21 Mar, 2012

Australians Beam as Asian Demand Makes Their Mines Boom

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CANBERRA: The Australian government has passed two separate laws designed to better spread the benefits the country’s mining boom and give 3.4 million pensioners an increase in their income support payments to help meet their cost of living. The cumulative effect of both should help make more Australians richer and spend more money on travelling.

On March 19, the Minerals Resource Rent Tax (MRRT) was passed by the Senate, delivering what the government calls “an historic reform” to share the benefits of the mining boom and deliver a fair return to Australians from the development of the nation’s resource wealth “for generations to come.”

Australian mining is booming. New investment in the resources sector has risen from $47 billion in 2010-11 to $95 billion this year, to an expected $120 billion in 2012-13, the government says.

Said an official announcement, “Australians know how important the mining industry is, but they also know that we can only dig up and sell the resources once. The MRRT will deliver Australians with a fair return on the resources they own 100 per cent.”

The Gillard Government believes all Australians should share in the benefits of the mining boom, not just a fortunate few.

At the Press conference announcing the move, Australian Prime Minister Julia Gillard said, “What we have achieved through our determination is the minerals resource rent tax against, yet again, a hysterical scare campaign from the Opposition acting as they do in the interests of a privileged few – on this occasion, taking their mining instructions from mining billionaires. So we’re stared that hysterical scare campaign down.”

Said Treasurer Wayne Swann: “We talk a lot about the Asian century and the Asian century is very important to Australia because it will provide opportunities, not just in resources, but right across our economy.

“But at the moment, we are experiencing a mining boom because of the very strong growth in Asia. We can make this the Australian century in Asia if we maximise the opportunities that flow particularly from resources and spread them right around our country.

“Because the fact is that there are great opportunities and there are great challenges and one of the challenges that comes with a mining boom is a higher dollar and of course a patchwork economy, because not every business or every worker is in the fast lane of the mining boom and that’s why we must put in place the policies that the revenue stream from the MRRT is funding.

“Now there’s a rolled-gold case in terms of equity to do what we’re doing but there’s an even stronger case in terms of cutting taxation for business.”

According to an official release, only super-profitable mining companies will pay the MRRT and the proceeds will go to where they can make the greatest contribution to jobs and economic growth – to cutting taxes for all companies, to infrastructure, and increased superannuation which will boost Australia’s national savings.

The MRRT will deliver:

• A new tax break for Australia’s 2.7 million small businesses as well as a cut to the company tax rate for all businesses, with small businesses getting a one year head-start;

• A boost to the superannuation for 8.4 million workers, which will increase the nation’s savings pool by $500 billion by 2035;

• An extra superannuation contribution for 3.6 million low-income-earners; and

• Critical investment in roads, bridges and other infrastructure, particularly in mining regions.

The second legislation, passed on March 20, will help mainly pensioners. Bill Shorten MP, Minister for Employment and Workplace Relations and Minister for Financial Services and Superannuation, announced that as of March 20, more than 4.5 million Australians, including 3.4 million pensioners, will begin receiving an increase in their income support payments to help meet their cost of living.

Single people receiving the maximum rate of Age Pension, Disability Support Pension and Carer Payment, as well as veterans’ income support recipients, will receive an extra $6.70 a fortnight. Pensioner couples on the maximum rate will receive an increase of $10.00 a fortnight combined.

Following the latest increase, total pension payments for people on the maximum rate, including the base rate and pension supplement, will be:

• $755.50 a fortnight for singles, and

• $1,139.00 a fortnight for couples combined.

Said the minister, “As part of our historic pension reforms, this Labor Government delivered the biggest increase to the pension in its 100-year history, and a fairer indexation system that helps ensure the pension keeps up with the cost of living.”

Pensions are indexed twice a year to the higher increase of the Consumer Price Index, the Pensioner and Beneficiary Living Cost Index or growth in Male Total Average Weekly Earnings. This month, the pension increase is driven by growth in Male Total Average Weekly Earnings.

According to the Minister, “Labor understands that pensioners have the least room to move in their budgets. That’s why it’s so important that when the cost of living goes up, the pension goes up to match it. Since the Government’s reforms, the maximum rate of the pension has increased by $154 per fortnight for singles and $156 per fortnight for couples combined.

“Labor has delivered for Australia’s pensioners and we’ll keep delivering to make sure they get the fair go they deserve. Recipients of other income support payments such Newstart and Parenting Payment will also receive an increase this month.”

As of March 20, Parenting Payment will increase by $7.00 a fortnight for singles. Newstart Allowance, Widow Allowance, Partner Allowance and Sickness Allowance will increase by $2.90 a fortnight for singles and $2.60 each for couples. These allowances are indexed to the Consumer Price Index. Rent assistance will also increase.

Pensioners receiving an increase in their payment:

ACT: 113,300

NSW: 1,124,600

NT: 77,900

QLD: 625,600

SA: 310,700

TAS: 105,500

VIC: 803,900

WA: 267,700

Full details of all rates and thresholds can be found by clicking here.