop opposing everything that we are doing to fund these initiatives. I am delighted that the opposition are here, listening with such attention and getting agitated as a result of us demonstrating the significance of what we are doing.
The other reason it is important to invest in the universities is that they become important parts of the community. We are trying to develop this community drive, this leadership that identifies the potential and does not look at the threats but understands the challenges, sees the opportunities and wants to go out and seize those moments, and universities become a very important part in that exercise. What we have done in this budget is fund another round in the education infrastructure fund. We have given some $500 million to higher education institutions just for the regions—not just for universities, but for TAFEs. I think that is very important.
Madam Deputy Speaker, you would be well aware of the work of Central Queensland University and how in Mackay, for example, they have moved to a dual campus model, where they have both the TAFE and the university effectively delivering across courses. What I have encouraged them to do is look also at the trade training centres, which will be funded only under a Labor government. Those who sit opposite have fought us every inch of the way in opposing those trade training centres. What we need is creative pathways, particularly in those boom growth areas that are crying out about skill shortages. We need to get them thinking about getting a vocational stream through schools so students can work out whether they go on to a TAFE or go on to a university.
When we build this infrastructure we need to insist on not only its flexibility but also the adaption of broadband, as the member for Blair has said. He has given a perfect example of another beyond-the-silo, dot-joining exercise in understanding that you can deliver both the education service and the education content. Increasingly we will have the ability to do it. Why? Because we have taken a strategic decision to invest in some of the most fundamental infrastructure this country can invest in—that is, for high-speed broadband. We have made that decision not just to roll out the cable but to challenge regions to think creatively about the applications and the delivery of the services.
We have also seen the numbers of student places increase in regional universities. In the five years to 2012 those numbers have gone up by one-third—they have gone up from 60,000 to 80,000—and we are now moving to uncap university places, which opens up more opportunity for the regions. It took us to come to office to not just understand the significance of it but do something about it. We are proud of our position and what we have done for regional universities and regional education. This is going to be one of the important underpinnings of regional growth and regional prosperity, and we will continue to make those investments.
Mr TEHAN (Wannon) (11:59): My questions go to RDA funding. Road funding is a key priority in my electorate of Wannon. Last time, in the first round, there was some conjecture as to whether road funding could be applied for or not. I would like the minister to clear up for us once and for all whether road funding can be a priority or not. For my second question I would like the minister to explain how much emphasis goes on the RDA committee's ranking of projects. Once again, last time there was a lot of conjecture because some of the projects which had been ranked higher were not funded, yet some of those which had not been ranked higher were accepted as projects. I was just wondering whether the minister could explain how that works. My third question to the minister is: how is the minister ensuring that projects are determined on a regional needs basis rather than on a political basis?
Mr CREAN (Hotham—Minister for Regional Australia, Regional Development and Local Government and Minister for the Arts) (12:00): I think it is absolutely essential that these funding initiatives are based on a needs basis and on proposals that stack up. We had to end that dreadful regional rorts program that the Howard government presided over: it funded the draining of the Tumby Creek, and it drained itself; it funded a cheese factory that was on the nose and went bust—
Mr Tehan: Deputy Speaker, I rise on a point of order on relevance. I did not ask about the Howard government; I asked about this government. They were three good questions that I would like answered.
The DEPUTY SPEAKER ( Ms K Livermore ) (12:01): The member for Wannon will resume his seat and the minister will return to the questions.
Mr CREAN: I will return to the question because I think it is important to base it on need and on integrity in the projects to make sure that they stack up and that they have rigour. That is what we are insisting upon. We do not want a return to those bad old days, and I hope that what we are doing with this funding and with this model is embedding the way in which we approach this problem for all time into the future.
As for the other dimensions of your question, it is true, generally speaking, that applications for RDAF funds will not get a tick if they can be funded through another source. But it is also true that there can be—
Dr Stone: Not for the silos.
Mr CREAN: We are thinking beyond the silos.
Dr Stone interjecting—
The DEPUTY SPEAKER: Order! The member for Murray will stop interjecting.
Mr CREAN: I think the member for Murray shows a total ignorance of everything that has been said to date and, as usual, just carps away single-mindedly. She cannot get out of the silo, so I ask her to keep quiet while I am answering the question—
The DEPUTY SPEAKER: Everyone will keep quiet, please.
Mr CREAN: because I think it is important to think beyond the silo. And if, in fact, the road dimension can be funded under another proposal, that is where we should be actively encouraging it to seek funding from. But if, in fact, there is a gap—something that falls between the stools—then we may have to look flexibly at that type of an opportunity.
The third part of the question?
Mr Tehan: The third part of the question was on the process of the RDA committees. Are the roads, though, in or out or maybe?
Mr CREAN: The roads are out. There is a formula for road funding, but what we are trying to do is understand where we link, if we can see the merit of the argument, to either refer them to Infrastructure Australia—but I must say there is a deficiency in that process because a number of initiatives that fit below the $100 million threshold do not get up. Nevertheless we have acceptance of the fact that RDAs have to be consulted by Infrastructure Australia on prioritising these sorts of initiatives.
What we are trying to do with the Regional Development Australia Fund is to respond to proposals that come forward but also actively encourage them to get out and join the dots. Insofar as the process is concerned, the second round required the RDAs to nominate the three priority regions. That is taken into account by the committee that advises me, and the final decision will come through that process. There will be some to-ing and fro-ing: When is the project ready to commence? What leverage in terms of the funding do you have? How does it connect? These are all sorts of considerations that the independent panel we have established considers when it makes its recommendation to me.
Mr FITZGIBBON (Hunter—Chief Government Whip) (12:04): I preface my question by congratulating the minister and thanking the minister for his energetic commitment to his portfolio responsibilities.
Opposition members interjecting—
Mr FITZGIBBON: I see members opposite agreeing with that proposition, and I am sure that will be appreciated by the minister.
The DEPUTY SPEAKER: Order! The member for Hunter will not encourage interjections.
Mr FITZGIBBON: This Labor government gets many things right, but two things stand out: first, the commitment to really engage in the regions and to formalise that commitment through the appointment of a dedicated minister; and, second, the appointment of Minister Crean to the position. He has had a longstanding interest in and commitment to the region and understands the regions—something he demonstrates to me each time he visits the Hunter region, on the last occasion to look at some of the land use conflicts in the upper Hunter where we have a mining boom, a very strong horse industry and agricultural pursuits, including viticulture. There are some very big issues there that are difficult to resolve and it is good to see the minister showing such an interest in them.
We are an economically diverse region these days, but the best news of all is that our unemployment rate in the Hunter electorate is 3.5 per cent and in the Hunter region 3.9 per cent.
Government members interjecting—
Mr FITZGIBBON: You heard me correctly. And it was 13½ per cent when I became the member 16 years ago. I am not taking all the credit for it, by any means. Certainly this government's policies are helping to sustain that economic growth, the growth that is driving that low unemployment rate, and, just as importantly, to expand our capacity to deal with that growth with projects like the $1.7 billion Hunter Expressway; the third rail track, which will allow our coal to go to port more quickly and more efficiently by avoiding conflicts with passenger transport; and the NBN. All these things are expanding our economic capacity, which allows our region to continue to grow economically and therefore allows us to keep the unemployment rate at historic lows.
Having said that, the capacity constraints continue to appear. Most of our roads throughout the region are like car parks at peak hour each morning and afternoon. People have trouble securing things like child care. Everywhere you look, people are struggling one way or the other because the economic growth has been so strong and so quick, mainly driven by the mining boom. There is much more to do to alleviate those traffic jams and to expand child care, and to address all the constraints that people face. For example, in Scone you have to stop on the main road for up to eight minutes now as the coal train goes across the level crossing. We need to fix that. We need to do something about Muswellbrook and Singleton and the traffic jams there. This is why I have such a strong interest in the MRRT. The government has made it clear that some of the MRRT money will go to the mining regions to alleviate some of these capacity constraints. I seek the minister's views and his reassurance, and ask him to talk about how this can best be done and, very importantly, what threats we might be facing with respect to returning some of the boom to the regions and to spread the wealth.
Mr CREAN (Hotham—Minister for Regional Australia, Regional Development and Local Government and Minister for the Arts) (12:08): I thank the member for Hunter for his question. I have had the opportunity to visit with him on a number of occasions not just since I have had this portfolio but over many years. This region is a fantastic example of one that not only has benefited from the mining boom but also shows the fundamental importance of economic diversification. It is economic diversification and this transition phase that we have to encourage so many of our regions to embrace. It is not moving away from their strengths; it is building on those strengths and adapting in different ways—in new ways and in using the smarts, the innovative processes, the technologies and the design to take them forward. But they cannot be expected to do it on their own. I have talked already about carbon farming and the opportunities in the Hunter—its great capacity to produce in not just viticulture but horticulture. It is a lush region. Why can't we see the opportunities more effectively in carbon-farming initiatives? Why can't we, in growth areas, instead of talking about councils having new costs imposed on them, look at the opportunities for landfill and conversion of landfill into energy? It is something that does not just produce a cost; it provides the economic return.
I am asked by the member what threats are posed to this suite of measures. The biggest threat is a Tony Abbott-led government getting into power. They already have a $70 billion black hole. They have already got overcommitted, without the ability to fund or cost. And they are going to cut the very programs that fund the initiatives that we have talked of. That takes out the potential to challenge regions and work with them—
Mr John Cobb interjecting—
The DEPUTY SPEAKER ( Ms K Livermore ): The member for Calare will have his opportunity.
Mr CREAN: to develop the initiatives. So I say to those people in regional Australia who are looking for the opportunities for their future: work with us, work in a way that understands your strength, and work with us to realise that strength. Access the programs; do not be scared off by the fear campaign that those that sit opposite run. We have more to gain by grasping the opportunities than by cowering in fear. All you will get is a fear campaign from the other side. You will get progressive, sustained and strong economic growth and social diversity from us.
Dr STONE (Murray) (12:11): Minister, I want to refer to the regional adjustment assistance fund. I know you referred to it earlier in relation to the carbon tax damage to economies in Gippsland and how you looked to try and help out there. I am wondering: can this regional adjustment assistance fund also be extended to where damage has been done by this government's policies in relation to water buyback in the Murray-Darling Basin?
As you know from the budget there is another $40 million being brought forward to buy back even more water from irrigators, the food producers of Australia, especially those congregated in the southern part of the basin, in northern Victoria. We have had seven years of drought. We have had two years of floods. We all know, from the Murray-Darling Basin inquiries undertaken by the House of Representatives Standing Committee on Regional Australia and from the socioeconomic impact assessment released by the authority in May this year, that there is a serious consequence of the government's policy to pursue water buyback. This includes stranded assets in the irrigation systems like Goulburn-Murray Water and the lack of economies of scale, essential for food processing to continue. If you only have half your number of irrigators dairying, producing milk, then quite self-evidently you do not have Fonterra, Murray Goulburn, Bega, Kraft and so on with the economies of scale to stay in those northern Victorian irrigation areas.
You also, in your remarks immediately before, suggested that there was support for food processing. I am a little intrigued as to where that is. Perhaps you can enlighten us as well in terms of what funds you do have. In my area, as you are more than aware, we have lost Heinz at Girgarre; we have had Murray Goulburn put off half of its workforce at Cobram and a very significant part of its workforce at its Rochester plant; and we have had Coca-Cola Amatil, which owns SPC Ardmona, contract its workforce by about 30 per cent—and there is more to come. We are wondering just what this support is that you are looking to give to the regional economy as it faces this extraordinary problem of its irrigation water being removed as part of this government's agenda. It is pandering to the Greens, who have said: 'If you take water out of irrigators, this is a good thing. They waste it; they're profligate. Why don't you simply focus on irrigation, take the water from there and put it into the environmental water holder's bucket, stand back and just see who's left after a period of this policy?'
Mr CREAN (Hotham—Minister for Regional Australia, Regional Development and Local Government and Minister for the Arts) (12:14): In relation to the opportunity for food processors to access funding, I would draw the member's attention to the clean energy future initiative that we announced. In terms of assisting industries to make the change to cleaner energy options, there is $150 million in there for food processors alone.
Dr Stone interjecting—
The DEPUTY SPEAKER: Order! The minister is answering the question.
Mr CREAN: The member has asked a question. I just wish at times that she would sit there and listen to the answer. I would also point out that, whilst it is true that businesses within her electorate have been contracting in terms of numbers, it is not true that some of them have not been expanding their operations. You mentioned Murray Goulburn. Murray Goulburn has expanded its operations into Tasmania. Murray Goulburn is now investing down there, and it is seeing huge growth in the dairy in that state. The member for Lyons has been down there with us when we have visited Smithton with the member for Braddon. We have funded initiatives to support the infrastructure and the training to develop the skill base for this industry, because a company like Murray Goulburn sees the potential in terms of not only dried product and export but also—with the rebound in prices and the global demand for food security—quality, clean nutritious and safe food. They have seen that there is huge potential in all those prime agricultural areas.
We know that these companies are threatened competitively by the high dollar. Therefore there is always going to be a challenge for them to build competitiveness back in by doing things smarter. Inevitably, that means looking at ways in which they do it with fewer people or more technology or more innovation. That is the nature of an economy in transition. Do not pretend it away, and do not pretend you have got a magic cure if you want these businesses to survive. What we have got to do is to get behind them in terms of their competitiveness and back them. And that is what we are doing. We are doing it in a way that actually works with the regions and understands their constraints and understands their challenges.
The member has asked me about the Murray-Darling Basin, and she knows that I have been actively involved in this space too, along with the Minister for Sustainability, Environment, Water, Population and Communities, in really coming to grips with this difficult problem. Everyone you speak to who lives in the basin knows—they all have a different solution to it—that they have got to operate in a more water constrained environment. There are ways in which we can deal with this. One is water buyback but, quite frankly, my preference has always been to try to produce more with less; in other words, get into the efficiency stakes. The regions know that what they have got to do is to actually embrace a water constrained environment, otherwise they will not have any industries. The system will dry up. The minister is now coming in; he can take over in terms of the areas that he has been covering. But I am making the point: there are different ways, other than buyback—ways that are being pursued by him—and there is also the question of the economic diversification in those regions. That is what we are working together on. The member has sat on the committee that has made recommendations. Predominantly all of them have been picked up, and it would be far better if she contributed constructively to this debate rather than just carped from the sidelines.
Ms BRODTMANN (Canberra) (12:18): I want to turn to a bit of soul food, but, before I do so, the minister has just recently highlighted the threat of those opposite to the nation. I just want to remind Canberrans about the threat that they pose to Canberra and remind them again of 1996, when they abolished 30,000 Public Service jobs.
Mr McCormack: How many Public Service jobs went in the last budget?
Ms BRODTMANN: I think I have said to you before, member for Riverina, that in terms of jobs, that is about half the population of Wagga gone. The future for Canberra that they pose is between 12,000 and 20,000 jobs lost. That is on the current figures, but every time I talk to someone opposite they throw in another 5,000 Public Service jobs. So at the moment I am ranging between 12,000 and about 30,000. I just want to remind Canberrans of the future, the threat, posed by those opposite to Canberra. It will not be pretty; we will go back into recession, housing prices will plummet and it will be an unattractive prospect for everyone in Canberra. Remember: half of Wagga gone. I just to talk about Canberrans and their passion for art. We have got a very vibrant and diverse arts community here. The current debate around the School of Music and the Canberra Symphony Orchestra attest to that. We are also the proud keepers of the nation's major cultural institutions. They continue to feed the souls of Canberrans, of the nation and also of people from around the world. Minister, can you please advise how the government is continuing to support the national cultural institutions based in the capital?
Mr CREAN (Hotham—Minister for Regional Australia, Regional Development and Local Government and Minister for the Arts) (12:20): I thank the member for her question. She has not only been a fantastically strong advocate for her constituency since she has come into this place but a deep and abiding commitment to the arts and cultural policy. I am asked what we have done in this budget. We have committed another $65 million over four years for the arts, in particular a huge boost—some $40 million—for the collecting institutions. The collecting institutions, whilst they are housed in Canberra, represent collections that belong to the nation. As we approach the centenary of Canberra, what better thought can we give than how we make more accessible that which we have collected being made available to the broader community? With this $40 million for these institutions, we have also requested that they look again at their strategies for digitising their content not just for the purposes of storage, as important is that is and the potential that is opened up now in this technological age, but dissemination of material.
When you think about it, how much better is this going to be for the schools in regional Australia in particular? They will have the ability to go online and hook into any chart, any book, any volume or any document held by the National Library through that fantastic Trove initiative that it has developed in terms of the digitisation of its content. Why stop at the Library? Why not also the National Film and Sound Archive, the National Archives, the National Gallery, the National Portrait Gallery and the National Museum? These hold wonderful collections. We have got to keep investing in them not only for their ability to keep functioning and putting on these fantastic displays but also to disseminate that information around the country.
We are committed to the development of a new national cultural policy. The last time we had one in this country was under a Labor government—Paul Keating's government, the Creative Nation. In that 17 years, bipartisan support remained for the arts but there was never the big step up—never the big lift, never the big understanding as to why creativity and culture is so important to this nation. We are unique in the world, because we are home to the oldest living culture on earth which is producing some of the most exciting new art forms on earth; we have also been welcoming to the most diverse group of cultures on earth in terms of our multicultural appeal and our engagement. This is unique. We have got to build upon it, but in a way that tells diverse Australian stories in Australian words. Whether it is visual, written or oral, these are all the opportunities that present themselves if we are prepared to commit again to doing something to recognise it. It is not just for the cultural dimension, important as that is. We believe firmly that investing in the arts has a social dividend because it does teach expression, respect for culture and values of team work and respect. That is the social dividend for the nation but there is also an economic dividend. We know that the nations that are creative nations are also more productive nations. Increasingly, this point that was asked by the member for Murray about downsizing and my point about needing to find new ways into competitiveness, it is no longer just going to be driven by the technology; it is also the design factor. It has to be driven by the creative approach as much as by the technology. Unless we are investing in the bodies that produce that creativity and in the people who produce that creativity, we are letting this country down. It is an investment that has to be made. The budget made such an investment, and we hope in future years that we will be getting to do much more.
Mr McCORMACK (Riverina) (12:25): In the decade from 2001 to 2011, the Visy pulp mill at Tumut produced 2.6 million tonnes of paper and generated $2 billion in sales. I am sure the minister can appreciate just how many jobs the Tumut Visy mill generates for the Tumut Shire. The Visy mill is also underpinned by the Gocup Road. I know I have raised this before with the minister but I would like to go through very quickly that there were no road projects funded in round 1 of the Regional Development Australia grants. That said, RDA Southern Inland endorsed seven road projects in the region for round 1, and it would seem that it considered such projects to be eligible.
The round 2 guidelines identified minor roads and access corridors as an exception to ineligibility criteria. There are at least 10 road projects considered in RDAF round 2. Of course, the RDAs were not asked to confirm eligibility so this may just have been a waste of resources at every level. I draw attention to the Glenelg Shire Council projects for the Condar Hot Spur Upper Road upgrade and Green Triangle region priority infrastructure. This does seem like another timber road except that it was cleared to proceed to full application. The Bomen intermodal at Wagga Wagga was approved to proceed to full application. Why was one piece of the timber freight task eligible for assistance but Gocup Road—admittedly it is a state road—which carries a greater tonnage of the overall industry freight task, not eligible? Minister, could this be considered as road project funding worthy of grants in a future RDAF?
Mr CREAN (Hotham—Minister for Regional Australia, Regional Development and Local Government and Minister for the Arts) (12:26): There are two points that I would make in response to the member. First of all, it is not a waste of time for the RDAs to be considering road proposals where they have the opportunity to advance their case to bodies like Infrastructure Australia or to seek funding through other programs that the government administers. We want the RDAs to think beyond the silo of RDAF, which is the point I have made consistently in response to questions from your side of the chamber in this session. It is not a waste of time. I think road infrastructure is vital, and there is a real challenge in terms of road infrastructure. There is also a challenge in terms of getting vehicles off the roads and onto rail, and that is why the intermodal hubs become terribly important. But the government has to think not just beyond the silos but also where it can work with the private sector and in the development of financial instruments that could also provide an avenue by which these things can be done.
I think the thrust of your question, as important as it is in identifying the opportunities, limits the scope if you just keep going back to RDAF. The mechanism that gives the RDAs critical mass is the RDAF because they can actually have an influence directly over that fund, but they should not see themselves as limited. If we believe in the principle of embedding localism in the way in which we govern, what we want is local input into the decision-making programs not just of the Commonwealth but also of state government and where local government initiatives and private sector money can be accessed. That is the model, quite frankly, that I want to develop.
As to the specific examples you have referred to, it is best to say that, in all cases where projects do not get up, they are offered the opportunity to engage with the department to understand why they did not get up and to learn again from the opportunity and to make adjustments accordingly. I would be surprised if the RDA had not already done so in that case. I made the point at the outset that, whilst round 2 is now out for consideration—and we will be announcing it in coming weeks—there are three more rounds potentially, but only courtesy of the passage now in the parliament of the minerals resource rent tax. Take that tax away—which your party supports—and take away that ability, and you take away the funding for regional Australia through RDAF; you take away the leverage. So you have to think really seriously about where this blind opposition is taking you. If you want to have influence in the way in which your region can actually benefit and drive the agenda, it has to have the capacity for leverage and it has to have the ability to makes its case in the knowledge that there is funding there. It is only under us that the funding is there. Under your proposals, the funding would disappear.
Proposed expenditure agreed to.
Agriculture, Fisheries and Forestry Portfolio
Proposed expenditure, $474,242,000
Mr BURKE (Watson—Minister for Sustainability, Environment, Water, Population and Communities) (12:31): I am pleased to present the 2012-13 agriculture, fisheries and forestry appropriation to the chamber. Our $36 billion agricultural export industry is dependent upon our reputation as a reliable supplier of high-quality foods and fibres to the global market. The Gillard government is committed to upholding that reputation and safeguarding our agricultural sector. To that end, the budget includes $524.2 million to boost Australia's biosecurity system. That investment will deliver a state-of-the art quarantine facility, maintain the core risk response capability and repair our information and communications systems. The government will also introduce a new biosecurity act to replace the century-old legislation that we currently have.
In last year's budget we set aside funds to purchase land for a new post-entry quarantine facility. This new budget delivers $379.9 million to build it. This state-of-the art post-entry quarantine facility, to be built in Melbourne, will mean that we have the newest and most advanced technology available to manage the import of high-risk plant and animal material. Our frontline defences play a pivotal role in protecting Australia from pests and disease. That is why $124.5 million has been provided over four years for core biosecurity capacity, including screening of passengers and international mail. The Gillard government is also prioritising the reform of century-old legislation to modernise the Biosecurity Act and ensure a seamless transition of goods and services across Australia's borders.
Supporting all of these activities is a $19.8 million investment over three years in biosecurity ICT infrastructure and systems. A separate $95.9 million over seven years provided from the Caring for our Council program will fund eradication programs for nationally significant pests and diseases.
All up, the funding announced in the 2012-13 budget will see more than $1.6 billion invested in biosecurity by the government since the Beale review. Our defence against pests and diseases is vital in protecting our agricultural sector and our environment. Protecting our natural resources also requires a broader effort. Australian farmers have been undertaking activities to manage and protect our natural resources for many years. It is vital that these efforts continue. As part of the budget, the Gillard government has committed $2.2 billion to continue to fund its flagship Caring for our Country program post 2013. This funding provides over half a billion dollars over five years plus over $200 million for Landcare for sustainable agriculture innovation, eradication and management of weeds and pests, as well as better practices that will protect our natural resources for food production. In addition to ensuring that Caring for our Country funding continues, this government has also recognised the complementary yet separate roles of farmers and those environmentalists who are not farmers—because many farmers are environmentalists, it is important to note—
Mr McCormack: Most!
Mr BURKE: I am not disagreeing with that for a minute. I have always disagreed very publicly with the argument that farmers are somehow environmental vandals. It is wrong and it deserves to be an argument that is knocked down at every opportunity.
From July 2013 these roles will be better reflected with Caring for our Country to be delivered through two specific streams: one dedicated to sustainable environment and the other to sustainable agriculture. This change provides a stream dedicated to agriculture, which allows for a more specific focus on the role our farmers play in keeping our land productive and the projects that are needed to support their efforts. It is a win for farmers and for farming communities. Look, here are a few extra pages which I have been given, all of which provide important issues, but given the time I think I might allow us to go directly to questions because I am sure some of the issues about drought support and research and development will come up during that opportunity.
Mr JOHN COBB (Calare) (12:35): I would like to start off, if I may, with a very nonpartisan issue and, if the minister is able to tell us anything about it, I would appreciate it, and I think the beef industry would as well. There are reports at the moment that manufacturing beef exports to the US in recent times have been found in some places to be infected with E. coli. I think that all of us have a great deal of knowledge of the great length that Australia's process is to make sure that nothing leaves our country that has not been subjected to that test in particular, and that it is not accepted into the US without having passed the same strictures. I think that currently we are at record levels of export to the US in this type of beef. I am just wondering, in view of how important this is, if the minister has an update on this issue that he can give us? If not, okay, but it would be good to know, if there is.
Mr BURKE (Watson—Minister for Sustainability, Environment, Water, Population and Communities) (12:37): I thank the member for Calare for the question and also want to acknowledge the goodwill inherent in the way in which the question was asked. Every member of this parliament can stand proudly and say that Australia provides the safest and best quality beef in the world. The information which I have to provide in response to the question, I think, simply gives credence to exactly how careful we are with our health standards and how seriously we take them.
The department received notification from United States authorities that ground beef in the United States had tested positive for E. coli, and that Australian beef had been implicated in the detection. It is important to note that the Australian product had been found negative when it went through the Australian E. coli testing program prior to export. The implicated Australian product also complied with the relevant US testing program and met their import requirements when it was met at the border. So, it had been found to be safe when it left Australia and it was still found to be safe when it arrived in the United States.
Discussions are going on with all parties concerned, while confirmation as to what exactly is the source of the contamination is being progressed. Notwithstanding that, a voluntary recall of the relevant product is occurring in the United States. Australia has a strong reputation as a reliable, high-quality exporter. That reputation is underpinned by our world-class biosecurity system. We are committed to securing that reputation; so much so that we have invested $524 million towards our biosecurity system in this year's budget. That investment will see more than $1.6 billion invested in biosecurity by the government since 2009.
We have high-quality export standards and we expect those to be met. We have strong systems in place to detect and identify breaches if they occur. They are taken seriously and are traced all the way back to the point of origin, and corrective action is taken. We have a strong relationship with the United States on many fronts, and trade is one of those. But I think it is important in response to the question from the member for Calare to take away three points. The first is that when the beef left Australia it was properly tested and no E. coli was present. The second is that when it arrived in the United States, it was properly tested and found, once again, not to possess E. coli. Notwithstanding that, the moment there was ground beef that tested positive and Australian beef was implicated within that detection, we were immediately involved in a voluntary recall of the product while discussions continued to determine precisely what the actual source of the contamination is.
Mr MITCHELL (McEwen) (12:40): Australia is uniquely isolated and positioned, which has provided us with natural protection from destructive pests and diseases. This has allowed Australian farmers to be recognised as amongst the most productive in the world, producing safe, high-quality food and contributing $155 billion, or 12 per cent, of GDP. However, with the rapid and expansive growth in the movement of people and goods between countries and regions, we must continually work to combat biosecurity threats. Failure to adequately protect Australia's biosecurity could result not only in a decline in productivity but also in the potential for an entire industry to come to a halt if there is a serious pest or disease outbreak like the one that we witnessed in the United Kingdom—one which could threaten the health of Australian people and our environment, livestock and livelihoods.
We know that the Gillard government recognises the significant threats posed by pests and diseases and, unlike the former Howard government, is choosing not to ignore the problem. Instead, the Labor government has invested more than $1.6 billion in biosecurity to safeguard our agricultural industry, not just correcting the mistakes of the coalition but also implementing a smarter, more sophisticated, biosecurity system.
The biosecurity reforms are based upon the recommendations of the Beale review, which we talked about recently, and which has recommended the risk based analysis of biosecurity. These reforms have included the establishment of the Biosecurity Advisory Council; the appointment of an Interim Inspector General of Biosecurity; and continuing to work towards a more flexible and risk based biosecurity framework. These reforms were developed in consultation with state and territory governments and industries, ensuring that the biosecurity system meets their needs and provides the most effective protection for all Australians.
The Gillard government's biosecurity reforms will increase the efficiency of our productivity. This biosecurity framework not only protects the efficiency of our agriculture from destructive animal and pest plants and diseases but also ensures Australia remains a reputable trading partner. This is essential, as Australian agricultural, fisheries and forestry sectors export commodities to the value of $36.2 billion, and our biosecurity remains a key strength in maintaining market access. My question is: how will the Gillard government continue to invest in biosecurity for Australia?
Mr BURKE (Watson—Minister for Sustainability, Environment, Water, Population and Communities) (12:42): I thank the member for McEwen for asking the question. I understand the new facility is located within his electorate—
Mr Mitchell: I don't think it's been formally—
Mr BURKE: We are not there yet? Okay. Let me go through, first of all, why we are in a conversation about a new facility at all, because it is really important for the House to be in no doubt.
Under the Howard government, the facilities which were owned by the government were all sold off. What then happened was that the standards under which the facilities were operating once the leaseback arrangements happened slipped further and further and further. By the time we came to office, the first job that I had to do in this portfolio was to be involved in the most substantial disease eradication program that Australia has ever had to engage in.
Let us not forget how far down the chain businesses were wrecked because of the quarantine standards that fell apart under the Howard government. Equine influenza caused massive damage—absolute carnage—and not just to the industries involved in the breeding of horses. If you are involved in a stud and you cannot move horses around, your business is over for that period of time. The money that you make is just gone. We had those careers and those businesses facing massive jeopardy.
However, when there was an end to the racing meets, which would subsequently occur, there was a massive impact on regional economies as well. And I am not simply saying: 'It is the big-money horses and the big-money breeders and trainers who might be at risk.' From the businesses that were meant to make their money selling the food at the shops, right through to every add-on business that relies on these race meets—which become so much of the core of the social and economic fabric of a regional community—it was just over. It was over and it could not take place. That saw this government having to oversee something which very rarely happens in Australia—that is, not simply a containment of a disease but a complete eradication of disease. Look around the world at the different examples of when a disease arrives. Find other nations that have had equine influenza arrive and have not just said, 'We've got it now; we'll put up with it.' Find other nations that have done that. If you want to find a place in the world that says, 'No, we will oversee right to the end a complete eradication of a disease,' it is Australia. That is exactly the problem that fell to this government and which we delivered on.
On that basis, how do we undo the extraordinary damage that was done by the wheels falling off our quarantine system under the Howard government? What that meant was that, in the first instance, the damage caused by not having proper systems in place needed to be fixed. That is why it has fallen to the current Minister for Agriculture to have to go to the budget process and see a significant increase in the injection of extra biosecurity dollars. When you have savings in biosecurity—the cuts to systems, the falling apart of processes and the abandonment of the quarantine facilities which we saw under the Howard government—you are not just putting the horse industry at risk but also creating a risk that goes through anybody who is involved in primary production throughout Australia.
With all the damage that happened with equine influenza, imagine if it was foot-and-mouth-disease that had slipped through. Imagine the carnage that would have taken place in primary industries across this entire country. The time has come to rebuild the mess we were left with. The work has already been done in terms of getting proper processes back into our quarantine systems, and that has been going apace. We need to have a proper structure instead of the system which had started to fall apart at Eastern Creek. That was all revealed in black and white through the Callinan inquiry and the system is now being rebuilt under this government.
There is $524.2 million in the budget for biosecurity, which includes $379.9 million for a new state-of-the-art biosecurity facility in Melbourne, which will be constructed over seven years. Funding for the purchase of land for the facility was in last year's budget. The facility is required because of the short-sighted decisions of the previous government. All they saw in an outpost entry quarantine facilities was something to sell. (Time expired)
Mr McCORMACK (Riverina) (12:47): Minister, you would be aware that the Prime Minister made a speech at the Global Foundation Summit in Melbourne on 3 May in which she said Australia must be ready to act as the food bowl of Asia. In that speech, the Prime Minister said that Australia needs to be able to grow the food to feed not only our nation but also other nations, particularly those in the Asia-Pacific rim. It was a very good speech and I wholeheartedly commend her for it. She also said that Australia needs to strengthen irrigation—and I will turn to that later when the minister is acting in his capacity as the Minister for Water and the Environment.
Minister, how do you assess the Prime Minister's desire for Australia to be the food bowl of Asia when this federal Labor government was quite tardy in stemming the incursion of the Asian bee? We had the importation of New Zealand apples and the inherent risks that that poses for apple growers. They certainly grow Australia's best apples in Batlow, and that town is reliant on the apple industry. If we get fire blight in, I fear very much for the town of Batlow and for the many jobs the apple orchards create and the whole industry there generates. There is also ongoing lobbying to ban all live animal exports for slaughter. I wonder how that agrees with the Prime Minister's bid to make Australia the food bowl of Asia.
Finally, there is the foreign ownership of both agribusiness and Australian farms. The thing I get asked about most in my electorate is foreign ownership of Australian farmland. Whether or not it is a big problem, it is still out there. People believe foreigners are buying up all our farmland. When the Commonwealth extended its absolute limit on foreign ownership from $231 million to $244 million in January this year, that sounded alarm bells throughout regional Australia.
In recent times we have seen the buyout of AWB by American owned Cargill, which has led to all sorts of problems—particularly in a wheat industry which is still trying to come to terms with the dismantling of the single desk. That is still of great concern to my electorate and other electorates; I am sure the member for Calare could back me up on that. There has also been the attempted buyout of SunRice by Ebro. Under this government's $244 million-limit you could buy just about every farm in the Riverina and every agribusiness, and this government would not so much as blink an eyelid. Minister, I do not believe that equates to the Prime Minister's desire for this country, which she rightly said needs to be the food bowl of Asia. Minister, please answer that question.
Mr BURKE (Watson—Minister for Sustainability, Environment, Water, Population and Communities) (12:51): I would need a good four hours to answer that question. If I miss anything in the time available I would be happy, when we resume, to come back to the question. A few issues have been raised, and I will start with the apples issue which is a classic example that members—in particular of the National Party, less so of the Liberal Party—have to be very careful about what they ask for. If you imagine where we would land if these protectionist demands were met, it would be an absolute disaster for Australian agriculture.
Let's look at the apples issue in order. First, Australian science had the import risk analysis and what we believed were the scientific risks of apple importation from New Zealand. This government held the line on the import risk analysis and found itself being taken to the WTO by New Zealand. As a member of the WTO, we ran the Australian case and we ran it hard, but we lost the case. We ended up with conditions put in place which provided a bar on a number of conditions—for example, if leaf matter were continued within a shipment. Since that time there has been an attempted shipment from New Zealand which was found to contain leaf matter. What happened? It never left New Zealand shores, because the protocols that were put in place after the WTO decision were the strongest we could put in place.
From time to time we get an argument about still stopping them all together. That was pretty implicit in the principles that the member for Riverina put forward. Make no mistake, deciding to rail against WTO rules and say we are going to ignore them means a lot for an industry that relies on 60 per cent of its product being exported: 60 per cent of what we grow we do not sell in this country. We as a nation have more to gain from trade than almost any other agricultural nation in the world. We have large agricultural production and a relatively small population. The risk that is borne by saying that we will rail against WTO rules carries a disastrous outcome for Australia's farmers. It is one thing to say to an apple grower, 'We want to keep these imports out for you and we want to ignore the WTO decision.' But try telling a grain grower that that is the game you want to play; try telling a beef producer that that is the game you want to play; try telling someone who is producing cotton that that is the game you want to play—because what you are saying is: 'We're willing to take a massive risk with our biggest areas of agricultural export.'
This government will not take that risk. We will run the argument of Australian science, and we will run it hard, in front of every international tribunal, but we are not going to abandon the trade opportunities that are in front of us. If we win a case, then we will grab it with both hands; if we do not win it, then we will be a nation that plays by the rules. The alternative is the worst possible outcome for Australian farmers. And, when you have entities that do not play by the rules, let us not forget how that unfolds for Australian farmers.
I was surprised to hear a member of the National Party have the courage to utter the letters 'AWB'—really surprised—because, if you want to know what happens when things go off the rails, what happens when people are not facing competitive pressures and what happens in the worst possible inside-deal scenarios, I reckon that side deals with Saddam Hussein's regime are not a bad example—not a bad example and a real one, one which was only cleaned up because this government came to office. The previous government was willing to see the rorts maintained and see the monopoly and the single desk remain. We now have a situation where farmers get to choose who they sell to. How outrageous is that!
Mr ADAMS (Lyons) (12:56): As Minister Burke is aware, the government want a national forest policy that is world class in sound forest management and conservation systems. In the Tasmanian Forests Intergovernmental Agreement between the Commonwealth and Tasmanian governments, which was signed last year following the downturn in the forest industry and the withdrawal of a considerable amount of capital by one company, the government committed $262 million to ensure that we do have a sustainable forestry industry by having a sustainable wood supply and by identifying the opportunities for regional development and economic diversity coming from those changes to our forest industry.
The minister was in my electorate just recently, opening $103 million worth of irrigation. We are getting on with a lot of sustainable irrigation in Tasmania, and that scheme will certainly change and diversify a lot of that farm area. The IGA certainly offers Tasmania a once-in-a-lifetime opportunity to diversify into many other areas. The government committed to providing $45 million to support displaced workers and contractors through this transitional period, so that they can exit the forest industry. There is also $27 million, over the next three years, being provided to Forest & Wood Products Australia, the industry's service provider, to invest in research and development and provide those research results to the forest and wood products industry of Australia.
With all these things changing in the forest industry, in Tasmania and in other parts of Australia, I know the government are committed to introducing the illegal logging legislation and have been doing some work on that in committees of this parliament. But we see the world, through the European Union and the United States, trying to come to grips with this as well. Minister, is our legislation trying to get to the same level as they are in the United States and the European Union so that we in Australia do not become a dumping ground for the timber from illegal logging? Are we working closely with industry groups and trading partners to promote our values of sustainable forest practices? Are there other issues? Is there opposition to this course through the parliament? Could you answer those questions for us, Minister?
The DEPUTY SPEAKER: Minister, we will be back at 4 pm to continue the debate on the appropriation bill. Would you be happy to answer that question, and others that I am sure will flow, when we resume?
Mr BURKE: I would be happy to. I will be back at 4 pm.
Sitting suspended from 13:00 to 16 : 00
Mr BURKE (Watson—Minister for Sustainability, Environment, Water, Population and Communities) (16:00): I will respond to some of the issues raised by the member for Lyons before the break, in particular the issues he raised surrounding illegal logging. I have received some information from the minister, which I will provide to the Federation Chamber.
In 2012-13 the government will also implement its regulatory and administrative approaches to illegal logging in response to its election commitment to combat illegal logging and associated trade. At the last election, the coalition also stated in its election policy that it would legislate to prohibit the importation of illegally harvested timber products, but it now appears that they have withdrawn bipartisan support for that.
This is a serious international problem which has significant economic, social and environmental costs. This is not, or at least it should not be, some sort of exclusively leftie issue, as was interjected before. The World Bank has estimated that each and every two seconds an area the size of a football field is harvested by illegal loggers. That is a rate of more than 2½ thousand square metres per second. But the beneficiaries of this illegal activity, by and large, will not be individuals driven to illicit practice by poverty. Again I quote the World Bank, who tell us that large-scale illegal operations are carried out by sophisticated criminal networks. This is an important issue, and it should not have been ridiculed in the way that it was by one of the opposition interjections when we were here previously.
The Australian government has been working assiduously with our trading partners, including all APEC countries, and with domestic wood processors to limit the negative impacts of this trade through the development of the Illegal Logging Prohibition Bill 2011. The bill will complement Australia's international efforts to promote sustainable management of forests globally. We are working to achieve our aims by engaging directly with other countries in the Asia-Pacific region to support international forestry cooperation and Australia's forestry interests. The bill will put Australia at the forefront of global action, along with the United States and the European Union, to combat illegal logging. International engagement is at the heart of the Gillard government's illegal logging policy.
It is a shame that any sensible perspective has been rolled in the Liberal party room. The Liberal Party has now signalled that it is the only party in the Australian parliament that actually wants to stand for illegal logging. In doing so, the Liberal Party is standing side by side with the interests of sophisticated criminal networks—standing for the wealth that is created from the proceeds of crime.
If you go to any timber mill and meet with the contractors, they will all say that they are happy to face fair competition from overseas but that what they do not want to face is competition with criminal networks. They do not want to see Tasmanian jobs being put at risk because they cannot compete with illegal logging operations bringing their product in to compete side by side with Australian product. Anyone who has a skerrick of support for timber communities in Australia and any interest in a viable domestic industry has to stand opposed to the importation of illegally logged timber.
The member for Lyons also referred to the issues currently surrounding the intergovernmental agreement in Tasmania. Make no mistake: while there may be members opposite who believe that social licence does not matter, or that there is no need for any restructuring of an industry, you will not hear the industry in Tasmania saying that. The industry in Tasmania knows that it is going through an extremely difficult period of change, and no matter how many times the opposition stands up and says it would tear up any support, that it would tear up any assistance and that it would tear up an agreement, we will continue to stand side by side with a lasting outcome for Tasmania.
Ms HALL (Shortland—Government Whip) (16:05): The time for this debate has well and truly expired. Unfortunately, I would like to move that debate on this matter be suspended and that we now move to what we should be debating, and that is infrastructure and transport. The time has expired as set in the standing orders, and as such we cannot continue to debate it.
The DEPUTY SPEAKER ( Ms AE Burke ) (16:06): In relation to the member for Shortland's motion, the fact is that these times are not set out in the standing orders. They are by agreement. I understand the member for Calare was also seeking the call. It will be up to the minister whether the minister responds to that call, but I give the call to the member for Calare.
Ms Hall: Further to that, I am happy for the member opposite to make his contribution, but after that I think we really do need to move on to the next report as the minister will be leaving this chamber—
The DEPUTY SPEAKER: I thank the member for Shortland. I have outlined my intentions to give the member for Calare the call and then it will be for the minister if he wishes to respond.
Mr JOHN COBB (Calare) (16:06): Thank you, Deputy Speaker, I appreciate your forbearance. As the minister representing the Minister for Agriculture, Fisheries and Forestry in his opening did stress the issues of quarantine and risk et cetera to a large degree, as well he might, I have some questions in that regard. First, the new quarantine station, which will take the place of five current quarantine stations in Melbourne, Sydney and Perth in particular, will mean that industry has to come to the one spot. Has a cost analysis been done on what that will mean to industry to have to confine itself to one spot? This is a big country, and it is a long way from Perth to Sydney.
Second, the Cocos-Keeling Islands held our offshore quarantine centre. Could the minister tell us whether his department still owns the old quarantine station or whether another department does? I am wondering if the minister is hearing me. Does the department of agriculture still own the deeds or the title to the old quarantine station on Cocos Island?
Third, why has the $7.8 million for the centre of excellence, which is the front piece for the government's quarantine and risk assessments, been put off being spent until 1 July 2013? Is that simply a budget measure to help the Treasurer meet his surplus requirements for the year 2012-13?
Fourth, the government is currently looking at bringing an amendment to the APVMA legislation, amongst which the government seems to be concentrating on having an automatic renewal process whereby all those chemicals which come under it have to be within a certain time—between five and 15 years—automatically reprocessed by the company that owns each chemical. I hope the government does realise that there are a lot of chemicals which are not high volume but are of high importance. Once companies realise they have to go through an extraordinarily lengthy, involved and expensive process, they may not see it as worth their while to do so, even though these chemicals in all likelihood have caused no ripples and are not likely to cause any problems in the process. What this means in the stock or the plant field is that we may be denied these chemicals in the future simply because the companies involved do not see it as worth their while to go through that reregistration process. I think that pretty much covers the ones I am concerned with at the moment.
Mr BURKE (Watson—Minister for Sustainability, Environment, Water, Population and Communities) (16:10): I will answer on the different issues with the best information that I have, and being mindful of the constraints on time in the House. But I thank the member for Calare for the issues he has raised.
In terms of the quarantine centre in Melbourne, let us face it: there were massive problems in the systems that we saw when equine influenza took off around the eastern side of this nation—massive problems in the system being properly managed across a large number of different centres. We saw that. Now if you streamline that into one centre, you have a centre that is properly managed, properly focused on and better resourced. Then you should have a way of avoiding a whole lot of the challenges that we ended up seeing, in particular coming through at Eastern Creek.
As to the concept of a quarantine centre being contaminated, the whole concept of a quarantine centre is that it is quarantined. That is where you keep things. By definition, in a quarantine centre there will often be pests and diseases; the problem, when the coalition were in government, was that they did not stay within the quarantine centre. Having equine influenza within a quarantine centre would have been one thing; the problem was that systems, and a lack of systems, meant it got spread all the way around the country. That is the problem that has been dealt with. That is why we had the Callinan inquiry. That is why, from opposition, we announced the full-ranging review that became the Beale review. And that is why we are now in a situation of significantly reforming the number of sites; we go to one. And do not forget: when we had more sites, not only was the management bad but the Howard government had chosen to sell them off. That is why they are not owned by the Commonwealth.
On the quarantine centre for excellence: we are talking about something where you are dealing with actual construction. The processes that will have to be gone through with the Department of Finance and Deregulation do have a degree of caution. That means the money does not go out the door as quickly as it would otherwise. But that level of caution in those processes and the different things that have to be gone through with Finance I think certainly amounts to good policy.
On the demand for automatic reprocessing for the APVMA: we are committed to a system of reregistration for agricultural and veterinary chemicals. This will assure the community that chemicals currently being used in Australia meet contemporary health and safety standards. We do not want to have a situation where something is approved on scientific information and evidence that becomes deeply old and is never looked at again.
There is a reason why we have an independent approvals authority. We have it for people's safety. We have it for the safety of farmers who are using the chemicals. We have it for the safety of people eating the food that is produced. And we make no apology for that—absolutely no apology. The fact that that gets looked at again in the future is something which is a decision the government took after we had received over 70 submissions on the draft legislation and after over 150 stakeholders attended consultation meetings. We do end up with a situation where the level of caution for Australians, for the environment, for people, is a higher level of caution than if once a chemical is registered you never look at it again. That does mean there is extra compliance that gets done and, as a result of that, we have a safer system. The government makes no apology for those decisions.
Mr John Cobb: Cocos Island?
Mr BURKE: On that, the information is not in front of us. If that comes to me then I will provide the information to the member.
Proposed expenditure agreed to.
Infrastructure and Transport Portfolio
Proposed expenditure, $588,568,000
Mr ALBANESE (Grayndler—Leader of the House and Minister for Infrastructure and Transport) (16:15): The 2012-13 budget has delivered a return to surplus but not at the expense of investing in important nation-building infrastructure. Our record investment in infrastructure is boosting the productive capacity of the nation and building an Australia that can compete and prosper in the 21st century.
This budget continues the rollout of Labor's unprecedented Nation Building Program and further builds on this through a range of measures. It delivers the federal government's commitment to provide our share of the funding to duplicate the Pacific Highway by 2016, by making up to $3.56 billion available on a dollar per dollar matching basis in the Nation Building Program.
It delivers $232.1 million to fund the final priority project on Infrastructure Australia's original priority list, arising out of the national audit of infrastructure that they undertook, the Goodwood and Torrens Junction upgrades, again, on the basis of fifty-fifty funding, this time with the South Australian government. That follows the announcement in between last year's budget and this year's—but the money is provided in this year's budget—for the Majura Parkway: $144 million from the national government and $144 million from the ACT government, again, on a fifty-fifty basis. So that now each and every project on the Infrastructure Australia priority list has received funding. It funds the relocation of the Moorebank Defence units, to open up a 220-hectare site for the development of the intermodal terminal facilities that were first chosen by the Howard government. But we have provided the next step, to address freight capacity constraints now and into the future.
The budget extends important safety programs under the Nation Building Program: an additional $1.75 billion over five years, for the Roads to Recovery program; an additional $300 million over five years for the Black Spot Program; and an additional $140 million over seven years for the Heavy Vehicle Safety and Productivity Program. This is the first time ever that there has been a specific program for safety of heavy vehicles in the Commonwealth budget. It funds reforms to make Australia a modern, seamless economy by reducing the number of national transport regulators from 23 to just three.
In the week after the budget we had sign-off at the Standing Council on Transport and Infrastructure meeting in South Australia. All states and territories signed off with the Commonwealth on the national maritime legislation, which, in the past fortnight, I have introduced into this parliament. That will deliver a boost to the economy of $30 billion over 20 years. It is important reform, talked about for decades but delivered by this government, with the additional funding that was required to make it a reality provided for in this budget. It continues nation building, particularly in regional Australia, with almost two-thirds of the $36 billion in the Nation Building Program being invested in regional infrastructure. In total, the 2012-13 budget provides some $6 billion in new investment for the Nation Building Program. I commend the fiscal measures, the budget, on infrastructure and transport to the House.
Mr RUDDOCK (Berowra) (16:19): I rise to seek information from the minister. He will not be surprised when I say that it is in relation to the F3-M2 link. I have read very closely the document that you have produced associated with your portfolio; that is, Nation-building programs—Sydney transport infrastructure: project highlights. I read the section dealing with the F3 to M2 link and I note that along with the M5 East it is described by you and your departmental officers as a 'vital transport project'. And I emphasise the word 'vital' very deliberately.
It says in the statement that the government recognises that:
Connecting the Sydney Orbital Motorway network to the F3 would provide an efficient an effective national network connection through Sydney.
It goes on to say that the project is one which lends itself to being privately financed and that exploration of private financing is a matter that should be pursued. It is noted that along with the M5 East this particular road is now costing the nation $5.2 billion as of 2011, and will cost the nation, through avoidable congestion, $7.8 billion by the year 2020. I find the arguments extraordinarily compelling.
I simply ask: does the government intend to do anything in relation to this project or do I read it correctly that you are making it totally subject to somebody else coming up with the same amount of money as you are willing to offer in order for it to be progressed? I note—and I may not note it correctly—that in a less-urgent project, according to the words that are used—and I do not know whether that is right or wrong—the Australian government has committed $30 million for planning for the M4 East motorway without qualification. In other words, my question is: are you serious about doing anything on this matter? I note that the Howard government promised $1.5 billion five years ago as an election commitment.
Mr ALBANESE (Grayndler—Leader of the House and Minister for Infrastructure and Transport) (16:22): I will respond to that question because this is a particularly important issue. I make the point that I have no doubt about the sincerity of the member for Berowra about getting funding for this project; he has raised funding for this project before. But I make the point that the former government, in which he was a senior cabinet minister for 12 years, and they did absolutely nothing in terms of progressing the issue. It is not good enough after four terms to say, 'We promise to spend something in our fifth.' That is not good enough. Not one cent was put in from Commonwealth funding into this project.
The fact is there are two elements of the budget which are relevant to this road. I agree with the member that this is a vital project for Sydney. There are a number of vital projects for Sydney, including the M5 East, and hence at the last election campaign we committed for Infrastructure Australia to undertake a study for financing options of the M5 East and the F3 to M2. Infrastructure Australia has produced that report and recommended a special-purpose vehicle be created. Under the auspices in negotiations we have had with the New South Wales government we will insist that Infrastructure NSW provide the lead role in advancing these projects. The fact is that both these projects are quite expensive. The fact is that neither the state government of New South Wales nor the federal government by ourselves are in a position to provide all of the funding that will be required for this to occur at this time. So how do you accelerate it? One of the ways that we accelerate funding in infrastructure is to mobilise private capital into infrastructure. That is why we have the creation of a special-purpose vehicle, led by Infrastructure New South Wales. I personally have had discussions with Infrastructure New South Wales, including its chair, Nick Greiner, about this direction in terms of infrastructure development. We know that for a period of time there has not been enough investment in infrastructure in our urban communities. We need to come up with ways in which we can mobilise that capital. We know from direct discussions I have had, including with managed funds in terms of the superannuation industry and other potential sources of private capital, that there is an appetite for investment in infrastructure which provides certainty in terms of a return. Hence, there is additional funding of $25 million for commitment to a special-purpose vehicle—bearing in mind that this road that the member for Berowra talks about is not a national road. It is the responsibility of the state government, but we are prepared to do our bit to provide that leadership.
In addition to that, $150 million that we have committed is available also to assist in terms of being allocated in the budget for the F3 to M2. That money has been there for some time. It was allocated by us in our first budget in 2008, after our election. There was nothing in the budget for this road when we came to office. Last year we did defer when that would be available, on the basis that we had received no requests to actually use that funding, just as the $30 million has been there for the M4 East awaiting a proposal from the New South Wales government, which of course is the responsible body in terms of the road network in Sydney.
So I would welcome discussions. Indeed, I am prepared to offer to have discussions with the member for Berowra—I know he is fair dinkum about this issue—about ways in which perhaps he could play a role in encouraging the New South Wales government to play a constructive role in this, because I think there is a real opportunity to advance this issue. (Time expired)
Mr TRUSS (Wide Bay—Leader of The Nationals) (16:27): The minister, in his opening remarks, spoke about the amount being allocated for road expenditure in the budget, but, according to table 15 on page 6-43 of Budget Paper No. 1, in the 2012-13 budget the estimated expenditure on roads will be just $2.67 billion. That is a drop of $3.62 billion, or 58 per cent, from the previous year. This is a lower expenditure on roads than in the last Howard government budget, and as a proportion of GDP it is lower than in 2004-05, when the coalition government introduced Auslink for the first time. What is perhaps even worse is that in 2015-16, the last year in the forward estimates, the amount proposed for roads is only $2.7 billion. That is still less than provided in the last Howard budget before the election of the Labor government. So, in spite of all we hear about this government and its grand projects, this year and in 2015-16 there will be less money provided than was in the last Howard budget. So I ask the minister: is the $2.7 billion being provided in the forward estimates for 2015-16 all that the government proposes to spend on roads in 2015-16, or are there amounts somewhere in the contingency reserve to ensure that there is some kind of decent allocation for roads that far out?
My second question relates to the carbon tax and its impact on road construction. It has been estimated that it will cost $400 million extra to build the roads on the government's program as a result of the carbon tax. Has the government provided an extra $400 million to enable these projects to be completed, or are we in fact going to get fewer roads constructed than the government had committed?
Naturally, because of the fact that expenditure has been reduced so much, every state will see a significant reduction in its road-funding budget this year. The centrepiece of the budget, as the minister said, was an alleged $3.6 billion commitment to the Pacific Highway. However, there is actually only $2.7 billion in the budget. The remaining $900 million is presumably for some year beyond 2016, which guarantees, of course, that the government's commitment to have it all done by 2016 will not even be honoured under its own formula. I note that the government is proposing that this should be done on a fifty-fifty basis. I ask the minister: why was it appropriate, when the last Labor state government was in power, for the split to be something like 86 per cent to 14 per cent? The Commonwealth met 86 per cent of the cost of projects when there were Labor governments at both the federal level and the New South Wales state level and the state met only 14 per cent. Indeed, it only got to 80-20 because the O'Farrell government put in $468 million after they were elected to bring it up to 80-20.
When the Labor Party was in power in New South Wales, an 86-14 split was considered appropriate, but now the government is demanding 50-50. I ask the minister: if in fact the New South Wales government says that what was good for Labor in New South Wales ought to be good for the coalition and therefore refuses to meet 50 per cent of the cost, will the government withdraw its $3.6 billion or will it ensure that that money is spent on the Pacific Highway without this draconian condition?
Moving to Queensland, another state where there have been significant reductions, I refer to the Cooroy to Curra project. There has been no money announced in the budget for any new work to be done right out to 2015-16. I note, however, that the government has said that the cost of the existing project, which will finish in a few weeks time, is now only $388 million, whereas in previous years it has been put down at $488 million. I ask the minister: does this confirm that the amount the government has taken away from the Cooroy to Curra stage B project in the last federal budget was in fact $100 million? Ever since the last budget, he has refused to answer questions on notice or questions in Senate estimates on that issue. I assume we can now take it for granted that the amount taken away in the last budget was $100 million.
Mr ALBANESE (Grayndler—Leader of the House and Minister for Infrastructure and Transport) (16:32): I am happy to answer the rather extraordinary questions from the Leader of the National Party, the party which purports to represent regional Australia. There are a couple of points to be made. One is with regard to the budget provisions and our expenditure. The fact is that, for example, two weeks ago I was at the Ipswich Motorway for the opening of the Dinmore to Goodna section. It is a major project—well over $1.8 billion of Commonwealth money. We have allocated over $2.8 billion to the Ipswich Motorway. It was opened six months ahead of schedule and $400 million was brought forward as the final payment. One of the things we have done which our predecessors never did—none of the transport ministers—was pay according to outcomes. We made milestone payments. The road is finished, so the $400 million allocated last year we have spent this year. That should not be too hard to understand. I say to the shadow minister that that is appropriate. We then had the extraordinary proposition with regard to Cooroy to Curra where, again, the shadow minister purports, 'It is bad that you have produced a road under budget'—which we did. And do you know what happened to the money? It went into the Bruce Highway.
Mr Truss interjecting—
Mr ALBANESE: The member did nothing to fix Cooroy to Curra when he was the transport minister, even though it is in his own electorate. He did nothing to fix it over the entire time he was in government, but now that section of the highway is about to be completed he says it is a bad thing that we have done it under budget. 'We should have given those poor contractors more money. Don't worry about how much it cost to build, here's a bonus. We'll give you more money.' You cannot be serious coming into an estimates hearing and putting that sort of preposterous position—that we should pay more money for roads, regardless of what it costs.
We make no apology whatsoever for the fact that we have driven efficiencies. One of the reasons we have driven efficiencies is we have doubled the roads budget. We have increased the scale of the work that is taking place. We have introduced alliance contracting. We have gone through the Infrastructure Working Group and introduced microeconomic reforms which may, for example, take away a lot of red tape and streamline the approval process for these projects that have resulted in less money from taxpayers being spent on building roads. That is a good thing. Everyone knows that except the Leader of the National Party, who again comes in here and is critical because projects come in under budget. I make no apologies for it whatsoever.
We then have the extraordinary proposition that somehow this government is being unreasonable with regard to the Pacific Highway. Under the former government, the Commonwealth put in $1.3 billion and the state government put in $2.5 billion for the Pacific Highway.
Mr Truss: But it wasn't on the national network then. You put it on the national network.
Mr ALBANESE: Give me a break! The Pacific Highway was just created in 2007 as an important national road—that is an absurd proposition from the member opposite. I make no apologies for the fact that we have delivered additional funding for the Pacific Highway. For example, as part of the stimulus, the Kempsey bypass is 100 per cent Australian government funded.
Mr Truss: You announced it, yes, so why do you want New South Wales to pay now?
Mr ALBANESE: I have admitted it. It is really hard to argue with that sort of logic. We have admitted it. It is in the budget papers. Part of the economic stimulus was to have major infrastructure projects, including the Pacific Highway, which is a vital road. People did not start having road accidents in 2007 on the Pacific Highway. (Time expired)
Ms SAFFIN (Page) (16:37): I have a few questions for the minister to do with the Pacific Highway, but I want to make some comments first. I listened to the minister's contribution and also to the question by the member for Wide Bay, the Leader of the Nationals. I start with a quote from a media release by the NRMA. It was Monday, 27 February this year. The title of it was, 'Stop passing the buck on Pacific Highway'. It says:
Calls by the NSW Government to change the funding model for the Pacific Highway from the current 50/50 spilt with the Federal Government is disingenuous and will do nothing to get the road upgraded by the 2016 deadline.
It goes on to say:
NRMA Motoring & Services President Wendy Machin said comments today by NSW Deputy-Premier Andrew Stoner on North Coast radio—
and comments I heard on my local radio—
would be concerning to communities waiting to see the road finally upgraded.
Another direct quote:
“It was the Howard Government that set the 50/50 funding split for the Pacific Highway from 2006 and the NRMA has supported this approach since day one,” Ms Machin said.
“While in Opposition, the current NSW Government frequently called on the NSW Labor Government to match federal funding for the Pacific Highway dollar-for-dollar and we supported this call too.
And there is more: I have pages and pages of quotes from the deputy premier in New South Wales, Andrew Stoner, and from the New South Wales roads minister, Duncan Gay, talking about meeting the deadline—always having a go as a good opposition would, correctly, at the government and saying, 'Put money in'. But as you heard from the minister, they did. I just find it really bizarre that the federal government is being called upon to adhere to this mythical 80-20 split. It does not exist; it never existed. There was stimulus money—
Mr Truss: It's in the agreement.
Ms SAFFIN: I know. I know what you are quoting from, honourable member for Wide Bay. I have seen it too in the nation-building program because there was stimulus money—there was extra money given. So you cannot even give something extra and have people say, 'Great, we have some extra money', all you do is turn it around and kick people in the teeth. I am fed up with it, because it is my local road and I am sick of having to be involved in this debate. The money needs to be there, fifty-fifty. It was no different to what Prime Minister Howard said at the time.
If you go back to the coalition's Auslink white paper of June 2004, it said, 'The government's objective is to duplicate the Pacific Highway by 2016, in partnership with the New South Wales Government.' It goes on to say, 'The government,' meaning the Howard government, 'will commence new duplication and upgrading projects by investing an additional $480 million. The New South Wales government will be expected to at least match this level of funding.' There is no different an expectation on the federal Labor government now.
Now, prior to the 2007 election the coalition's election policy 'Our 2020 plan for Australia's transport future' said, 'The coalition is willing to commit funds to fully duplicate the Pacific Highway by 2016 if New South Wales matches this commitment.' So what has happened to that? Is that a policy that has just been dropped, abolished, gone? Particularly by the Leader of the Nationals; you were once seen as the party that cared about roads and that funded roads. Where has that gone? I have only ever lived in areas that have generally been National Party and I just find it astonishing that we are having this debate in my local area on this.
Everybody has looked for this so-called 80-20agreement. It does not exist. What you find in the state budget papers in New South Wales is:
The Australian Government’s Economic Stimulus Plan significantly increased capital expenditure in New South Wales in 2009-10 and 2010-11 ($3.0 billion and $1.7 billion, respectively). This expenditure effectively concludes in 2011-12 …
Which is as it should be: it was stimulus money. It finished, and to have it used to be kicked and beaten up on is just unconscionable.
Minister, my question is: how much money went into the Pacific Highway?
Mr ALBANESE (Grayndler—Leader of the House and Minister for Infrastructure and Transport) (16:42): I thank the member for Page not just for her question but for her strong advocacy of the Pacific Highway.
For example, we had the pleasure of being at the sod-turn, the construction milestones and the opening of the Ballina bypass. This was a project that was a very challenging engineering project indeed. It was one promised, funded and delivered by the federal Labor government. We also have, of course, underway right now a range of projects on the Pacific Highway.
What is astonishing for the Leader of the National Party is that 92 per cent of the funding for the construction for projects currently underway on the Pacific Highway are in coalition seats. The $618 million that we committed to the Kempsey bypass during the economic stimulus plan is completely within the electorate of Cowper. It is a vital project, which will be extended with the Frederickton to Eungai section, the section where the Clybucca bus crash occurred in 1989. Australia's worst ever road accident and the road had not been fixed. That is an indictment on the entire political system, that that had not been fixed. Not just Labor or coalition, state or federal—all of us. So let us get rid of this nonsense and get it done!
I have not played politics with the Pacific Highway—92 per cent of it is in coalition seats. If that is playing politics, then that is just pathetic. The funding has been allocated with absolutely no reference to partisan politics. Three per cent in the electorate of Lyne and four per cent of the construction projects are in the Labor held seats of Richmond and Page. We have not said, 'Let's do Page first, before Cowper.' Most of the money is going into Cowper right now. They are big projects: Sapphire to Woolgoolga, the Kempsey bypass. We get this nonsense: 'You admit that 100 per cent of the funding for the Kempsey bypass is from the Commonwealth government.' Of course we do. It is part of the economic stimulus plan. I am proud of it. This project will save lives and will make a more productive Australia. And the opposition is opposing this funding. That is amazing.
Of the remaining projects on the Pacific Highway, 48 per cent are in coalition seats. If you are fair dinkum, Leader of the National Party, I say this to you: go out there and commit today to fund all of it, the $7 billion plus, over the forward years. Our funding goes until 2016-17. The Leader of the National Party needs to understand the complexity that the 2016-17 financial year is the annual year 2016 in terms of the milestone payments! That is why the final amount—because we pay on milestones, as I explained before—is in that year. He should go out, stand up now and commit to $7 billion from the coalition by 2016. It will just add to the black hole you have! If he does not do that, he is a fraud on this issue. The Leader of the National Party should be saying to his New South Wales coalition colleagues, 'Get on board. Do what you said you would do.'
There is not a single project on the Pacific Highway under construction or committed that has an 80-20 agreement—not one. There is no 80-20 agreement between the Commonwealth and the state government—there was not under us, there was not under you. The fact is, we have provided additional funding. To argue that that should be continued is like arguing that the BER or a range of other projects that were stimulus projects should be continued ad infinitum. If the Leader of the National Party is at all fair dinkum, he must stand up—he has until five o'clock—and commit to that whole $7 billion. (Time expired)
Mr CHESTER (Gippsland) (16:48): I would like to draw the minister's attention to the Princes Highway in south-east Australia, which he is very familiar with, and I thank him for his correspondence on this issue. This relates also to the seat of Eden-Monaro. The issue I refer to is the duplication works between Traralgon and Sale, where $140 million has been committed by the federal government and $35 million by the state. I seek clarification about the government's position on the re-profiling of the $20 million, which has been extended out from the previous financial year and which I understand was an EPBC-related issue. In that context, I would be interested in your thoughts, Minister, on what extra costs these EPBC-related issues are adding to the road construction bill in Australia. I am finding in my electorate that road construction not referred to the EPBC is extraordinarily frustrating for the local community and roads are being realigned in a manner not consistent with what was expected when the reserves were put aside in the first place. I would be interested in what reforms the government has in mind in relation to that, but more particularly about the $20 million which has been re-profiled. I know the minister understands that this is a much larger project than the $140 million which has already been allocated. I would be interested to know the minister's view in terms of any future funding commitments to that section of the road.
More broadly, Minister, I want to refer you to the Princes Highway east across Victoria and into the seat of Eden-Monaro. I have the figures in front of me for 2005 to 2010 when, from Sale to the New South Wales border, there were 22 fatalities and 116 serious injuries on that stretch of road. I am not sure what happens after that, in Eden-Monaro, but I am sure the member can tell us.
This road is not on the national network—I appreciate that—but on that stretch of road between Wollongong and Sale some off-network projects are being undertaken with support from the federal government for the Bega bypass. What is the government's attitude to the status of the highway from Wollongong through Eden-Monaro and Gippsland to Sale, where it joins up with the national road network section on which work is currently underway?
This area has quite significant heavy vehicle usage, with the timber industry, the fishing industry, the moving of agricultural products and the local and tourism related traffic increasing. Does the government see this as a priority? What advice do you have for the communities along that route to get more of the federal-funding pie to ensure we improve the safety and productivity of the road in that region? I would appreciate your feedback.
Mr ALBANESE (Grayndler—Leader of the House and Minister for Infrastructure and Transport) (16:50): I thank the member for Gippsland for his question. He is a strong advocate for his local community. We have some political differences, but I have no doubt that he is a genuine advocate for additional money to be spent in his community. He would never take the attitude of arguing against funding for his areas that some on that side of the House seem to take.
With regard to the Traralgon to Sale section, yes, the deferral of some of that funding was because we pay against milestone achievements. The EPBC environmental approvals meant that the state government requested a deferral essentially because the money could not be spent at that time. My advice from meetings with Minister Mulder from Victoria, with whom I have a very good and constructive relationship, has been that there has not been a request for additional funding—that is, an argument that because of the deferral the costs would increase. For a number of recent projects in Victoria there were cost increases, while for some projects there were cost savings. We have constructively worked through those issues, so I am confident that we could work through those issues with the Victorian government. People would be aware that there is a current commitment to the $175 million project, jointly funded with $140 million from the Commonwealth and $35 million from the state government.
With regard to issues with the highway beyond Sale, the section of the Princes Highway that the member refers to is a state road and the responsibility of the Victorian government. We have not had representation from the Victorian government for additional funding that I am aware of. There may well have been representations to the department, but none I am aware of from direct discussions I have had with Minister Mulder, the most recent of which were face-to-face discussions two weeks ago when I had two meetings with Minister Mulder, one in Victoria and one in South Australia at the ministerial council meeting. I would invite the member to have further discussions with me to find a constructive way of dealing with this.
In answer to the member's questions, we have had funding for projects including on the other side of the border, such as for the Bega bypass. I think that is now fully federally funded after we made a commitment to get it done. It is unfortunate that state governments of various persuasions have not all come on board with funding for that project. The member for Eden-Monaro, Mike Kelly, has been an extraordinary advocate. In two weeks we will be in Bega commencing construction of that road, an important part of nation building program 1.
Importantly, on state government negotiations, nation building program 2 will commence from 2014-15 going forward. State governments are preparing submissions both to the federal government and through the Infrastructure Australia process. It is unlikely the Princes Highway funding will be prioritised by Infrastructure Australia, because IA looks at benefit-cost ratios and it would be difficult to progress it through a productivity inspired funding recommendation process. That is not to say that that should be dismissed. Productivity is, of course, vital and the economic utility of one project versus another has to be analysed.
We also have to look at issues such as road safety. I do point out to the member that we had in the budget the Roads to Recovery program in terms of local government funding extended and an increase in the Black Spot Program that has been very effective in delivering projects that save lives on our roads.
Dr MIKE KELLY (Eden-Monaro—Parliamentary Secretary for Defence) (16:55): While we are talking about the Princes Highway, I do appreciate the member's question on that because it is a very significant story and one neglected by state governments. It was part of the Infrastructure Australia process. There was a bid that the New South Wales government put in. That bid made it a long way through the process and we were hopeful that it was going to get up but, of course, the Infrastructure Australia process is independent and we did not quite get there. I did do a deal with the previous New South Wales state government that, if the bid did not get up, they would pick a couple of the more dangerous spots along the highway and do Victoria Creek and Dignams Creek. To give credit to the current New South Wales government, they have maintained that commitment and that work is underway.
One of the most important elements of that project is the Bega bypass that the minister has mentioned. This particular minister for infrastructure will go down in history as the greatest friend that rural and regional Australia has ever seen in government. When I look back at the 12 years of neglect of the Howard government when services vacated the regions, this is what gave Pauline Hanson her leg-up. We saw banks, post offices and railway stations in the towns in our regions suffer.
The Bega bypass is a classic example of where judicious intervention is being exercised by this government to unlock the potential of the regions. If you look at the Bega bypass it was something that was promised 40 years ago. I was at my father's knee when they first started organising for the Bega bypass and organising the land corridor.
Honourable members interjecting—
Dr MIKE KELLY: Yes, I was that short at one point in time. For all of these years we have waited for that project to be delivered. Why is it so important? Because, right now, the Princes Highway does a dogleg through the town of Bega and it is incredibly dangerous as the larger trucks come through the town. Over time they have become much, much bigger. Of course, we know that the b-doubles have to uncouple and recouple on the outside of town on both sides of town. This adds enormous costs to business and adds delay in moving traffic. We have a lot of goods that we need to move such as milk goods from Bega Cheese, timber goods, sheep and beef meat and logs. That whole array of measures require the ability of the b-doubles to move smoothly through the region. With the Bega bypass we will no longer have the requirement of those b-doubles to uncouple and recouple. Also we will be taking 500 truck movements a week out of that central street in Bega, Carp Street, which will improve safety and the air quality in the town. We are also going to see something like 360 direct jobs involved in the delivery of the Bega bypass. It is going to be a massive boost to the region and help unlock its economic potential.
The minister has demonstrated a complete grasp of the overall impact of unlocking a region's potential by unclogging the arteries of these key road links. We have here in the ACT the Majura Parkway, which is not in my electorate, but that $250 million project to which the minister is contributing $140-odd million is part of that seamless road network that we need in this region to unlock that potential. This is a region that is absolutely full of potential. It is going gangbusters. It is not just in the issues of identifying what are the current needs and impediments, but the minister was able to fund, through a $60,000 grant to the Bega council, a study done by consultants into the potential of the Port of Eden. The port of Eden is the best deep-water port in Australia, positioned halfway between Sydney and Melbourne. We have large industries that see the potential in using the port of Eden, like the Visy pulp mill in Tumut, Bega Cheese and major wind farm proponents—the Wind Prospect wind farm for Boco Rock will bring 120 turbines in to my electorate and a wind farm development in north-eastern Victoria will be using the port of Eden. We are also starting to bring in cruise liners in greater numbers. To bring those cruise liners alongside will vastly enhance the tourism potential of the region as well. This is the vision of this minister. I would like the minister to explain also how this relates to the overall productivity objective of the government and how the Infrastructure Australia part of this puzzle also introduces the independence element and a greater decision-making basis.
Mr ALBANESE (Grayndler—Leader of the House and Minister for Infrastructure and Transport) (17:00): I thank the member for Eden-Monaro for his outstanding contribution. In a balanced and fair way he has been a very strong advocate for not just his electorate of Eden-Monaro but also for regional Australia. Indeed, the member talked about the Bega bypass, that I think is important, to make the point that one of the issues that creates cynicism out there in the community is when infrastructure projects are promised but not delivered. It is absolutely vital that there be a long-term approach to these issues. It is vital that, where possible, there be a bipartisan approach to these issues. The Bega bypass, for 40 years, is just one example.
The Moreton Bay regional rail link is perhaps a more extreme example. First promised in the Queensland parliament in 1895, it will be delivered two centuries later. It was promised in the 19th century, missed the 20th century but is being delivered in the 21st century. The cynicism is there, and when I travelled to Bega with the member for Eden-Monaro there was a great deal of excitement that the project was actually happening. When construction commences, that is particularly important.
I have already had constructive discussions with the new Queensland government about the way that projects should continue in a seamless way. I have had constructive discussions with the Victorian government since the government changed hands. New South Wales thinks the world stops when there is an election and you should renegotiate everything. If you do that you cannot deliver infrastructure. You cannot have that approach to infrastructure development. That is why I have taken the approach of this government having a six-year nation building program, of building on the Infrastructure Australia process that is about recommendations and priorities. It is also about recommending policy initiatives such as the creation of the special purpose vehicle for the F3 to M2 and the M5 East, to look at innovative ways in which we can drive not just public investment but also private sector investment in infrastructure.
The member also raised the issue of the port of Eden. One of the initiatives that Infrastructure Australia has taken in driving that policy agenda, driving that long-term approach, is the National Port Strategy and the National Land Freight Strategy. For the first time, ports are being required to have an approach that recognises that they are not islands, that they relate to the land transport issues of how the goods get to the port. The big difficulty in road and rail transport and the productivity of our port structure is often at what is known as the last mile, which is so vital for a nation that has more than 99 per cent of our trade conducted by shipping.
That is why looking at how we best maximise the efficiency of our ports is so important. Infrastructure Australia has certainly done that and has provided in recent times advice on northern Tasmania that will put a rigour into the debate that was lacking in the past. I welcome the creation of similar bodies based upon the Infrastructure Australia model, such as Infrastructure New South Wales, and I think that Nick Greiner, as the chair of Infrastructure New South Wales, is playing a very constructive role in the debate.
In conclusion, I thank all those who have contributed to the debate. I understand that not everyone has had an opportunity to have a say. I am happy to offer people a private discussion or they can put questions on the Notice Paper.
Proposed expenditure agreed to.
Immigration and Citizenship Portfolio
Proposed expenditure, $2,609,431,000
Mr BOWEN (McMahon—Minister for Immigration and Citizenship) (17:05): As is my practice at these forums I will make an opening statement. This time provides a good opportunity to talk about the migration program. It always strikes me that one of the most important jobs for an immigration minister is to set the annual migration program for the year following.
It does not get very much attention or coverage, but it is the core of our very important migration policy. This year on budget day I announced an increase in the migration program from 185,000 people to 190,000 people—a modest increase but, nevertheless, an important one. This year's migration program includes a skills stream of 129,250 places, a family stream of 60,185 places and a special eligibility stream of 565 places. I would note that the breakdown between skills and family has been the same for many years—I think since 2006. I think it is an appropriate mix. It enables a continued focus not only on skilled migration but also on very appropriate and important family migration.
Up to 16,000 places have been reserved for the Regional Sponsored Migration Scheme to ensure that those areas have the support they need to fill skills gaps, grow local communities and strengthen communities. In relation to the Family Program, the figure of 60,185 is an increase on last year's program, which had 58,600. This is a program which is under considerable pressure given the considerable legitimate demand for people to live with their families in Australia. We have increased the parent stream, in particular, to 2,150 places. It was 1,000 when I became the minister; it is now 2,150 places. There is still a substantial backlog of applications for parent visas and a substantial waiting time. Obviously, we would like to see that come down, but it is important that the program be increasing.
Importantly, last week I made a number of announcements, some of which may get some attention today. One which may not get much attention is one that I am particularly pleased about: reforms to the Business Skills Program. I am particularly proud of this and we worked hard to deliver it. In my time as financial services minister I was particularly struck by the opportunities for Australia as a financial services hub and an investment location. That is what really drove our reforms to the significant investment visa, which will target migrants who can make an investment of at least $5 million in the Australian economy.
The significant investment visa will provide a boost to our economy and help Australia compete for high net wealth individuals seeking investment immigration. This will be a non-discriminatory visa, available to any high net wealth individual around the world who makes a financial contribution and an emotional commitment to Australia by seeking permanent residence. I envisage very heavy interest and demand in Asia, and particularly in China, where there has been a very substantial growth in high net wealth individuals over the years. This will of course help create a good source of new investment capital and increase the pool of funds to be managed locally. This will be good for jobs and good for our financial sector—in particular, funds management, financial planning, fund administration, stockbroking and accounting. We looked very closely at world's best practice in developing the significant investment visa. We looked at the experience of Canada, Singapore in particular, New Zealand and the United Kingdom, and I think we have a very competitive product indeed. There will be some more details announced, of course. Some of the reforms come into force on 1 July; others come into force later in the year, particularly the significant investment visa. We have also cut red tape by reducing the number of visa subclasses from 13 to three. I think we still have too many visa subclasses in Australia, but we have moved to substantially reduce them and we have made good progress in very substantially reducing the number of visa subclasses.
There are a number of other reforms that the government has engaged in, particularly in the skilled migration area, and I am sure some of those will receive the attention of honourable members over the coming hour.
Mr MORRISON (Cook) (17:10): First of all, I request that the minister table the 2011-12 outcome for the migration program as well as the 2012-13 planning levels. They have not been posted on the website since the budget was released, so I request that he do that. Going further, though, to the matters that the minister has raised in his opening statement, I add the coalition's support. I know that the minister appreciates it greatly when the coalition supports initiatives of the government, particularly in this area. I put on record that the coalition is very supportive of a number of the changes that the government has introduced in skilled migration. Although I am yet to see the details of the business skills reforms that he announced last Friday, in principle they are welcome.
I also welcome the minister's statements about the balance of the overall program between the skills and the family component. One of the great achievements of the Howard government was to lift the proportion of skilled migrants in the overall permanent migration program from less than 30 per cent to almost 70 per cent. The government has fallen back a little from that, but not much, and I think the intention of the government is to retain it at around two-thirds of the overall program, which is welcome. The other very important reform which is being introduced by the government—and I particularly commend the department officials on this—is the SkillSelect program. The SkillSelect program is a very worthy advance, and I commend those involved in it. Finally, visa subclass reform is effectively an area of regulation and the more we can do to reduce the paperwork around the issues in that is something that the coalition would always support.
The Enterprise Migration Agreements policy was part of last year's budget and is now very much in the public domain. This is a policy the coalition has supported from day one. It is a worthy policy which ensures that proponents of large projects can get upfront support to reduce the uncertainty around the implementation of their projects, which enables them to attract funding and support. I have a number of questions about the policy, and I ask the minister to take them either here or on notice. My questions are: can the minister confirm that the deed giving effect to the enterprise migration agreement for the Roy Hill mine project approved by the minister has not yet been signed? When will this deed be signed? What, if any, additional requirements were added to the arrangement by the government for the deed to be signed? Did any government minister seek to impose any additional conditions on that agreement before it was announced last Friday, or since, in relation to the finalisation of the deed for signing? Has the minister done an assessment or asked for an assessment to be done on the impact of any of these additional conditions in terms of their impact on this project? Would it delay start-up? If so, by how long and what will the impact of these delays be on the ability of the Roy Hill project to secure its financing? Finally, can the minister confirm that side agreements for the Roy Hill mine yet to be agreed with construction unions could restrict access to foreign workers provided for under the enterprise migration agreement and approved by the government? What steps is the minister or the government taking to ensure that unions will not use these agreements on site as a secondary bar to frustrate the purposes of the government's EMA and therefore put at risk this $9 billion project and the more than 6,000 Australians jobs it will deliver?
Mr BOWEN (McMahon—Minister for Immigration and Citizenship) (17:14): In response to the honourable member: firstly, I welcome his support for our increased skilled migration program in particular. I must correct the member, however—my clear understanding is that we have kept the same proportion of skilled versus family migration since 2006.
In relation to SkillSelect, I also welcome his support. It is a good reform—a very good reform—which will help us better manage the skilled migration program. We do have a substantial backlog of skilled migration applications and that is something which has provided a very significant challenge. That is because Australia, being a very attractive place to live, does attract many applications for all our migration streams and particularly in relation to skilled migration. Those applications of course have varying degrees of quality and qualifications, and some will never be in a position to be approved. Nevertheless, we are legally obliged to fully consider the applications. SkillSelect is an expression-of-interest model which will enable the department to sift through those applications much more effectively and much more quickly.
On the honourable member's question about the tabling of the outcome for 2011-12, I am advised we will not be able to do that until 30 June at least, because 2011-12 is not yet complete. In relation to the further matter he asked to be placed on the website, I will take on notice the question of when that will be put on the website. But certainly we are not able to put the 2011-12 result up until the end of 2011-12.
In relation to the honourable member's questions: yes, last week I announced in-principle agreement with Roy Hill. I said in my speech announcing the Roy Hill enterprise migration agreement that it was an in-principle agreement and documents would shortly be signed. Those documents of course are the subject of discussion between the Roy Hill project and the government. There will be substantial discussions about those. They are important documents.
In relation to site agreements: site agreements are a matter between the enterprise and the unions. If there were to be any government or ministerial involvement it would be through the Minister for Employment and Workplace Relations and Fair Work Australia. As Minister for Immigration and Citizenship I have no role in industrial relations matters. Site agreements, I dare say, will be a matter of vigorous negotiation between the unions and Roy Hill. But that will be a matter for Roy Hill and the unions under our Fair Work system.
Ms VAMVAKINOU (Calwell) (17:17): I want to ask the Minister for Immigration and Citizenship some questions on a matter of government reform which is of great importance to me and to my electorate. I am referring to the expansion of the community detention program, which I will get to in a minute. I have spoken on many occasions in this place about the Melbourne Immigration Transit Accommodation centre in my electorate. It is a smaller centre in the overall detention network across the country and was established some years ago under the previous government. Senator Amanda Vanstone was then the Minister for Immigration and Multicultural Affairs and, through the budget of the time, she allocated some $240 million or thereabouts to have a maximum security detention centre built in my electorate at the site of the Maygar Barracks which was purchased by the immigration department all those years ago.
It was obviously a proposal that our local community—and that is important, because my local community has driven a lot of the activities that have taken place since—in Broadmeadows were, at the time, clearly very unhappy about: the idea of a high security detention centre. People would recall barbed wire and children, and all sorts of very negative images associated with the handling of boat people.
Our community was very sensitive to that and of course they fought a very successful campaign which they called, incidentally, 'Links not Locks'. They managed to fend off the building of this massive high-security detention centre and, in its place, a smaller centre was created which was initially meant to accommodate, for very short periods of time, those people who were visa overstayers, given the proximity of MITA to Melbourne Airport.
In recent times, especially in the last couple of years, the centre has been a place that has accommodated unaccompanied minors and, again, my community maintained the idea that they wanted links not locks in whatever was going on in MITA. We embarked on a program that saw us develop a community interaction with the centre, with MITA. That community interaction involved a considerable number of people in my electorate. Some had reservations, but when they did go to MITA and met with the immigration officials there—Serco officials—and when they got to know a lot of the people that were staying there, they decided that they really wanted to be involved in improving and advancing community interaction. That saw the creation of a very successful soccer program which involved a lot of our schools not only in my area but in the surrounding areas. The immigration department in particular were highly cooperative and we were allowed access. We conducted music evenings in there, as well as IFTA dinners. The whole idea was to make people feel like there was a community out there that was interested in their welfare.
After that we moved into the community detention program, which is what I want to ask the minister about, and I have a number of questions because that program has been expanded. It actually a very successful reform and one that I am certainly very proud of as a member of this government. Minister: can you tell me how many people have been put into the community since it was announced in 18 October 2010, and how many people are currently in community detention? How many of those are children and how many are unaccompanied minors? How long does that mean that eligible minors have spent in held detention prior to moving into community arrangements? How many people are currently living in homestay arrangements and how many applications or expressions of interest have been received by the homestay network, which I understand is a more recent reform and one that appears to have been implemented very well?
Mr BOWEN (McMahon—Minister for Immigration and Citizenship) (17:22): I thank the member for Calwell and I acknowledge her very real interest, particularly in the detention facility in her electorate, the Melbourne Immigration Transit Accommodation facility, which she referred to. That is a centre which has changed its role over the last 18 months. With the release of children and families into the community, we have changed the role of the MITA. The member for Calwell is a very active visitor to that centre and has engaged very closely with the community to build the links that she referred to and to build understanding between the community and the people held in that centre. She is a very popular visitor to the centre as well as, I am told, very effective on the football field at the centre in particular.
I would also like to acknowledge the role of the honourable member as chair of the parliament's Migration Committee. She is conducting a particularly important inquiry at the moment on migration and multiculturalism with her colleagues. Also, I recognise her role as parliamentary co-convenor of Parliamentary Friends of Multiculturalism, which she founded together with the honourable member for McMillan.
In relation to the honourable member's questions—yes, I agree—the community placement program has been a successful one; frankly, I am very proud of it. I will take this opportunity to thank the members of my department who have worked very hard to see it implemented. It is an ambitious program.
When I announced in October 2010 that we would see the majority of children into the community by July 2011 there were many people who questioned whether that could be achieved. It sounds easy sourcing the accommodation and sourcing the carers but it is not. I particularly place on record in the House my thanks to First Assistant Secretary Kate Pope and her entire team. My thanks also go to the Red Cross and other service providers who assist the government in delivering that program.
I decided very quickly when I became minister that this was an appropriate thing to do and I actually decided on a visit to Christmas Island. When I visited families at the detention facility on Christmas Island and looked at the children in that centre, I thought there has to be a better way of doing this. A month later we announced the community detention program. It is one that has worked well. It has had the odd occurrence of people in the community who have had behavioural incidents. There have been some difficult decisions I have needed to make about those but, by and large, it has been very successful.
In order to answer the honourable member's question, since October 2010, 4,014 people have been approved for community detention. That includes 2,151 adults and 1,863 children—among them 800 unaccompanied minors. Of course, many of those people have gone on to receive protection visas.
In relation to community detention, as we speak today, there are currently 1,914 people in the community or transferring into the community. Of these, 672 are children, including 173 unaccompanied minors in or transitioning into the community program. That means that 66 per cent of all asylum seeker children are currently held in the community. That is a reduction from a couple of week ago, when we hit 71 per cent. It is a reduction because of course the figure is impacted at both ends. At one end by arrivals—when we see an increase in arrivals, particularly of children, that reduces the proportion in the community and, at the other end, by protection visa grants. When a protection visa is granted to a child, that child comes off the community program, becomes a permanent resident and is not counted in the community detention figures. However, we do have 346 children remaining in detention.
In relation to the honourable member's question about the amount of time spent by children in detention before being transferred into the community, that figure has come down. As we speak, any child who arrived in February or before is now being held in the community, if they are eligible. There is a very small number of children in relation to security cases, cases of behavioural concern and there are a number where I do have some concerns for the child's wellbeing because of a range of complicated factors. But everybody who arrived before February is in the community. I have run out of time to talk about Homestay. I can say there are currently 20 people in Homestay arrangements. If the honourable member wants to take another opportunity to ask me about Homestay again, I will do my best to answer her questions.
Mr MORRISON (Cook) (17:26): Just following up my earlier questions to the minister: what, if any, additional requirements have been added to the EMA for the Roy Hill mine project? Since the in principle agreement was reached, as I understand it, last Wednesday, have any government ministers sought to impose any of those additional commitments since that in principle agreement was reached? Has the minister done an assessment on what these additional conditions may require or mean? Will it delay the start-up of the project and, if so, by how long? Have any concerns been expressed to the minister in his capacity as the minister for immigration and being intricately involved with the EMA for the Roy Hill mine project about concerns of the project proponents about the potential for the arrangements under the EMA to be frustrated by site agreements in the Pilbara that are yet to be concluded with the construction unions?
Can the minister confirm that unions were extensively consulted in the formation of the enterprise migration agreement for the Roy Hill mine project? If so, can he outline the extent of that consultation? In reference to consultation with members of the government, which has been a topic of discussion this week in the House, I refer the minister again to his response in the parliament yesterday when, at page 29 of Hansard, he said:
… I have discussed with and updated informally the productivity committee of the cabinet in relation to this enterprise migration agreement.
As a member of the committee, was the Prime Minister present at any of these discussions and did the Prime Minister receive any of these informal updates—these two separate processes that the minister has referred to? Were any of the reports of the progress included in any minutes of that committee and were those minutes circulated to members of the committee?
Mr BOWEN (McMahon—Minister for Immigration and Citizenship) (17:28): In relation to the enterprise migration agreement, as has been commented upon by me, the Prime Minister and other government spokespeople, we are of course committed to ensuring that Australians have opportunities to apply for the 8,000 positions being created by the Roy Hill project. It is a requirement of the EMA that Roy Hill make every effort to employ locals. There are 6,700 jobs earmarked for Australians. Of course, as has been publicly commented upon, the Prime Minister and I have referred to the use of the jobs board and its reference in the enterprise migration agreement. I do not envisage that that commitment does in any way delay the implementation of the EMA or the project. In relation to site agreements, again, I remind the honourable member that I have no involvement in site agreements. Of course, I have met and discussed various matters with Roy Hill. They are a matter for Roy Hill and any discussions I have had with them are in relation to their approach to the project generally.
I can confirm the honourable member's suggestion that unions were consulted. That consultation process is outlined in enterprise migration agreement guidelines that I released in September 2011. That consultation is substantial. It requires Roy Hill to talk to relevant trade unions and enables trade unions to be participants in the program. That is what has occurred. That was a key recommendation of the National Employment Resources Taskforce committee, chaired by the then Parliamentary Secretary for Western and Northern Australia, the now Special Minister of State. The whole idea is to have a holistic approach, but that does not mean, as the honourable member may have noticed, that every trade union is happy with the results, but it does mean that they were involved in the consultation, which is important and would be the case for other enterprise migration agreements going forward in the future.
In relation to the honourable member's question about cabinet matters, I have nothing to add to my answer of yesterday in the House and I certainly have nothing to add in any question about timing.
Mr STEPHEN JONES (Throsby) (17:31): I start by congratulating the job that the minister does in what is often a controversial portfolio and always in the spotlight. There is no doubt about that. I do not know if there is a sleepy hollow anywhere in the executive level, but if there is it is certainly not this portfolio.
I am particularly interested in some of the economic aspects of the portfolio, and an area that is very dear to my heart is international education and education services. It is dear to my heart because it is worth around $20 billion in export income to Australia annually; a figure not often understood in the Australian community when they think about our export earnings. It is also very important to my local area. The University of Wollongong has a very big international education services area. We attract students from about 140 countries from around the world to courses at the University of Wollongong, and around 27,000 international students are enrolled at any one time at the university's Australian and international campuses.
I am particularly interested in the Knight review that the government has commissioned and the findings of that review into the student visa regime. I am particularly interested in what the minister can do to update the House on the government's adoption of the recommendations of that report. In particular, which student visa reforms have been implemented as part of the second stage changes? Perhaps if you had the time, Minister, you could explain the streamlined visa processing for bachelors, masters and doctorate courses at participating universities and explain why the decision has been taken to increase the allowable working hours for student visa holders—another important area and why it is important that we continue to reform the visa framework around the international education sector.
In another area, I am also interested in something that has been discussed a lot over the last week and that is the enterprise migration agreements. I have received a lot of inquiries about this in my own electorate office and I would be interested in any observations you can make about how people from my electorate of Throsby in New South Wales can gain access to any of the 8,000 jobs that I understand are going to be created by that project and how they can be assured that Australian workers get first go at those jobs, and particularly workers who might have been displaced from other industries in electorates such as my own.
Mr BOWEN (McMahon—Minister for Immigration and Citizenship) (17:34): I thank the honourable member for his question and his interest in international education. He referred to his advocacy of the University of Wollongong. In a very modest way he did not refer to his advocacy for St Paul's College in his electorate and the very important work St Paul's does in international education. The honourable member will correct me if I am wrong, but I think well over 90 per cent of the students at St Paul's are international. It is a great facility in the Illawarra and a great export earner for Australia and a great educator of young people. The honourable member is correct: international education is vital for Australia. It is one of our largest export industries. It also provides a very important stream of finance to our tertiary institutions. It is a creator of employment. Also—and this is sometimes forgotten—it is important to Australia's international strategic long-term best interests. If we are educating the leaders of tomorrow—from Indonesia, Malaysia, China and India—if we get it right we will stand in very good stead with those people who get their education in Australia. There are plenty of examples of senior leaders in Asia at the moment who studied in Australia, and I hope we have many thousands more.
For that reason, the minister for skills and I appointed the Hon. Michael Knight, a former minister for immigration, to conduct a review of our visas settings for international education. The number of student visa grants had declined between 2009 and 2011 due to a range of factors. We wanted to make sure that the visa settings were right for the times. Michael Knight made 41 recommendations and we accepted every one of them. Twenty recommendations have been implemented, a further eight are going to be implemented by early 2013 and work on the remaining 13 is ongoing because it involves long-term research and ongoing liaison.
A number of Knight review recommendations were made in March this year as part of the second stage of the review. The changes included streamlined visa processing for certain prospective students of participating universities. That was very warmly welcomed by Australia's university sector as a very important streamlining of their necessary processing. It really gives universities and other institutions—but universities in particular—the opportunity to ensure that their processing is as efficient as possible and, while protecting integrity, not overly bureaucratic.
We have also made significant progress on other reforms—in particular, the assessment level framework review. That will be very important to the honourable member because it goes to VET institutions and it goes to schools like St Paul's. It will look at how we can best take a streamlined approach and apply it to other institutions. It is not as simple as universities. There is a much smaller number of universities and they are easier to monitor. But there are many more VET or other institutions. But the principle is sound and good, and we are looking at how that could be expanded.
The very important new post-study work visa arrangements come into effect in early 2013. Graduates who have completed a bachelor's degree, a master's degree by coursework, a master's degree by research or a doctoral degree will have access to post-study work arrangements of two, three or four years respectively. In relation to streamlined visa processing, that came into force on 24 March 2012.
The honourable member raised the subject of working hours. We did make changes there. It was not so much an increase but more a streamlining. The previous condition was 20 hours a week. We have changed that to 40 hours a fortnight. That might not seem like a change, but it does actually provide a lot more flexibility. As you can imagine, there are different working hours and different working environments. Sometimes students might want to work 25 hours in one week and fewer hours in the next week. Averaging that over a fortnight makes more sense to employers and their record keeping.
In relation to the honourable member's question on enterprise migration agreements, as the government and I have repeatedly stressed, we want these jobs to go to Australians, particularly those who have been affected by structural change and adjustment in electorates such as Throsby. That is one of the reasons for the jobs board, which will have the capacity not only to advertise positions but for people to express interest in working not only at Roy Hill but at other projects throughout the resources sector. I know that Roy Hill is soon to begin a very major recruitment exercise across the country in a high-profile way. It will be making its own announcements about that. But I expect to see lots of capacity for the member for Throsby to refer people to Roy Hill, including through jobs expos which he may wish to hold in his electorate.
Ms GAMBARO (Brisbane) (17:39): Can the minister explain what the Prime Minister's jobs board is, how it will function, when the concept was first raised and by whom, and when the Prime Minister first indicated to him that a jobs board should form part of the EMA policy infrastructure?
What is the process for prospective workers to place themselves on the jobs board and will parties to the EMA be required, as part of the EMA, to take workers from the jobs board prior to seeking overseas workers? How will prospective workers be vetted prior to their details being put on the jobs board? Is there an independent panel or an organisation that can ensure that the details and the background of prospective workers are accurate and up to date?
Minister, there was a report in the West Australian newspaper on 29 May 2012 which refers to a current investigation by DIAC into the claims that hundreds of Chinese workers on the $5.4 billion Sino iron ore project in the Pilbara are being paid half the wages that Australian workers are getting. They are being paid $70,000 to $80,000 instead of being paid $150,000. When were these claims first brought to DIAC's attention, what is the current status of the investigation and, Minister, which government agency is going to have oversight to ensure that overseas workers are paid in Australia or, if they are paid through offshore agencies, that they are actually receiving the correct workplace entitlements under Australian law? How are you going to ensure that they are paid the correct amount, both onshore and offshore?
Mr BOWEN (McMahon—Minister for Immigration and Citizenship) (17:41): I thank the honourable member for Brisbane for her contribution, and the honourable member for Chifley for his contribution, over the last few minutes. The honourable member refers to the jobs board. The jobs board is an opportunity not only for people to express interest in positions that might be available in the resources sector generally but also for resources companies to use—it will obviously be an internet based mechanism—to undertake some recruitment. A jobs board will be referred to in Enterprise Migration Agreements, and there will be requirements for companies to show what use they have made of the jobs board as part of their ongoing compliance. The jobs board will be operated and conducted by the Department of Education, Employment and Workplace Relations, and I know they have made good progress. The Minister for Employment and Workplace Relations is very focused on ensuring that that jobs board will be up and running as soon as practical.
In relation to Sinosteel, yes, I am aware of those very serious allegations; I have been aware for some time. I would be misleading the House if I could say that I could recall the exact date it was brought to my attention, but it has been brought to my attention not only through my department but also through unions. I think I have answered media questions on it, particularly in a 7.30 interview about the Sinosteel allegations, in particular. They are serious allegations. They are being investigated not only by my department but also by other government departments that, I am sure, are involved. It is an ongoing investigation, a serious one, and it is not appropriate for me to comment on an ongoing investigation. My department will have more to say when it is in a position to do so, but serious allegations are taken seriously, of course. Not every allegation that is made turns out to be true, but some do. But every one of them should be investigated—as these allegations are being investigated very seriously by my department.
In relation to who conducts compliance, there is a substantial compliance unit in my department which looks at dedicated monitoring of employer sponsors of 457 visas in particular and of course there is Fair Work Australia. The Fair Work Ombudsman also has a role to play here. We work hand in glove in investigations and compliance and we would also work very closely in compliance on Enterprise Migration Agreements. If I could reflect, I must say that I agree with the contribution, which may or may not be recorded in Hansard, of the honourable member for Chifley in relation to the reforms this government has brought in for 457 visa holders. We have made using 457 visas not harder but fairer. We have ensured protections are in place. We have ensured, because of the reforms we have made, that some of the stories of exploitation that we saw in the latter years of the Howard government cannot be repeated. I think 457 visas are very important in making the Australian economy work, but nobody should see workers exploited, whether they be Australians or foreigners working in Australia. Our reforms make sure that that is the case. We ensure that there are protections in place for 457 workers, because some of the stories we saw and heard and that were proven in 2005, 2006 and 2007 were disgusting and should never be repeated in Australia. I am glad of the reforms that this government introduced.
I note that the Leader of the Opposition has said he would make it easier to use 457s. I want to know: does that mean reversing some of these reforms? There is not much else he could do. We already have very fast turnaround times in relation to applications for 457s. We have opened the Brisbane processing centre, which in March, for example, saw 457 visa applications being turned around in 10 days. I would like to see if the opposition could do better than that—10 days. The Leader of the Opposition, in a speech a couple of weeks ago, said he would reform the 457 system—but that is all he said. He cannot increase the numbers because it is an uncapped program, although he said he would increase the numbers. He did not seem to be aware that it is actually an uncapped program, so good luck with increasing the numbers in an uncapped program. I am not sure how you would do that. But I fear that he is referring to winding back or, dare I say it, clawing back some of the reforms and protections that this government has put in place in relation to 457 visas. If that is what he intends to do, he should have the guts to come out and say so.
Mr BYRNE (Holt) (17:46): I would like to ask the minister a question relating to offshore resettlement for people in certain countries. I do so having spoken with my good friend the member for Chifley about an issue that the member for Chifley and I have both spoken about, which is Coptic Christians—Coptic Christians in Australia and also Coptic Christians who are in Egypt at a very problematic time. I wish to raise this issue in light of the turmoil in the Middle East over the past 18 months, which we would all be aware of, and especially in light of the instability in Egypt that we are seeing on our TV screens.
In asking this question, Minister, I take you back to the events of 1 January 2011, when 22 people died after a suicide bomber set off a massive explosion as hundreds of Coptic Christians celebrated a new year's eve service in the Church of the Two Saints in Alexandria—a horrific atrocity. Several congregation members who were killed in this murderous atrocity had relatives in Australia. Moreover, since the start of the Egyptian revolution, violence in general and against Coptic Christians specifically has increased. Some of the more prominent examples are the church burnings in Sol and El-Marinab and the terrible violence at Maspero in Cairo on 9 October 2011 which resulted in 27 deaths and 300 injuries. This also affected our Coptic community in Australia greatly as well as those over there as the targeted victims of this terrorist attack. In particular, Salafist groups have organised violent demonstrations against Christians—for example, falsely claiming that Camelia Shehata, the wife of an Orthodox priest, had converted to Islam. The same group posted a film on the internet repeating the ridiculous claims of Dutch journalist Lex Runderkamp that Christians in the village of El-Marinab had set fire to their own church under construction.
As well as the ongoing instability, Coptic Christians have spent many months grieving the passing of his Holiness Pope Shenouda III. Pope Shenouda was an incredibly powerful voice for unity, tolerance and reconciliation. He was a much loved leader of Coptic Christians around the world and a great leader of his church who had a strong commitment to Egypt's national unity. His passing has made the transition to a new democratic Egypt all the more complicated. These are definitely difficult times for Coptic Christians in Egypt and also in Australia.
In recent discussions with Coptic Christians—who represent, as the minister knows, an 80,000 strong community—it was made clear to me that they are not pleased with this strong shift towards Islamism in Egypt. The Islamist parties have collectively won approximately 73 per cent of the vote in parliamentary elections this year. With Egypt in the midst of presidential elections at present, many Christians now fear the worst—an Islamist president who will enforce restrictive laws for Christians and liberals in the country.
I would also like to say, particularly given that they would be keen for me to be asking you this question, that I know you have been good enough to come down to my electorate to meet with Father Abanoub and His Grace Bishop Suriel. This is an issue that has been brought to our attention for some period of time. I am very proud to say that I have a very large and strong Coptic community in my electorate and when, in asking this question—which I am about to do with respect to giving us an update on what you are doing and how you are helping people like Coptic Christians who find themselves in danger and want to come to this country under the Humanitarian Program—I do so on behalf of my Coptic Christian constituents particularly at Saint Mina and Saint Marina Church, which you have been down to.
You can hypothesise about this. You watch it on your TV screens and you look at it and there is some distance. But when you meet with people whose families have been killed over in Egypt, when you see the desperation of these people looking at their TV screens, looking for hope and information about is happening in Egypt, you can understand the impetus behind their requests to find out whether or not they can come to this country through the Humanitarian Program. So, Minister, on the community's behalf, and I guess on behalf of my good friend the member for Chifley, Ed Husic, I would like to ask you: what you are doing through this Humanitarian Program to help minorities like the Coptic Christians who find themselves in danger and who want to come to this country?
Mr BOWEN (McMahon—Minister for Immigration and Citizenship) (17:51): Again, I would acknowledge the honourable member's very firm advocacy for the Coptic community. I did visit his electorate and visited Saint Mina and St Marina Church with Bishop Suriel and the clergy and a large contingent of the parish. The honourable member has been a very strong advocate for the Coptic community, as has the member for Chifley and many other members. The member for Parramatta was talking to me about the issue just today and I recognise all members and members opposite who have also raised concerns for the Coptic community.
The Sunday before last, I visited Saint Mark's in Arncliffe, my second visit, and spent almost all of Sunday at Saint Mark's with the community, and I think that the honourable member for Cook might have been there as well. It is a wonderful experience—three separate churches in the one facility—and they certainly know how to make you feel welcome and they are certainly passionate about their community. I am a regular interlocutor with Bishop Suriel about the issues facing the community and with Father Agostino and other fathers in Sydney and Melbourne as well.
In relation to the honourable member's question, the situation facing Copts in Egypt continues to be serious and the government has made, in relation to the foreign affairs portfolio, representations. Of course we would like protections placed in law for churches and other places of worship and we would like antidiscrimination law brought into place in Egypt. But until the situation improves in Egypt, then immigration and refugee issues will be front of mind.
The honourable member asked about the number of grants in the last four years. This government has granted 120 offshore humanitarian visas to Coptic Christians from Egypt. This compares to one offshore grant in the last three program years before the election of this government. A further 100 Egyptian nationals have been granted protection onshore in the last program year after seeking protection in Australia, and for the year to date, I am advised that to 7 May the figure for Copts was 33.
I would also say that one of the reforms I introduced on becoming minister was every six months releasing ministerial intervention statistics—this is my personal power to grant visas—and there are many thousands considered each year. I wanted to introduce more transparency to that process and be clearer with the Australian community about who gets those ministerial grant visas, because they are appropriately issued in unique or exceptional circumstances. It is a very important safety valve. Those figures that I have released would show a particularly high success rate for ministerial intervention when it comes to applications from Copts. They are all considered individually and on their merits. Certainly, in using my own powers I do take into account very clearly the situation in Egypt and the issuing of those visas is something that I take very seriously, and hence the high approval rating that is reflected.
In addition, during the height of the unrest last year, I announced that my department would take circumstances in Egypt into account when dealing with requests for visa extensions, something we do from time to time in relation to circumstances in home countries whether it be natural disasters or humanitarian issues such as we have seen in Egypt. I know that this has helped ensure that individuals can remain in Australia. They may not wish to have permanent residence. They may not wish to seek protection, but they nevertheless do not want to return while the situation is so uncertain. My department takes as flexible an approach as possible in those circumstances.
Again, my office engages very regularly with the Coptic community about issues broad, specific and individual. That is appropriate for a community which is facing such uncertainty and such dangers. I join with the honourable member, as I have in this House before, in paying my respects and condolences for His Holiness Pope Shenouda III. I have indicated, perhaps without authority, to the Coptic community that we will welcome the new Pope in the new year for a visit to Australia. I am sure the entire government and the entire parliament would hope that he—whichever bishop emerges as the new Pope—will be able to make an early visit to Australia to visit the vibrant and very passionate Coptic Diaspora in Australia.
Mr MORRISON (Cook) (17:56): First of all, can I just associate the coalition with the condolences and sentiments of the minister in relation to the Coptic community and the minister's response. Can I also associate the coalition—I am sure the member for Menzies in particular, who has been a keen advocate on these matters, as well as the member for Brisbane—with the honourable member's question to the minister. This is a matter that I think enjoys strong cross-chamber support. That is something that I am sure will continue well into the future.
In the time remaining, I will pull together a number of eclectic matters from different parts of the portfolio for the minister to address. In following up the member for Brisbane's question, can the minister advise when the concept of the jobs board was first raised in relation to enterprise migration agreements and more specifically for the Roy Hill EMA? Who raised it, and when did the Prime Minister first indicated to him that a jobs board should form part of the EMA policy infrastructure, in particular for the Roy Hill project? Can the minister please advise, will parties to an EMA be required, as a condition of that EMA, to take workers from the jobs board prior to seeking the overseas workers that are part of that agreement's entitlement?
On another matter, could the minister please confirm to us matters raised in evidence in estimates last week regarding the department's resourcing for monitoring these EMAs. Evidence was provided by the minister's department by officials last week that the government would not be providing any additional resources or officers to monitor the implementation of enterprise migration agreements to ensure that conditions are met for granting 457 visas. I refer specifically to the response of Mr Kukoc. Senator Waters asked:
… You said that that existing monitoring program will be extended to EMAs. Will there be any additional officers or resources to cover that new area of responsibility?
The response from the official was:
That will be covered within the existing number of inspectors and resources
So, how many additional inspectors? How much additional resources will be provided to the department to perform their responsibilities in relation to the monitoring of 457s? Could I also ask the minister to advise me, moving to outcome four, is it now the case that the government has adopted the coalition's policy that those seeking family reunion applications—who have arrived as EMAs or who have received visas as a result of an onshore application more generally—are now being directed to make applications for family reunion under the mainstream family reunion program as opposed to under the refugee and humanitarian program? Can the minister advise how many special humanitarian visas he anticipates will be granted this year to offshore applicants, and how many applicants there will have been to date for special humanitarian visas? As well, how many he anticipates may be available to be granted next year?
Finally, given that the average number of arrivals has risen since the last MYEFO before the budget to 750 per month and the estimates process has confirmed that the budget is based on a number of arrivals of IMAs of 450 per month, and given that since last year's budget there has been an increase of $420 million a year for 2012-13—which is an extra $1.1 million every day—can the minister guarantee that when the next MYEFO is released there will not be a further blow-out because of the higher than assumed level of arrivals?
Mr BOWEN (McMahon—Minister for Immigration and Citizenship) (18:00): I never thought we would get to the budget estimates session and that the member for Cook would wait for the last question to talk about irregular maritime arrivals. I guess that is some sort of achievement. In relation to his questions, I will do my best. He did have an eclectic bunch of questions.
In relation to the jobs board, this is a proposal which has been discussed for some time. The union movement has been vocal about it for a considerable period of time. It has been mentioned at Labor Party conferences and in Labor Party platforms. As a concept, it is something the government has been considering for a considerable period of time. That comes as no surprise.
In relation to enterprise migration agreements, as part of the compliance activity my department would look at use of the jobs board in assessing whether genuine efforts have been made to employ Australians. That would be one of the range of factors that the department takes into consideration. It would be necessary, of course, for employers to show that recruitment efforts had been made, including showing what efforts they have made to use the jobs board.
In relation to monitoring, there will be a specialised team in relation to my department and the monitoring of enterprise migration agreements. The resources level in my department for compliance in relation to 457s generally is good. It is a high level of resourcing for compliance per visa holder, for example, compared to other compliance activities around the government.
As I have said elsewhere, I think this needs to be kept in perspective. If you take the 1,700 potential 457 visa holders under the Roy Hill agreement, that is equivalent to the number of 457s that will be issued by my department over the next fortnight. There are 90,000 457 visa holders in Australia as we speak, and so the increase in 457 visa holders, as a proportion of the total in Australia, would be small. Of course, there will be necessary compliance in relation to ensuring ongoing recruitment and ongoing capacity for Australian workers to undertake those jobs. That will be a specialised team in relation to enterprise migration agreements and ensuring that is the case.
In relation to irregular maritime arrivals, the government updates its figures at regular intervals during the year: in the Mid-Year Economic and Financial Outlook, during additional estimates and at other points during the year and, of course, on budget day, and that is what we will do. I thank all honourable members for their very constructive feedback and contributions.
Proposed expenditure agreed to.
Human Services Portfolio
Proposed expenditure, $4,025,778,000
Mr BRENDAN O'CONNOR (Gorton—Minister for Housing, Minister for Homelessness and Minister for Small Business) (18:03): The Department of Human Services provides policy advice on service delivery matters to government to ensure effective, innovative and efficient implementation of government service delivery. The department delivers a range of government and other payments and services to Australians, including through its three main programs: Medicare, Centrelink and child support. Total appropriation in the 2012-13 year for the department is $4.156 billion. This comprises departmental appropriation of $4,048 million and administrative appropriation of $107.2 million. Total appropriation includes the following moneys: through Appropriation Bill (No. 1), for ordinary annual services of $4,025.8 million; of $41.1 million, through Appropriation Bill (No. 2), for other services; and $89.1 million in special appropriations. The department received net funding of $226.4 million in the 2012-13 year for new measures. The new measures with significant funding impact in 2012-13 for the department are: call centre funding $50.9 million; Living Longer Living Better—Aged Care Reform Package $49 million; Parent Payment changed eligibility for 1 July 2006 grandfathered recipients $32 million; fraud protection and compliance $28.7 million; and the national e-health program $16.9 million.
Non-appropriation receipts in 2012-13 for provision of goods and services have been estimated to be $303.1 million. For example, the department will receive an estimated $160.7 million from the Department of Education, Employment and Workplace Relations in the 2012-13 year for the provision of rehabilitation services. External receipts to special accounts in the 2012-13 year for child support payments have been estimated to be $1.273 billion. These are payments which are received from one parent and paid to another.
Mr ANDREWS (Menzies) (18:05): I seek clarification from the minister, as he is representing another minister. It used to be the practice in this place as he may recall, some others may not, that questions would be asked and then answered backwards and forwards. Given that he is representing the other minister, I presume he will not be in a position to answer questions in that manner and would prefer for me to put them effectively on notice.
Mr Brendan O'Connor: May I assist the Chair, I am certainly happy to respond to the honourable member's questions. It is up to him, clearly, if he wishes to foreshadow a list of questions. I may respond to some immediately and for others I might want to come back to the honourable member.
Mr ANDREWS: I will give you the list of questions then at the outset. I would seek, as my first question, an undertaking from the minister that he would provide written answers to me for the questions that he is unable to answer tonight. Otherwise, this process is frankly a waste of time. I am not making that as a criticism of the minister but the same thing applies to whoever is in government.
Mr Brendan O'Connor: I have been where you are sitting now.
Mr ANDREWS: That is right. The questions are to the minister and the minister he is representing. Question 1: does he have a charter letter and what is the date of the charter letter? Question 2, and these are more detailed questions: how many temporary visa holders claim family tax benefit A? For each of the past four years, including the current financial year, how many of these recipients were overpaid or incurred a debt; what is the total amount of debt and overpayment that has been incurred by the Commonwealth in this way; and how much of this debt or overpayment has been recovered by the Commonwealth? Question 3: how many noncitizens receive the disability support pension? Question 4: how many noncitizens receive Newstart? Question 5: how many noncitizens have been prosecuted or had debt recovery action initiated for overpayment or for an incurred debt? Question 6: what is the status of the collocation program and when will the collocation program be completed? Question 7: how many DHS officers have been located to date? Question 8: can the minister confirm whether any Minister for Human Services since 2007 has directed or made a request to the department to monitor the social media of any opposition parliamentarian or opposition staff member? Question 9: at an estimates hearing last night, officials confirmed that the department was currently the subject of an investigation by the Australian Public Service Commissioner; in broad terms could he outline what this investigation relates to and when it will be completed and, as part of that question, has the department briefed Minister Carr about this issue? Question 10: it emerged at Senate estimates that the department is using the term 'citizen' instead of 'client'. Are you aware when this practice commenced and what are payment recipients who are not Australian citizens referred to as now, or are they referred to as citizens as well? Question 11: of the approximate 600 residents on the Cocos Islands, 151 are recipients of payments. Of these, how many have been overpaid or incurred a debt and, of these, how many overpayments or debts have been recovered by the Commonwealth? Question 12: how many international social security agreements has Australia entered into since 2007? Question 13: do department employees attend migration detention centres to carry out business on behalf of the department? Question 14: is the department replacing departing staff or is there any recruitment freeze at any level of the department?
Question 15 is: do you agree with the findings of the ANAO and the Ombudsman that there are systemic issues relating to fraud in DHS, and why is more money from fraud prevention being cut from departmental appropriations?
I would reiterate that I appreciate that the minister is representing another minister; therefore, could I have an undertaking that these questions would be answered in writing? Otherwise, we can go through the charade of my putting them on notice, and that just duplicates things.
Mr BRENDAN O'CONNOR (Gorton—Minister for Housing, Minister for Homelessness and Minister for Small Business) (18:10): I say to the honourable member that he is correct in assuming that I am not in a position to fully answer what are very specific, significant and important questions. Of course he does have the facility, as members do, to ask for questions on notice. He is using this opportunity to require the minister—and I guess I am acting on his behalf—to respond to those specific questions in writing. I am happy to give that undertaking. They are important questions, and the responses should be provided to the honourable member. But, given the nature of the questions and the specific requests for certain information that I am not privy to at this point, we will indeed do that in writing and not attempt to do it by way of response now.
Mr ANDREWS (Menzies) (18:11): As to my first question about the charter letter, which goes to the minister as well as the minister he is representing: has he received a charter letter, and when did he receive it?
Mr BRENDAN O'CONNOR (Gorton—Minister for Housing, Minister for Homelessness and Minister for Small Business) (18:11): Are you asking me in my capacity as the minister for human services or as the current minister?
Mr ANDREWS (Menzies) (18:11): As the current minister.
Mr BRENDAN O'CONNOR (Gorton—Minister for Housing, Minister for Homelessness and Minister for Small Business) (18:11): Yes, I have. I cannot recollect the date. I am happy to get back to the honourable member. I have been in receipt of a charter letter.
Ms LIVERMORE (Capricornia) (18:12): I have a question to the minister about a very positive initiative that is taking place in my electorate, but I will just take a couple of minutes to bring the House up to date on where things are at in Rockhampton in regard to its inclusion—
The DEPUTY SPEAKER ( Dr Leigh ): There not being a quorum present, the Federation Chamber must temporarily suspend.
Sitting suspended from 18:12 to 18:20
The House having been counted and a quorum being present—
Ms LIVERMORE (Capricornia) (18:20): Before the suspension of the Federation Chamber I was bringing the House up to date on the range of initiatives that are taking place in Rockhampton at the moment as a result of the measures introduced in last year's budget under the Better Futures, Local Solutions package. Rockhampton was identified as one of 10 places around Australia to be the location for this range of initiatives, and we really are seeing differences on the ground in the way that services in our community are working together, very focused on shared results and shared outcomes, and looking at ways in which they can collaborate very effectively to achieve some of those outcomes for local people.
A lot of this is being led by the Government Action Leader Debbie Sear, who is a former manager of Centrelink in Rockhampton and is very well placed to play a role in joining up our government services and making sure that they are all working together to achieve the common goals of supporting people, addressing their needs and, very importantly, getting them ready to take up opportunities in the workplace. Debbie is assisted by Karen Gerrard, who is also doing a terrific job as the Community Action Leader, playing a similar role in identifying what community organisations are working in this space and how they can work together more collaboratively and effectively to meet some of the challenges. A lot of that work is coming together through the Local Advisory Group, which has the job of identifying some projects to be funded under the Local Solutions Fund. There is $25 million allocated to be shared amongst 10 locations around Australia. We are seeing some great results already in the way that government and non-government organisations are working together.
The measures take on a few different dimensions. There is support for teenage parents and support for jobless families, and income management and more targeted efforts to assist disadvantaged people and those who have been out of work for a long time to achieve a start in the workplace. While some of those measures, such as support for teenage parents and income management, are taking up a lot of the headlines and attention in the local media, one of the things that is actually at the heart of these place based initiatives, and which is something of a pilot for the rest of Australia, is the move towards case coordination within Centrelink. Case coordination is going on day in, day out inside our Centrelink offices and it is really driving some of the change in the way that the government interacts with people coming for payments and help. It allows Centrelink staff to be much more proactive in drawing together the services that might assist people, in a holistic way, to get into the workplace or meet other needs they might have.
My question to the minister is about the pilot program moving towards case coordination as the basis for the work of the Department of Human Services in helping people. Could the minister please update the chamber on the Case Coordination program trial?
Mr BRENDAN O'CONNOR (Gorton—Minister for Housing, Minister for Homelessness and Minister for Small Business) (18:24): Can I firstly thank the member for Capricornia for her support for what I think are very important attempts to provide local solutions to problems in communities like Rockhampton. I know she has a very strong record in providing support and providing insights into the way in which we should respond to our most vulnerable in our communities around the country, not least of all in Rockhampton. So I thank her for her interest and for her affirmation about the way in which the Department of Human Services and indeed other bodies—and the Gillard government—are going about providing support for people in this manner. We certainly do believe that there are some great results already from the efforts to dedicate resources locally and ensure that decisions and actions are taken locally that are peculiar to the community. I think it is a more effective way than having decisions made centrally and applied without regard for local considerations.
In relation specifically to the question asked by the member for Capricornia, on 10 May 2011 the government announced the budget measure of increased support for people needing assistance, which will provide $74.4 million to fund the case coordination trials over four years under the service delivery reform agenda. Case coordination complements the Building Australia's Future Workforce initiative. It operates in each of the 10 local government priority areas and it is part of a range of place-based initiatives. Case coordination was implemented in 19 locations are in 2011-12 and will increase, I am happy to say, to 34 locations in 2012-13 and 44 locations in 2013-14.
As at the end of April this year—and I am responding now specifically on the number of people assisted—I can inform the House, and indeed the member for Capricornia, that 6,861 people have received assistance and more than 11,000 referrals have been made. In Rockhampton, 1,035 customers have been assisted and 916 referrals made, which is a very significant number being provided with this sort of assistance.
Case coordination is trialling a service delivery approach to assist customers with complex needs to access services and support to improve their level of self-reliance and enable them to better participate in the economy and their own community. The objectives of case coordination are to deliver coordinated services that increase customers' ease of access to local support services; to provide enhanced assistance to people with additional needs, including appropriate referrals and follow-up; to provide the people, processes and systems to enable department staff to consistently identify customers with complex needs who will benefit from more targeted or specialised services; and collaboration with other local service providers to support better outcomes for customers.
The case coordination approach leverages the position of the department as a key first-to-know agency and facilitates connections with appropriate community services. Case coordination puts the customer at the core of our business, ensures that the customer rather than the service remains the focus, and promotes collaboration, engagement and empowerment—and, of course, it is voluntary. Staff spend time with people to identify the services they need, including those that will support their capacity to participate in work, education and training. People are seeking access to services that enable them to get the support they need to get on with their lives. The assistance provided is tailored to the needs of the person being supported. The data shows that customers are accessing a broad range of services indicating that a needs-based approach may be important when supporting vulnerable and marginalised people accessing services. Twenty-three per cent of people have been referred to housing related services in my own portfolio, 15 per cent have been referred to emergency services, 10 per cent had been referred to general health services, 10 per cent to education and training and nine per cent to financial stability services. I do thank the member for her question and her interest in these matters. It is an important area. To date, very good things have been done. Can I say on behalf of Minister Carr that more will be done to provide support for our most vulnerable in Australia.
Proposed expenditure agreed to.
Sustainability, Environment, Water, Population and Communities Portfolio
Proposed expenditure, $1,604,732,000
Mr BURKE (Watson—Minister for Sustainability, Environment, Water, Population and Communities) (18:30): I am very pleased to present the appropriations here to the House of Representatives. I do not think we need me to make a long opening statement. I think there are some significant questions that people will want to go into. Let us get straight into it. I will only say that, for this portfolio, this was a very good budget. I am sure the questions will reflect that.
Mr HUNT (Flinders) (18:31): I wish, in the same spirit of brevity as the minister, to place a number of questions on the record. I will let the minister either answer them now or respond on notice. For his assistance and the assistance of his department, we have had some of them prepared in writing and we will table those. Let me begin with a question in relation to the Antarctic Climate and Ecosystems CRC. My understanding is that the department, through the Antarctic Division, makes a contribution. I also understand that the CRC is due to expire and is not able to apply for a formal replenishment in 2014. Our view is that this is a highly effective body, that it is well respected and that it is critically linked into the world of the Antarctic Division. The first question is whether the government has any plans to help assist and maintain the Antarctic Climate and Ecosystems CRC, whether it has a migratory path for it to exist in the long term or whether it is the government's intention that this CRC will simply stop dead in 2014?
The second question is in relation to the Caring for our Country budget. In particular, we ask the minister to enumerate all of the different subprograms which have had allocations within the Caring for our Country budget. We understand the three strategic areas which are identified and which have been given separate allocations within the budget. But, within the general division and the other two specific divisions of agriculture and landcare, and Indigenous support for Caring for our Country, we seek a list of all subprograms for which commitments have been made or allocated. I think that would provide great transparency to the budget. I would put it in the context that there are many community groups that have expressed concern that they have not had access to Caring for our Country the way they did under the Natural Heritage Trust and then the Envirofund. That may take some time, but full and complete Caring for our Country budget subprogram descriptions, with actual allocations in the forward estimates against each of those areas for which allocations have been identified, would be much appreciated.
The third area is in relation to the Heritage Division and the treatment of heritage by the department. I have a series of brief questions, which I will hand to the minister so he and the department can work together on those. First, how many staff members work exclusively on cultural heritage? Second, has this figure gone up or down over the past three years and by exactly how much? Third, are there any plans to increase or reduce heritage staff numbers over the forward estimates period? Fourth, page 68 of the portfolio budget statement appears to show a reduction in funding for heritage grants from $8.42 million in 2012-13 to $4.42 million in the forward estimates period. Is this correct and what is the explanation?
Fifth, we understand that the budget cuts last year to the heritage division mean that staff are now struggling to fulfil their statutory obligations, such as assessments and listings. Has there been an increase in the time taken to perform these duties? Sixth, we understand that the Australian Heritage Council has no separate budget and is struggling to fulfil its responsibilities. Are there any plans to address this issue? Seventh, we understand that low staff numbers in the division mean that it is well behind on such assessment matters as the processing and announcement of the York community history grants and assessments and servicing of the Australian Heritage Council. Is the division appropriately funded to enable it to complete the development of the Australian Heritage Strategy?
Eighth, the Voluntary Environment, Sustainability and Heritage Organisations grant given to the Federation of Australian Historical Societies has been cut from $30,000 a year for three years to $23½ thousand for one year—that is, from triennial to annual. Why? Ninth, there appears to have been a move away from supporting heritage to supporting environmental organisations. Is this a new policy? Tenth, has there been a change of policy from supporting national peak bodies to supporting small local groups? Eleventh, will the department undertake a review of the grants to look into these matters?
Mr BURKE (Watson—Minister for Sustainability, Environment, Water, Population and Communities) (18:36): I am tempted to thank a senator for the questions, in the sense that I feel I am reliving Senate estimates in this chamber in the nature of these questions.
Mr Hunt: No, they are all mine.
Mr BURKE: Please do not presume that I am saying someone else wrote them. I have absolutely no doubt that the member for Flinders put them together. This specific style of question would normally be answered almost immediately when we have all the officials present in Senate estimates. That means I will have to work my way through a whole lot of them subsequent to this and communicate with you.
There are a few overarching points that I think would be helpful. I am going through the heritage questions, which are the only ones I have been given in writing.
Mr Hunt: All of the heritage questions have been provided in writing but not the Antarctic ones.
Mr BURKE: The Antarctic CRC, as the honourable member would appreciate, is a part of the CRC program itself, which is not run out of this portfolio. Notwithstanding that, there are substantial items in the budget which reflect our ongoing commitment to Antarctica and Australia's presence in Antarctica. It would be remiss of me if I did not refer to that and take a moment to do so. On the specifics of the CRC: CRCs by definition and by entire program design are meant to be temporary organisations. That is how the model has functioned under governments of both sides. No-one should see an expiration date for a CRC as being a reflection on the seriousness of the work that the organisation is doing. Rather, expiry dates are in the nature of the model. That has been the case ever since CRCs were first established, which I think goes back to Barry Jones.
In the budget, the government has committed $41.1 million to sustain our level of engagement in the Antarctic program itself. This includes $11.2 million for continued funding for Australia's Antarctic program, $6.7 million for shipping support for the program and $23.1 million to continue operation of the Australia-Antarctic Airlink. There is ongoing pressure on our Antarctic operations. Let us not underestimate the significance of Antarctica to our nation. We are the biggest claimant in the area with the Australian Antarctic Territory. We have also played a very significant role—in particular there was the role played by then Prime Minister Hawke in his work with then Prime Minister Rocard—in making sure that we had an area preserved and dedicated to science rather than one that became a new area for minerals exploration. I think that work has been continued very effectively under governments from both sides of politics. The problem that we have—and this is a very real challenge—is that the air transport link we have into Antarctica simply has not provided the functionality which it was meant to. When it was opened by the member for Wentworth when he held this portfolio it was welcomed by all as being great technology and effectively establishing an ice runway in Antarctica. What happens repeatedly now with access to Antarctica is that there is a limited number of months when you can get in there. Those are obviously the months when there is light. After that it is not just that it is dark but also that the weather conditions become quite torrid and quite difficult to get into. Each summer now that runway melts for a significant period, and while it was presumed at the time it was built that that would not be the case, historically it has been. So we have ended up with a situation that, while for a number of months of the year the runway is still able to be used and is used, the level of access to our facilities there that we thought would be provided simply has not been. That has been repeated each year. Last year was not as bad as the one before; in the one before there was a significant period where we simply could not get planes in and out. We have had a situation where, frequently, we have had to use United States facilities and other facilities and then come over land into our own territory.
So in terms of future pressures on our engagement with Antarctica, if we are going to provide the leading role that Australia has, the issue of how we get people, supplies and equipment there is probably the biggest issue facing us. I have all the different budgetary measures for what is in front of us now, but I think it is important to advise the Federation Chamber of the very real pressures that are there in the years to come in order to make sure that we have ongoing access and can provide the leading role which would be expected. I am getting some information on the subprogram lines, as they are within the Caring for our Country budget, and I suspect during the period that we are here I will be able to provide more information on them.
Needless to say, for the area that has just been added to the forward estimates, some of those subprogram decisions—in fact, many of them—have not yet been made. We have them for the previous five years and we now have the appropriation going into the extension of the program, and that means that there are a number of decisions on program and design lie in front of us. (Time expired)
Mr NEUMANN (Blair) (18:42): Recently I had a meeting with Charlie Lewis, a koala protection activist in the Somerset region. She lives up at Toogoolawah and she talked to me about the fact that the Somerset Regional Council has not signed up to the same degree of protection as have, say, the Ipswich City and Brisbane City Councils. She was arguing for some corridors for the protection of koalas and other native fauna. I know the Somerset Regional Council has just had an election and that there are some changes there.
I also met with some other activists who are campaigning against coalmining in rural Ipswich around Ebenezer and Rosewood. They are also concerned that further mining leases, if they are granted and if mining is undertaken in and around those areas—Mount Maude, et cetera—would have a significant adverse impact on native fauna, particularly koalas. I know that in some of the schools in those areas, particularly around Peak Crossing, just outside of my seat, there are trees with koalas, and clearly whole ovals are set aside for that.
I ask the minister: what action are you taking on the protection of native fauna, particularly koalas, and how is that being reflected in the budget?
Mr BURKE (Watson—Minister for Sustainability, Environment, Water, Population and Communities) (18:43): I thank the honourable member for the question. The koala listing has been one of the more complex listings that has come before the Threatened Species Scientific Committee. It is a subject that I know the member for Flinders has also taken a keen interest in during his time as shadow minister.
There are a number of problems. First of all, a problem that we have in identifying endangered or threatened species throughout the entire country is that the quality of data is always significantly limited. The work of surveys is very important, but when many of these decisions first come to the Threatened Species Scientific Committee they are grappling with limited data sets. That is the first problem that we have been faced with for the koala. The second problem with the koala has been that if you simply say that whether or not something goes on a threatened species list is based on how hard they are to find and how strong some of the populations are, in some parts of Australia the koala population is unbelievably strong. South Australia is a classic example, where there are actually programs to control numbers. I should add, before anyone gets worried, that it does not involve culling—but there are issues of number control that take place in South Australia.
At first glance, some people work on the basis that, 'If you have anywhere where there are heaps of them and where they are actually in such numbers that they are eating themselves out of habitat, it is hard to argue that they are also in some way threatened', particularly with iconic species. But as a general principle it is a bit much to say that here is a species that used to be found across so much of Australia and that we are just willing to tap the mat and concede defeat in the vast majority of those areas because you can go to South Australia to find one.
I do not want to see a situation where for Queensland or New South Wales—or the ACT, for that matter—the only possibility you have of ever seeing a koala is to visit a zoo. I think Australians have an expectation that protection is afforded. That means that we had to do something which is done rarely, but which has been done previously. It was done, for example, with respect to the grey nurse shark, where you had listings that applied differently in different waters. On this occasion, the Threatened Species Scientific Committee's recommendations to me recommended that a listing that would only apply at the 'vulnerable' status to Queensland, New South Wales and the ACT.
The New South Wales government welcomed the decision. The Queensland government, it is fair to say, did not. I have spoken about that elsewhere in the parliament, but I remain of the view that it was a surprise, so soon after the Queensland Premier had been saying that he wanted to enforce federal standards, that he would be suddenly outraged by federal standards.
Mr Neumann: I did say that, actually.
Mr BURKE: You did. And I have read some of the media clippings in Ipswich about the extent to which Mr Newman disagreed with Mr Neumann. I have seen that in print there.
What a threatened species listing means at the category of vulnerable is a few things. First of all it means that a plan needs to be put in place to try to get the numbers to recover—a recovery plan is to be put in place. We work very closely with the states on that. Certainly New South Wales, as far as I understand, is being completely cooperative in playing that role and they welcomed the decision when I took it. It also means that for development proposals the koala, if we are dealing with koala habitat, now needs to be taken into account. On the simplicity of the question: does that add an extra layer of bureaucracy? Yes, it does. But, let's face it; if we are not going to use threatened species legislation to protect the koala we may as well give up. Occasionally for anyone who holds this job, some species that no-one has ever heard of will be used as a way of trying to ridicule environmental protection. You always get that. There are not too many people in Australia who have not heard of the koala, and there are not too many people in Australia who will not be seriously alarmed at the decline in numbers.
In the state of the member for Blair, since 1990—so this is a fair way into your process of land clearing—we are talking about a further 40 per cent decline in the numbers. The rate of decline has been extraordinary, and with that in mind I think it is not merely good policy but the very purpose of threatened species policy to make sure that the appropriate plans and protocols are put in place.
Mr McCORMACK (Riverina) (18:48): The Murray-Darling Basin Authority's revised draft Basin Plan to states was greeted with dismay and disbelief by communities in the Riverina, Minister, as I am sure you could imagine. The MDBA received nearly 12,000 submissions during its 20-week consultation period, and tens of thousands attended consultation sessions across all parts of the Basin, including 12,000 people who attended the meeting at Griffith on 15 December, which you attended yourself, Minister.
The revised plan is mostly unchanged from the draft plan released on 28 November 2011. The sustainable diversion limits remain unchanged, resulting in water use reduction of 2,750 gigalitres of entitlement compared to 2009 levels. Are you concerned about the 2,750 gigalitres figure for surface water to be taken from productive use—that is, growing food by farmers—and given to the environment remains?
Is it too high? Is it too low?
Can you work with state governments to get an outcome from this process which moves us beyond 120 years of contention among the states? The plan is underpinned on state cooperation. We all know that without the support of the states this plan becomes more difficult to implement, because the plan calls for the states both to run the system and to develop the detailed environmental watering plans. Every state, as you mentioned in parliament only yesterday, has so far refused to support the revised plan. To get the support of the states, it is clear that the government is going to need to better address the concerns of each state. What do you propose to do to achieve that?
The government has failed to outline commitments to invest in water recovery options, which will reduce the impact on jobs, communities and food production. Craig Knowles, the chairman of the MDBA, says that more water needs to be recovered through investments in water infrastructure compared to water buybacks, but there is nothing so far, Minister, from you or your government that reflects these statements. The government has spent $1.8 billion on water buybacks but just $413 million on investments which will deliver water into the basin. For every one litre of water which has been saved through infrastructure, five litres have been taken out of communities through buybacks. I would like to ask: why did the government defer $941 million of Murray-Darling Basin infrastructure funding until 2015-16 yet keep the money for largely unwanted buybacks in the Treasurer's 8 May budget? The plan remains complete. The government has not done its work on environmental works and measures, and I would like to know why. The government says that environmental watering must become more efficient, just as farmers have asked to become more water efficient. I would like to know what the government's response is to that. The coalition remains, as always, available for sensible dialogue with the government about the plan. I believe you have met with our shadow water minister, Barnaby Joyce. I would like you to just to perhaps briefly outline what came of that meeting, if that is possible.
Also, does the government have an estimate of the additional cost of recovering up to 2,750 gigalitres, compared with what will be necessary through buyback with the current budgetary allocations? If the states develop environmental watering plans which determine different environmental watering needs from what is in the current plan, will the government change the plan? Has the government decided to seek a minimum amount of water recovery through means other than water buybacks? If so, how much? You could take some of these on notice too, because I know there are a lot of questions.
I would like an update on the Nimmie-Caira landholders' proposal in the Lower Murrumbidgee, where historical extractions are in the order of 310,000 megalitres. I would like to know where that is up to. I spoke with Michael Spinks, at Maude, just an hour ago. He says that they have had a meeting with the state office of water. I know there have been funds provided by the federal government for a feasibility and business plan with that.
Just on something completely different, can the minister and department advise me what the government has decided in relation to restriction of land use in littoral lowland rainforests? I ask for and on behalf of the member for Cowper. Can the minister advise what actions he has taken in relation to relinquishing power under the EPBC Act in relation to flying foxes?
Mr BURKE (Watson—Minister for Sustainability, Environment, Water, Population and Communities) (18:53): I have to say that I am going to try not to take any of it on notice, because I really want to address every issue that has been asked, although I know some of your colleagues will not be too keen for me to do that, because I will have to jump up a couple times to be able to get through it.
Could I deal with the last issue first, the issue of trying. You have all heard me talk about my frustrations with this in the chamber again today. The states have been asking and both sides of politics in this parliament have been saying, 'We are willing to explore and willing to go down a path where, as much as possible, if we can streamline decision-making processes so that they are only dealt with at the state level, we want to.'
On flying foxes, I decided not to wait for the COAG process to finish, the reason being that one of my great frustrations—and I think a great frustration of anyone who holds this particular job—is when delays through duplication of processes do not just cause delays but actually fundamentally change outcomes for the worse. The flying fox is a classic example. There is a limited period of time, during the first half of each year, when flying foxes can be relocated without triggering the EPBC Act. Once you hit their breeding season it is much harder. If you have to go through a state process and a federal process, you are more likely to go beyond that period and then you end up with a challenge.
I wrote to the state governments and said, 'If you are willing to sign a conservation agreement, I will give you this one immediately.' To the credit of the New South Wales government, their officials are talking to my officials, so some progress is being made there; they have not signed it yet, but at least there are conversations. It will be much better for people. If the right environmental decision is going to be made, my view is: make it quickly. But to my great frustration the Queensland government still has not responded at all. The government that was actually championing this issue at COAG has not even bothered to reply as an immediate down payment on something that is a huge issue up and down Queensland.
On flying foxes, if a state is willing to sign the conservation agreement, I will put my signature on the document with them that day. I do not want to see the situation we have seen in the past where schools, hospitals and homes end up being infested with bats and living there just becomes a disaster. I do not want to see that happen. But the only way to fix it is to streamline the process so that decisions can be made and actions to relocate colonies can happen quickly. For the life of me, I do not understand why the states have delayed on this. I do not want to be critical of New South Wales, because they have at least had their officials dealing with mine.
A number of the environmental groups are quite upset that I have offered this to the states straightaway. But I have seen, and been frustrated by, what this does to communities. There is a period when flying foxes can be relocated without causing any significant objection from the federal legislation. Why on earth, when the conservation agreement is on the table and ready to go, the states have not taken me up on it is beyond me. But every community that ends up with problems in the second half of this year as a result of it will know exactly the outcome of the delays.
On Nimmie-Caira, I think the question was answered during the question: we have paid for the feasibility study and, until that comes in, you are not able to take the first step. You need the feasibility study to work out how the project would operate and to make it happen. Suffice it to say that it is my view and the view of the New South Wales minister that, while this project is complex in a number of ways, it actually has real potential. We funded the feasibility study not to make it go away but to try to find a way of making it work.
On the Murray-Darling Basin issues, I will first go to the question on why infrastructure money has been deferred. It is a really simple and, I would hope, unanimously agreed principle that you do not give the states money to do things unless they have signed the contracts to tell you what they will do. That is a logical thing. These are massive projects. Some of them have long planning periods once contracts are signed. If we want them to be high-quality projects, the money does not just rush out the door. That means that with the initial run of state projects a lot of them did not pass due diligence. They were not able to—
Mr Hunt interjecting—
Mr BURKE: It will put at risk getting the answers on the record. I am not going to take everything on notice. If you want that, you will then get some pretty brisk answers without the details.
Mr Hunt interjecting—
Mr BURKE: We do not have the same notice provisions in here. I mean, you can put them on the Notice Paper, but we have one hour to answer questions here and I do not want to take up any extra time discussing what our procedure will be. But I want to flag that we have been given some extraordinarily important issues. I have seen the anger of the community of Griffith, who are about as upfront as you can be on this. I would be disappointed if the expectation of the opposition was that I only provided that response in writing. I think the people of Griffith have an expectation that I turn up in person to their meetings and they have an expectation that I respond directly to what has been raised by the member for Riverina. On the deferral of infrastructure money, where contracts have not been signed it has to be deferred. The money does not disappear; it remains there. But for projects like Menindee, for example, the New South Wales government, when Premier O'Farrell came in, unilaterally terminated that agreement. We have kept the money there because we want it to be spent. We are still negotiating with the state government but, until we get an agreement, I am not going to have a situation where budget figures appear where there is no prospect at all of money being spent. I do not think that is sensible. I will certainly not send it out of the door without contracts being concluded.
On what came of the meeting with Senator Joyce, I do not want to breach the confidence of your colleague, so I will simply say it was a positive and productive meeting. We certainly do not have anything like agreement at the moment, but we are meeting and I think that is significant. I have no doubt that Senator Joyce is conducting the meeting in good faith.
My principal concern about the numbers being unchanged in the SDLs is that there were changes to the groundwater numbers. I thought those changes were good and I have said so. I would like to see the environmental outcomes be more ambitious than they are. That goes beyond the concept of an SDL. Even wherever SDLs land, there are other things that can be done that deliver much more significant environmental outcomes, through things like the release of capacity constraints. That is important. Also, Menindee is a classic example. The SDL does not refer to how much additional water will go into the river. The SDL refers to how much water will be stored in dams for environmental purposes. If you are getting sensible environmental works and measures like, say, Menindee, that does not actually count towards the SDL because it is not being stored in dams. But it is already in the river. So it is already delivering a better environmental outcome. That is where I think some of this debate gets too caught up in the SDL, from an environmental perspective as well. We have to look at what the problems are that we are trying to solve in terms of the health of the Murray-Darling Basin and then drive the best ways of dealing with that. Held water is part of it. Buyback needs to be part of it, but it should not be the only game in town.
If you look at the infrastructure projects where we have reached agreement with the states—NVIRP 2 in Victoria is a classic example—you will see that you get the infrastructure money flowing there now. The Victorian government put together a well designed program—there was a change of government—and they wanted to change it from what the previous Labor government wanted. That was fine. We have ended up negotiating something that works for them, works for those communities and that will ultimately deliver more water for the environment than we previously would have had as a result of NVIRP 2 and 3. So where those projects can be put together, we are doing so.
Every state was always going to reject it at this point. If we get agreement, it will be agreement further down the track. I would add that the reasons for states rejecting the current plan are not consistent. Some of them are diametrically opposed. I do not particularly think we will ever come up with a plan—we certainly have not done so for the last century—where every state believes that it is ideal. If we end up with a plan where the objectives we are trying to reach are met, then I think that is a sensible objective. I think I have covered what needed to be covered.
Mr BILLSON ( Dunkley ) ( 19:03 ): I have two clusters of questions, the first one picking up from MILD research that more than half of small businesses still have very little idea about the way the carbon tax will impact upon them. I have one particular area of concern. Can the minister confirm that, under the carbon tax as administered by his portfolio, the cost of certain synthetic refrigerant gases will cost up to $75,000 per tonne? That is causing enormous concern for refrigerant trucking operators, small retailers, convenience store operators, butchers, cool store operators, supermarkets—everybody right across the board. Anywhere where refrigeration is a part of daily operating costs, there will be an astronomical increase in the cost of those gases. Relating to carbon tax cost impacts, can the minister confirm that the off-road diesel rebate for council heavy vehicles was to have been 38.1c per litre after 1 July 2012, prior to the creation of the carbon tax package? Can the minister confirm that the figure will now be reduced by 6.1c or 6.2c per litre to 31.9c as a consequence of the shadow carbon-pricing policies that are being implemented?
Those are two particular questions around costs. The first one relates to refrigerants; the second one relates to the off-road diesel rebate for council vehicles.
Mr Burke: Why are you directing these to me?
Mr BILLSON: Because you are the nearest, neatest correct entry, Minister, to ask that question of. The second cluster of questions relates to the heritage area within SEWPaC. I am an extremely patient person, and thankfully so are the good folk of the Mornington and District Historical Society. Former Acting Prime Minister James Fenton is buried in the Mornington Cemetery. Being a former acting prime minister, he was given a really splendid state funeral, but he has no surviving relatives and his grave looks like a wombat hole or as if something of that kind has decided it liked the gravesite. In partnership with the Mornington and District Historical Society I have pursued the Department of the Prime Minister and Cabinet—the protocol and ceremonial officers and those that organise present-day state funerals—for over a year now. They have all said that they do not have anything to do with earlier state funerals and the fact that this eminent person's final resting place is now in a great state of deterioration. I was then guided to liaise with your department, which I did. I was guided towards the Commemorating Eminent Australians program, and I learned that it expressly excluded grave restoration—even if they are state funeral graves. I sought to bring about a change to the program eligibility criteria, which I managed to achieve. Then, about a year ago, I was told an opening in that program was imminent.
The good folk of the Mornington and District Historical Society realised a couple of months ago that Mornington's 150th anniversary commemoration celebrations were on. Part of bringing to life the Mornington community's history is the very informative walks the society conducts through the cemetery. They were most optimistic and, given the extraordinary lead time that was available, we had hoped to have Mr Fenton's grave restored. But, as of today, I do not even think the program has been opened for applications of this kind. Given that he was a unique character who served both Labor and the conservative parties, helped to create the Australian Broadcasting Commission and was quite distinguished in his day as Acting Prime Minister, I urge you, sir, to get that program that has been such a long time coming to activate itself. He has certainly perished, and we are concerned that the program has perished as well.
In a similar light, you also offer a Your Community Heritage Program. A grant application was made by the same historical society in partnership with the chamber of commerce to put up some signage, plaques and street walk information. Again, the ambition was to have that up for the 150th commemoration. That has now passed but they are still keen to do the work and I was hopeful of getting some advice. Senator Farrell has been most helpful, but we have not concluded this matter for some time now.
Mr BURKE (Watson—Minister for Sustainability, Environment, Water, Population and Communities) (19:09): I will deal with the issues in reverse order. I thank the honourable member for the question and in particular for the tone in which the last issue has been put, and I take it completely in good faith.
I remember getting quite a shock when I was presented with a brief called 'Commemorating Eminent Australians'. I was very excited about it and asked what it did, and then discovered it was entirely dedicated to cemeteries. Given the particular sensitivity of this one, I am very conscious of making sure that any of the projects are run through the department, because I think that is the right way to do it. I do not want to get personally involved in the judgment calls on this. I have signed off on some issues within this program quite recently. Whether the one that was referred to by the member was included in those or not I do not recall. If it was not, then let us have a conversation and look at whether or not there are deficiencies within the guidelines. I am very happy to have that conversation in good faith, but I do not want to provide any particular level of expectation on the current round.
On the council heavy vehicles issue I think the nearest correct fit would be the answer that was given in question time today by the Minister for Climate Change and Energy Efficiency and I am not proposing to go beyond my portfolio in answering that.
On the issue of synthetic greenhouse gases, the figure when referred to by tonne does sound like an extraordinary figure but what also needs to be remembered is that these gases, while potentially having an extraordinary impact, are used in very, very small quantities in refrigerants. For example, the rough bench mark that has been given to me is in the order of $4 for a fridge. I asked the question specifically and that is the advice that came back to me from the department. So the issue of dealing with their value under the carbon price per tonne needs to be taken in the context of how many grams of the gas are in fact being used within any individual item. As I say, there are some refrigeration projects massively bigger than a domestic fridge, but in terms of a benchmark, I think it does give a slightly different lens to the figures that the member put forward.
Mr O'DOWD (Flynn) (19:11): Minister I have two questions. Firstly, why has the minister refused to fund the restoration of the St Joseph's Catholic Cathedral in Rockhampton? This is a gothic church, the only one north of the Brisbane line. It is undergoing $6 million of repairs. The church itself has come up with about $3 million but there is quite a shortfall. The church was built in 1899 and covers quite a few of our electorates including Capricornia, Dawson, Maranoa, Flynn and Hinkler. The church community is in a quandary and we would like an answer on that please.
The other question concerns water quality in the Fitzroy River, Australia's second biggest river catchment and the source of drinking water for Rockhampton and other towns in the area. Of late, there has been a noticeable deterioration in the standard of the water—the colour and salt content of the water. I put this down to two things. One is the discharge of water out of mine sites—that is, water from mine pits which fill up after floods and heavy rain. The other is groundwater that comes off mine sites and washes into the river, and I am talking about larger heaps of coal. When it rains, there is no catchment for that water and it ends up in the river. The other reason is the Mount Morgan mine. Everyone is aware that Mount Morgan mine discharges water which is heavy in metal, is poisonous, toxic and visually blue and green on all parts of the river. There have been six testing holes in the 60 kilometres of the Dee River until it flows into the Dawson, which in turn flows into the Fitzroy. The federal government grant of a few years, did some good for the—
A division having been called in the House of Representatives—
Sitting suspended from 19:14 to 19:37
BILLS
Appropriation Bill (No. 1) 2012-2013
Consideration in Detail
Debate resumed.
Sustainability, Environment, Water, Population and Communities Portfolio
Proposed expenditure agreed to.
Debate adjourned.
Tax Laws Amendment (2012 Measures No. 3) Bill 2012
Income Tax (Seasonal Labour Mobility Program Withholding Tax) Bill 2012
Tax Laws Amendment (Income Tax Rates) Bill 2012
Cognate debate.
Debate resumed on the motion:
That this bill be now read a second time.
Mr TONY SMITH (Casey) (19:39): I rise on behalf of the coalition to speak on the Tax Laws Amendment (2012 Measures No. 3) Bill 2012, the Income Tax (Seasonal Labour Mobility Program Withholding Tax) Bill 2012 and the Tax Laws Amendment (Income Tax Rates) Bill 2012. There are a number of schedules in the first bill that I will go through very briefly. But let me say at the outset that the coalition will not be opposing these bills. I will run through them very quickly. The first bill, the Tax Laws Amendment (2012 Measures No. 3) Bill 2012,has a series of schedules making changes to our tax law. In the first schedule, as was made clear during the minister's introduction and in the explanatory memorandum, there will be a new final withholding tax regime that applies to income derived by nonresident workers participating in the Seasonal Labour Mobility Program Workers Pilot Scheme. The second schedule has some technical amendments to ensure that the 2011 alternative fuels and clean energy legislation works as originally intended. The third schedule removes eligibility for the low-income tax offset on unearned income of minors.
The fourth schedule relates to clean energy payments. As the minister—the Assistant Treasurer, who has just joined us here at this hour—made clear in his introductory speech, this measure proposes to exempt from income tax clean energy payments made to recipients of various payments under the Abstudy scheme, the Veterans' Children Education Scheme, the Military Rehabilitation and Compensation Act Education and Training Scheme, and the transitional family farm payment and exceptional circumstances relief. The measure will apply from 2011-12, but naturally any retrospective impact is beneficial to those taxpayers concerned.
The fifth schedule relates to better targeting of the employment termination tax offset, and the measure amends the Income Tax Assessment Act 1997 so that access to the employment termination payment tax offset and the amount of the offset received will take into account an individual's taxable employment termination payment as well as other taxable income in the year they receive the employment termination payment. From 1 July 2012, any taxable component of that ETP that takes a person's total taxable income in a year above $180,000 would be taxed at marginal rates.
Very briefly, the Income Tax (Seasonal Labour Mobility Program Withholding Tax) Bill 2012 provides for the formal imposition of income tax and the establishment of the applicable tax rate to give effect to the final withholding tax regime that would apply to income derived by non-resident workers participating in the seasonal labour mobility program. As I said, as with the previous bill under discussion, the Assistant Treasurer outlined all of these measures in some detail during his introduction just last Thursday.
The final bill, the Tax Laws Amendment (Income Tax Rates) Bill 2012, amends the Income Tax Rates Act 1986 to align the personal income tax rates for nonresidents for Australian tax purposes more closely with the personal income tax for Australian resident taxpayers. It does so in a number of ways, as he outlined. As I said at the outset in speaking on this bill on behalf of the opposition. the coalition will not be opposing it and I commend the bill to the House.
Dr LEIGH (Fraser) (19:43): On a blog post on 8 December last year, Possum Comitatus—aka Scott Steel—wrote of 'Australian exceptionalism'. He wrote:
Never before has there been a nation so completely oblivious to not just their own successes, but the sheer enormity of them, than Australia today.
It is within the context of that extraordinary economic performance—unemployment, inflation and the cash rate each below 5 per cent for the first time in 40 years—that we are considering this package of bills. Time does not permit me to go into the many features of this package of bills that the Assistant Treasurer has pulled together, so let me simply note: that the Seasonal Labour Mobility Program builds on the successful Pacific Seasonal Worker Pilot Scheme; that the government is realigning the tax rate schedule for non-residents to align it better with marginal tax rates that Australian residents face; that the government is removing the ability of children to access the LITO to discourage income-splitting between adults and children; that we are introducing technical amendments to ensure that legislation does not impose unintended consequences on taxpayers; and that we are scaling back large tax concessions for generous executive salary packages that are simply not available to many low- and middle-income earners. It is a terrific package of bills and I commend them to the House.
Mr BRADBURY (Lindsay—Assistant Treasurer and Minister Assisting for Deregulation) (19:45): I thank members who have contributed to this debate. Schedule 1 to the Tax Laws Amendment (2012 Measures No. 3) Bill 2012 reduces the marginal tax rate for Pacific Islander and East Timorese seasonal workers to 15 per cent, to be administered as a final withholding tax with effect from 1 July 2012. The Income Tax (Seasonal Labour Mobility Program Withholding Tax) Bill 2012 formally imposes this rate of tax.
Schedule 2 makes minor consequential amendments to the taxation of gaseous fuels and the taxation of aviation fuels. These will ensure that the clean energy legislation and the legislation applying fuel tax to gaseous fuels operate as intended. Schedule 3 makes a technical amendment to the Income Tax Assessment Act 1936 to ensure that the government's 2011-12 budget measure to remove the ability of minors to use the low-income tax offset to reduce tax on their unearned income operates as intended. Schedule 4 provides an exemption from the income tax for clean energy payments made to recipients of specified government payments. Schedule 5 changes the taxation of termination payments to make it fairer by limiting access to the employment termination payment tax offset for high-income earners. Payments received because of genuine redundancy, invalidity or the death of an employee will not be affected by these reforms.
The Tax Laws Amendment (Income Tax Rates) Bill 2012 will amend the personal tax rates for non-resident taxpayers to align with the rates for resident taxpayers. I commend this bill to the House.
Question agreed to.
Bill read a second time.
Ordered that this bill be reported to the House without amendment.
Income Tax (Seasonal Labour Mobility Program Withholding Tax) Bill 2012
Second Reading
Debate resumed on the motion:
That this bill be now read a second time.
Question agreed to.
Bill read a second time.
Ordered that this bill be reported to the House without amendment.
Tax Laws Amendment (Income Tax Rates) Bill 2012
Second Reading
Debate resumed on the motion:
That this bill be now read a second time.
Question agreed to.
Bill read a second time.
Consideration in Detail
Bill—by leave—taken as a whole.
Mr BRADBURY (Lindsay—Assistant Treasurer and Minister Assisting for Deregulation) (19:48): by leave—I present a supplementary exploratory memorandum to the bill and move government amendments (1) to (7) as circulated together:
(1) Clause 2, page 1 (lines 7 to 9), omit the clause, substitute:
2 Commencement
(1) Each provision of this Act specified in column 1 of the table commences, or is taken to have commenced, in accordance with column 2 of the table. Any other statement in column 2 has effect according to its terms.
Commencement information |
|
|
Column 1 |
Column 2 |
|
Provision(s) |
Commencement |
|
1. Sections 1 to 3 and anything in this Act not elsewhere covered by this table |
The day this Act receives the Royal Assent. |
|
2. Schedule 1, Part 1 |
The day this Act receives the Royal Assent. |
|
3. Schedule 1, Part 2 |
The later of: (a) immediately after the commencement of the provision(s) covered by table item 2; and (b) 1 July 2015. |
|
Note: This table relates only to the provisions of this Act as originally enacted. It will not be amended to deal with any later amendments of this Act.
(2) Any information in column 3 of the table is not part of this Act. Information may be inserted in this column, or information in it may be edited, in any published version of this Act.
(2) Schedule 1, page 3 (after line 2), after the Schedule heading, insert:
Part 1—Amendments applying from the 2012-13 year of income
(3) Schedule 1, page 3 (after line 11), after item 2, insert:
2A Paragraph 15(2)(b)
Omit "$732", substitute "$663".
(4) Schedule 1, page 3 (after line 22), after item 4, insert:
4A Paragraph 15(4)(d)
Omit "$732", substitute "$663".
(5) Schedule 1, page 3 (after line 28), after item 5, insert:
5A Paragraph 15(6)(b)
Omit "$732", substitute "$663".
(6) Schedule 1, item 8, page 4 (line 8), omit "this Schedule", substitute "this Part".
(7) Schedule 1, page 4 (after line 9), at the end of the Schedule, add:
Part 2—Amendments applying from the 2015-16 year of income
Income Tax Rates Act 1986
9 Paragraphs 15(2)(b), (4)(d) and (6)(b)
Omit "$663", substitute "$653".
10 Application provision
The amendments made by this Part apply to the 2015-16 year of income and later years of income.
Question agreed to.
Bill, as amended, agreed to.
Ordered that this bill be reported to the House with amendments.
Federation Chamber adjourned at 19:51
QUESTIONS IN WRITING
Positive Body Image Awards
(Question No. 969)
Mr Hartsuyker asked the Minister for School Education, Early Childhood and Youth, in writing, on 8 May 2012:
In respect of the Positive Body Image Awards, how many nominations were received as at (a) 23 March, and (b) 10 April, 2012.
Mr Garrett: The answer to the honourable member's question is as follows:
A total of eight nominations for the Positive Body Image Awards were received by 23 March 2012.
A further seven nominations for the Positive Body Image Awards were received by 10 April 2012. This brought the total number of nominations for the Positive Body Image Awards to 15.
Health and Ageing: Training
(Question Nos 993 and 997)
Mr Laurie Ferguson asked the Minister for Health, in writing, on 8 May 2012:
Since 1 January 2008, has the Minister's department contracted Skills Training Australia Pty Ltd, 92 Copeland Street, Liverpool, NSW, to conduct training; if so, for each type of training, what (a) was the purpose, (b) was the duration, (c) sum was charged per participant, and (d) oversights (if any) occurred on the specified outcome, duration and delivery.
Ms Plibersek: The answer to the honourable member's question is as follows:
No, the Department of Health and Ageing has not contracted Skills Training Australia Pty Ltd, 92 Copeland Street, Liverpool, NSW, to conduct training since 1 January 2008.