Saturday, May 15, 2010

Mining tax could kill off the Labor government

KEVIN Rudd's mining super-profits tax directly threatens four Labor-held seats, three in Queensland and one in Western Australia, as the government prepares to defend a slender nine-seat buffer at this year's election amid a dramatic drop in support in the polls.

The risk in the mining states comes as the government struggles with the fallout from a series of policy backflips and bungled programs.

The mining tax also risks erasing a favourable redistribution that promised to deliver five seats to the government. The net loss of just nine seats could cost Labor government.

As Tony Abbott vows to turn the federal election, expected later this year, into a referendum on the mining tax, a senior Labor source conceded the Queensland seats of Leichhardt, which includes Cairns, as well as Dawson, which includes Mackay, and Flynn, which includes Gladstone, would be at risk if the government failed to convince voters of its merits.

And in Western Australia, where the government is facing a states' rights campaign from the Liberal government over the mining tax and its clawback of 30 per cent of the GST as part of the hospital reform plan, expected gains have evaporated and the Liberals are now targeting Hasluck, held by Labor's Sharryn Jackson with a 1 per cent margin.

In Perth, the Liberals this week blitzed mining companies, sending out 450 letters seeking a "direct financial contribution" for a marginal-seats campaign to kill the resources super-profits tax.

A special Morgan poll - taken after the mining tax changes and last Tuesday's budget and released yesterday - showed the Coalition would win a close election if it were held this weekend.

The poll conducted on Wednesday and Thursday nights found Labor's primary vote had slumped 3.5 percentage points in a week to 36 per cent, while the Coalition's vote increased 1.5 points to 46 per cent, giving the opposition a two-party-preferred lead of 52-48 per cent over the government.

The Morgan survey follows leaked party polling published in Sydney's Daily Telegraph yesterday, showing Mr Abbott to be the most popular leader in key NSW marginal seats and that the government could lose the western Sydney seat of Lindsay, the north coast seat of Page and the bellwether regional seat of Eden-Monaro.

Yesterday, in his home town of Brisbane, Mr Rudd defended the mining tax and predicted it would win support among voters as it would fund local infrastructure.

"I think if you spoke on the ground to what people are saying in those communities about what they need locally and how it should be funded, every one of those communities I've been to, whether it's in Rocky or whether it's in Mackay or Gladstone - each one of the local authorities

has asked me this question: how do we plan for and fund for growth? How do we do that?" Mr Rudd said. "Now, we can't just invent that from somewhere, that's got to come from somewhere, and that's why we believe that there should be a fair share and a fair return for miners, that's true."

Wayne Swan also used an address in Brisbane to sell the budget before a trip to Perth tomorrow.

The Treasurer, addressing the Queensland Media Club, said he wanted Brisbane to be the first stop in his post-budget tour "because I think Queensland's economy is arguably the best backdrop for the biggest economic challenges and debates we're having right now".

"When you're talking about the challenges of a two-speed economy; when you're talking about the impact of a high dollar; when you're talking about another resources boom and all that means for the demand on infrastructure and skills, Queensland is a great place to start," Mr Swan said.

Mr Rudd has swept through NSW and Queensland seats in the past month, holding meetings of up to two hours with newspaper editors in centres including Hervey Bay, Bundaberg, Mackay, Townsville and Cairns as he promoted his health reform package.

This week he paid tribute to the local press while sledging ABC 7.30 Report interviewer Kerry O'Brien, saying the locals reported "what's happening on the ground".

Fraser Coast Chronicle editor Peter Chapman said his meeting with the Prime Minister was "one of the most refreshing talks I've had with a politician in my life".

The next day the paper ran a headline saying "Prime Minister is our new very best friend", while explaining the importance of the Nationals-held marginal seat of Hinkler to the upcoming election.

The Townsville Bulletin editor Peter Gleeson suspected he would see more of Mr Rudd in coming months. "It's obvious that he sees Herbert and Dawson as prime targets at the next election and so he should - they're both marginal," Gleeson said.

Mr Abbott said the government was proposing with its new mining tax to "plunge a dagger into the heart of Australia's prosperity".

"It is a triple-whammy tax," the Opposition Leader said. "It is a tax on the 500,000 Australian workers whose jobs depend directly or indirectly on the mining industry. It's a tax on the millions of Australian retirees whose incomes are drawn from those shares and those dividends that the mining companies pay.

"It's a tax on consumers because you can't raise the price of coal, you can't raise the price of oil and gas, you can't raise the price of building material, you can't raise the price of fertiliser, without that flowing through into the Consumer Price Index."

Speaking at the National Press Club on Wednesday, Mr Swan conceded the resource super-profits tax could cost Labor at the election, but said he was acting in the national interest. He said he could not do nothing after receiving analysis showing how much Australians were being ripped off under the current state-based mining royalty regime.

Labor has been struggling in the Queensland marginals for months, especially mining-rich Dawson and Flynn, where there have been fears the now-shelved Carbon Pollution Reduction Scheme, and now the mining tax, will halt the resources boom.

First-term Labor MP in Flynn Chris Trevor has publicly raised his concerns over the proposed tax, as has Labor's candidate in Dawson, Mike Brunker.

The Coalition is trying to unsettle blue-collar voters who have already questioned the government's handling of insulation and school upgrade programs.

Leichhardt services the lucrative far north Queensland bauxite mines, and Labor incumbent Jim Turnour faces a comeback from popular former Liberal member Warren Entsch.

The Nationals have been active in the marginals - Barnaby Joyce is the lead campaigner in Flynn and Dawson - warning of the threat Labor poses to both the national and local economy, and questioning why more mining royalties have not been returned to mining communities.

Senator Joyce told The Weekend Australian yesterday he had spoken to packed houses in Mackay and Gladstone, and Lismore in the NSW marginal seat of Page, and that "the mood is changing" in favour of the Coalition.


More Rudd loopiness over mining tax

He is making completely contradictory claims about it. Will the tax grow or shrink the industry? BOTH, says Rudd!

KEVIN Rudd is refusing to budge on the 40 per cent rate of his new $12 billion-a-year mining tax but has held out the prospect of changes in the details in the face of continuing pressure from miners.

Mining executives accuse the Prime Minister of wanting to slow growth in the resources sector to help slower sectors catch up.

Defending the new tax in Queensland yesterday, Mr Rudd said the government believed "we've got the rate about right" but "on the question of detail, on the question of implementation, on the question of transition, that's all part of the consultation process".

The industry wants the government to lower the rate, allow more deductions and raise the threshold for the start of the tax from 6 per cent of profits.

Mr Rudd said people in Mackay told him "the mining boom is fantastic -- what we want is a fairer share of the proceeds for our city".

But the latest Morgan poll has shown a majority of people oppose the resource super-profits tax and mining executives are complaining about Mr Rudd's comments to a dinner last week in Perth.

The miners said Mr Rudd told them the new tax would help the rest of the economy by slowing down the mining sector. At the private dinner on May 4, the Prime Minister argued that the commodities sector had driven up the value of the dollar so much it was hurting other areas of the economy. Mr Rudd cited financial services, tourism, wine exports and foreign students, which he said were being badly damaged.

He said the executives might be looking after their shareholders' interests, but as Prime Minister he had a responsibility to govern for all Australians and to ensure more balance in the economy.

Mr Rudd's blunt comments contradict the government's repeated assertions that the proposed 40 per cent tax on mining super profits is not aimed at slowing investment.

In the face of strong criticism from the federal opposition and mining industry that the new tax would slow down development, ministers have repeatedly denied this prospect or that they wanted to use the tax to deal with the pressures of a two-speed economy.

Tony Abbott has given notice he wants the election to turn on the imposition of a tax, which he maintains will kill off the resources boom -- a claim dismissed by the Prime Minister. The stunned executives were told by the Prime Minister at the Perth dinner that the mining industry was creating problems by soaking up skilled labour and that the sector cost a lot to support in terms of infrastructure and funding remote towns.

Mr Rudd said that in terms of return to GNP, the mining industry gave back less to the community than did the finance sector.

He also said the new tax would be popular with 80 per cent of Australians. In contrast, he said the fall in the government's polling figures was all to do with the tax hike on cigarettes.

The industry was expecting a profits tax but has been blindsided by its punitive design, the details of which were not discussed with companies in advance.

They believe its impact, particularly on the larger, low-cost profitable projects that have contributed heavily to the surging terms of trade, will be disastrous and dramatically hold back large-scale investment.

The Reserve Bank and Treasury believe a slowdown in the resources sector would have benefits from a macro-economic viewpoint, in particular reducing inflationary pressures and capacity constraints in terms of labour and infrastructure.

But the official modelling on which the government is relying predicts an increase in investment in the mining industry because it will supposedly encourage the development of smaller, more marginal projects. [Only an intellectual could make such a stupid assumption. I cannot even begin to think of a reasonable rationale for it -- JR]


A VERY "stimulating" price, courtesy of Kevvy and the NSW government

More abuse of "stimulus" money. Neither Leftist government seems even to have heard of cost control or contract supervision. Waste is normal to Leftist governments. They just don't care about it. It's not their personal money that they are wasting

PARENTS at a NSW school are furious that the cost of a new library funded under the Rudd government's Building the Education Revolution program has blown out to be almost three times the manufacturer's price.

Last year, Cattai Public School, in the Hawkesbury region north of Sydney, was told it would be given a $678,000 library and a $202,000 shade structure under the federal government's $16.2 billion schools stimulus program.

At the time, Parents & Citizens Association president Helena Bark raised serious concerns over those costings, as the pre-fabricated "cookie-cutter" designed library cost just $341,000 from the manufacturer.

Further, the school had 18 months earlier built a covered outdoor learning area, or COLA, twice as big as the proposed new structure for $70,000, just one third of the proposed price.

Now, not only have the school's concerns gone unanswered, but they have been told the cost of the library has blown out to $920,000 - more than the school's entire original budget - and plans for a new shade structure have been scrapped.

"We have been told we cannot have the COLA anymore because the library has gone over-budget," Ms Bark told The Weekend Australian yesterday. "We had asked for amendments to the building design because it was too small but we were told we couldn't change anything because it was all pre-designed and pre-determined by the NSW government. "But now we're told one thing has changed, and that's the price."

Ms Bark said the school's repeated requests for information regarding how the price of the prefabricated building had soared by more than one-third in the past year had been unanswered by the NSW government and the managing contractor handling the scheme, Brookfield Multiplex.

"Our unanswered question remains: how can pre-fabricated, standard government-designed buildings simply soar in price for no apparent reason?" she said.

The issue of vastly inflated prices of pre-fabricated "cookie-cutter" designed buildings delivered under the scheme is becoming a key focus of wastage under the BER.

Federal Education Minister Julia Gillard has attempted to explain away scores of examples of public schools receiving poor value for money under the BER compared with private schools and industry costing standards by claiming such examples do not compare "apples with apples".

However, under the BER the standard design, pre-fabricated libraries, school halls and classrooms are manufactured by the same companies that were building those identical structures before the BER.

The manufacturers traditionally deliver and fully install those buildings - at a total cost of between $400,000 and $500,000. Under the BER in NSW, managing contractors take control of the buildings and install them, typically charging about $900,000.

Those manufacturers interviewed have been outraged by the enormous prices being charged for those buildings, but say they are unable to speak out for fear of losing key contracts with the NSW government.


New national curriculum less rigorous than existing NSW curriculum

The new national curriculum threatens to water down the content of some Higher School Certificate courses for NSW senior secondary school students, critics say. And they say the consultation period for the draft curriculum, which ends on July 30, is being rushed in an election year.

The highest-level courses in maths and English do not appear to extend students as much as existing courses, under the proposals for years 11 and 12.

NSW students will have to learn more about statistics in maths and the modern history of Asian countries under the draft curriculum for year 11 and 12 students. A strong focus on World War I in year 12 will be replaced with an emphasis on World War II, the Cold War and the modern history of Australia's Asia-Pacific neighbours.

Teacher associations fear many of the changes threaten the rigour of the HSC syllabus. The national curriculum specialist maths course covers only some of the more challenging areas of the extension two HSC course.

For most students studying English the focus will shift from literature to language and literacy. But a specialist literature course will be available for brighter students.

A spokeswoman for the NSW English Teachers Association, Eva Gold, said: "The problem for NSW is that all our top students, even those with an inclination towards maths and the sciences, engage in a rigorous study of literature and language. In the national curriculum, top students may not have the exposure to literature that we are used to."

The president of the Mathematical Association of NSW, Mary Coupland, said: "A lot of work needs to be done to make it anywhere near as good as what we have in NSW. I get a sense it is all being rushed."

Rob Randall, general manager curriculum for the Australian Curriculum Assessment and Reporting Authority, said the national curriculum courses would replace equivalent courses in each state and territory.

States and territories could continue to offer extension courses, he said.

Launching the draft curriculum at North Ryde Public School, the federal Minister for Education, Julia Gillard, said it was "important to our sense of being one nation". "It's important to those school kids who move from one state to another during school, and around 80,000 schoolchildren [do so] each year."

The state Minister for Education, Verity Firth, said that while she recognised that having eight curriculums was unsustainable, a national curriculum posed a problem. She believed the national curriculum would not water down the high standards of NSW but raise them everywhere.


Queensland cops colluded to protect killer colleague

The thug in question above

QUEENSLAND police colluded to protect an officer who caused the fatal injuries to an Aboriginal man in his custody, a coroner has found. However, Coroner Brian Hine said the unreliability of police and Aboriginal witnesses meant he was not able to make a definitive finding on the death in custody of Cameron Doomadgee.

Mr Doomadgee died on the floor of a watch-house cell on Palm Island in November 2004.

Mr Hine accepted the fatal injuries suffered by Mr Doomadgee - a burst portal vein and a liver which was cleaved in two - were caused by Senior Sergeant Chris Hurley. However he was unable to rule whether the injuries were inflicted deliberately or accidentally.

Mr Hine said the injuries could have been caused by Sen Sgt Hurley accidentally falling on top of Mr Doomadgee or by the officer "dropping a knee into his torso". He also accepted Sen Sgt Hurley had punched Mr Doomadgee in the face and abused him during his attempts to force him into the police station.

The coroner's inability to deliver a definitive finding on the death in custody of an Aboriginal man was a "tragedy", the deceased's family says.

Lawyer Andrew Boe, representing the family of Cameron Doomadgee, said the officers should "hang their heads in shame". "This is a tragedy not just for the family, but for all of us, to think that this level of investigation went so badly because of the specific conniving conduct of police officers" he told reporters in Townsville. "This judgment documents an abysmal failure of duty of care to a man in custody and abysmal investigation by police."

The inquest held fresh hearings in March after Queensland's Court of Appeal upheld a decision to overturn the 2006 findings into the matter by Deputy Coroner Christine Clements.

Sen Sgt Hurley was acquitted of Mr Doomadgee's manslaughter by a Townsville jury in 2007. [That acquittal would now appear to be badly polluted by police malfeasance. Grounds for a re-trial?]


(Note that this is just one of the recent stories on my Queensland Police blog)

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