Media Release: The Industry, Innovation, Science and Resources Committee tabled the report for its mining inquiry, entitled Keep it in the regions: Mining and resources industry support for businesses in regional economies.
A key issue during the inquiry was the terms of payment offered by mining companies to their suppliers and contractors in regional areas.
Since the inquiry was launched, resource companies Anglo American and Peabody have decided to offer payment terms of 30 days or better to all Australian small and medium sized enterprises.
In addition, Australia’s biggest mining company, BHP submitted that it has now changed its payment terms policy to provide terms of 30 days or better to all locally-based supplier businesses – regardless of size.
‘This change will benefit up to 700 local businesses around Australia,’ said Committee Chair, the Hon Barnaby Joyce MP.
‘Mining companies have essentially been using regional businesses as a bank,’ Mr Joyce said, ‘It’s time for this practice to stop. Our Nation has an obligation to make sure that in the region where the wealth is extracted, the greatest benefit goes back to the people who live in the same area’.
Deputy Chair, Mr Luke Gosling OAM MP, agreed, saying, ‘The Committee calls on all mining companies operating in Australia to provide fair payment terms to regional businesses.’
‘If the industry does not act, the Committee is recommending the Government revisit legislating maximum payment terms,’ Mr Gosling added.
The Committee’s report also makes recommendations aimed at increasing local procurement by mining and resources companies, addressing gaps in regional areas around skills, training and apprenticeships, and building innovation through the mining equipment, technology and services (METS) sector.
Other key issues for the inquiry were the impacts of FIFO work practices and the mining industry’s interactions with landholders.
‘If you look back at the history, mining companies used to build whole towns – Murrumba and Dysart for example. Now they prefer to fly their workers in and out and do the bare minimum for the nearby towns. Benefits from mining should be long term, not boom and bust,’ said Mr Joyce.
‘One thing we do know is that communities thrive when their workers and families live in the area and can contribute to the local economy. The Committee made some recommendations around this issue, but we think industry bodies like the Minerals Council of Australia also have a role to play in making sure their members do the right thing,’ Mr Joyce added.
The report will be available on the Committee’s website.