The Commonwealth Mid-Year Economic and Fiscal Outlook (MYEFO) confirms the critical importance of the resources sector to the nation, with sharp falls in commodity prices translating to the budget plunging from consecutive surpluses into a deficit of $26.9 billion for 2024-25.
Mining export earnings have been downgraded by $100 billion over the next four years, reflecting softening demand for Australian resources as competing jurisdictions ramp up production.
Chamber of Minerals and Energy WA Chief Executive Officer Rebecca Tomkinson said the forecast hit to exports was expected to result in the Commonwealth receiving $8.5 billion less in corporate tax over the forward estimates.
“When the resources sector struggles, Australia struggles,” Ms Tomkinson said.
“The strong headwinds buffeting industry are reflected in the nation’s fiscal position.
“These downgrades must act as a wake-up call for the Commonwealth Government to the substantial challenges confronting WA’s resources sector.
“Harmful policy is no longer just a handbrake on the growth of industry – for some commodities it is now an existential threat.”
CME continues to advocate for the repeal of several key aspects of recent Federal industrial relations reforms, including involuntary multi-employer bargaining, the ‘intractable bargaining regime’ and allowing unions to force bargaining without employee support.
“Disconnecting wage rises from productivity gains and opening the door to widespread industrial action has substantially increased investment risk,” Ms Tomkinson said.
“Uncertainty over the future of Nature Positive legislation is also hurting business confidence.
“CME continues to support reforms that are better for the environment and better for business but the proposed Nature Positive laws as currently drafted achieve neither objective.”
Ms Tomkinson said legislating production tax incentives for renewable hydrogen production and critical minerals processing, the key plank in the Commonwealth Government’s Future Made in Australia plan, must be prioritised if Parliament returns ahead of next year’s election.
“The road to net zero should run through Western Australia – but it won’t without recognition that we are competing against jurisdictions that are rolling out the red carpet for downstream processing,” Ms Tomkinson said.
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Natasha Mutch n.mutch@cmewa.com / 0435 383 382
