Treasurer Joe Hockey has moved to head off a damaging fight with Australia's mining industry, assuring them there will not be any cuts to the diesel fuel rebate in next Tuesday's budget.

Leaked confidential correspondence between top mining chief executives, obtained by the ABC, reveals deep anxiety within the resources sector.

Their concerns are shared by members of the Coalition, who warn any reduction to the multi-billion-dollar tax credit would have a devastating impact on farmers.

Recent speculation of a possible cut to the 38 per cent fuel tax credit in next week's budget has prompted emergency crisis meetings across the resources sector.

The ABC's AM has obtained a confidential brief sent on April 28, which warns of the potential impact of the budget savings measure.

"We've run the numbers on any substantial change to the rebate and the impact would be profound. Most likely far greater than any MRRT (Minerals Resource Rent Tax) and probably a little less than the first mining tax," it read.

The leaked correspondence written by one CEO explains that after labour costs, fuel is the next biggest expense for miners.

"With so many projects in their infancy or in early stages of developments in three states - such changes would alter the landscape for investment - and no doubt spook financiers," the message said.

Treasurer Joe Hockey told the mining industry the diesel fuel rebate would not be changed in the budget. What do you think?
Rebate expected to cost $2.4 billion over next financial year

Government sources have confirmed the budget razor gang has examined the diesel fuel rebate, now formerly known as the fuel tax credit.

According to the Parliamentary Budget Office, the rebate to the mining industry is expected to cost $2.4 billion over the next financial year.

AM has been told Mr Hockey gave an assurance late yesterday that the Government would not touch the rebate in its first budget.

A spokeswoman for the Treasurer would not comment on the suggestion.

But Mr Hockey appears to have also avoided a messy stoush with his Coalition colleagues in the Nationals.

Nationals senator John Williams, a former farmer, warns if the rebate is significantly reduced it could push some marginal producers into bankruptcy.

"The diesel fuel rebate is essential for the people on the land," he said.

"Be aware that farmers who are farming their paddock are not wearing the roads out."

Senator Williams says it is important that costs are kept down for farmers so they can compete.

"No matter how big or small those properties are, whether they are growing just 500 acres of wheat a year or they're growing 50,000 acres of wheat a year, that diesel fuel rebate should remain as is with 38 cents rebate to the farmers," he said.

Voters will thank us for fixing budget: Abbott

Meanwhile, Prime Minister Tony Abbott says voters will eventually thank him for trying to repair the budget bottom line, even if it includes breaking his promise not to introduce new taxes.

He says the Government's "most fundamental commitment of all" was to "get Labor's debt and deficit disaster under control".

And he says voters will eventually "thank" the Government if it meets its top promises.

"You've just got to make hard decisions at times like this, and I think in the long run the voters will thank us for doing what is absolutely necessary if Labor's debt and deficit disaster is to be tackled," he told the Nine Network this morning.


http://www.abc.net.au/news/2014-05-05/budget-joe-hockey-moves-to-assure-miners-o...

Bam wrote on May 5^th, 2014 at 2:48pm:


Didn't Joe hockey just pay a $1Million to Tony Shepherd to get his advice it should be wiped out?

has anyone heard this before ...  'It is not the role of government to subsidise private businesses ...

sounds familiar, can't remember who said it though ...

Quote:


And the average citizens are told they must wait for budget night to learn any details.

Scare enough OAPs and some just might die, thus helping your budget bottom line.

That what you are aiming for, Joe??

Pyne's another little know-all bastward we'd be well rid of