Ladies and gentlemen, thank you very much. It’s a great honour to be with you today.
Thank you very much to some of you who I have had the opportunity to meet with one-on-one.
It’s a real pleasure to be here with your sector and to support the industry and the many great companies who are represented here today at the lunch and during this week.
I want to firstly acknowledge the excellent work of the Minerals Council. I want to say thank you very much to Tania, to the Board of Directors, to my former colleague Helen Coonan, acknowledge Ian Macfarlane, my former colleague, who’s also here.
Tania, it’s a real pleasure to work with you and with the organisation. We don’t say that of every group who comes through the door: the CFMEU for arguments’ sake. It’s quite the contrast. It’s faint praise on them. It’s a very professional organisation.
As you’ve pointed out, I’ve had two decades in Parliament. You can tell that you weather very poorly in this job, it’s a long time since I was a young minister, but I’ve been a great admirer of this industry and I’ve watched you achieve some astonishing growth and success, which ultimately has been in our country’s best interests.
In 2000-2001, when I came into Parliament, the gross value added by resource companies was $35 billion dollars, or about 5 per cent of GDP.
In 2020-21, it was $222 billion dollars, or almost 11 per cent of GDP.
Whilst the majority of Australians appreciate that our minerals and mining sector has been core to our national prosperity historically, and that it has helped cushion our country from some of the damaging economic impacts which have affected countries around the world in recent years, there’s a lot more work that we need to do to convey that message.
A strong performing and well-supported minerals and mining sector will help us as a country to speed up the road to recovery and that’s necessary.
Export earnings are estimated at about $405 billion dollars this year and forecast to rise to $419 billion dollars in 2022-23, figures most Australians wouldn’t be aware of and it delivers two successive record years.
The financial trajectory is cause for quiet and cautious optimism.
But, as we know we are not out of the woods.
We continue to contend with an array of inter-connected pressures like supply chain disruptions, inflation, high interest rates, increasing insurance premiums, and soaring costs of living and operating business.
Today, I wanted to touch very quickly on the Coalition’s thinking on several issues, discussing challenges and opportunities for the minerals and mining sector.
As nations around the world contend with energy issues related to shortages, to security, new generation, there are, of course, many opportunities for our country.
The intersection of energy demand and technological development has ushered in a moment for market expansion.
Traditional resources are performing strongly, but the need for critical minerals is soaring to accommodate the growth of renewables, low emission technologies, batteries, and electric vehicles.
An electric car, as you know, requires six times the amount of minerals needed for that of a petrol car.
And a wind turbine requires several more times the amount of minerals needed for a coal or gas-fired power station.
The inconvenient truth, of course, for activists is that decarbonisation will require more mining.
Australia has some of the largest reserves of critical minerals and metals but we need to do more to exploit that.
When the Coalition was in government, we invested close to $2.5 billion dollars to support the industry and create thousands of new jobs.
It is paramount that the current Government’s policies do not stymie opportunities for industry growth and investment when we could be on the brink of a new mining boom.
The Coalition certainly, as we have said repeatedly, supports emissions reductions and Australia contributing to global efforts.
But we don’t support the Government’s move to lock-in, via legislation, an emissions reduction target.
Our concern is that when faced with economic headwinds, rising costs of living, and energy shortages, some nations will not honour their emission targets, including some of our competitor nations.
Labor’s legislation will deny the government important policy options, placing Australia in an inflexible position when all nations need flexibility to respond to varying and volatile conditions.
The legislation will make it harder, if not impossible, for government agencies – like Export Finance Australia, the Northern Australia Infrastructure Facility, and the CSIRO – to support energy and resource projects.
Having amended the Safeguard Mechanism, Labor is weaponising it as a battering ram for its legislated emissions reduction target.
The government will target Australia’s 215 biggest carbon facilities, forcing emissions reductions of between 3.5 and 6 per cent a year through to 2030.
It’s at a time when we need to develop sovereign capabilities and promote the competitiveness of our industries to support economic recovery, the last thing Australian businesses and manufacturers need is another tax by stealth.
Labor’s use of the Mechanism speaks to its distrust of business and of industry.
Labor always seeks to compel behavioural change, rather than incentivise it.
As a Coalition, we believe strongly that the most effective way to reduce emissions is to drive down the cost of low-emissions technologies, making them cost competitive with higher-emitting alternatives, and thus more feasible for business to adopt.
Importantly, we trust businesses to make decisions which serve both emissions reductions and economic interests, not just for themselves, but for our nation – it’s in everybody’s interest.
Another concern with Labor’s legislated emissions target is that infrastructure projects, mining ventures, and construction developments will increasingly become prey to green activism and lawfare.
Around the world, there have been more than 2,000 climate change cases, many of which relate to legislated national or state-level emissions reduction targets.
Where countries have legislated climate targets, governments have ceded control to climate advocates.
The UK Government’s decision to legislate net zero green-lit green activism.
Cases brought before its courts have included those seeking to prevent the construction of a high-speed rail network connecting London, Birmingham, Manchester and Leeds.
Those claiming that a program of road works and highway maintenance was incompatible with climate targets and those wanting to prevent the building of Heathrow Airport’s third runway.
Just as projects have been delayed or shelved overseas with economic ramifications, an Australian-legislated emissions reduction target will likely spark green activism across the nation, including in your sector.
Intervention will not be limited to issues of environmentalism.
Consider, for example, as a prime example, the Palaszczuk Government’s controversial coal royalties scheme.
The increase in coal royalty rates is yet another example illustrating how higher taxes really are the lifeblood of Labor governments at all levels.
Tania pointed out in July that: “Coupled with state royalty payments worth $42 billion, the industry has paid over $100 billion to the people of Australia in a decade – nearly 20 per cent more than its operating profits before tax in the same period.”
You can’t deny that fact, that as a result of these new royalty rates, BHP, as we know, has suspended plans to build a coal mine in Central Queensland – a $1 billion dollar investment which would have created 750 construction jobs and 1,200 mining jobs.
BMA, which has put $17 billion dollars into the state over the last ten years, has said that it will not invest any further in Central Queensland. These are consequential decisions.
In July, and indeed yesterday, our distinguished and highly-regarded Japanese Ambassador to our country expressed his shock at the royalty rate hike stating:
“I fear this may have widespread effects on Japanese investment beyond the coal industry.”
He’s been very clear about his assessment, his analysis of what this means back in Tokyo.
“Japanese companies are involved,” he says, “not only with minerals, but hydrogen, infrastructure and a variety of cutting-edge technologies”
The coal royalties scheme warrants much greater interest from the federal government given this state-based issue has national implications.
Our closest partners are watching with interest. They worry themselves very much, as you would know within your own business about sovereign risk.
Getting our settings wrong could jeopardise future investment from overseas companies which are looking for new opportunities.
Here’s the primary point:
At a time when we need to put downward pressure on inflation, downward pressure on interest rates, costs of living and doing business, the federal government are making poor decisions which will undermine industry and investor confidence.
Many of these decisions come out from an ideology but also coming from a point of pressure: pressure from the unions which have clearly been emboldened from the election in May. The ACTU wants to see skilled migrants automatically given union membership as part of employment contracts. So much for freedom of association.
In the mining and minerals sector, among others, there is a continued union push for a “same job, same pay” arrangement. And you know the impact on your own businesses of that policy.
What sounds like a reasonable proposition in the minds of many is a misleading notion.
As the Minerals Council has noted:
“… some mining workers may earn more than their colleagues in the same work team because they have more qualifications, longer experience, a capacity to operate more types of equipment, or greater familiarity with the geology of particular mines.”
The Jobs and Skills Summit was a talkfest to tick-off a union agenda under the veneer of consultation.
Almost a quarter of those who attended were union leaders, yet union membership across the nation’s private sector is now well below 10 per cent.
Any return to industry-wide or economy-wide bargaining will be a return to a disaster – to industry-wide and economy-wide strikes and wage-price inflation which was characterised by the 1970s and 1980s conduct and we would hope that was left in the 1970s and 1980s, it’s pre-Hawke and Keating.
If the unions get their way, employers and their staff will have pay agreements ripped from their hands – the first time in modern history employees would be denied the right to bargain.
If the unions don’t get their way, history is a window into the widespread disputation or economic disruption we can expect.
Our mining sector must grow, for the sake of our country. We have to employ more Australians, and deliver high-skilled, high-paying jobs.
That’s the trusted history of this sector and it must be the future as well.
There is no case for multi-employer bargaining in mining.
Although the Coalition has been in opposition for just over 100 days, I am determined that we can lead the agenda on many issues over this term.
Already, we have called for an honest and informed debate on how net zero emissions and how new-age Small Modular Reactor nuclear technologies should be part of the mix here: how it could contribute to firming-up renewables, how it can help reduce emissions, lower power prices over time, and support our general energy security.
Due to coal and gas plant closures, AEMO has brought forward its predictions for Australia experiencing unreliability in power supplies.
The Coalition supports renewables and we recognise the growing role they will play.
But as long as the sun sets, the wind doesn’t blow, and batteries don’t have a few hours of storage, renewables need to be firmed by energy which can be dispatched 24/7.
Australians want and need affordable, reliable, and secure sources of power based on proven technologies which preferably emit zero emissions.
Nuclear power ticks all these boxes.
France has embarked upon a ‘nuclear renaissance’.
Germany has done a U-turn deciding to keep two of its three plants online to cover expected electricity shortfalls during winter.
The UK plans to triple the size of its nuclear generation by 2050.
Canada, South Korea, the UK and the US are all investing in research and development for SMR to sure-up energy security and meet their emissions targets.
The science is no different in our country than it is of course in theirs.
But in Australia, Labor refuses to have a frank debate, having burrowed so far down an ideological hole with the Greens.
The imperative on all of us is to create affordable, reliable, and where possible, emissions-reduced energy but it necessitates that we at least have a conversation about the role of nuclear, and how that technology can play in the energy mix in the future.
Especially as Australia is home to one third of the world’s deposits of uranium. We have a wonderful opportunity to add value to that resource.
At present, we know that Australia only supplies about 10 per cent of global demand with all of our production exported. Extra production and higher prices are expected to lift Australia’s uranium export earnings from half a billion dollars to $815 million over three financial years and it will continue to grow.
I want to say thank you very much to the Minerals Council for joining with the Coalition in our call for a reasonable discussion on next generation nuclear technologies.
In closing, again, I thank all of you for being here in Canberra, for your advocacy, for your work with the government, with us, in what we see as a crucial sector, employer, and contributor to the future of this country.
Thank you all very much for your time and for being here today.