Ads prompt Twiggy to leak Henry chat
Wednesday June 2, 2010, 5:52 pm
au.biz.yahoo.com
Fortescue Metals Group chief executive Andrew Forrest says he decided to divulge a private conversation with Treasury secretary Ken Henry after learning the resources super profits tax had been planned as "a surprise attack" on the mining sector.
Mr Forrest said he was shocked when he heard the federal government had approved on April 20 a $38 million advertising campaign to correct misinformation about the tax being disseminated by the mining sector - two weeks before the tax was announced.
"I was absolutely staggered," the billionaire told reporters on Wednesday.
"I have decided that my conversation with the Treasury secretary is now in the national interest to be heard because, clearly, this has been a surprise attack on the resources sector by the government."
The billionaire says Dr Henry told him during "an animated discussion" at the post-budget National Press Club function in Canberra on May 12 that the logic of the tax collapsed if financiers put no value on a 40 per cent tax credit guarantee on losses.
Mr Forrest said Dr Henry may not have passed this information on to his superiors but if he had, it appeared that "at this point in the electoral cycle, the prime minister and the treasurer are turning a deaf ear to their own Treasury secretary".
Mr Forrest said Dr Henry had effectively conceded at a lunch with leading economists late last month that he was uncertain how financiers would view the rebate.
"When asked ... he (Dr Henry) said, `I'm sure some clever banker is going to find out how to make it work'," Mr Forrest said.
"What he's saying to the Australian people is that he doesn't know.
"Ken Henry doesn't have the answers and what I know with absolute certainty is that he didn't consult with the banking industry, like he didn't consult with the mining industry.
"He just allowed the treasurer, or could not stop the treasurer, from launching it onto the Australian people for purely political purposes."
Fortescue recently shelved two of its three growth projects in Western Australia worth more than $17 billion, saying it could not raise capital under the proposed tax because the loss rebate was virtually useless as far as financiers were concerned.
"They have said that there is no ability for you to not breach your standard interest cover multiples because of this tax," Mr Forrest said.
"If we have any hope of getting any funding, we will have to go to non-traditional sources, to sovereign governments and the like."
Resources Minister Martin Ferguson and Opposition Leader Tony Abbott addressed the Minerals Council of Australia annual conference in Canberra on Wednesday.
However, Prime Minister Kevin Rudd has declined to attend the dinner, while Treasurer Wayne Swan flew out for China on Wednesday afternoon.
Mr Ferguson told delegates he was delighted to be among "friends" before saying "friends do, from time to time, disagree", and said the government wanted to work with miners over the tax - within limits.
"We are open to generous transitional arrangements but the headline rate of 40 per cent is not negotiable."
Mr Abbott vowed to continue his attack on the tax, but told the miners the only way to ensure it was not introduced would be to vote out the Rudd government.
He warned Mr Rudd would use talks with mining executives to attempt to convince them to drop their campaign against the tax.
"Those honey words will come from this prime minister every day until the election campaign starts," Mr Abbott said.
"Above all else, if you want to stop the resources super tax, you've got to change the government."
Mr Abbott rejected suggestions he had been bought off by the mining industry.
Source:By Lloyd Jones |
