Dutton’s gas play to deal out Greens
The Opposition Leader says he’ll ‘engage constructively’ with Labor and work closely with industry on the proposed $2.4bn gas tax hike.
Peter Dutton will demand Anthony Albanese reduce red tape and approval timelines for gas projects in exchange for the Coalition’s support for the government’s $2.4bn tax impost on the industry.
The Opposition Leader said the Coalition was “happy to engage constructively” with Labor and would work closely with gas companies to negotiate an outcome on an overhaul to the petroleum resource rent tax, just as Joe Biden had worked with Republicans in the US.
“I accept the industry doesn’t want the government to have to deal with the Greens, they’re crazy and they’re economic wreckers,” Mr Dutton told The Australian in an exclusive interview to mark the one-year anniversary of his leadership of the Liberal Party.
“As we’ve seen in the US, the Democrats and the Republicans come together on these types of issues. To the credit of the Biden administration, they’ve tried to condense timelines, they’ve tried to remove bureaucracy and regulation and red tape from a sector that is productive but could provide so much more by way of benefit to the Australian economy – and, frankly, to the fight to achieve reductions, incredible reductions in emissions.
“Our task is to look at ways in which we can work with the government. I think there is a reasonable ask of the government to give something back to the industry by way of reduced regulation, by way of condensed timelines for approvals, and that will be part of our discussion with the government in relation to this bill.”
The industry, which largely supports the government’s budget reforms to the petroleum resource rent tax, has called for a bipartisan approach to drive them through parliament.
The Albanese government plans to introduce a 90 per cent cap on the use of deductions that can be offset under the PRRT from July 1, which will bring forward more revenue from the nation’s offshore gas projects sooner.
While Jim Chalmers has said the changes will make the system fairer, Mr Dutton said the opposition would consider the budget measure through the lens of whether it would add another layer of sovereign risk or make Australia a less-desirable investment location.
Since the government’s first budget in October, PRRT receipts have been revised up $300m next financial year (to raise $2.8bn) and $2bn over five years from 2022-23 (raising $13.15bn).
The industry estimates oil and gas will deliver $16bn to state and federal government coffers in 2022-23, with $8.8bn being paid in corporate income tax.
“Already countries are starting to talk about sovereign risk in Australia under the Albanese government for the first time that I can remember,” Mr Dutton said.
“My job is not to make decisions that are in a particular company’s best interests. My job is to make decisions that are in our country’s best interests.
“Certainly, killing off investment for a sector that has underpinned our success for decades as a country is fraught.
“We can’t kill the golden goose and we have to be honest about the jobs, that economic activity that’s generated from the mining sector and it can’t just be WA that has an acute appreciation of the benefit of mining,” Mr Dutton said.
“There are schools and hospitals and roads and infrastructure on the east coast, and from one end of the country to the other, that is only possible because of the royalties from the mining sector,” he said. “We shouldn’t shun them. We shouldn’t be embarrassed by them. And the only reason the government’s got back to surplus is because of the revenues that tend to come out of the mining industry.”
The Greens have blasted the government’s PRRT changes, saying they were designed by the gas industry, would continue to fuel climate change and helped gas companies make more profits.
Mr Dutton was guarded on the government’s $4.8bn budget measure to increase JobSeeker by $40 per fortnight, which is due to pass the Senate with Greens and other crossbench support.
The Liberal leader said it may be easier politically to wave the increase through parliament, given its guaranteed passage, but the Coalition would make its decision based on the prevailing economic conditions.
“We don’t want further inflationary pressures in the economy because middle Australia, who were completely left out of this budget, end up footing the bill,” Mr Dutton said.
“They foot the bill through higher taxes and they’ll foot the bill through an upward pressure on inflation, so that at the very least inflation will stay higher for longer because of this measure.
“The government predicts over the forward estimates period that 175,000 Australians will lose their jobs. At the same time, the government’s bringing in 1.5 million people (migrants) over the five-year period. And we’ll have to see what the labour market looks like over the next few years.
“But the idea of JobSeeker is to provide people who have been deemed to have a work capacity to temporarily be in that position until they can find work. And we know … there are 438,000 job vacancies … and 840,000 people on the unemployment line, and the government’s incentivising people to stay longer on the unemployment line.”
Mr Dutton’s signature budget reply proposal was to raise the income-free area for JobSeeker recipients from $150 to $300 per fortnight and allow those on welfare to supplement their payments by working more – however, the policy has not yet been costed by the Parliamentary Budget Office.
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