The Minerals Council of Australia (MCA) is the peak industry body of Australia’s exploration, mining and minerals processing industry. It represents the minerals industry, both nationally and internationally, in advancing its contribution to sustainable development and to society.
MCA member companies account for more than 85 per cent of Australia’s annual mineral production and more than 90 per cent of mineral export earnings. The minerals produced by member companies are:
- base metals — copper, lead, zinc;
- precious metals — gold, silver;
- coal — thermal, metallurgical, lignite;
- iron ore;
- minerals sands — rutile, zircon, ilmenite, titanium; and
- light metals — aluminium, nickel, manganese, magnesium.
The MCA advocates public policy and operational practice for a globally competitive minerals industry that is safe, profitable, innovative and environmentally and socially responsible. It promotes balanced and consistent policy settings for:
- an industry free of fatalities, injuries and diseases;
- a macro-economic framework conducive to sustainable economic growth and global competitiveness;
- a skilled, productive and flexible workforce;
- efficient transport infrastructure;
- the reconciliation of energy security and climate change management as part of a sustainable global solution;
- a seamless and efficient Federation characterised by consistent regulation;
- access to competitive markets for capital, production inputs, human resources and end products;
- access to natural resources and competitive markets for land, water and energy;
- a fair and stable society where effort is encouraged and rewarded and support is extended to those in need;
- mutually beneficial relationships with Indigenous and local communities through engagement and capacity building; and,
- improved environmental performance embracing long-term considerations for sustainable eco-systems beyond life of mine.
The Australian minerals sector's approach to sustainable development
The minerals industry recognises that its past success and future prosperity is dependent on a sound and expanding national economy, an educated and cohesive society and a sustainable natural environment.
The minerals sector supports public policy settings aimed at the following objectives
- sustainable economic growth characterised by low inflation, low interest rates, fiscal prudence, and a skilled and productive workforce;
- a sound, fair and stable society, where effort is encouraged and rewarded and a helping hand extended to those in need; and
- a sustainable natural environment, reflecting national consistency and balance in policy settings.
The MCA recognises that the future of the Australian minerals industry is inseparable from the global pursuit of sustainable development. Through the integration of economic progress, responsible social development and effective environmental management, the industry is committed to contributing to the sustained growth and prosperity of current and future generations.
The economic significance of the Australian minerals industry
The Australian minerals industry is an industry of considerable size and economic and social significance, benefiting all Australians both directly and indirectly.
The mining and minerals processing sector
- underpins vitally important supply and demand relationships with the Australian manufacturing, construction, banking and financial, process engineering, property and transport sectors;
- has contributed over $500 billion directly to Australia’s wealth over the past 20 years;
- is in the top five producers of most of the world’s key minerals commodities, including:
- the world’s leading producer of lead, bauxite and alumina, diamonds (by volume), ilmenite, rutile and zircon (and synthetic rutile) and tantalum;
- the second largest producer of uranium, zinc and nickel;
- the third largest producer of iron ore, lignite, silver, manganese and gold;
- the fourth largest producer of black coal and copper; and
- the fifth largest producer of aluminium.
- directly and indirectly employs some 320,000 Australians, many of whom are in sparsely populated, remote and regional Australia;
- is responsible for significant infrastructure development – since 1967, the industry has built 26 towns, 12 ports and additional port bulk handling infrastructure at many existing ports, 25 airfields and over 2,000 kilometres of railway line.
MINERALS COUNCIL OF AUSTRALIA POLICY PRIORITIES
The years of easy gains to national income from higher commodity prices are over. National policy should be framed by the reality that the nation faces a tougher decade than the one just gone, with higher living standards now squarely reliant on improved productivity. This challenge needs to be communicated in clear, compelling language to the Australian people and be matched by a coherent policy roadmap for future growth and prosperity.
Policies that increase industry costs and reduce the economy’s structural flexibility need to be replaced by policies which support wealth creation and a more productive economy. Australia can no longer afford the dangerous pretence that mining offers bounty to be spread around and not earned, or that throwing sand in the wheels of the industry is somehow beneficial to the nation’s economy as a whole.
The priorities of the Minerals Council of Australia are:
Roadmap for fiscal sustainability – Improving the long-term structural health of the Budget remains critical, notwithstanding cyclical impacts on the budget bottom-line. To ensure this is done in a way that supports growth and productivity, the focus should be on cutting poor quality spending, not higher taxes.
Efficient capacity building – Efficient public sector investments and targeted policy reforms are needed to overcome current and future capacity constraints in social and physical infrastructure and skills, given the structural changes taking place in the Australian economy. Priorities should include skills development and improved infrastructure, especially in regions where governments have abrogated their core responsibilities to deliver citizenship entitlements. Lifting the speed limits to national growth – by building the pool of skilled labour, through market responsive education and training in vocations and professions and enabling the ready import labour where there are critical skills shortages; and unfettered access to foreign direct investment and globally competitive suppliers – will ease the inflationary pressures on labour costs, energy (diesel fuel) and raw materials costs.
Australia should continue to promote international trade and investment liberalisation. The accent should be on beyond-the-border trade restrictions, services and, in particular, investment.
Best practice regulatory reform – reforms are urgently needed to poorly developed and administered regulation at all levels of government. Inefficient and overlapping regulation is creating higher costs and uncertainty for the minerals industry in the key areas of:
- project approvals –Federal/State relations should be streamlined to institute strategic land use assessment and planning, and to limit the Commonwealth to a strategic oversight and enforcement role while devolving assessment and approvals processes to the States;
- water market access –the minerals industry should be included in water planning and entitlement regimes and the development of a national water trading market;
- occupational health and safety – nationally uniform, risk-based and consistent legislation should be introduced across jurisdictions, sectors and industrial activities; and
- infrastructure regulation reform – market based solutions should provide closer alignment between the owner and those with a direct economic interest in the operation of the logistics chain.
Stable, predictable, efficient and internationally competitive taxation system – Notwithstanding significant reforms to Australia’s taxation system over several decades, it remains complex, economically inefficient and administratively complex across all aspects – personal income tax, the tax social security interface, business tax arrangements including resource rents, and indirect taxes both the GST and State taxes and royalties.
Australia’s tax system should fairly balance the need to protect the taxation revenue base with the principles of a good tax system – efficiency, fairness (horizontal and vertical equity), simplicity, transparency, and with low compliance costs. The tax system should enhance competitiveness in providing a climate conducive to improved investment within and into Australia and from Australia for Australian-based entities and individuals, and should not impede organisational restructuring.
Workplace arrangements should be flexible for both employers and employees, encouraging direct collaborative relationships, promoting productivity and safety and health – The Federal Government’s Fair Work Act contains substantial flaws, principally restrictions on legitimate individual agreements, expanded scope of subject matter in agreements beyond those directly relevant to employment arrangements, expanded union right of entry (that goes beyond worker interest to union claims of coverage) and broader than necessary Good Faith bargaining rules.
Reconciling climate change policy and energy security – Reducing greenhouse gas emissions and the carbon intensity of the Australian economy need not compromise the international competitiveness of trade exposed industries nor the incentive to invest in new energy capacity – electricity generation, gas and transport fuels. Pricing carbon through a market mechanism in a manner which is both in sync with the development of low emissions technologies and aligned with a comprehensive global protocol (which at minimum contains an understanding of the imperative to act and agreement by all to respond) is superior to Australia’s current array of policies – the Clean Energy Future (carbon tax), the Renewable Energy Target and the plethora of state based initiatives.
The carbon pricing scheme has little more intent than a massive tax and redistribution churn of compensation. It will impose costs on key trade exposed industries that overseas competitors will not face – while failing to reduce emissions, or improve the economy’s carbon competitiveness in the event of a future carbon constrained world.
Deep benchmarking for global competitiveness - The Productivity Commission should be given a sweeping mandate for ‘deep benchmarking’ of Australia’s international competitiveness with an enhanced focus on Asian benchmarks.