News & media releases
Article by Cian Hussey courtesy of the West Australian
Western Australia’s prospects of becoming the fastest-growing, highest potential State in Australia after the coronavirus recession was boosted by the commitment of the Commonwealth and McGowan Governments to slash red tape for WA’s resources sector.
Yesterday the Commonwealth Government confirmed its intention to enter into a bilateral approval agreement with WA under the Environment Protection and Biodiversity Conservation Act 1999.
This would put the State Government solely in charge of the environmental approvals process, removing unnecessary Commonwealth duplication.
Commonwealth government approvals for big projects currently average 1013 days, or almost three years. The bilateral agreement could reduce the approval time up to six months and would help unlock more than $100 billion of development.
This latest initiative builds on momentum developed by the State Government to cut red tape. In 2018, the McGowan Government launched a whole of government red-tape reduction initiative called Streamline WA.
The initiative has already produced tangible results, such as the establishment of risk-based statutory guidelines for mining proposals and mine closure plans.
The EPBC Act, and green tape more generally, impose significant costs on the Australian economy.
Institute of Public Affairs research released this year found that regulation under the Act has increased 445 per cent since the year 2000. With 4820 individual regulatory restrictions, the Act provides one of the most significant regulatory burdens to WA’s most important industry, the resources industry.
According to a recent survey by the Chamber of Minerals and Energy of WA, the resources sector contributed $102 billion of value to WA’s economy, including by paying $45.6 billion in wages, in the 2018-19 financial year.
Additionally, the sector directly and indirectly supported 452,229 full-time equivalent jobs in the State — that’s just over a third of total employment in WA.
The resources sector is central to WA in emerging from the COVID-19 lockdown-induced recession.
By reducing the green tape that holds the sector back, Premier Mark McGowan can ensure that WA has the best performing economy in Australia.
According to the Australian Bureau of Statistics, 73,000 West Australians have lost their job since March and an additional 98,600 people are working less hours than usual because there is no work, not enough work, or they have been stood down.
These job losses are both an economic and social tragedy that will have a lasting negative impact on people’s lives, from worse mental health to increased likelihood of alcoholism and drug dependency.
The experience from past recessions has demonstrated that the longer people are out of work the harder it is for them to get a job.
While West Australians should be encouraged by the latest move to cut red tape, it is up to the McGowan Government to hold its Commonwealth counterparts to their word.
The WA and Commonwealth governments originally finalised a bilateral agreement way back in December 2014.
The draft agreement sat in the bottom draw of a bureaucrat’s desk until November last year when Mr McGowan revived interest in it, saying that “we need to do everything we can to speed up approvals and bring on these new jobs as a matter of urgency”.
Indeed, we do.
But doing so means moving beyond “confirming an intention” to enter into the bilateral agreement, to actually signing that agreement.
Cian Hussey is a research fellow at the Institute of Public Affairs
Courtesy of the West Australian
Featuring Chairman and Director Gina Rinehart.
Reporter Ticky Fullerton courtesy of Sky News.
Article by Peter Law courtesy of The West
WA’s economy is forecast to only shrink slightly due to COVID-19 this financial year, thanks largely to the State’s resilient mining sector and enormous levels of fiscal stimulus.
That’s according to the Chamber of Commerce and Industry WA’s biannual economic forecast, which defies a State Treasury prediction that the economy would contract 3.1 per cent in 2020-21 — the worst on record.
The report warns the current financial year was expected to be “extremely difficult” but a growth in exports and a significant decline imports should see WA’s gross State product drop just 0.2 per cent.
CCIWA chief economist Aaron Morey said he had expected the economic shock would be worse, but mining investment and WA’s huge export base had held the State in good stead in the pandemic. He said WA had benefited from from high iron ore prices due to strong demand from China and supply difficulties in Brazil, which was first hit by the Vale disaster and then suffered badly with coronavirus.
The Australian and WA economies were being propped up by an unprecedented amount of government fiscal support, with retail spending by many measures actually higher than it was at the same time last year.
But Mr Morey said the health of the overall economy was only part of the story, with the winding back of JobSeeker and Job-Keeper posing the greatest risk to service-based sectors like retail and hospitality.
Unemployment in WA was forecast to reach 11 per cent, feeding a cycle of falling consumption (-3 per cent) and business investment (-4.5 per cent), as well as population growth plummeting to the lowest levels since 1916.
Lower population growth and the building of additional homes, fuelled by the Federal and State Government’s incentive schemes, may see house prices fall further, with resulting fallout of reduced household wealth and spending.
All of this comes at a time when the WA economy has been “struggling to find its feet”, particularly outside the mining sector, where investment has contracted in six of the past seven years, the report states.
Mr Morey said Western Australians were likely to face more than a year of uncertainty and low appetite for spending, with fewer hours being worked and more people out of jobs. Unemployment could remain at 9 per cent into 2021-22, he said.
“We’re in the eye of the storm. Massive fiscal support is propping up the economy at present and we haven’t seen the full weakness in the global economy play out,” he said.
The peak business lobby group said promoting business investment and confidence would be critical to WA’s recovery. Even a 1per cent increase in business investment in each year would make the WA economy $1.5 billion larger.
“We don’t have to accept our economic fate. If we stimulate investment we can avoid much worse conditions. So it’s really up to our policy makers to not be content to resigning our economy to another decade of incrementalism when it comes to reform — be ambitious,” Mr Morey said.
Article courtesy of the Sunday Times
IT could be tagged a tale of two cities. Or perhaps more accurately, a tale of two States. But whatever title is settled on, one thing is clear: WA and Victoria have become synonymous with the best and the worst ends of the States’ responses to the coronavirus crisis.
The extent of their divergence emerged over the week as the virus hit the national economy and the health responses of the two States were detailed.
First to the economic picture.
That was revealed in a virtual mini-Budget presented by Finance Minister Mathias Cormann and Treasurer Josh Frydenberg, who had warned that the debt and deficit numbers would be “eye-watering”.
He was not wrong. The economic statement showed that Australia’s debt will balloon.
“That’s the harsh reality of this pandemic. The coronavirus has required the Government to spend unprecedented amounts of money to support people in need,” Mr Frydenberg said.
Australia’s balance sheet reveals a $85.8 billion deficit for 2019-20 and a forecast $184.5b deficit for 2020-21. Australia will have its highest debt-to-GDP ratio since World War II, with net debt forecast to be 35.7 per cent of gross domestic product — or $677.1b — by June 30 next year.
The official unemployment rate will hit 9.25 per cent in December. And the national business picture is gloomy, with overall business investment forecast to fall 12.5 per cent this financial year.
But WA is offering a ray of hope.
The statement confirmed mining investment grew 4 per cent in 2019-20 and was forecast to grow 9.5 per cent in 2020-21.
It is the first time in seven years mining investment has increased, with the resources sector still largely able to operate as usual — thanks in no small part to the way the State Government and mining companies have reacted to the pandemic.
By way of contrast, Victoria is dragging the economy in the wrong direction.
Victoria’s latest lockdown is expected to cost Australia’s economy at least $6b — if it is just six weeks — and significantly slow the nation’s economic recovery.
Should the latest Victorian health crisis run for longer or spread even wider, the numbers released this week will in all probability need to be revised again — and the outcomes will be significantly worse.
Again, in contrast, WA’s handling of the virus has allowed this State to march a long way down the road towards normal, secured behind a State border which is closed and will likely remain so for a long time yet.
The vastly different situations in which WA and Victoria now find themselves can be explained.
When the heat was on, West Australians responded, followed advice, did the right thing and worked with their Government to get on top of the threat — and to stay on top of it. Put bluntly, we have been doing our bit. But Victoria has let it slip.
So now, not just for their own sakes, but for the sake of the rest of the country too, Victorians must do what is asked of them — and required by common sense — to get on top of the virus.
Treasurer Ben Wyatt says keeping WA mines open was WA’s ‘golden decision’ amid soaring iron ore price
Article by Josh Zimmerman courtesy of the West Australian
Allowing WA’s resources sector to continue operating throughout the pandemic has proved a “golden decision” that has added billions of dollars to the national balance sheet and averted complete economic catastrophe.
The soaring iron ore price — touching $US108 a tonne yesterday — has fuelled an unexpected royalties and taxes bonanza at a time when practically every other government revenue stream has evaporated.
Treasurer Ben Wyatt said the State’s miners had been “an extraordinary bright spot” in an otherwise desolate economic landscape.
“I don’t think there’s any doubt that Western Australia’s performance, primarily led by our world class mining sector, has saved (Federal Treasurer) Josh Frydenberg from what would have been a much more dire set of figures,” Mr Wyatt said.
“Very early on there was a very strong push by some States to close everything down, including the mining sector.
“Western Australia resisted that firmly and I think that has been proven to be a golden decision.”
In his December State Budget update, Mr Wyatt pencilled in a “conservative” projected iron ore price of US$66.20 for the current financial year.
But nearly two months into 2020-21, the actual price has averaged nearly US$50 higher at around US$104.
For every dollar the iron ore price remains above forecast the WA Government pockets around $81 million in additional royalties.
Even if it the price were to stabilise at $US90 for the remainder of the year, that would represent a nearly $2 billion royalties windfall for the State.
“The iron ore sector has been in rude health on the back of a very, very high iron ore price that has been maintained for longer than I think most people expected,” Mr Wyatt said.
He attributed the elevated price to increasing Chinese demand at the same time as the world’s second biggest exporter Brazil grapples with a massive coronavirus outbreak hot on the heels of dam failures at key mines.
Mr Wyatt praised the adaptability of the State’s resources companies and their willingness to “reorientate” their mainly FIFO workforces – parts of which have relocated to WA from other States.
“As a result, Josh Frydenberg, myself and other Treasurers find ourselves in a fiscal position much better than it otherwise would be,” he said.
“We’re delighted that the mining sector has proven itself worthy of the challenge of operating and retaining its workforce.”
Roy Hill is excited to announce that it has just won the Industry Leadership Award for Raw Materials and Mining at the prestigious S&P Platts Global Metals Awards for 2020.
This win recognises the decades of hard work that has gone into the mega Roy Hill project to make it the successful one that it is today. This win follows numerous other award wins by Roy Hill, its team and its Executive Chairman, Gina Rinehart.
Roy Hill has marked a number of firsts including the fastest ramp up in WA to its nameplate capacity, the biggest debt financing deal for a largely Greenfield’s mainland project, some of the biggest equipment in the world, and launched Australia’s first fleet of pink mining trucks and trains.
We are very proud of this win and thank the S&P Platts team for their very welcome recognition.