PERTH (miningweekly.com) – The Minerals Council of Australia (MCA) has warned that future investments and jobs in the Australian resources sector could be put at risk as reforms to streamline project approvals and modernizing workplace relations stalled.
In its submission to Parliament’s inquiry into impediments to business investment, the MCA said that the Australian mining sector will not achieve its potential to create jobs and national prosperity while the reform agenda remains at a standstill.
“Australia’s world-class mining companies could perform at their best, generating additional benefits for the economy, the workforce and society, if policy reform was initiated in a number of important areas,” said MCA interim CEO David Byers.
He pointed out that in August last year, the Productivity Commission estimated that adopting its 2013 proposals to make major project assessment processes more efficient would reduce project delays and save the economy approximately A$240-million.
The commission also estimated that implementing its 2015 recommendations for workplace relations reform would add A$850-million a year to the Australian economy.
“Improvements in the regulation of workplaces are crucial because existing rules lock in poor practices that discourage investment, hinder productivity and innovation, and put high-wage jobs at risk,” said Byers.
“Since the standard of living of all Australians depends on productivity growth, policies and regulations should encourage firms to invest in capital and allow them to manage the use of that capital efficiently.”
Byers noted that while Australia is well-placed to supply growing minerals and energy markets in emerging Asia, this opportunity is not guaranteed.
“In particular, stable and internationally competitive tax settings are essential for stimulating business investment, especially in capital-intensive industries like mining.
“This means the government’s Enterprise Tax Plan, which will ensure that by 2026-27 the corporate tax rate for all Australian corporations will be 25%, should be passed by the Australian Parliament as a matter of urgency.”
He added that foreign direct investment is vital to the resources sector, facilitating transfers of technology, skills and capabilities, as well as access to global supply chains and export markets.
“Australia should continue to encourage free trade and international investment, including by joining the Comprehensive and Progressive Agreement for the Trans-Pacific Partnership,” Byers said.
“Governments also need to ensure that policies to encourage business investment do not distort markets or favour particular industries. While government support for pre-competitive activities that yield public goods, such as geological surveys and low-emissions technology demonstration projects is important and desirable, commercial operations should be run by the private sector and without government assistance.”
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