For the briefest of moments — and to everyone's great surprise — it seemed like the Queensland government was finally going to do one thing right in relation to the Adani coalmine.
On May 27, Deputy Premier Jackie Trad announced that the state would not facilitate any loan funds from the Northern Australia Infrastructure Facility (NAIF). This is the federal body that is expected to approve a loan of almost $1 billion towards the rail line that would service Adani's proposed Carmichael mine.
The NAIF has $5 billion to disburse: if this proposed loan goes ahead, it would represent almost one-fifth of the total. There are much better things the money could be spent on and only 7% of voters support the loan being used to bail out Adani.
Importantly, the Queensland government has the power to veto the proposed loan if it chooses. This is because the Palaszczuk government was elected on a promise that they would not support direct taxpayer subsidies to the Adani mine.
The Queensland government has disgraced itself time and again with over-the-top support for Adani, but so far it has not made a direct grant of state funds to the mine. So even though it has violated the spirit of its pre-election promise, it claims that it has not broken the letter.
However, campaigners have pointed out that the promise was in relation to taxpayer funds and that this should apply to more than just Queensland government funds. To stick to its promise, it needs to reject the $1 billion loan from federal taxpayer funds as well.
Of course, if the Palaszczuk government did that, it would be a contradiction of its entire pro-Adani policy. Queensland government support has included: an unlimited free water licence for the mine; full environmental approvals; favourable terms regarding royalties; support for the Abbot Point port and the rail line; endorsement of ripping up Aboriginal Native Title rights; and grovelling public relations support including a lobbying trip to India.
So Trad's May 27 announcement was a surprise. But it was immediately contradicted by state Treasurer Curtis Pitt who said Queensland would facilitate the loan if it were approved by NAIF.
This is probably one reflection of a reported dispute within the government about how much support to give Adani. Previously there had been talk of a $320 million “royalty holiday” for the Adani mine. That would mean that the company would have discounted royalties for the initial period of mine operation.
On May 26, Annastacia Palaczszuk emerged from a Queensland cabinet meeting saying the government had unanimously decided there would be no “royalty holiday”. Instead, in a triumph for political weasel words, the government will allow “deferred” payment of royalties “with interest”. At best this would still represent a government loan direct to the company.
However, economist John Quiggan has questioned whether or not this policy is realistic: “The holiday is supposed to be temporary, but that's unlikely,” he wrote. “The mine is always going to be marginal at best, so any attempt to extract royalties in the future, let alone collect those foregone during the holiday, will raise the threat of closure. What government, having put so much into the project, would be willing to take the blame for its failure? ”
There are many reasons to oppose the mine. It cannot go ahead without trampling on the rights of Aboriginal owners of the land. It would be the biggest coalmine in Australia, thereby making a major contribution to greenhouse pollution. Aside from climate there are huge environmental problems with the mining and transport of its coal (including destruction of the Great Barrier Reef). The commercial viability of the mine is dubious at best without government subsidies.
In the context of a mushrooming grassroots campaign against the mine, some voices of opposition have begun to emerge in federal Labor. However, Queensland ministers routinely claim that they are stronger supporters of Adani than the state Liberal National Party.
The truth is that both major capitalist parties in Australia are gambling with all of our futures by tripping over themselves to support the fossil fuel industry. We need an alternative that will put the interests of people and the planet before corporate profit.
[Alex Bainbridge is a national co-convenor of Socialist Alliance.]