Australian Mining Tax

There is widespread concern across a broad spectrum of the Australian community concerning the Rudd Labor Governments Mining Super profits tax.

Unionists have voiced concerns relating to job losses.Industry Giants have shelved hundreds of millions of dollars worth of expansion plans, which by some estimates would have generated 30,000 jobs.

Offshore, investors across a broad spectrum of industries are re-rating Australia as a capital destination, with good reason. The mining industry apparently had no prior warning of the proposed introduction of the Mining Tax. Major mining players were treated like schoolboys by a rather inept Federal Government under the guise of negotiations.

Revelations today (23 May 2010) by Treasurer Wayne Swan that miners in fact pay a concessional tax rate - just half of other businesses, begs the question of why this is so, how this concession came about, and why Miners tax rates should not reflect that of any other business.

There are further issues raised though, than have been widely canvassed.

The vexing issue for us is why this tax is not being applied across all extractive industries. Serial polluter Chevron has announced that it is staking its future on the Northwest Shelf Gorgon Gas deposit. Other energy players are at developmental stages of oil and gas extractive processes in the region. Why are they not taxed similarly? Why not banks, whose excessive profits are generated using methods which do perhaps as much social and environmental harm as extractives.

There is the additional concern that while Rudd Labor is prepared to impose this tax, they insist on giving the proceeds over to benefit the government pampered baby boomer generation. In contrast, Norway (when oil was discovered) nationalised, formed Statoil to extract, and had funds diverted to a future fund which benefit all future generations of their people. This would be a welcome use of such a windfall tax.

We have not heard from the Rudd Government on the issue of strengthening extractive eco management responsibility obligations for extractive industries. The Montara #oilspill last year graphically illustrated the lax legislation companies such as Atlas Rig site operator PTTEP could operate under. There is also the issue of independent monitoring by government or non-government bodies. Given the flow of information from Montara,largely repeated by the Australian Government from statements by PTTEP, one is entitled to conclude that monitoring is less than perfect. I suspect,in practical terms,non existent.

The uncertainty created in the minds investors, industry players workers and the international investment community is not salved by Opposition Leader Tony Abbott's promise to repeal the Mining Super Tax-- the day after he stated that he exaggerates and that we the public shouldn't believe everything he says.Who do you believe??

Stronger Legislation needed

Lost amidst all the jockeying to be seen to be the Baron of clean & green is the fact that 11 workers souls were lost in the Gulf Oil Tragedy. We offer our condolences and support to those families concerned, and ask extractive workers worldwide to consider the safety of themselves and others at their worksite. Workers who have reason to believe that an action or omission may result in personal or environmental injury or catastrophe have not only the right, but the responsibility of duty of care, to refuse to carry out such actions or emissions, and where necessary prevent those acts or omissions being carried out by others- whatever the consequences may be.

In the aftermath of the widely reported PTTEP Montara oil spill last year,and the BP Gulf oilspill unfolding now, we have immediate unquestionable clarity on 2 points.

• In both cases, the companies concerned were unable to immediately and effectively respond to catastrophic failures of their systems. Neither company had a strategy to deal efficiently with the disaster.In PTTEP - Montara's case, the environmental damage covered 24,000 square kilometres of pristine ocean (imagine if fish could file lawsuits), and took three long months to bring under control. BP America & the US Government have no clear strategy to deal with the current Gulf disaster. BP are building "a structure" to hopefully capture & contain the oil for pumping -but could take 3 weeks.Or they are exploring the Montara option, which could take 3 months.
• Both situations point to widespread systemic failures across multiple layers of government at State and Federal levels. The public have every right to expect that their governments will ensure that any extractive processes are carried out with maximum Safety and Environmental protection in place and ready to be implemented from day 1. Why does BP need 3 weeks to build a "Containment Structure". Why isn't one available on the Gulf Coast? Theirs is not the only oil rig in the area.All Governments must support worker monitoring of safety on extractive sites over company self regulation.Company self regulation decisions are too often subservient to profit motives, a powerful driver.
• The local people and wildlife of new extractive exploratory areas such as the Bering Sea, or East Africa, where legislation is likely to be weak or non existent deserve the same protections 1st World countries demand for their own regions. USA EU and other trade blocks must boycott imports which cannot meet sustainable chain of responsibility requirements, and place such onus on their countrys own extractive industries. Countries of particular note are Canada, Australia, USA , UK in no particular order...

Countries with extractive processes, whether mining or oil/gas, whether onshore/ offshore must ensure that their environmental and safety legislation adequately addresses catastrophic failure, as is the case in both of these situations- and that such legislation is supported by appropriate and current technologies capable of immediate successful response- or don't start exploring / extracting