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Address to the Minerals Week 2014 Annual Minerals Industry Parliamentary Dinner, Canberra
Andrew, thank you so much. I very much look forward to working with you and the other people in this room to try to ensure that this industry continues to flourish.
We are all here, I suspect even Labor Members of Parliament are here because we want this industry to flourish and I do acknowledge all my Parliamentary colleagues, particularly Ian Macfarlane, the Industry Minister, the Shadow Treasurer and so many of my Parliamentary colleagues who are here tonight.
I want you to know that you are not in hostile territory; you are here amongst people who want you to flourish and if there is one message that I can give you this evening, it is that this Government wants you to succeed, because when you succeed, our country succeeds.
Back in September of last year, on election night, I said that Australia was under new management and that we were once more open for business and I hope in the eight months since then you have seen plenty of evidence to justify those statements.
We do appreciate what this industry does for our country. You may not employ as many as some other industries – only about two per cent of our workforce are in the mining and resources sector – but you are 10 per cent plus of our GDP - and in recent times you have been some 60 per cent of new investment in our economy.
Our prosperity rides on the ore and gas and coal carriers steaming the seas to our north, just as surely today as once it rode on the sheep’s back.
Our job in Government is to keep mining strong. It’s not to tell you how to do your job; it is to allow you to do your job.
That’s why this Government is utterly determined to abolish the mining tax because that’s the third tax that your industry pays on top of royalties and on top of company tax.
We are determined – utterly determined – to abolish the carbon tax because, as your President has just pointed out, this tax has achieved the quinella of damaging our economy without helping our environment.
We will restore the Australian Building and Construction Commission because in your industry, particularly in the investment phase, there should be a tough cop on the beat to ensure that the ordinary law of the land applies.
We are establishing a one-stop-shop for environmental approvals because massive investment requires swift and certain processes and, even though there are still some steps to go before we get to that position, already under this Government, projects worth $500 billion have received environmental approval.
And yes, there will be some additional support through a kind of capped flow-through share scheme for small start-up miners.
You see, the main difference which I’m sure you know but which I suspect many of our people have forgotten, between the modern and the pre-modern world is energy consumption and it is our destiny in this country to bring affordable energy to the world.
It’s particularly important that we do not demonise the coal industry and if there was one fundamental problem, above all else, with the carbon tax was that it said to our people, it said to the wider world, that a commodity which in many years is our biggest single export, somehow should be left in the ground and not sold. Well really and truly, I can think of few things more damaging to our future.
But, my friends, I want to speak to you tonight, not just as miners but as citizens.
I want to speak to you as Australians, not simply as business people.
I want to speak to you tonight not just about your industry and government policy towards your industry, but about the Budget on which so much now rests.
I want to assure you that as far as this Government is concerned, the Budget is nothing like an indulgence to keep economists happy. This Budget is a necessary response to an inherited debt and deficit disaster.
Now I know my predecessors did not mean to get us into the predicament in which we are in, but good intentions are not enough to manage an economy, and the truth is that the former government gave us the six biggest deficits in our history.
Under the policies of the former government we would have had four more record deficits. Under the policies of the former government we would have had a decade of deficits. And as all of you know, any entity that is spending more than it makes, any entity that is borrowing to pay the interest is doomed – is doomed.
It simply cannot continue.
Each year’s deficit means more debt and ever higher debt means ever higher interest – $1 billion a month is what the Commonwealth is currently paying. Every single month, $1 billion to meet the interest bill alone and on the projections which we inherited, within a decade it would have been $3 billion every single month.
It simply could not continue.
That interest is just dead money. It’s money that we cannot spend on the things that we wish to invest in. It’s money that we couldn’t invest in tax cuts, it’s money that we couldn’t invest in schools and hospitals and infrastructure. It’s just dead money.
So this Government simply had no option but to tackle the debt and deficit disaster. We had to tackle it, but I want to say to you that the changes that we have made in this Budget are not made simply because they’re necessary; they’re made because they’re right.
And how do you know that we believe they’re right? Because we have taken risks – quite significant risks – in order to do what is right for our country.
The Medicare co-payment – perhaps the most difficult policy change in this Budget. It sends a price signal – a necessary price signal – because visits to the doctor might be free to most patients, but they certainly haven’t been free to the taxpayers of this country. And if it’s right to pay a co-payment when you get a Pharmaceutical Benefits Scheme drug, how can it somehow be morally wrong to face a modest co-payment when you go to the doctor?
Indexation of most social security benefits to CPI rather than Male Total Average Weekly Earnings is necessary, not because we want to be hard on anyone but because over the years the number of contributors is shrinking and the number of beneficiaries is growing. At the moment the ratio of working age people to retirement age people is 5:1. By 2050 it will be under 3:1. So these are necessary changes if our social security system is to be sustainable for the longer term.
And yes, we’ve raised the pension age to 70. Let’s never forget that when the pension age was first set at 65 back in 1907, most Australians died before the age of 60. Today, most Australians live to be beyond 80. It’s perfectly reasonable to take it up to 70 by 2035 when life expectancy and healthy life expectancy could reasonably be expected to have increased again. If there was no real argument about taking it up to 67, as happened under the former government with the support of the then opposition, why not take it to 70 by 2035?
And yes, there’s some modest activity testing being brought in for the Disability Support Pension because it’s cruelty, not kindness, to keep people on welfare when they could be economic contributors.
And yes, we’re expecting young people who leave school to either earn or learn, because we want them to make the most of their lives and you don’t make the most of your life by starting it on welfare.
And yes, there are some changes to Family Tax Benefit Part B for two reasons. First, because we do want to bear down on what’s often described as ‘middle-class welfare’, and while we’re all in favour of choice and we want to support choice, there’s a limit to the amount of taxpayer support there should be for families once the youngest child is at school.
And yes, there are higher education changes, because unlike every single government in this country up until now, we trust our best and our brightest, whether they’re in universities or considering going to universities, to make rational decisions about their future.
And not only do we trust them, but we trust our future tradies, we trust people who are going for diplomas as well as degrees to make rational decisions for their future and that’s why we have extended the FEE-HELP system effectively to them.
Now some of these changes are very difficult.
Some of these changes are hard for people to get their minds around.
Change is often bracing, change is often challenging, but sometimes change is necessary and I believe that the changes that we have brought forward in this Budget represent the best values of our people.
These are, I have to say, testing times for our Government but they’re also testing times for our country. But I am confident that our character, I am confident that our country’s character is up for these changes.
As the Treasurer said in his Budget night speech, we are a nation of lifters, not leaners. We are a nation of workers, not shirkers.
We are people who are just as determined to have a go as we are determined to extend a fair go to others.
So my friends, it’s very good of you to be here this evening.
Thank you for coming to this Parliament. Thank you for bringing to this Parliament – bringing to all of us on all sides of politics – the insights that you have from the work that you do.
Thank you for coming at this critical time in the life of the new Government.
I think over the past eight months you’ve seen enough to know the character of this Government.
We have all but stopped the boats.
We have responded quite appropriately to requests for corporate welfare given that the age of entitlement is dead.
We have successfully negotiated two out of three of the major free trade agreements that we’ve been pitching for as a nation.
As you’ve seen in the Budget a fortnight ago, we are capable of meeting the fiscal challenges that our country faces.
I hope you’ve seen the warm heart that every decent person should have, the clear head that every serious thinker should have and above all else, the strong spine – the backbone – that a good government needs.
Thank you so much.