Debates Day 3 - Thursday 19 June 2003
Parliamentary Record 13
Debates for 9th Assembly 2001 - 2005; ParliamentNT; Parliamentary Record; 9th Assembly 2001 - 2005
Made available by the Legislative Assembly of the Northern Territory
Legislative Assembly of the Northern Territory
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Legislative Assembly of the Northern Territory
DEBATES - Thursday 19 June 2003 explorers submitted their expenditure records seeking to be issued with an Exploration Expenditure Certificate. Two or three of the Territorys 11 active mines used EECs to reduce their royalties. Go back in the Parliamentary Record, and you will fmd in 1987 that the then minister Barry Coulter was bemoaning the fact that the EEC scheme was not working to attract and grow exploration in the Territory. That is why they introduced the uplift factor. They amended the scheme at the behest of former Minister Coulter to push the uplift factor from 25% to 50% because that would make it all work. Sadly, it has not. In 2003, all those years later, after a lot of money has gone into this EEC scheme by way of rebates against royalties supposedly on the premise that it was acting to promote exploration, it simply has not and the facts do not stack up. So despite the claims of the member yesterday - he was going on again about local content provisions in the scheme - no such thing. The only stipulation, quite sensibly, was that, of course, the exploration expenditure had to occur in the Territory. It would not make any sense for the Northern Territory to be paying for someone to explore in Western Australia, Queensland or anywhere else. It was a very generous scheme by Australian standards. It simply was not promoting the ever-increasing levels of exploration or development of new mines. Under the former government, we saw exploration expenditure in the Territory decline. Good public policy says that you ask the question: is this the best way that you can target assistance to the mining industry that promotes exploration activity? That is why we made the changes, because it did not seem to add up to this. I will take him through it again. A mining company comes to the Territory and spends Sim on exploration. If they so choose, they go to Northern Territory Treasury and verify that expenditure of $lm. Treasury then issues an EEC to the face value of $ lm, which they can take out into the marketplace and sell to a mining company. The going rate for these EECs, historically and traditionally, is around 10%. They sell this in the marketplace, and they get $100 000 back against the $lm certificate. The mining company, having purchased the $lm certificate for just $100 000, can uplift it by 50% to $1.5m, which they then submit, if they are paying royalties to the government, as an offset. Remember that this is a scheme to push and encourage exploration. The poor old explorer has $100 000 - he is still $900 000 out of pocket the way I read it. The mining company, who has only forked out $100 000, gets $1.5m off their tax bill. Well, hello - who is this helping? Is this pushing exploration? I do not think so. Is it helping a mining company pay less tax, pay less royalties? Absolutely! The mining company is $1.4m ahead because they paid $100 000, they got $ 1.5m-you tell me how that works to promote exploration ... Mr Dunham: I will. Bring it on for debate and I will tell you. I will tell you because you are an idiot! Mr STIRLING: ... because if you believe that, you are a bigger dill than you look. Mr Dunham: You are an idiot! It is promote local purchase. You have not got a clue. Talk to the miners, they will tell you how it works. Madam SPEAKER: Minister, could you direct your remarks to me, not across the floor? Member for Drysdale, you have made many inteijections. I am becoming very irritated. Let us get on with the closing debate. Mr STIRLING: Madam Speaker, the Opposition Leader claimed he had a vision for the future. Well, I think I know where he found his vision: he has gone back to Labors Access Economics costings issued prior to the last election, and the announcements of the Martin government over the recent months, because there were no new ideas at all. He wants to make the railway a link with Asia, not just a transcontinental service. You have to ask: what is the Darwin Business Park for? What is the Darwin Business Park for, if it is not about proving up this link with Asia? There was no plan for a Darwin Business Park under the former government. There was a port, there was a railway, and nothing in between. Nor was there a railway station planned, Hendo, if you recall, let alone funded. Mr Henderson: Yes. Mr STIRLING: All those initiatives had to come from this government. Another so-called vision of the Leader of the Opposition is a project management company to oversee the development of the wharf precinct: The Martin governments task force or a project management company? You have to ask yourself: which would succeed best at the least cost to the taxpayer? Both options would probably deliver, but why do you need a project management company? Why doesnt the Leader of the Opposition have faith in the value and ability of our senior public servants who worked so tirelessly for him to deliver the railway? Why doesnt he have the faith that he had in them then to do the job on the railway which they 4379
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