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Article – Funding crash as foreign investors retreat

by 13 February 2017

11 February 2017
Simon Benson
The Australian

Australia faces a potential investment crunch with Treasury analysis revealing that foreign ­direct investment has already crashed almost 50 per cent on 2015 levels.

The downward trend is more concerning because it runs against growing global flows; Australia’s share of the $US1.8 trillion ($2.36 trillion) global foreign direct investment pool tumbled from 3.2 per cent in 2011 to 1.3 per cent last year as other countries became relatively more attractive.

Seeking to intensify the ­urgency of the debate over the government’s corporate tax plan to cut rates to 25 per cent, Scott Morrison told The Weekend Australian the analysis showed that Australia was already on a worrying slide down the world investment rankings, partly because of its high company tax.

A senior government source said that while Australia had weathered the worst of the fall since the end of the mining ­investment boom, the concern was that it was failing to pick up its share of the investment recovery since the end of the global financial crisis. Of equal concern was that conditions could further ­deteriorate, with the US, our largest source of investment, headed for a company tax rate of 15 per cent — half Australia’s — which could cause a flight of capital back to the US.

According to the Treasury analysis, foreign direct investment had begun falling even during the mining construction boom — by an estimated 15 per cent from 2006 to 2015 — but the downward trajectory had since steepened despite global ­direct investment flows increasing 25 per cent since the end of the GFC and 38 per cent year-on-year in 2015.

“Between 2011 and 2015 Australia was the 10th largest destination for investment, but has fallen to 18th in 2015,” the Treasurer said.

Mr Morrison made a direct link between the falling level of foreign direct investment and Australia’s company tax rate, which had failed to keep pace with the lower tax environments being pursued by other OECD countries.

He seized on a speech by ­Reserve Bank governor Phillip Lowe on Thursday in which he implicitly rejected Labor’s claim that the budget could not afford corporate tax cuts. Mr Lowe ­argued Australia needed to ­respond to lowering tax rates among competitor nations.

“The independent RBA has made it clear that Australia must have a competitive business tax rate,” Mr Morrison said.

“We need to be internationally competitive to attract investment, to encourage business to set up or expand their operations in Australia, to hire more and to buy more machines and equipment that boost our economy.

“Fifteen years ago we had the ninth lowest business tax rate among advanced economies. Today just five of the 35 OECD ­nations have a business tax rate higher than Australia’s.

“With the largest source of ­investment coming from the US, our tax rates must remain competitive because our attractiveness as a place to invest may be impacted by a reduction in the US corporate tax rate that might reduce outward investment from the US and divert ­investment away from Australia to the US.”

Mr Morrison said that while indirect foreign investment remained healthy, direct investment, such as foreign companies setting up Australian operations or expanding existing ones, was in a worryingly decline.

“The RBA governor makes it clear that our tax system is becoming uncompetitive and that we risk becoming stranded internationally and constrained in our efforts to increase investment in jobs and wages.

“Governor Lowe has sounded an independent warning that Australia is falling further behind our international competitors in being able to attract the critical investment we need to grow Australian jobs and lift wages.”

In 2015, global foreign direct investment flows jumped 38 per cent to an estimated US$1.8 trillion, their highest level since the GFC, but in Australia the same year the flow fell 44 per cent.

Even during Australia’s mining construction boom the flow of foreign direct investment fell 15.4 per cent from $US26.3 billion in 2006 to $US22.3bn in 2015. Mr Morrison cited the International Monetary Fund’s recent claim that foreign investment increased 4.4 per cent for every percentage point cut in the business tax rate.

It suggested a 10 per cent ­increase in foreign direct investment over the period 2010 to 2020 would increase real GDP by 1.2 per cent.

In his speech to the A50 Australian Economic Forum, his first for the year, Mr Lowe said Australia was built on the free flow of capital. “For more than two centuries now, capital from the rest of the world has helped build our country,’’ he said. “If we had had to rely on just our own resources, we would not be enjoying the prosperity that we do today.”

Labor infrastructure spokesman Anthony Albanese yesterday dismissed Mr Lowe’s assessment that company tax cuts were needed, instead citing the Reserve Bank chief’s calls for more infrastructure investment.

“Given the need to fund education and healthcare, given the need to provide support for the economy, what the government shouldn’t be doing is pursuing the $50bn of cuts, most of which, as a result of the structure of their proposal, will go to the very large corporations,” Mr Albanese said.

“Philip Lowe has repeated the comments that he has made, and that were made by his predecessor Glenn Stevens, that what Australia needs is a significant increase in infrastructure investment. He correctly has identified the fact that borrowing can be made and funds made available at a very cheap rate at the moment because of the record low interest rate environment.”

Treasurer Scott Morrison. Picture: Kym Smith

Courtesy of The Australian

Article – Gina Rinehart visits Kidman stations on Australia Day

by 27 January 2017

26 January 2017
The West Australian

Gina Rinehart is spending Australia Day in outback Australia visiting her newly acquired cattle stations, which were previously part of the Kidman cattle empire.

Mrs Rinehart wrapped up the $365 million acquisition of Kidman in November as part of a joint venture bid by her Hancock Prospecting with Chinese minority partner Shanghai CRED Real Estate.

Collectively the Hancock and Kidman herd will reach 300,000 head, placing the new entity in the top three beef producers in Australia.

Mrs Rinehart visited the company’s head office in Adelaide last month and is spending the week visiting Innamincka station in South Australia’s channel country, Helen Springs in the NT and Rockybank in Queensland and meeting station managers.

Mrs Rinehart said she had been looking forward to meeting the individual Kidman station managers to hear first-hand from them about their ideas on improving the stations… and to discuss the improvements the company was implementing.

“With the expansion of Hancock’s agricultural portfolio, this is an ideal opportunity for both long standing and new managers to come together and learn from each other’s experiences to help improve each of our stations,” she said.

“Today, Australia Day, I also pay tribute to the pastoralists and farmers of Australia and their families and others in the outback, many of whom can’t take today off.”

Gina Rinehart celebrates Australia Day with Kidman cattle station managers.PHOTO: Gina Rinehart celebrates Australia Day with Kidman cattle station managers.

Courtesy of the West Australian

Happy Australia Day from Kidman

by 27 January 2017

The Rinehart Review: Merry Kidman Christmas

by 16 January 2017

Hello from South Australia, the home of Kidman (and award winning wines)! Since my last newsletter, we have had a busy few months. It has been a year of growth and achievement, with the most recent acquisition of S. Kidman & Co through our joint venture with Shanghai CRED topping off an exciting year for our team.

HISTORIC KIDMAN ACQUISITION

This joint-venture will further expand Hancock’s beef interests geographically across Australia, mitigating weather risks, and placing us in the top three beef producers in Australia, with a herd size growing to 300,000 head. This helps to underpin valuable brands and make us more attractive to customers, both here and overseas.

The acquisition also raises the Australian ownership of properties recently held in the Kidman portfolio from 66% to 74.7%.

I would like to sincerely thank my team at Hancock, led by CEO Garry Korte, and the Kidman team for all of their hard-work over the past few months to make this vision a reality.

The Kidman brand and business, established by true Australian pioneer Sir Sidney Kidman, has a unique place in Australia’s history. It was over 105 years ago since Sir Sidney Kidman and James Nicholas, my mothers father, owned stations and ran business interests together. My mother thought very, very highly of her father, and I can’t help but feel that she would be very happy that our company has taken this historic step.

We will build on this historic legacy as we plan to increase productivity, utilise more technology and further invest in infrastructure, and grow the iconic brand. I look forward to working with the Kidman staff and visiting the stations in January.

BEEFING UP THE HANCOCK AGRICULTURAL BUSINESS

Hancock is also a leading Australian Wagyu beef producer having increased our Wagyu beef herd earlier this year with the purchase of 1,500 fullblood Wagyu cattle from globally renowned breeder David Blackmore.

This acquisition ensures that Hancock is able to sustainably produce premium Wagyu beef products for the domestic and export markets.

We also purchased Riveren, Inverway and Phoenix Park cattle stations in the Northern Territory earlier this year.

BANNISTER PREMIUM MILK AND PRODUCTS

Another partnership of ours, Bannister Downs Dairy, is also embarking on a major project to grow the business while remaining focused on its high quality products. The new processing centre began construction this year and is targeted for completion in 2018.

We are delighted and excited with all the awards the Bannister products are achieving for their excellent and delicious quality. Congratulations to Matt and Sue Daubney and their family and staff for their dedicated efforts.

And, we are moving into ice creams too!

PLANNING FOR THE FUTURE

We also marked another first this year with our first major overseas investment in Sirius Minerals, a natural fertiliser business based in the UK whose product will be used to value add to our agricultural land holdings.

Sirius Minerals is developing the world’s largest polyhalite resource which involves the construction of a mine, a 37km underground conveyor system, and port facilities.

FIRST ANNIVERSARY OF ROY HILL’S INAUGURAL SHIPMENT & INDUSTRY BEST PRACTICE

10 December 2016 marked the first anniversary of Roy Hill’s inaugural shipment of iron ore. I visited almost to the day of our second anniversary, when two ships were at Port Hedland, one almost finished its loading process, so sitting low in the water, and another shortly to berth for loading. On this site visit, I was also able to join the staff at the wet bar at Roy Hill, to wish all present a Merry Christmas. Another enjoyable visit to Roy Hill and Port Hedland.

From our mega $10 billion USD project being within budget, a big feat for major projects, with above industry safety standards, and using some of the biggest equipment in the world, now in operation, Roy Hill, thanks to our Roy Hill staff, has achieved a lot over the past year including many awards:

  • Golden Gecko Certificate of Merit for Environmental Excellence
  • Australian Mining Prospect Awards Excellence in Environmental Management Award
  • Engineers Australia (WA) Australian Engineering Excellence – Engineering Distinction Award – Project of the Year
  • Engineers Australia (WA) Australian Engineering Excellence Award – Resource Development
  • Engineers Australia (WA) Australian Engineering Excellence Award – Project Management
  • Project Management Institute Project of the Year
  • Railway Technical Society of Australasia Railway Project Award

An outstanding effort and record, warmest congratulations. Roy Hill also recently opened its cutting-edge ‘ROC-ED’ learning centre for high school students. ‘ROC-ED’ is part of the company’s commitment to education as a foundation for the development of careers for young people.

NATIONAL MINING AND RELATED INDUSTRIES DAY

22 November marks National Mining & Related Industries Day, and this year functions were held in both Mount Isa and Melbourne.

National Mining & Related Industries Day celebrates the enormous importance of our mining and related industries. It is a time to reflect and champion our industry and those who work in it.

Congratulations to Rhonda O’Sullivan from Glencore and Australian Laboratory Services (ALS) who both won the National Mining & Related Industries Day Awards for their efforts in speaking up for our industry, and its importance to Australia’s economy and future living standards.

AUSTRALIA’S BIGGEST TAXPAYER

Hancock also released our 2015-16 annual report which reflects the strong financial performance of the company over the past year. The three Hope Downs mines operated at capacity for the 2015 and 2016 fiscal years, and production and sales at Roy Hill are being ramped up.

Taxes paid in the 2016 fiscal year amounted to more than $390 million, and since 2011 we have paid over $3 billion in taxes. This makes us Australia’s largest private taxpayer.

PHILANTHROPIC HEALTH INITIATIVES

The redevelopment of the new 13 storey east wing at St Vincent’s Private Hospital in Sydney is underway and due to be completed in mid 2017.

Hancock has made a significant contribution towards this redevelopment which is helping to build three new operating theatres, additional consulting suites, a new rehabilitation centre, an ambulatory care centre plus further additional much-needed facilities.

In Queensland, Hancock supported the opening of the private Kingaroy hospital, named after a great Queenslander, Lady Florence Bjelke-Petersen. The Lady Florence BjelkePetersen hospital was officially opened in August this year, providing medical assistance and services to those in the South Burnett Kingaroy community.

During National Breast Cancer month in October, we launched nine more pink trucks at Roy Hill named Nola, Koichi Yajima, Marubeni, POSCO, China Steel, Ginbata, Gillie, Chevonne and Pat, adding to the three christened earlier this year. In December, during my visit to Roy Hill, I saw another six pink trucks waiting to be put into service in the new year, honouring women in the mining work force, and breast cancer victims.

We were delighted to have the CEO of the National Breast Cancer Foundation, Sarah Hosking, at the launch of the pink trucks and present the foundation with a cheque. Roy Hill and Hancock matched all staff donations.

SUPPORTING PEOPLE AT RISK

Hancock and the Georgina Hope Foundation were the major sponsors of various fundraising events this year, including the Path of Hope Ball and the Parkerville Children and Youth Care Annual Fundraising Lunch.

Funds raised from the Ball, their major fundraising event, are used towards helping to break the cycle of domestic violence.

Parkerville Children and Youth Care is a charity that protects and cares for the most at risk children and youth in our community. Parkerville’s largest fundraising event of the year, it’s annual lunch at Crown held in October, was a wonderful success raising much needed funds. As major sponsors, we were delighted to be supporting this cause, a charity I have supported privately over many years.

SUPPORTING YOUNG ATHLETES

I was also delighted to agree to an extension of our partnership with Swimming Australia, Synchronised Swimming Australia, Volleyball Australia and Rowing Australia as principal partner as well as Patron of each.

For over 20 years, we have been sponsors of Australian sports, starting with our swimmers and adding other sports over time. It has been an honour to watch them become valuable role models and achieve both in and out of the sporting arena, including in Rio!

A big congratulations to rising star swimmers Laura Taylor and Jenna Strauch who were recently named as the 2017 Georgina Hope Rinehart Swimming Excellence Scholars. This scholarship will give these up-and-coming athletes the ability to compete at the top level while gaining a top-rate higher education degree from Bond University in Queensland.

Well done also to gold medalist Mack Horton, Paralympian Tanya Huebner and swimming superstar sisters Cate and Bronte Campbell who were the inaugural Patron Awards winners at the Swimming Australia Gala Dinner on 6 November in Brisbane.

From everyone here at Hancock, and me, we wish you a very happy Christmas and New Year!

All best, Gina Rinehart

Cut the Red Tape and Make W.A. Great

by 16 January 2017

From: “Julie Matheson”

Subject: Cut the Red Tape & Make WA Great.

Date: 9 December 2016 at 9:25:30 AM AWST

 

Dear Mrs Rinehart,

It was a pleasure to meet you recently in Port Hedland for the 120 year celebrations.  Also thank you for the advanced copy of your embargoed speech.  The implication of you doing that was not lost on me.

After reading your speeches and the most recent one delivered to the National Mining and Related Industries Day on 22 November 2016, I share your obsession with red tape and bureaucratic government agencies.  Since 2009, many of your speeches have rung the alarm bells but nobody is taking any action.  However, I’m about to change that and seek your involvement.

The only way to terminate the red tape industry and bureaucracy is through political force.

Labor will add to the 4,000 bits of red tape if elected.

Liberal have had eight years and done nothing except give multinationals an easy ride with red tape, yet Australian private companies like yours have been forced into compliance and you are the highest tax payer in Australia.

The “Trump Movement” and Brexit demonstrates that people all over the world are prepared to vote for a political force that is more like a revolution because they are tired of more of the same political doublespeak.

My party, Julie Matheson for Western Australia will be the political force against red tape and bureaucratic agencies of the State and Federal Government. Voters have been led around by agencies of false hope who promise representation and better outcomes for communities but all have been miserable failures, costing taxpayers millions.

I am seeking your involvement in this State election to gain the balance of power and shake up the bureaucracies running this State.  This requires a professional political campaign with candidates running in all seats.  It will take a budget to reach all Western Australian voters and require an office and staff to run the campaign.

Our first advertisement promoting our party’s campaign is booked for The West Australian on Thursday 15 December where we will be issuing one of many notices to shut down the agencies of red tape and false hope.

We also need a direct contact to Nick Xenophon if you can assist.  His party is not running in this State election, but he does have 30,000 voters from the last election which we would be a natural home for.  His endorsement or a coalition would help our profile as he remains a relevant political identity.

If we don’t run this political force against red tape now, nothing will change for another four years, in fact it will be worse.

We have 102 days left to the election on 11 March 2017.

Thank you for your time and I look forward to hearing from you soon.   We need a “Godfather”.

 

Yours sincerely

Julie Matheson

 

JULIE MATHESON for WESTERN AUSTRALIA Inc.

WA’s only INDEPENDENT registered political party

PO Box 8134, SUBIACO   WA   6008

Cut the Red Tape and Make W.A. Great

by 16 January 2017

From: John Samuel
Sent: Friday, 9 December 2016 10:18 AM
Subject: Fwd: Cut the Red Tape & Make WA Great.

At the shonky builders meeting on Sunday, the Labor Party told the audience they would have an inquiry that would take 12 months and then issue a report. They would make no comment about SAT. Mark McGowan told an economic business meeting yesterday he was going to move a few departments around or together. Nothing about slashing the “red tape nightmare”. A bit like moving the deck chairs on the Titanic.

God will have no mercy on us if his circus gets control of the State.

Julie Matheson on the other hand told the meeting she would “shut these shonky red tape agencies and quango’s down immediately”. That received a rousing response from the crowd. Everyone, consumers, business etc. are angry at being shafted by apparatchiks and shysters.

I highly recommend Julie Matheson as a competent and urgently needed revolutionary and pioneer. Time waits for no man.

Regards,

John Samuel

Kidman head office welcomes first visit from new Chairman Mrs. Rinehart

by 16 January 2017

With the completion of the sale of S. Kidman & Co, new principal owner and Chairman, Mrs. Gina Rinehart, made her first visit to the Kidman Adelaide head office. A warm welcome by management staff was followed by an executive briefing, meeting of all staff and morning tea where Mrs. Rinehart was presented with a Kidman branding iron. The visit concluded in the afternoon with Mrs. Rinehart and her executives attending the annual Kidman staff Christmas party.

Mrs Gina Rinehart, Executive Chairman, Hancock Prospecting Group: “It’s exciting to be at the Kidman Adelaide head office, the headquarters of such an iconic company. It’s been 18 months of uncertainty for the staff and I hope they are pleased they now have more certainty and a majority owner who values the Kidman legacy. And one who is proud of the fact that Sir Sidney and my grandfather, James Nicholas, were long term friends and business partners. I look forward to working with the team in Adelaide and the managers on the stations to understand their ideas to build the Kidman business and continually improve our quality and competitiveness. I’m especially looking forward, weather permitting, to my first visit to the Kidman stations, in January.”

Garry Korte, CEO, Hancock Prospecting Pty Ltd: “Mrs Rinehart brings a new dimension to Kidman with not only an increase in Australian ownership, but also her desire to invest in the future. We now have an opportunity to build the leading cattle business in Australia. Her executives are very excited by the challenges and opportunity ahead.”

Tad Watroba, Executive Director, Hancock Prospecting Pty Ltd: “The Hancock board has been and is supportive of the Kidman purchase, and appreciates that the growth and diversity of the joint Kidman and Hancock herds will provide critical mass guaranteeing both supply and quality to underpin valuable export brands. As an Australian company, we are also pleased that our investment has been welcomed, indeed our investment means that Kidman will now have greater Australian ownership than it did prior to its sale.”

Greg Campbell, Managing Director, S. Kidman & Co: “It’s been almost 100 years since Mrs. Rinehart’s family, her grandfather, James Nicholas, and Sidney Kidman owned businesses together. I, like the rest of the staff have been looking forward to meeting and welcoming Mrs. Rinehart, another iconic Australian, on her very first visit to the Kidman Adelaide office.”

Approval of S. Kidman & Co. Limited sale to increase Australian ownership

by 4 January 2017

9 December 2016

Today I have approved a proposal for the sale of S. Kidman & Co. Limited (Kidman) that will increase the level of Australian ownership of the Kidman group of properties.

Under the proposal the largest station in the Kidman group, Anna Creek and its outstation The Peake, will be acquired by the Williams Family, a local farming family with properties that adjoin Anna Creek.

The remainder of the S. Kidman and Co. Limited business will be acquired by Australian Outback Beef Pty Ltd (Outback Beef). Outback Beef is majority owned 67 per cent by Hancock Beef Pty Ltd (Hancock), with a minority interest of 33 per cent held by Shanghai CRED Real Estate Stock Co. Ltd (Shanghai CRED).

Under the proposal Australian-owned Hancock will control the Board, and will control day-today operation of the business. Kidman will remain majority Australian owned under this proposal, and remain an Australian incorporated company headquartered in South Australia. Existing environmental and other commitments will continue to be honoured.

Outback Beef has made a commitment of significant investments into the Kidman business. Outback Beef will increase herd size by 20,000 head of cattle over the next 18 months. Outback Beef has indicated it will invest up to $19 million in capital improvements to increase efficiency and carrying capacity. Importantly this investment will also achieve the creation of 35 new fulltime permanent jobs by June 2018 while also employing many more new contractors and short terms specialists. This increased employment will be met by engaging local populations as far as possible, including Indigenous employees.

Currently Kidman is 33.9 per cent foreign owned. With the sale of Anna Creek and The Peake, the proposal I am approving today represents a significant increase in overall Australian ownership from 66.1 per cent to 74.7 per cent.

Consistent with the recommendation from the Foreign Investment Review Board (FIRB), I have decided that the acquisition of Kidman as proposed would not be contrary to the national interest and will be permitted to proceed as proposed.

The proposal will be subject to standard taxation conditions. Any future changes in ownership, including any increase in interest by Shanghai CRED, will require subsequent FIRB and Treasurer approval.

The sale process has been extensive and heavily scrutinised, and afforded ample opportunity for Australian bidders to participate. Over the process as a whole, Kidman has spoken with over 600 potential bidders, and over 30 bids were received.

Kidman is Australia’s largest private land owner and holds approximately 1.3 per cent of Australia’s total land area, and 2.5 per cent of Australia’s agricultural land. Of this, 99.8 per cent of Kidman land is held under leasehold arrangements. It has 10 cattle stations, including properties across regional South Australia, Western Australia, the Northern Territory and Queensland covering 101,411 square kilometres and managing a long-term average herd of 185,000 cattle. This is a significantly larger than the next biggest rural landholding in the country.

Previous security concerns that influenced my earlier rejections of sale proposals have been mitigated by excision of Anna Creek, the largest single property holding in Australia part of which is located in the Woomera Prohibited Area (WPA) in South Australia, from the proposed sale to Outback Beef.

Australia welcomes foreign investment where it is consistent with our national interests.

Foreign investment has underpinned the development of our nation and we must continue to attract the strong inflows of foreign capital that our economy requires. Without it, Australia’s output, employment and standard of living would all be lower.

Foreign investment rules facilitate such investment while giving assurance to the community that the investment is being made in a way which ensures that Australia’s national interest is protected.

Under the Foreign Acquisitions and Takeovers Act 1975, all foreign investment applications are examined against Australia’s national interest. This test comprises a range of factors including: the impact of the proposal on the Australian economy and community; national security; consistency with other government policies including tax; competition; and the character of the investor.

We will continue to welcome and support foreign investment that is not contrary to our national interest.

Treasurer’s Media Release

Speech by Mrs Gina Rinehart Delivered by Sophie Mirabella National Mining & Related Industries Day 22 November 2016, Melbourne

by 12 December 2016

Good evening distinguished guests and friends

It is great to celebrate with you in Melbourne tonight the 4th annual National Mining & Related Industries Day.

Thank you very much to John and the whole IPA team for putting on tonight’s special dinner. Thank you to Gabriella and the AusIMM Women in Mining Network also for helping with tonight’s gala dinner.

Today is the day to pose a question for all Australians to consider: “Where would our nation be without the mining industry?”

Who would be paying more taxes, to support our defence, police, roads, airports, elderly, health, recreation and more, without the mining industry?

Today is a national day to celebrate the enormous importance and contribution of our mining and related industries.

Today is a day to cheer on all those who work in these industries, and to remind those in the mining industry to be proud of the industry, and to stand up for it constantly.

It is a day to remind our political leaders and media of how much more difficult things would be if it weren’t for the contribution of our mining industry, and the many related industries that require the sustainability of the mining industry.

It is also a day to better understand the basics required to continue the benefits from these important industries, industries other nations wish they could have.

We are an industry that is at the forefront underpinning Australia’s prosperity and living standards.

We are an industry that not only contributes significantly to national and state taxation revenues, but one that is innovative and one that provides opportunities to many.

Let’s be encouraged to speak up for, and defend, our industry.

The mining industry accounts for around 60 per cent of all exports.

Without mining you wouldn’t have the 35 different minerals available that make up your mobile phone.

Imagine that, a world without phones, and iPads, and computers.

Please Look around this room, this city and every other Australian city.

They wouldn’t and couldn’t be the same without the mining and related industries.

Our industry has also built large parts of Australia.

We have brought investment, opportunities, infrastructure, city conveniences and jobs into some of the most remote and in-need places in our great country.

In some remote centres, 50 per cent of total employment is in mining.

At our own expense, we build towns, villages, roads, sporting facilities, swimming pools, shops, community facilities, rail lines, seaports, airports and many other items of infrastructure.

Moreover, while much of Australia is talking about the technology revolution, the mining industry is actually doing something about it.

Automatic trucks, automated rail, and remote operations centres have moved from the realm of Star Wars to the practical day-to-day.

Drones are now a part of the engineers and surveyor’s toolkit, and deep analytics and data lakes are used in everyday business improvement projects.

This revolution is continuing, and will create new high tech jobs and catalyse new Australian innovation initiatives.

If this isn’t enough, let’s not forget that mining and its related industries also ensured that Australia survived the Global Financial Crisis (GFC) relatively unscathed.

Mining companies paid around $25 billion in royalties and taxes in the 2013–14 financial year alone.

My own private family company is Australia’s biggest private taxpayer, and our tax, just like the rest of those paid by the mining industry, helps to fund vital government services, our hospitals and health care centres, the defence of our nation, our police, our roads, the care of our elderly and those who are unable to look after themselves.

And more.

How many other industries have done as much, for as long as our mining industry has?

The media at times pressure politicians to spend more taxpayer’s money, and politicians in turn often succumb to this and announce greater expenditure, and our record debt increases.

But the focus seems to have been lost regarding creating the revenue to pay for increased expenditure, creating a good environment for investment and for enabling export industries to be cost competitive internationally, given so many expensive government burdens.

Is it any wonder that investment in Australia is now the lowest it’s been since the Whitlam years?

Our government now has to borrow more money just to be able to pay the interest costs of previously borrowed money.

For Australia to prosper it needs investment to be encouraged with good policies, less government tape and lower government taxes and costs, and, Australia needs our mining and related industries, and all our export industries.

But our government seems to be out of touch, in around 2 years of commodity price cuts, and many calls to reduce government red tape and other government burdens, what have they actually done to cut government burdens to enable us to still be internationally competitive?

There’s no ‘buy Australian’ campaign that will induce our trading partners to purchase our products if it costs more than competing nations.

There is no place for government intervention in the commodities export market, but our international customers will buy our products if they remain cost competitive, and reliable.

As an export-orientated nation, with a relatively small population, our prosperity and high living standards depend on our ability to export competitively and sell our goods overseas.

Fundamental to international competitiveness is low government regulation burdens, low taxation and other government expense.

We somehow need to get our government to understand, despite its members usually not from a business or mining related background, that we can’t tax our way to prosperity, and the government needs to be more financially responsible, and needs to spend less and reduce our record national debt, instead of being induced by media to spend more.

I recently visited Washington D.C., where I had the pleasure of listening to and meeting various members of Trump’s campaign team, including former New York City mayor, Rudy Giuliani, and Trump’s campaign manager Kellyanne Conway.

Trump and his team won this election because they listened to the people of America, despite the significant problem of constant and unrelenting negative coverage of the President-elect, including at times his loyal supporters, such as his wife, in attempts to upset the focus of the President-elect.

People close to the President-elect and his campaign advised that their countrymen told them they wanted, firstly less government tape, secondly less taxation, and for the USA to grow and be economically strong again, and provide more sustainable jobs.

And how exciting, this is exactly what the President-elect, and his team, are advising.

They want to deliver for America and its struggling economy.

In addition to wanting to deliver secure borders, a safer country and less government debt. Trumps team members advised that the President-elect wants to cut federal government tape by 50 per cent in his first months of office, and that he wants to cut company tax to 15 per cent.

What a kick-start to the American economy that will provide!

If only we were hearing similar policies from our own government.

We need to let our government know this would be good for Australians too. Instead of continuing along the path of the Greece example, that being, increasing irresponsible government expenditure and debt, to the ultimate detriment of the people of Greece.

Unfortunately for Australia, government regulation and red tape is one of our biggest industries…and its growing!

Decades of regulations piled upon regulations with little thought as to how this would impact business and indeed, the economy and living standards.

To attempt to illustrate just how bad Australia’s red-tape problem is, the Institute of Public Affairs (IPA), and I’m so glad that many IPA members are here tonight, estimates that red tape costs the Australian economy $176 billion annually.

Who can really tell that it’s not even higher?

That’s a staggering 11 per cent of GDP.

The IPA also estimates that under the Gillard and Rudd Governments, an astounding 444 bureaucratic government bodies were established in Australia, of which 198 are engaged in imposing regulations on different industries.

It gets worse. In a ranking by the World Economic Forum of the burden of government tape on companies, Australia is ranked 80th out of 140 countries.

Imagine the difference if the time and money spent on bureaucratic tape and compliance had been able to be channelled into productive outcomes instead.

With over 700,000 Australians unemployed and more underemployed, and our record national debt, the question must be asked – how can we afford this?

Yet earlier this year, and astounding to many, a wild orchid stopped the building of a gold mine in the small Victorian town of Talbot.

Now I like orchids as much as anyone but this particular plant was growing 7 kilometres away from the proposed mine!

Not only was there a 7km buffer zone, but the mine developers were even asked to pay $900,000 to the state government to remove grass because an orchid may grow there in the future.

It’s probably the world’s most expensive possible bouquet!

Having just completed the Roy Hill project, my company’s $10 billion mega-mine in the Pilbara, I have experienced firsthand the impact excessive regulation places on new projects.

The journey to build this mine was a mammoth one from acquiring the tenements in 1993 after BHP dropped them after their years of exploration, finding little of value, to Hancock later exploring and finding iron ore bodies of size and value, to, after considerable work, high risk investment and many government and other obstacles, then celebrating the first shipment of ore in December 2015.

How many approvals, permits and licences do you think we had to complete before construction even commenced?

I asked this question of one former Australian Prime Minister who guessed “about 40.”

But it wasn’t 40, or 50, or 100 or 1000. It wasn’t even 2000 or 3000.

There were more than 4000 pieces of red tape we had to deal with before we could even start to build. More than 4000!

And then more for construction.

What small company can pay for all that?

How many people would dedicate high risk money, years of effort and undertake a project knowing that it would require over 4000 pieces of regulation to be complied with before any prospect of being able to start construction, and go through even more tape, approvals, permits, licences and compliance before producing income.

For a project like Roy Hill, that has contributed to employing approximately 50,000 people in the Australasian region and one that will pay billions in various forms of taxation whilst providing decades of opportunities for many, is it really in the best interests of Australians to burden and delay such projects with thousands of approvals, permits and licences?

In a little under three weeks on 10 December, Roy Hill will mark its one-year anniversary from first shipment, after a very aggressive construction timetable.

It is currently completing a very aggressive ramp up to achieve early next year 55 Mtpa, to become the largest single iron ore mine in Australia.

It is telling that during this period there have been no other major mining projects opened in Australia and who can honestly say, Australia’s lack of encouragement to investment, it’s onerous government tape, and high taxation, with threats from time to time of even higher taxation, had nothing to do with that?

Despite mining companies usually having mines in tough outback areas, having to deal with poisonous snakes, mosquitos, flies; battle the very high temperatures, dust, drought, fires, floods and earthquakes, their biggest challenge was complying with government regulation.

The University of Sydney’s Faculty of Law recently reported that the fastest growing sector for new graduate lawyers was “in compliance services” – in other words, helping companies comply with government regulation.

Now that’s something that should alarm us all.

Red tape is not something that we can’t change, governments can act to reduce it.

Other countries have done this with great success, such as our neighbour Singapore, and currently India.

As a country, we need to reassess our priorities, and as an industry, we need to work harder to make our case better understood and heard, especially when it comes to taxation.

Australia has the fourth highest company tax rate (for large businesses) out of the OECD countries, up there with Greece, Portugal and Belgium, who’s economies are hardly the models of success.

The Tax Foundation also found that Australia’s 30% corporate tax rate is above the world average of 22.38%, and higher than that of other countries in the Asian region whose average corporate tax rate is 20.86%.

Even the UK, where my company recently acquired a stake in a future Polyhalite mine, have a company tax rate well below ours of 20 per cent, and it is scheduled to further decrease to 17 per cent by 2020.

Additionally, recent proposals in West Australia to increase the tax burden on iron ore mining are misplaced and very concerning.

The situation is this: the Australian iron ore industry already has the second biggest tax burden in the world.

On average, Australia’s two biggest miners Rio Tinto and BHP Billiton pay $19 per tonne of iron ore produced and extra on top of that, as Currently proposed in West Australia, would see Australia become the highest taxing jurisdiction for iron ore in the entire world.

Rio Tinto have publicly called this West Australia threat the biggest threat to their iron ore mining business that they face anywhere in the world.

This new tax if introduced would also cost many jobs in both mining and related industries.

As I outlined at the start of my speech, the mining industry has done so much for Australia over decades, it and its related industries contribute billions and billions to the economy and create opportunities and jobs for millions.

The mining industry cannot however be the governments perpetual ATM or cash cow.

Our industry has to compete internationally or lose its markets.

We are continually targeted and told to give more and more money to solve political problems we didn’t cause or create.

It wasn’t the mining industry that created our record national government debt of more than $450 billion.

It’s the next generation who will be left to pay this off, with an increasing elderly proportion of people requiring more health services and support.

Employees in our industry including related industries need to become more vocal and diffuse the perception, “hit mining and all of our problems as a country will be solved,” or sadly the consequences will see less jobs in our industry and related industries.

As Winston Churchill so eloquently said “for a nation to try to tax itself into prosperity is like a man standing in a bucket and trying to lift himself up by the handle.”

Reductions in government spending and policies to encourage investment such as less government tape, and less taxes and less other government expense, which in turn will lead to stronger economic growth, like America after its President-elect takes office, will help to grow the economy and help to pay back this debt.

Higher taxes, are not the answer to pay off this debt.

Australian’s for Northern Development and Economic Vision (ANDEV), is a group I founded of concerned Australians who advocate lower taxes, and less red tape to enable investment and development, similar to the IPA.

We advocate for special economic zones to be set up in the North to encourage investment to develop this remote area.

Special economic zones would help to build more towns and businesses in our North and would provide more infrastructure, more amenities for people in the outback, new opportunities and employment.

Special economic zones operate successfully in many parts of the world and they can operate successfully here too.

I encourage everyone here tonight to visit www.andev-project.org and get involved in defending and supporting your industry.

Ultimately, mining is one of our country’s most significant and necessary industries.

Whether it’s the watch you’re wearing on your wrist, the jewellery you’re wearing, or the iPhone that you’ve checked a few times tonight, mining is essential.

I am so pleased that we have a day to celebrate mining’s importance and recognise its incredible stories and history, and I wish everyone, a Happy Mining & Related Industries Day! Thank you.

Gina Rinehart Quote on the U.S. President-Elect

by 10 December 2016

“The president-elect wants to cut federal red tape by 50% in his first months of office, and to cut company tax to 15%. What a kickstart to the American economy that will provide.”

- Mining magnate Gina Rinehart calls for Donald Trump-style tax cuts in Australia.