I often wondered where Greens politicians go on their winter break from Parliament. Well at least I now know where Greens Leader Christine Milne chooses to holiday: New Zealand.
Yes, I am certain Milne travels to rural North Island of New Zealand to spend time touring the sets of Lord of the Rings and the Hobbit, immersing herself in the sights and sounds of Middle Earth.
She must, because the speech she presented to Federal Parliament on her first week back was the stuff of pure fantasy. It’s bad enough that many Greens supporters look like they walked straight out of Mordor, but Senator Milne’s speech on her job-destroying Bill to abolish the diesel fuel rebate for the mining sector would have caused the great Tolkein himself to cry ‘that’s just bloody ridiculous!’
The Greens Mining Subsidies Legislation Amendment, seeks to remove the diesel rebate for the mining industry. The Bill’s central platform is to abolish the diesel fuel rebate because ‘…since the carbon price repeal, mining companies no longer pay a cent in tax for their fuel, compared to ordinary Australians who pay 38 cents per litre.’
The fuel excise was introduced in the 1950’s to generate revenue guaranteed to be spent on the upkeep and improvement of our nations’ roads.
The diesel fuel rebate acknowledges the fact that heavy mining vehicles do not operate on public roads, but in underground and open cut operations. They cause no wear and tear on our roads and are therefore exempt from the tax.
The fact is that mining in Australia does not operate within a vacuum. We compete for limited mining investment with overseas jurisdictions in South East Asia, India and the Americas. Over the last 12 months mining in Australia has been battered by low commodity prices and a stubbornly high Australian dollar.
If the diesel fuel rebate for mining was abolished, the added cost burden would send a shockwave through the domestic mining sector.
Thousands of jobs would be lost as mining operations down-sized or closed. The flow on effect would see thousands more jobs lost in industries that service the mining sector. Mining royalty revenue that helps pay for services like hospitals, schools and roads would be slashed. One of the pillars of economic stability in this country would be significantly weakened.
This reality is somehow lost on the Greens Leader. Therefore, here within is a dissection of the Senator’s fanciful recitation from start to finish, along with the facts she so eloquently ignores.
Paragraph 2: “Supporting mining and fossil fuels puts them at a huge advantage compared to other sectors of the economy.”
Mining doesn’t compete with other sectors of the economy. In fact, mining stimulates economic activity in a vast array of other industries from manufacturing, hospitality, accounting, law, transport, and health. In NSW alone, there are 10,000 businesses from a range of sectors who engage with and supply NSW mining, from mechanics in Western NSW to component manufacturers in Western Sydney.
Paragraph 3: “As a nation… we should be increasing Newstart, not condemning people to poverty.”
Across Australia nearly 244,000 workers and their families rely on mining for their livelihood. It’s estimated that for each mining job, three additional jobs in other industries are supported. With potentially thousands of jobs being lost as a result of the Greens proposal, how does cutting the fuel rebate prevent people being ‘condemned to poverty’? If anything it increases the chances of more people being forced into financial hardship.
Paragraph 4: ‘We can do all these things and more, like bringing dental care into Medicare for everyone, by standing up to the big mining companies, and big banks and demanding a fairer contribution to the whole community.’
How exactly does job losses and a sharp decline in mining royalties ensure a ‘fairer contribution’ for the community?
For example, as a result of the fall in commodity prices, the high Australian dollar and the number of mines operating in NSW declining by 11 in the last 4 years, mining royalties in the state are falling. Between 2011-12 and 2013-14 mining royalties in NSW have fallen by $100 million.
If the Greens proposal were adopted, this would be magnified exponentially, resulting in even less public resources for services like Medicare. It would be like putting two jockey’s on a Melbourne Cup hopeful and demanding it run faster.
Paragraph 6: ‘If mining companies didn’t get so much government assistance, then renewable energy would be more competitive.’
‘Pants on fire’ doesn’t quite cover this nonsensical claim.
Firstly, in its annual Trade and Assistance Review, the Productivity Commission found that the effective rate of government assistance to the mining industry in Australia is ‘negligible’.
More to the point, renewable energy sources are not competitive compared to coal and gas for the simple reason that they cannot provide the same base load power supply required to meet our society’s power needs. The current renewable energy sources available require too much land and simply don’t produce enough power.
For example NSW’s largest wind farm near Bungendore has 67 wind turbines that take up 35 square kilometres of land. The entire wind farm produces enough electricity to power 60,000 average homes a year.
At the time of the 2011 census, there were 2,864,531 private dwellings in NSW. So to power only the private dwellings in NSW solely using wind power – not taking into account heavier users of electricity like factories, schools, hospitals etc – NSW would require another 47 wind farms similar to the Capital Hill project.
This represents land use of 1,670 square kilometres – twice the size of Tonga.
By contrast, total mining in NSW accounts for just 630 square kilometres or 0.1 per cent of NSW land.
In fact, the land required in the Capital Hill example to power just the private dwellings in NSW, is almost the exact land use of all current mining operations across Australia – 1,676 square kilometres.
But surely the Greens offer something valuable in exchange for the thousands of lost jobs, the ocean of families forced onto Newstart and the drastic reduction in government services their Bill would leave in its wake?
The answer stands out like a vegan at Hungry Jacks in paragraph 5: “This Bill could counter Abbott’s cruel budget by saving cuts made to ABC, SBS and CSIRO…’
That’s right; Senator Milne is more than happy to let thousands of mining families go to the wall, so that Tony Jones can take Q&A on even more overseas junkets. The Greens would rather see the ABC, their political haven – the left wing, anti-Israel, anti-mining, anti-capitalism, anti-anything that doesn’t contain the word ‘socialist’, ‘alliance’, ‘climate’ or ‘change’ in its title – given more taxpayer funds than see food on the table of hard working mining families across the country.
Paragraph 14: ‘The Greens believe in a safety net that will prevent people from crashing into poverty and homelessness when they are facing difficult circumstances.’
Following the Greens’ proposal would relegate thousands of families to the bread line. As mining investment heads overseas and operations in Australia close, an economic tsunami would sweep our regions and our cities, sinking thousands of jobs across a broad range of industries. Power prices would soar as energy is imported to supplement inadequate domestic renewable electricity generation. Government spending would be slashed as billions in mining royalties disappear, instead filling the tax coffers of our international competitors.
Paragraph 16: ‘I commend the Mining Subsidies Legislation Amendment (Raising Revenue) Bill 2014 to the Senate.’
Based on job-destroying policies like this, let’s hope the Greens continue their electoral downward spiral from the last federal election, and are themselves commended to the political rubbish bin of history.
Brad Emery is Director of Media for the NSW Minerals Council