PERTH (miningweekly.com) - The Australian mining industry on Monday criticised the federal government’s A$1-billion plan to boost local productivity and competitiveness.
Prime Minister Julia Gillard has announced plans to introduce legislation that would improve the benefits Australian companies would see from large-scale projects.
Gillard said the federal government would introduce legislation requiring projects worth A$500-million or more to implement Australian industry participation, or AIP, plans to give local industry the opportunity to work on a commercial basis.
Projects worth A$2-billion or more would need to apply for concessions under the enhanced project by-law scheme, and to embed Australian industry opportunity officers within their global supply offices.
“Our plans will give Australian firms a fair chance to win work on major resources and infrastructure projects, improving their opportunities to gain the experience, scale and business connections needed to successfully become part of global supply chains,” Gillard said.
However, the federal government’s plans were met with less enthusiasm by the mining industry, with the Minerals Council of Australia saying the proposal was uncalled for.
“Australian mining companies use more than 80% local goods and services, we are already buying Australian when it makes good business sense to do so,” the council’s CEO Mitch Hooke was reported as saying.
“The proposal to embed public servants inside companies is both unnecessary, unwarranted and inefficient,” he added.
The Queensland Resources Council (QRC) has also spoken out against the plan, saying the additional local content regulation proposed for the resources sector was based on a “misplaced” premise that Australian industry was not getting a fair shake in being able to supply goods and services to resources sector projects and operations.
“In fact, the opposite is the case,” QRC CEO Michael Roche said.
He pointed to analysis by the Minerals Council of Australia, which showed that, in 2009, of the mining industry's total demand for goods and services of A$86-billion, some A$76-billion was supplied by Australian business.
“In Queensland, the latest data for spending by minerals and energy (including gas) companies showed that in 2011/12, Queensland businesses supplied some A$28-billion worth of goods and services to the sector.
“That's an almost 50% increase in just two years.”