Gillard Celebrates The Mining Boom


With hindsight, Kevin Rudd could be forgiven for having turned down a few dinner invitations this time last year. The mining industry was up in arms about the prospect of a great big new tax on the sector and knives were being sharpened closer to home. Rudd didn’t attend the annual Minerals Council of Australia (MCA) dinner in 2010.

This year, Gillard addressed the MCA at Parliament House and the rift seemed to have been healed. She brought with her the top parliamentary brass including Wayne Swan, Martin Ferguson, Greg Combet, Gary Gray, Brendan O’Connor, Warren Snowdon, Nick Sherry and Mark Arbib as well as a cohort of parliamentary secretaries.

She said, "What I really want you to take away tonight is an understanding of just how central your industry is to the Government’s economic agenda." 

Gillard might want Big Mining to pay more tax — and Big Mining, represented ably by the MCA and hundreds of their guests, might want to slow down a new resources tax and a carbon tax — but the two sides were playing nice last night.

"The truth is I spend much of my time as Prime Minister explaining to people who aren’t here tonight just why the boom is a good thing for all Australians, and why nurturing the boom is central to the Government’s economic strategy."

As Gillard emphasised in her speech, this economic strategy involves "profit-based taxation" rather than royalties. And that’s a position that doesn’t thrill the mining industry.

Gillard’s speech came at the end of a big day for the delegates to Mining Week, which was organised by the MCA. Tony Abbott filled the lunchtime speaking slot and did everything he could to cast the Government as bitter opponents of the mining industry’s agenda:

"They are threatening this sector with the mining tax but they are also threatening this sector with the carbon tax. The carbon tax, let us repeat over and over again, is designed over time to phase out the use of coal, gas and oil."

And repeat it he did, over and over and over again. The PM might have sounded like she was sucking up to an industry that isn’t afraid to lobby hard to get what it wants. By comparison with Abbott, however, she sounded altogether reticent.

"Can I say that as I look out at the people in this room I do not see big polluters, I do not see big polluters. I see big employers, I see big exporters and I see people who contribute big time to the prosperity that every single Australian wants and mostly enjoys."

It was stirring stuff. Promising to oppose the mining tax in opposition and rescind it in government, Abbott exhorted the miners to think of the support they would receive from their "brothers and sisters" in the steel industry, the aluminium industry, the plastics industry, the glass industry and the cement industry. Indeed, he called on the miners to become "political activists" and oppose the tax. Why? "To continue to be the miners that you want to be and that Australia needs."

Although his calls for miners to become activists got panned afterwards, Abbott wasn’t alone in putting the boot into the carbon tax. MCA chair and CEO of Minara Resources, Peter Johnston, had some stinging words to say on the matter in his welcome address to his colleagues.

He got started by framing the situation like this: "Stable and globally competitive taxation and climate policy settings are of paramount importance if we are to take maximum advantage of this period of strong commodity demand." Read between those lines if you will.

Johnston, like Abbott, doesn’t approve of the term "big polluter". "It’s quite clear, the term big polluter has been designed for one simple purpose — to demonise the companies and organisations that produce emissions or use so much electricity that they incur a carbon liability."

"It is unfortunate that the debate over a key economic-reform like carbon pricing has boiled down to pejorative put-downs and slogans."

Would Gillard’s "let’s be friends" speech have given Johnston hope that the two fronts could move beyond name calling?

MCA chief executive Mitch Hooke had these words for Gillard:

"And it gives us great heart, great heart, to hear that our Prime Minister — we think we’re pretty special but it gives us, it really does a lot for our spirits to know that we figure so much in your day and so much in the Government’s economic policy thinking.

"You can be assured ma’am that the respect is reciprocated."

Even so, it’s a tough sell. The revised MRRT and the carbon tax are due to launch on the same day — at the beginning of the 2012 financial year. That’s just over a year away. And as Gillard, who’s looking to the anniversary of her first year as PM, well knows, a year in politics is a mighty long time.


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