Conference shows renewed industry confidence
It was heartening to observe the improving sentiment in the mining and resources industry at this year’s Diggers and Dealers conference. People who have been in the industry for years know that it’s cyclical and that with the ups, come the downs. I dare to hope that renewed confidence means we are on an upward trajectory again.
All levels of government know the importance of the resources industry and the Federal Government is working hard to show its support.
At the end of July, we repealed the carbon tax, saving Australia's minerals industry $1.2 billion a year when the price of emissions permits, the impact on diesel fuel and higher energy charges are included.
Next on the agenda is repealing the mineral resources rent tax (MRRT) which damaged international investor confidence in Australia, particularly in the energy and resources sector.
The repeal of the MRRT and its associated expenditure will not only improve the budget bottom line, it will save millions of dollars in compliance costs for small, medium and large entities.
We also launched the Exploration Development Incentive (EDI), a $100 million incentive allowing investors in junior companies to deduct a proportion of exploration expenditure against their taxable income.
You don’t need me to tell you that if you’re not doing the exploration work we don’t have future projects.
Today I will be attending the WA Liberal Party State conference in Perth. The Kalgoorlie branch has a motion on the table to oppose any rate royalty increase for the gold sector.
It’s not my motion, but I fully support it and commend the Kalgoorlie branch for putting it forward. Clearly, any rate royalty increase will have a significant impact in this region.
According to a report by Deloitte for the Gold Royalties Response Group, over the past six years the average cost of gold production for WA gold mines has doubled from $511/oz to at least $1,100/oz. We can’t keep hammering our productive industries. I will oppose any move that places more pressure on the gold industry.
But the renewed confidence I observed at Diggers and Dealers is encouraging. There’s a long way to go before we can say we’re anywhere near the top of the cycle, but at a Federal level at least, we’re doing everything we can to make sure that comes sooner rather than later.