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Palmer United Party and government reach deal on mining tax

The mining tax has been repealed after the Abbott government reached a deal with the Palmer United Party to scrap the tax but keep the associated compensation.

The lower house on Tuesday evening voted in favour of amendments passed by the Senate earlier in the day to repeal the tax.

The deal means millions of workers will not receive a promised boost to their superannuation, with the PUP agreeing to let the government delay the increase to improve the bottom line.

Compulsory super, currently set at 9.5 per cent of an employee’s wages, had been set to increase to 12 per cent by July 2019.

PUP has made a deal with the government that will sacrifice that increase in order to keep spending associated with the mining tax.

The amendment circulated says the superannuation guarantee will not increase to 12 per cent until on or after July 1, 2025.

PUP senator Glenn Lazarus told the Senate the deal would keep the schoolkids bonus in place to December 2016, low income super contributions until June 2017 and the low income bonus until December 2016.

Finance Minister Mathias Cormann said that the schoolkids bonus would now have a tougher means tested and only families earning $100,000 a year or less would be eligible.

Treasurer Joe Hockey and Palmer United leader Clive Palmer appeared in the chamber to shake hands as the amended bill was presented. The Senate voted in favour of the bill 36 votes to 33.

Mr Hockey said on Tuesday that working Australians should blame Labor for the now decade-long wait before compulsory super reaches 12 per cent of their wages.

The Treasurer said if Labor had agreed to the repeal of the mining tax, the delay would not have been necessary.

“If people think this is going to have a long term impact on their superannuation, blame Labor,” he said.

“This is entirely their fault.”

Mr Palmer defended trading off an increase in superannuation entitlements to keep, in the short term, the compensation associated with the mining tax.

“Australian families are doing it tough and we think it’s more important ourselves that Australian families have access to the funds or purchasing or bargaining power now, while they are bringing up their children, not in 50 years,” he said.

Mr Palmer rejected the suggestion that it was a conflict of interest for him, as a politician with mining interests, to be negotiating on the repeal of the mining tax.
“We all pay tax, does that mean that members of Parliament don’t vote on income tax bills?” he said.

Mr Palmer said his party had only reached a deal with the government on Tuesday and as recently as Tuesday morning talks were continuing over sticking points.
Labor and the Greens attacked the government for what Labor Senator Penny Wong called “a dirty deal”.

“We have another deal…another dirty deal where they try to ram through the chamber just like we’ve seen before,” she said.

Greens Leader Christine Milne called the move to gag debate on the amended bill “contempt for the Senate”.

“I can’t remember a time when we had amendments dropped on the desk with no attempt to explain what they mean,” she said.

Senator Cormann rejected accusations the government was rushing the legislation through.

“This is three hours more than the previous government spent on the whole debate in the first place,” he said.

Senator Cormann said the deal would benefit the economy.

“A strong mining industry…is good for Australia, good for the economy and it’s an important part of generating more jobs,” he said.

Senator Milne called the deal “an absolute disgrace” that would hurt the super entitlements of millions of working Australians.

“This is exactly what the Australian people were concerned about at the prospect of a mining billionaire coming in here.”




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