I rise this evening to speak on the Minerals Resource Rent Tax Repeal and Other Measures Bill. It gives me pause to mention the original mining tax, the resources super profits tax, which was expected to raise $49.5 billion over five years. In July 2010 the resources super profits tax proposal was replaced with the MRRT and an extension of the PRRT to onshore projects. Whilst the MRRT was forecast at that time to raise $26.5 billion over five years, the minerals resource rent tax revenue estimates have since been progressively revised down. It is a great pity that the $26.5 billion, or the earlier $49.5 billion, has not been available to previous federal governments or indeed our own government in order to address this severe issue of structural deficit.
The minerals resource rent tax damaged international investor confidence in Australia, and in particular the energy and resource sector. The repeal of this tax will provide a boost to the mining industry and is a strong step towards repairing perceptions that international investors have formed on Australia over recent years. We know that foreign investment is important to our future economic prosperity. Since it started, the minerals resource rent tax has only raised $400 million in net terms, yet the former government has locked in more than $16.7 billion of expenditure on an underlying cash basis over the current forward estimates or $18.4 billion of expenditure on a fiscal basis over current forward estimates. Only Labor can do their maths and their budgeting like that, and only Labor can leave us with such a diabolical mess. The repeal of the MRRT's associated expenditure will improve the budget's bottom line over the current forward estimates by $13.4 billion on an underlying cash basis and $15.1 billion on a fiscal basis.
The repeal of the MRRT will save millions of dollars in compliance expenses for small, medium and large entities. Fewer than 20 taxpayers have contributed to the net $400 million raised by the MRRT to date, but around 145 other miners have been required to submit MRRT instalment notices while making no net payment. That is, around 145 tax payers are compliant with the MRRT legislation but are not actually paying any tax. That is what happens when you to sign a tax without understanding the sector for which you are legislating. So well designed by Swannie, the Treasurer of the world, was this tax—
The ACTING DEPUTY PRESIDENT ( Senator Fawcett ): Order! I remind you to address members by their correct title.
Senator McKENZIE: Mr Swan designed a tax that does not collect any revenue and then proceeds to attach funding promises against said lack of revenue. This tax has been very poorly executed and has been criticised for favouring big multinational mining companies. Australian owned and operated mining companies which are trying to expand their businesses are being stifled by this tax. These young companies provide Western Australia and the nation with thousands of job opportunities and billions of dollars in royalties and export revenue. Senator Back, I am sure, has already made mention in this place of the young geologists who have been laid off as a result of the impact of this tax on the mining sector in WA. Given the large scale of mining operations in Western Australia, mining companies need to make large profits to pay off significant debts accrued when investing in their business.
The Labor Party—the supposed party of the fair go—has stifled the ability of ordinary Australians to develop viable businesses, effectively turning their back on the workers as a result. This is an anti Western Australian tax that has not worked, has scared off investment into Australia through the Labor Party's political posturing and has done more harm than good. It is time this tax was abolished so that we can get on with the business of fixing the mess the former government left us in. Australians voted to get rid of this tax. Western Australians voted to get rid of this tax, and they will have the opportunity come 5 April to once again vote for a party, for a coalition and for senators who will actually stand up for their right to have a strong economic base within their own state boundaries.
As a National Party senator, I am dealing with the mess left over from former Minister King's playing around in regional development. So many of those projects relied on the supposed funding from this failed tax. For many communities, Labor's Regional Development Australia Fund and Regional Infrastructure Fund have been another cruel con. Up to election day, Labor was announcing projects using money it knew did not exist. Hundreds of projects were announced that had not even received cursory departmental assessments, yet Labor was promising anyone who would listen that these were somehow a done deal.
The government will of course honour signed contracts undertaken by the previous government. However, non-contracted announcements made by the Labor government have the status of election promises and do not bind an alternative government. Some projects to miss out on funding include the Bendigo tennis centre, which was going to develop the current infrastructure in Bendigo to ensure that we could host international-level games in the fabulous regional centre of Bendigo. Another example is the Wangaratta saleyards. They were funded under RDAF round 5 and 5B. Similar projects in Wodonga to revitalise its streetscape and in Bendigo to upgrade its botanical gardens were similarly going to miss out on funding thanks to failed Labor budgeting processes.
Unlike the previous government's phantom funding based on a flawed and failed mining tax, the government's $1 billion National Stronger Regions Fund is fully funded and accounted for as part of our budget. That funding is guaranteed, and projects that will be announced under that program will proceed, unlike the phantom promises that Labor made throughout the election campaign.
On the coalition side, we note the rhetoric of the Greens and Labor that the coalition somehow does not believe that the non-renewable resources within Australia belong to the people—but we do; we had that argument. We had that argument about 113 years ago when we formed our federation. We had the argument, and, guess what—the states won. So they get to collect the royalties and spend them on things for their state and their citizens. We forget sometimes—and we should not in the Senate, but some senators do forget—that the states are sovereign entities and completely have the right to retain their state royalty rights. I think that WA has used those royalties for the very best purpose—that is, to send them right back to the regions from whence they came.
In our own mining boom in Victoria, we did not give WA a bean; we kept it all for ourselves. We have beautiful cities in Bendigo and Ballarat. I would love you to all come and have a look at the wonderful and magnificent infrastructure built two centuries ago on the back of our mining boom.
Senator Urquhart interjecting—
Senator McKENZIE: We were not giving Tasmania a cent, Senator Urquhart, and we were definitely not giving it to WA. I do not think WA should have to share that with the nation. It is their resource. They are choosing to mine it now and they are sharing it with their citizens, as is their constitutional right—and indeed responsibility. As I was saying, the Western Australian government's Royalties for Regions program is a great example of well-developed policy that is doing an excellent job of spreading the wealth of the resource boom to the wider population of Western Australia.
As the National's Western Australian Senate candidate Shane Van Styn says, 'This program is about ensuring some of the profits from mining go back to the communities where that wealth was created.' You cannot rent out something you do not own. The Commonwealth government does not own those minerals. Section 114 of our Constitution prevents that. Conceived by former Western Australian National's leader, Brendon Grylls, and continued now by Terry Redman and the partnership between the Liberal and National parties in Western Australia, the Royalties for Region program quarantined 25 per cent of all mining and petroleum royalties to be spent in the bush. This has been—