SUBMISSION ON “MEASURES TO EXTEND AUSTRALIAN INDUSTRY PARTICIPATION” CONSULTATION PAPER

SUMMARY

This submission is made by the Minerals Council of Australia (MCA), for and on behalf of the Australian minerals industry, in conjunction with State representative bodies of the industry. It has the support of the Chamber of Minerals and Energy of Western Australia, the Queensland Resources Council, the New South Wales Minerals Council, the South Australian Chamber of Mines and Energy, the Victorian Division of the MCA, the Tasmanian Minerals Council and the Northern Territory Division of the MCA.

The MCA is the peak industry organisation representing Australia’s exploration, mining and minerals processing industry (nationally and internationally) in its contribution to sustainable development. Many MCA members are experienced participants in the Enhanced Project By-law Scheme (EPBS) and the associated Australian Industry Participation (AIP) Plan requirements.

Mining Projects Already Generating Large Benefits for Australian Industry

It is important that the Working Group advising the Australian Government on the implementation of new measures has an appreciation of the extent to which mining projects are already generating large benefits for Australian industry.

Market realities dictate that the Australian minerals industry has a strong interest in the development and maintenance of a vibrant and competitive local supplier industry. The exploration, mining and processing of minerals underpins vitally important supply and demand relationships with, inter alia, domestic manufacturing, construction, financial, legal and other professional services, process engineering, property and transport sectors.

MCA member companies already make substantial purchases locally on major projects and generally achieve high levels of Australian content. In 2009, the mining industry’s total demand for goods and services was $85.7 billion, of which $75.8 billion (88%) was supplied by local industry. Within this total:

  • 53.3% of iron and steel used by the mining industry was locally supplied;
  • 64.6% of structural metal products used by the mining industry was locally supplied; and
  • 71.7% of sheet metal products used by the mining industry was locally supplied.1

More recent data from major mining states highlights further the degree to which both local business opportunities and broader societal benefits are being generated by the mining sector in Australia. For example, in 2010-11 the Queensland resources sector purchased $20.5 billion in goods and services from employing QLD businesses, up from $18.8 billion in 2009-10. Around 80% of QLD postcodes benefited directly from this expenditure.

A recent internal study for Western Australia’s resources industry shows a continuing high level of local industry participation in mining sector supply chains with 86% of spending sourced domestically in the construction phase and 95% in the operations phase of WA projects. With the large expansion of WA mining projects, operations expenditure has increased substantially providing sustained opportunities for local suppliers.

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