Federal Opposition leader Tony Abbott has used his first Budget reply to promise to abandon the National Broadband Network and change workplace laws to give employers more flexibility.
Abbott also used the speech to launch a stinging attack on the Government’s resources super profits tax, describing it as a “new tax that will eventually choke the goose that’s laid the golden egg for Australia”.
While Abbott’s speech was short on specific policy initiatives and detailed costings, he did set down some clear battlelines for the Federal Election later this year, with the Opposition promising to block the resources super profits tax in the Senate and rescind the law if it wins Government.
“Despite its name, this is not a normal tax on super profits. It’s a super tax on normal profits.,” Abbott told Parliament.
“Every company extracting non-renewable resources will have to pay an additional 40% tax, as well as normal tax, once its rate of return on capital exceeds the long-term bond rate or about 6%. The new tax applies to the extraction of phosphate, sand and stone as well as to the extraction of minerals, oil and gas. It’s a tax on small quarries as well as big miners.”
“It will impact on the price of fertilisers and building materials as well as on the price of energy. It’s a triple whammy tax on the jobs of half a million mining and related workers, on the superannuation of millions of retirees with mining shares and on the cost of living of everyone who uses power.”
Abbott also rubbished the Government’s claims that the new tax could actually help smaller miners grow.
“By this Budget’s bizarre logic, putting a new tax on cigarettes means less smoking but putting a new tax on resources means more mining. If this tax is going to be so good for the resources sector, why aren’t other industries lining up to beg for a super profits tax to be imposed on them?”
While Abbott did not completely explain how the $12 billion set to be raised from the Resources Super Profits Tax would be replaced, he did promise to cut the number of public servants by imposing a two year hiring freeze. Abbott says this will result in $4 billion worth of savings.
Abbott has also made a clear pitch to employers, saying a Coalition Government would re-introduce some of the workplace flexibilities that have been removed by the Rudd Government’s Fair Work laws.
“The former government’s workplace reforms went too far but they helped to create more than two million new jobs, lift real wages by 20% and more than double net household wealth between 1996 and 2007. We’ll seek to take the unfair dismissal monkey off the back of small businesses which are more like families than institutions.”
“We’ll make Labor’s transitional employment agreements less transitional and Labor’s individual flexibility agreements more flexible. We have faith in Australian workers who are not as easily pushed around and exploited as the ACTU’s dishonest ad campaign is already making out.”
However, no details were released about whether the Government would re-introduce an exclusion from unfair dismissal laws for companies with less than 100 staff, as existed under the Howard Government’s Work Choices regime.
Perhaps more controversially, Abbott also signalled the Government not proceed with the National Broadband network, claiming the project would create a new monopoly player in the telecommunications sector.
“The Coalition won’t go ahead with the National Broadband Network avoiding the creation of a $43 billion white elephant. Better access to faster broadband should not mean a new nationalised telecommunications monopoly and Telstra shareholders should not have their assets subject to coerced acquisition.”
Labor has been quick to slam Abbott for revisiting the Howard Governments’ Work Choices regime, and attacked Abbott’s projections as being “flaky”.
James was the editor and publisher of SmartCompany and LeadingCompany for five years. He is now the Australian Financial Review‘s companies & markets editor, and a former BRW editor.
Comments