Surprise Backdown On Diesel Fuel Rebate
Sydney Morning Herald
Tuesday August 13, 1996
The Leader of the National Party, Mr Fischer, took his Cabinet colleagues by surprise yesterday by announcing the Government would retain the $1.3 billion diesel fuel rebate scheme for farmers, miners, foresters and the fishing industry.
The pre-Budget announcement was welcomed by mining and primary industry leaders, but government sources said senior ministers were angry because Mr Fischer had given them no warning.
The announcement came as the Prime Minister received a strong indication yesterday that the Government would face a tough fight in having Budget spending cuts and other key legislation passed in the Senate after a meeting he held with the Greens.
The two Green senators, Bob Brown and Dee Margetts, left a meeting in Mr Howard's Sydney office staunchly opposed to the partial privatisation of Telstra, the increase in HECS student fees, industrial relations legislation and cuts to Aboriginal services.
The Greens hold the key position of the balance of power in the Senate to defeat legislation, when combined with Labor and Democrat senators.
Meanwhile, the Federal Government is expected to announce today a small increase in funding for NSW councils.
The Minister for Local Government, Mr Smith, yesterday released details of general purpose funding and road grants totalling $285.5 million for Victorian local councils - part of a promised increase of 4 per cent to local government spread across the nation.
Mr Fischer chose a radio interview in Sydney to declare it was "time to end some speculation" on the diesel rebate scheme, which returns diesel excise to off-road users.
He confirmed the scheme would be retained, but would be subject to a "systematic crackdown on rorts, including any illegal use of rebated diesel fuel", as reported in the Herald last week.
Sources said a working group of three ministers and representatives of the mining and agricultural industries had been set up to discuss objectives of the scheme, to cut costs and to formulate ways of dealing with rorts.
One of the options was to introduce coloured dye to diesel available under the scheme, and to impose fines of up to $10,000 to operators found using the dyed fuel on roads.
The Minister for Resources and Energy, Senator Parer - who has been involved in sensitive negotiations to retain the scheme for the mining industry - and Mr Fischer's deputy, the Minister for Primary Industries, Mr Anderson, were forced to scramble to issue press releases confirming the announcement.
Senator Parer said the decision to retain the rebate for the mining industry was "a vote of confidence in an industry critical to future economic growth and stability".
In a prelude to a coming Senate battle, the Green senators said yesterday an "enormous gulf" remained between their party and the Government on the eve of next week's Budget.
Senator Brown signalled likely opposition to key parts of the Government's industrial relations bill, saying the "warning lights were flashing" on legislation to deregulate the labour market that handed more power to employers, at the cost of the rights of working people least able to look after themselves.
PAGE 29: $800m sigh of relief.
© 1996 Sydney Morning Herald