Hyatt Regency Hotel, Perth
It's a great honour to be here on my first visit to Western Australia as Prime Minister.
This visit is special to me because it is a chance to see old friends again. It is also a chance to underline my absolute determination to govern for all Australians, no matter who you are or where you live.
You are rightly proud of the State you live in. Western Australia plays a huge part in the Australian story and the Australian imagination.
The vote of Western Australia sealed Australia's destiny as a united federation. Many of the ships that took Australians to war departed from these shores, and you are home to our elite special forces. Many of the migrants who came "across the seas" made their landfall here to build a new life under new skies.
Western Australia has given the nation some of its greatest sons and daughters, and in coming to this state as Prime Minister for the first time, I am especially conscious that Western Australia gave Australia one of our most outstanding Prime Ministers, John Curtin.
Of course Western Australia also has a substantial claim on a second, Bob Hawke, although my fellow South Australians also like to claim him as one of their own.
I want to speak today about two matters that I identified as immediate priorities in my first remarks as Prime Minister two weeks ago.
I want to focus my remarks on the Government's commitment to provide certainty for the future of the mining industry, but let me first make some brief remarks about the Government's approach to addressing the concerns of Australians about the security of our borders and the matter of unauthorised arrivals in Australia.
Earlier this week I made the case that regional processing needs to be part of our long-term solution to unauthorised arrivals. I said in my speech that one possibility was a centre in East Timor.
I had spoken to President Ramos Horta and he had indicated both that he would need to speak to Prime Minister Gusmao and that he was open to considering the possibility. My government has been in further contact with the East Timorese Government since Tuesday.
Yesterday, as you know, Prime Minister Gusmao met President Ramos Horta.
Prime Minister Gusmao is right to say that a concrete proposal is the next step. He confirmed that his Government is open to considering one. He also said a proposal would need extensive consideration and debate, through the East Timorese community and Parliament. That reflects the proper functioning of a democracy.
I said on Tuesday that there is no quick fix and that a careful dialogue is needed. That is exactly what I am pursuing. The dialogue with other regional neighbours is also continuing.
A strong regional framework must include collaboration across the region and it must involve the UNHCR. Those critics who want to declare the approach dead in week one are mistaken and will, I'm afraid, be disappointed.
Friends, in coming to Western Australia today, I take as my starting point this simple proposition: the people of this nation admire and respect Western Australia's economic achievement.
Yesterday's labour force data, for example, showed that Western Australia generated almost half the nation's entire job growth in the month of June. unemployment in this State is now just 4 per cent, well below the national rate of 5.1 per cent.
At the heart of Western Australia's achievement is the mining industry, one of the nation's genuine success stories. All of us, from every part of the country, understand the vision and commitment that have made the mining industry what it is today.
We understand the passion of pioneers like Lang Hancock - entrepreneurs with big dreams who took big risks.
The current expansion is the fifth major mining boom in our history and by far the greatest. It will provide strong foundations for our future prosperity and enable our nation to aim higher than we ever could before, but we should not take it for granted.
Economists tell us the current phase of development in China and India in time will level off - as it did in Japan and South Korea earlier on. In addition, our mineral resources, while plentiful, are not unlimited.
It was for these reasons that the Government secured a more balanced share of mining revenues for the nation.
As we all know, the design of the tax as announced created uncertainty, not only in the mining industry but across the wider community. My West Australian parliamentary colleagues like Gary Gray were at the forefront in expressing those concerns. They understood, as strong and effective representatives of this State, that uncertainty on such a fundamental question could impact on our economy and our global reputation.
That is why in my very first remarks as Prime Minister I said that we needed to end the uncertainty. I indicated that my Government would throw open its doors and in return. I asked mining industry leaders to open their minds. That is the style of leadership to which I am committed.
The government I lead will address difficult questions in a spirit of mutual respect and with a shared commitment to move forward. We will consult, listen and encourage people to give their best and we will work though the nation's policy challenges with a calm, methodical and analytical approach.
It was in that spirit that we came to the table to seek agreement on the reformof resource taxation, and it was in that spirit that we reached a breakthrough agreement one week ago.
That agreement preserves the broad principle of a fairer share of our mineral resources for the Australian people, at the same time recognising the legitimate needs and concerns of the mining industry.
Together, by consensus and mutual respect, we secured an agreement that moves Australia forward.
I know that some parts of the mining industry will still have their criticisms, but I believe we've struck the right balance.
Our agreement:
cuts the headline rate from 40 to 30 per cent;more than doubles the uplift level from around five to around 12 per cent based on current bond rates;provides a 25 per cent extraction allowance;excludes small miners with resource profits below $50 million per annum; and,excludes all minerals other than coal and iron ore.As a result, we have been able to remove almost 90 per cent of mining firms from the scope of the original Resource Super Profits Tax, with coverage slashed from around 2,500 firms to just 320.
Most importantly of all, nothing in our agreement will deflect our steady and determined course of returning the budget to surplus in 2013.
The negotiating process from my first statement to the final deal took eight days. They were long and difficult days, but productive and respectful ones as well.
Having signed the Heads of Agreement last Friday, the Policy Transition Group will soon be getting down work. I'm delighted Mr Don Argus AC, former chairman of BHP, has agreed to co-chair this body alongside my Ministerial colleague, Martin Ferguson, to whom I also pay a warm tribute today, along with the Treasurer, Wayne Swan, who both did an outstanding job.
The Policy Transition Group will consult with industry and advise the Government on the implementation of the new tax in advance of legislation next year, should the Government be favoured by the Australian people with re-election at the coming poll.
As with the initial negotiating phase, our door is open and our good faith commitment is real.
My friends and colleagues, with the principal negotiations now over, it is worth reflecting for a moment on exactly why we embarked on this journey of reform in the first place.
Yes, this was about fairness and equity, but it was also about securing a lasting dividend from the mining boom so that our current prosperity can be expanded and made to last.
In the past, taxation increases have tended to be absorbed entirely into general revenue. This time we wanted it to be different.
We wanted to confer lasting and significant benefits upon the Australian community, in a similar way perhaps that the railroads and telegraph were a lasting endowment from the mining booms of the 19th century.
The Minerals Resource Rent Tax gives us scope to achieve three big things for Australia:
first, an increase in national savings through superannuation that will strengthen the financial security of more than eight million Australians in their retirement years;second, a reduction in business taxation to make us a more competitive and attractive destination for investment into the future, a huge contrast to the Opposition's planned 31.7 per cent company tax rate;third, a much-needed new investment in economic infrastructure for our mining towns and regions.In other words, using the dividends of growth to build our future prosperity. Nowhere are these things more important than in Western Australia, where the challenges of growth are all too obvious.
That is why, for example, a very large share of the Regional Infrastructure Fund will be expended right here in Western Australia - $2 billion out of $6 billion.
That's new money for ports, roads and utilities returned to the very mining communities where the Minerals Resource Rent Tax will come from in thefirst place.
These investments, in turn, complement the Government's wider investment in Australia's productive capacity so that the growth we enjoy today is not a flash in the pan, but a durable and lasting uplift in our prospects and our potential.
Key to unlocking our potential is the National Broadband Network or NBN, the missing link in Australia's economic infrastructure. In a global economy based on the flow of information, it is unacceptable that we lack affordable, ubiquitous high speed broadband.
The NBN is a critical piece of reform for Australia. That is why the Financial Heads of Agreement between Telstra and the NBN Company to utilise Telstra's assets is so important.
Not only that, construction of the NBN is already underway in Tasmania. The very first NBN customers have already been signed up and the NBN Company expects construction to begin this month on the first mainland release sites.
In other words, the NBN is not just a plan. It is happening right now and it will touch every Australian business and household.
The obvious question for this gathering is - what about Western Australia?
Well, I'm delighted to say that yesterday the NBN Company announced the first sites for the broadband network roll-out in Western Australia. These sites will be Victoria Park here in Perth; the vibrant growth centre of Mandurah; and the beautiful town of Geraldton to our north.
Construction should begin in the second quarter of next year.
I am determined that the West gets its fair share of infrastructure to help cope with the challenges and demands of growth, and I am determined that as a nation we should not be afraid of the future.
I understand that the challenges of today and tomorrow can easily leave us yearning for what we remember as a kinder and simpler age, but I do not believe in romanticising the past or going backwards.
The best days of this great State and this great nation lie in front of us, not behind us.
We can live sustainably together on this fragile land. We can create new wealth, reward hard work and extend a helping hand to each other. We can harness the best of new technology including the transformative power of the National Broadband Network.
My friends, in this growing prosperous State, I believe you share my sense of confidence about the future.
Indeed coming from Melbourne I can tell you when people in Melbourne's Collins Street think about the West, they visualise a State that's a kind of nirvana. They imagine a place where everyone earns six-figure sums from mining and the community is awash with money but as rightly proud as you are of your State, you know this is not the reality.
Here in prosperous Western Australia and right around the country, there are families finding it tough to make ends meet and to cope with cost of living pressures. Indeed as a result of Western Australia's prosperity, the ordinary costs families experience like the cost of buying a home have grown.
Research from the University of Western Australia has highlighted the significant economic stresses in recent years borne by Perth suburbs such as Mirrabooka, Girrawheen, Yanchep and Kwinana.
Between the start of the mining boom to the onset of the global financial crisis:
annual price inflation in Perth averaged 4.0 per cent, compared to the national annual average of 3.3 per cent;Perth rents increased by two-thirds more than the national average;and Perth house prices grew by 14 per cent a year, almost triple the national average growth rate.My Government is determined to help families battling with such cost of living pressures. Just last week, those families received a welcome boost from the tax cuts that came into force on 1 July, the Government's third round of tax cuts.
For someone earning $50,000 a year, last week's tax cuts mean an extra $450 in the pocket each year, and when you take our three tax cuts as whole, that's an extra $1,750 in the pocket, cutting the amount of tax paid by almost 20 per cent compared to three years ago.
We have also acted to help families with the cost of childcare - a significant burden on family budgets.
I am proud we have increased the Child Care Rebate so it meets 50 per cent of the out-of-pocket costs that families experience with child care. The maximum child care rebate is now $7,500 a year, over $3,000 a year more than under the previous government.
Valuing child care is a central part of our agenda of early learning. Driven by the research which shows that you make a profound difference to a child's life chances by supporting that child to develop in their early years, we have moved to ensure every child can benefit from pre-school, and Western Australia should be proud of its contribution to the innovative research in this area with the work led by Professor Fiona Stanley.
As part of helping with child care costs, today I announce that we will change the payment system for the Child Care Rebate so that families will have the option of getting the financial assistance we provide fortnightly rather than quarterly.
If parents chose, the fortnightly cheque can even be paid direct to the child care provider, slashing out of pocket costs.
Some families may well prefer to stick to the current arrangements and get a lump sum every three months, but for those families that find it hard to balance the budget while waiting for the refund, help will be available more quickly.
Take a family earning $80,000 with one child in full-time care.
At the moment, they would be paying more than $220 per week in out-of-pocket costs until they receive the rebate at the end of every quarter. Under this new proposal, the same family's out-of-pocket costs would reduce to just over $110 per week.
That's what our new measure designed to do - take a bit of pressure off. It's one way that as a nation we can again demonstrate our support for children and their mums and dads.
Friends, in conclusion I want to say to this great State that while I am not from here, I believe we share some common values.
A belief that hard work should be rewarded.
A belief that a fair go means, more than anything else, a fair go for kids delivered through a great education.
A belief that we can, as a nation, look forward with confidence and shape our future together.
Friends, to Western Australia, to the nation I say let's go forward together.