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Australian Labor Party wins enough support to rule

Australian Prime Minister Julia Gillard speaks during a press conference in Canberra, Australia, Tuesday, Sept. 7, 2010. (AP / Mark Graham) Australian Federal Independent Lawmaker Bob Katter is pictured in his office at Parliament House, in Canberra, Australia, Tuesday Sept. 7, 2010. (AP / Mark Graham)
Australian Prime Minister Julia Gillard speaks during a press conference in Canberra, Australia, Tuesday, Sept. 7, 2010. (AP / Mark Graham)

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Date: Tuesday Sep. 7, 2010 10:02 PM ET

CANBERRA, Australia — Tensions emerged on the first full day of Australia's new minority government's rule Wednesday between the deputy prime minister and a kingmaker independent legislator over plans to make mining companies pay more tax.

The disagreement between Deputy Prime Minister Wayne Swan and Tony Windsor underscores the fragility of the centre-left Labor Party administration that could be brought down by a single lawmaker defecting.

As part of a deal to get Windsor and fellow independent lawmaker Rob Oakeshott to throw their support behind a Labor government on Tuesday, Swan and Prime Minister Julia Gillard promised to hold a public summit of tax experts by June 30 next year to discuss options for tax reforms recommended last year in a Treasury department report.

But Swan surprised Windsor by saying that Labor's plan to impose a new 30 per cent tax on iron ore and coal miners' profits, which are burgeoning with the voracious demand for raw materials from Chinese and Indian manufacturers, will not be submitted for review at the summit.

Swan said some of the 10.5 billion Australian dollars ($9.6 billion) to be raised from the tax over two years was needed to pay for other sweeteners offered to Windsor and Oakeshott, including AU$10 billion for upgrading rural schools, hospitals and other infrastructure outside major cities.

"There are going to be vigorous debates and the mining tax is one where we do disagree," Swan told reporters.

Swan said he hoped to introduce the mining tax legislation in Parliament as soon as possible.

Windsor said he understood that the mining tax plan would be scrutinized at the tax summit and would talk to Swan about having it included.

"I thought it was going to be included in any discussions in relation to taxation" and the Treasury report, Windsor told Australian Broadcasting Corp. radio on Wednesday.

Windsor could not immediately be contacted by The Associated Press for comment Wednesday.

Opposition leader Tony Abbott, whose conservative coalition could have formed a minority government with Windsor and Oakeshott's support, has refused to back the mining tax because Abbott argues it would reduce investment in the mining industry and cost jobs.

Opposition finance spokesman Andrew Robb on Tuesday attempted to prevent the pair from siding with Labor by citing a report from mining information firm Intierra Resource Intelligence that found that revenue for the mining tax could be AU$8 billion less than the government forecast.

"There's an AU$8 billion dollar gaping hole in the government's mining tax and in its budget and this will cause major problems again with more borrowings, more reckless spending and a Julia Gillard government, if it is returned today, will mean more incompetence and more debt for Australians to meet," Robb told ABC radio on Tuesday.

Labour was returned to govern for a second three-year term on Tuesday, after 17 days of intense negotiations since an Aug. 21 election failed to give any party a clear majority for the first time in 70 years.

Comments are now closed for this story

Pat - Toronto
said

From what I have been told by friends who live in Australia.. this is not good news.. I am surprised she won the election, many do not like her or trust her. Let's hope this is not the downfall of Australia!


Dave
said

Australian population - 21,431,800 150 seats in government Canadian population - 33,311,408 308 seats in government Something wrong with this picture. Approximately 50% more in population and we have twice as many seats in government and Harper wants to increase it. Too much money being wasted on dead wood in this country. Nice to see Australia with a constitutionally legal government and in the near future Canada will have a constitutionally legal coalition after Harper and the rest of the Reform/Alliance are tossed to the gutter where they belong!


Sue
said

Conservatives keep saying that a center-left government will lead to economic disaster. But the reality is America experimented with free-market capitalism over the last 30 years and now the country is falling apart and may never recover. The most successful examples are in northern Europe with countries that use the centrist, Keynesian mixed-market model. They have high-growth, high-productivity economies that are fiscally, socially and environmentally responsible. The conservative model keeps lowering living standards, making people work more for less wages and benefits causing the economy to go into a downward spiral. Time to go back to what worked for us in the post-war era of the 1950s and 60s and is working now in northern Europe.


Paul
said

The beginning of the end for them. bThey elected a disloyal, backstabbing, self serving, egocentric, scoundrel. They will now have to pay the price.


Richard D
said

Um. Paul? We had Kim Campbell.


Bob Jones
said

Labour with the Greens plus independants have formed a 'stable' government. Seems every western nation with more than 2 parties are in minority/coalition now (CA, AU, US, UK, DE, FR, etc, etc).Why is coalition a 4-letter word in Canada? Or right, because the Conservative Party doesn't have a logical partner. Almost like there should be fiscally conservative party in our Parliament ... Greens perhaps?


Paul ~ Kitchener
said

Congratulations to this "First Female Prime Minister".This minority government can be a very affective one especially driven by a strong, intelligent woman.I think if the world had more "Female Leaders", this world could be a Better Place ~ it sure as heck couldn't be worse, that's for sure.A lot of great woman have lead successful governments ~ remember the Iron Lady, (Ms Thatcher), how about Chancellor Merkle (doing well thank you) and the list goes on.Canada wake up and lets get our "Female Leader" how about Her Excellency Michelle Jean ????


FACT CHECK
said

1) The guy has a girls name2) Sits on a desk3) Puts shoes on a chair4) Wears cowboy hat inside5) Wears cheap suit 6) Vest went out of style 15 yrs ago7) Tie is about a 6 inches too long I am concerned that if Julia is not smart enough to dress himself he is not smart enough to run kangeroo land.


Wade Ens
said

Centre left is bad. People will be left behind when it comes to jobs. Even China scapped it's left wing economic policies. Seems pretty simple.


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