Labor’s hot air is no energy substitute
“Our future is being held to ransom by a highly organised, highly funded grouping of leftist activists”
IN EARLY August 2005, the Howard government took control of uranium mining in the Territory.
It happened after a short meeting between federal Resources Minister Ian Macfarlane and Territory Mines Minister Kon Vatskalis.
Macca gave Kon a quick lesson on how the Commonwealth Grants Commission operates. He explained the Territory was within its rights to take a principled stand against uranium mining, but it wouldn’t be without financial consequence ... sound familiar?
A few minutes later the pair fronted the media. Macca told them that the Territory had abdicated responsibility on uranium mining and the place was now open for business.
While Kon complained the Territory had been bullied and he said it was further evidence of our need for statehood.
The political fix had been made. John Howard had again shown that steely resolve in pushing back against the Labor states who held no regard for the national interest.
Clare Martin, on the other hand, gladly took the money, but declared that she would stay true to her word and never approve a new uranium mine in the NT. (She’d never knock another back either – but no one mentioned that).
Both leaders stood tall in the eyes of their supporters.
The question is, why can’t Malcolm Turnbull and Michael Gunner come to the same type of arrangement over onshore gas? What’s happening now seems the complete opposite of commonsense.
Our future is being held to ransom by a highly organised, highly funded grouping of leftist activists who have captivated public opinion through social media and yellow plastic triangles.
These NIMBYs twist the truth and make up stories but our leaders lack the ticker to pull on a fight with them, even when it’s in everyone’s interest to do so. Scott Morrison’s budget relies on the prospect of a growing economy.
Most people know that an economy mainly grows through exports. When exports are greater than imports, the economy grows and when imports are greater than ex- ports, it shrinks. So why would Malcolm Turnbull threaten the national economy with export controls on a resource that unarguably has made Australia more prosperous?
Such talk heightens our sovereign risk in the eyes of our trading partners and puts in doubt future export income.
Our Prime Minister knows that we need our exporters to be making strong profits, in order to grow our economy and maintain our high standard of living.
Meanwhile, the Territory budget relies purely on the goodwill of other Australians.
Don’t be fooled by what many in the media and political class tell you. We have no entitlement to other people’s money, despite what they say.
Australians are looking much closer at how we carve up the pie. The states are screaming poor and it stands out that Territorians get more than 10 times the per capita money than those poor souls unfortunate enough to live in WA. Eighty per cent of the Territory budget revenue comes from Canberra.
Reduced GST payments must be expected following the enormous growth the NT has achieved in recent years. The dramatic fall in GST after the WA mining boom should be a strong signal to Territorians that we can expect the same.
Combine this with the hardening of attitudes to the NT’s financial state, and you don’t have to be Nostradamus to predict that Commonwealth money will start to dry up in the Territory. The last budget demonstrated this and the next will be worse. Across Australia, the fickle pendulum of public opinion is also swinging back in favour of fossil fuel.
People are slowly coming to grips with the real cost of “green” electricity. Almost all media outlets are running stories predicting blackouts and massive price spikes in the eastern states this summer.
For decades, there has been bipartisan support for the establishment of a gas industry in the Territory. Indeed, both CLP and Labor claim credit for what we currently have. The CLP says “we started it with Conoco Philips” and Labor says “we got Inpex”.
Every Federal government and Territory government, of every political stripe, until now has been working towards the establishment of a gas industry.
To date, the Territory government has done all the heavy lifting but the Commonwealth has seen almost all of the revenue. Territorians have shelled out millions to attract Conoco Philips and Inpex to Darwin, but aside from a meagre amount of payroll tax, all taxes and royalties have gone to Canberra.
Every Territory government knew this would be the case, but they were prepared to pay the price because it would seed the development of a much larger onshore industry.
Royalties arising from offshore gas go to Canberra, the onshore gas industry pays its royalties directly to the NTG.
While Michael Gunner rightly feels comforted that the NT has more than enough gas for our electricity needs, he should be alarmed that the Conoco Philips plant, now Darwin LNG, is desperately trying to find new sources of gas to process. If Michael Gunner understands a little bit about macro-economics he’ll also be very alarmed by the closure of several large scale energy dependant manufacturing businesses interstate. This can only
lead to further erosion in Territory government revenue.
Michael Gunner knows that the Macarthur basin alone holds more than twice the gas of all the gas fields in Queensland, and over fives times the gas of the entire northwest shelf. Supposedly, it’s enough to power the entire Australian electricity system for the next 200 years. He knows we can use this gas to alleviate the shortages along the east coast. It doesn’t even have to be transported there – it can be used to meet the export demand, while freeing up interstate gas for electricity production.
He’s been endlessly briefed on the job numbers and the many downstream industries including the establishing of new hi-tech manufacturing plants. And he knows that if we are to ever have an efficient port and rail system, we need this industrial development.
Michael Gunner knows that onshore gas holds the key to the NT becoming financially self sufficient and paying its own way. He also knows that it’s no idle bluff that the Commonwealth Grants Commission will cut our GST revenue if we don’t develop our proven resources when there’s a proven market. That’s what everybody signed up to when the GST was first agreed on. That’s what the Grants Commission has to do by law – they refer to it as “foregone revenue”.
It’s not Territory Labor policy to oppose onshore gas – it’s simply rank populism.
For decades, Australia had the cheapest and most reliable electricity system in the world and we became one of its most wealthy nations selling coal and minerals.
Twelve years ago, two leaders as opposite as John Howard and Clare Martin each found a political fix to a rather similar issue. Admittedly, Facebook and Twitter didn’t exist back then, and the media wasn’t so wet, but both were prepared to do something.
Today, the national budget is far more fragile and the money coming into the Territory is clearly in decline. But, our leaders are paralysed with fear – despite the problems that each must surely see coming their way.
The saddest thing of all though is that nobody seems to care. Like frogs, we are happy, comfortable and ignorant, basking ourselves in slowly warming water.
The Inpex-operated Ichthys LNG Project’s central processing facility