CSG gasfield in Queensland | Image: Lock The Gate Alliance
States banning unconventional gas and fracking activities could miss out on some GST revenue if a proposal by the Commonwealth Grants Commission is implemented.
New South Wales, Victoria, Western Australia, Tasmania and the Northern Territory all currently either fully or partially ban coal seam gas exploration and/or development, or have a moratorium on fracking.
The Commonwealth Grants Commission, which recommends how GST revenue should be shared between the States, last week released a position paper indicating its thoughts on GST carve-up in the years ahead.
Among its proposals is denying a portion of GST revenue to states not engaged in certain potential mineral and energy developments, such as CSG exploration and development.
“In these circumstances, the Commission could take the view that all States that have CSG have the opportunity to exploit it and whether they do or not solely reflects policy choice,” says the Commission. “Similarly to gambling revenue, this view could lead to an EPC 1 assessment of States’ capacities to raise royalty revenue from CSG production, meaning that the royalties raised on CSG gas would not lead to a redistribution of GST revenue away from an EPC distribution.”
The Commission says it will further address the situation in an update next year. The Commission Position Paper can be downloaded here (PDF).
Lock The Gate Alliance reacted angrily to the news.
“The attacks ramp up. The Commission that oversees the distribution of GST between the states has confirmed it is considering a measure to blackmail the states and territories to roll out unconventional gas and fracking or face a penalty in the distribution of the GST. Read our lips: No. Fracking. Way”
It’s not the first time the idea has been tabled. Federal Treasurer Scott Morrison threatened to cut the GST distribution for state and territory governments opposing unconventional gas extraction back in June, stating the concept should get a “fair dinkum look”.
Victorian Premier Tells Abbott To Get Fracked
In related and rather bizarre news, ex-Prime Minister Tony Abbott has bettered his recent spray regarding subsidies for wind and solar power, reportedly seeming to suggest the Government involve the Army to control Australia’s resources and compel states to boost gas exploration and supply.
Victorian Premier Daniel Andrews was rather blunt about the idea.
“Wow. This guy has officially lost it. He loves fracking so much he wants to send the army to invade our farms. We don’t want a war. We want a solution,” he said.
Premier Andrews says Australia already produces more than enough gas, but the issue is much of it is exported overseas.
“If the former PM thinks driving tanks through regional Victoria is the way to go, he can get fracked.”
Treasurer Scott Morrison says the Government is not interested in pursuing a “khaki solution”.
Footnotes
- equal per capita — EPC ↩
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Tony Abbott only wants to use “defense powers” and not the actual army to take control of gas resources. But as the only reason for increasing gas production is to have more to export to places such as Japan and the only danger to the nation is missing out on some foreign exchange, the call to use defense powers is still very strange.
We’ve come a long way from the days when we used our defense powers to stop Japan taking our resources.
Some enterprising journalist needs to follow the money trail. There will be one for sure.
Guaranteed Pulitzer in it.
But, the bad abbott is no more than a bag of hot gas, like most members of his LNP (or, should that be LNG = Liberal-National Government = LoopyNaturalGas) government.
It is kind of like Brandis and his cronies, having determined that Barnaby Joyce, and the others, are disqualified from being members of the federal parliament.
The Australian Zoo, the federal parliament, with the building designed to portray the fundamental policy of the parliament – a closed fist, with the middle finger pointing skyward…
I expect that the interference by the federal government, with the government and operation of states, using blackmail, would be contrary to the provisions of the federal Constitution, and, somewhat “ultra vires”.