Are you still basking in the afterglow of Saturday’s frenzied outbreak of democracy? Or are you, like me, quietly fuming that your local P&C Association failed to conduct a sausage sizzle at their school’s electoral polling booth?
Nothing. Not even a fudge stall.
Regardless of your position on the lack of election-related dining options in this country, you may have noticed that we have a new government, and with that inevitably, comes a new Mines Minster and new raft of new resources policy.
Excited yet? Me neither, but this stuff is quite important so I’ve taken a bullet for the team, and broken down what the change in Government will mean for the resources sector – now presented in bite size chunks for your chewing pleasure….
The Carbon Tax
People herding goats in Outer Mongolia are aware that Tony Abbott will be repealing the Carbon Tax when he comes into office. He’s been telling anyone with a pulse about his utter loathing of the tax since five minutes after it was introduced. How he’s going to achieve the repeal with the present, and likely future, hostile Senate has got everyone intrigued.
FIFO (fly-in, fly-out)
Despite Tony Windsor’s recommendations in his FIFO report, the LNP won’t be making any changes to the current taxation system that would make FIFO employment models less attractive to mine companies. It’s business as usual when it comes to FIFO. Disappointing, but not unexpected news, for some small country towns.
The soaring cost of housing in mining communities
Consecutive federal governments have neatly hand-balled this issue to local and state governments. Something for them to sort out. However the Abbott government plans to re-introduce the Australian Building and Construction Commission (ABCC), which they claim will address some of the spiraling construction costs of housing in this country. Details are a bit vague on this one.
Temporary Skilled Overseas Visas (457 Visa’s)
Tony’s team will continue to support 457 visas.
In a recent Australasian Mining Review interview with Ian McFarlane, the soon-to-be new Mines Minister said,
“I don’t think you’ll ever have a situation where you won’t be offering 457 visas, but the long term goal is to make them less required in terms of skilling-up. That skilling-up isn’t just a matter of getting people to go and do a trade. There has to be some security in being a tradesman in that field. And part of the challenge that the industry faces as this all slows down is that tradesmen are always the first people out the door unfortunately. That flows through to people being involved in the trade in the first place, so we need to make sure companies are on board with that and there’s not the sorts of levels of redundancies we’re currently seeing in the coal industry, for instance, which is probably going on 6000 people in the last twelve months.”
It might just be me, but this sounds like a pretty solid argument against 457 Visa’s…
Coal Seam Gas – project approvals
Tony Abbott’s Government will move to a one-stop-shop model when conducting environmental assessments on CSG projects. They will remove the current duplication of approvals between the State and Commonwealth which should significantly speed up the approvals process. This doesn’t mean every project will get rubber-stamped by the end of the week; projects can still be rejected due to environmental or community concerns. But it does mean you’ll find out about the rejection sooner rather than later so everyone can move on with their lives.
Mining Mineral Resources Tax
The new Abbott Government will abolish the Mining Mineral Resource Tax and the programs that go with it. The most controversial of those programs is the superannuation payments to low income people.
Encouraging exploration
Ian McFarlane says he will introduce a floated share option to make investing in exploration more attractive to investors and mine companies. However he qualifies that by adding, “… we will have to see whether or not we have enough money in the coffers to do that…”
The Abbott Government will abolish the carbon tax and mining tax and introduce a one-stop-shop for regulation which they claim will cut costs substantially.
“The approvals process we would hope to return to a sub two year process optimally, perhaps as little as 18 months.” McFarlane said, “We want a proactive process, not a lower standard, but something that achieves the standard with a lot less bureaucracy.”
A Northern Economic Zone
Ian McFarlane says the LNP are looking at development of the Northern Australian region but that a report is still to be finalised. He also said that at this stage they’re not considering an individual taxation zone or a change to the concessional taxation zone.
So I guess that’s a no.
Development of a National Minerals Strategy.
The LNP will be revisiting the Energy White Paper (which McFarlane describes as a ‘damp squib’) and will develop a much more comprehensive strategy including areas such as permitting, resource exploration, development costs, training and recruitment.
Overseas competition and what to do about it.
On this point Ian McFarlane seems to be in a bit of a hurry…
“Australia has come to realise, (it’s been a long time coming) that the resources sector is a crucial part of our economy and we need to make sure we develop all the resources we’ve got as quickly as possible because quite frankly the world changes so quickly. LNG being a case in point. You need to be getting everything you can out of the ground as soon as possible because look at China as they develop their gas and oil shale deposits. And around the world look at Africa. The competition is quite serious so we need to do everything we can ASAP”, McFarlane said.
In our last edition of Australasian Mining Review we spoke to the LNP’s Ian McFarlane, who will almost certainly become the country’s new resources Minister under an Abbott Government, about his vision for the mining sector. Read the full interview with Ian McFarlane in Australasian Mining Review’s Winter edition.
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