14/03/2012 - 11:23

No free kick as Swan puts boot in

14/03/2012 - 11:23

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Wayne Swan probably isn’t surprised by the response to his comments on a handful of Australia’s wealthiest individuals.

Wayne Swan probably isn’t surprised by the response to his comments on a handful of Australia’s wealthiest individuals.

WAYNE Swan must have been convinced he had chosen three easy targets when he decided to give Gina Rinehart, Clive Palmer and Andrew Forrest a touch-up in his recent essay in The Monthly Magazine.

But in deciding to single out the trio he revealed a significant oversight. Unlike the entrepreneurs of the 1980s, these three are all wealth creators. Instead of sitting on St Georges Terrace playing the stock market they are investing big money in big new projects. Thousands of skilled jobs have emerged and export markets have opened up. So why put in the boot?

There is merit in political leaders outlining their thoughts and beliefs in lengthy essays. It is a welcome addition to the 10-second ‘grab’ and increasingly inconsequential television interviews, where few leaders are prepared to enter into legitimate discussions. Instead they are pressured to ‘stay on message’; and Mr Swan is a prime example.  

The treasurer said politicians had a choice, which was “between standing up for workers and kneeling down at the feet of the Gina Rineharts and the Clive Palmers”. That’s a far cry from the message often given by the victor on election night that the winning side, Labor or Liberal, will ‘govern for all Australians’. 

Ms Rinehart – Australia’s richest person – is also singled out for increasing her holding in Fairfax Media, ‘reportedly in an attempt to wield greater influence on public opinion and further her commercial interests ...’.

And Mr Forrest gets a mention because he “wails about high company taxes and then admits to not paying any …”. 

Of course the common bond here is that the trio are all big investors in Western Australia’s iron ore industry. And they were strong opponents of Mr Swan’s initial strategy for a new tax on big profits from iron ore ventures, taking a high profile in rallies against the tax. So effective were they, along with miners across the board, that plan A had to be scuttled.

But it’s worse for Mr Swan. It has now emerged that at the COAG meeting in 2010 when (then) prime minister Kevin Rudd announced the tax, he did so in the understanding that Mr Swan and his team had already won the support of the states. 

Not so, and WA said clearly the tax was unacceptable in its initial form.

The ‘compromise’ tax was effectively hammered out between the government and the three mining giants –  Rio Tinto, BHP Billiton and Xstrata. The three “rogues” who are investing billions of dollars into their new WA mines, were effectively sidelined.

It’s a massive change in Labor’s attitude to the ‘four on the floor’ operators. In the 1980s they were on Brian Burke’s ‘A list’. The fact they were good Labor donors was not lost either. Now Mr Swan is attempting to portray their successors as pariahs.

Remember when Kerry Packer told a cowering federal parliamentary committee in the early 1990s that “anyone who paid a dollar more in tax than they had to is a fool”? 

At least Mr Swan hasn’t accused the hapless trio of tax avoidance, so no illegalities are involved in their operations. And many mining companies have said that perhaps there is a case for increased taxes to provide benefits for the wider community, but they disagree with the tax as structured.

And remember, Colin Barnett agrees miners could pay more, suggesting a surcharge for super profits on the present company tax rate.

A full-page advertisement signed by Fortescue Metals Group’s deputy chairman, Olympic hero Herb Elliott, states the company will pay more than $1 billion in taxes, royalties and other government charges this year, and $2 billion next year. The company can probably afford to pay more. But there’s no “free ride”.

Mr Swan says he wants to keep growing Australia’s economic pie, make Australia a fairer society and ensure that the vulnerable are looked after.

So why attack three Australians who are intent on doing just that? The three companies controlled by the Forrest, Hancock and Palmer interests employ thousands.

Mrs Rinehart is a relatively easy target because of the lucrative royalties deal her father struck with Hamersley Iron in the 1960s, the high-profile feuding over the family fortune and the low priority she has given – until now – to her public image. 

Mr Palmer bankrolls the conservative side of politics and doesn’t care what people think, while Mr Forrest has the most political savvy, with wide community involvement.

But Mr Swan weakens his case by playing the person for political gain. Surely there is scope to raise the level of national debate.

Into India

STATE MPs were thick on the ground when the recently opened Indian Consulate-General hosted a forum aimed at identifying new opportunities for two-way trade between India and WA.

India has long been identified as the ‘next big thing’ from a WA point of view. Despite attempts at kick-starting activity during the past 20 years through trade-oriented activities, it appears there has only been limited follow through.

The state’s trading pattern with the world’s largest democracy is all-too familiar. Exports to India in 2009-10 were valued at $8.6 billion, compared with merchandise imports of only $130.3 million. 

India’s new consul-general, Subbarayudu Mandarapu says it’s a gap he is very keen to close; and he was given some heart by Ian Whitaker, the Chamber of Commerce and Industry WA’s senior trade adviser.

Mr Whitaker is no stranger to India, having organised trade missions there for the CCI. He told the forum his office gets frequent inquiries from WA companies seeking advice on the options for the importing of products not readily available in WA that they need in their operations. Invariably, Mr Whitaker said, they were referred to Chinese suppliers, but there was no reason why India couldn’t tap into that market.

Other members of the panel included Reg Howard-Smith, the chief executive of the WA Chamber of Minerals and Energy, and Sanjay Bhartia, president of the Australian India Business Council of WA.

Peter Forby, the regional director of the WA Trade Office in Mumbai, said there were growing opportunities for WA companies across a range of activities as India’s standard of living continued to rise. Planning was under way for a ‘Year of India’ to promote the mutual opportunities from expanding two-way trade.

National Party MLC Colin Holt said sister-city and sister-state relations appeared to have worked well with major trading partners such as Japan and China, and suggested a similar move could accelerate activity with India.

It’s a point not lost on India’s consul-general, as he moves to raise India’s profile in WA and promote new areas for trade and investment.  

Premier Colin Barnett has been in Singapore this week as part of his strategy to strengthen business and cultural ties with the region. India should loom large on his radar as well.

STANDING BY BUSINESS. TRUSTED BY BUSINESS.

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