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Wednesday, 13 March 2013
Page: 2055


Mr BALDWIN (Paterson) (12:45): The mining boom, that began under the Howard government, has been hugely beneficial to Australia in a broad range of ways. It has provided royalties and payroll tax to state governments, company taxes to the federal government, employment to a generation and, in particular, addressed disadvantage amongst rural, remote and Indigenous Australians. It has provided training and skill development, and construction of multi-use ports, railroads and other significant infrastructure. The mining boom and superior economic management allowed the Howard government to pay off the $96 billion net debt left by their Labor predecessors and to turn it into a very healthy surplus.

Along with these benefits, Australia has been subjected to a number of difficulties born of Australia's two-speed economy. It has kept the Australian dollar at record highs, which has made Australia a comparatively expensive tourism destination, and the federal government has applied untimely and avoidable extra pressure in the following ways: the $750 million in accumulated travel taxes and charges over the next four years, which were added in the May 2012 budget; $500 million in further visa hikes announced in the MYEFO, including the 457 visa, which now costs $450—up from $350 per applicant; the working holiday visa, which is now $360, up from $280 per applicant; successive cuts to Customs staffing, lengthening customer processing times; passing on the cost of AFP security to airports, which is passed on to airlines and which is then passed on to the passengers; cutting regional aviation grants; and imposing multimillion dollar costs on aviation security upgrades at regional airports. And let us not forget one of the biggest impacts: the carbon tax. To quote an example, we only need to look at Virgin's recent fall in profit for the period because of the amount of carbon tax that they had to pay.

The two most significant problems that this Labor government has created include labour force pressures and Australia's record outbound tourism numbers. In fact, last year 132 million bed nights were spent overseas by Australians and this year it has skyrocketed to 139 million bed nights. To quote but one of the submissions—by the chairman of a coal company in January 2013—to the FIFO inquiry which led to the Cancer of the bush or salvation for our cities? Fly in, fly out and drive in, drive out workforce practices in regional Australia report:

Noting the importance of a profitable resources sector and a vibrant services sector for Australia’s future, and recognising there is no foreseeable end to growth for Australian coal exports (notwithstanding some recent softening of demand from China), the tourism and hospitality sector is taking the mature and sensible policy approach of looking for synergies and areas for mutual benefit.

The resources sector stands ready to work with the services sector.

I welcome these sentiments and I commend this approach. It is not a winner-takes-all approach. As our Minister for Resources, Energy and Tourism, Martin Ferguson, has said, mining and tourism are compatible. Over the past week there has been much debate over the needs of the mining sector for staff, the pressure this has placed on other sectors that are bleeding staff to the mining industry and the need for properly thought-through labour force plans that include staff retention, school-leaver recruitment, assistance for unemployed Australians and, only after exhausting local labour supplies, recruitment from foreign sources.

This government must undertake a study to properly map out the economy's total skill needs across all of the sectors. This would assist the immigration minister in deciding the granting of skilled and semiskilled visas. It would also help the training minister in planning to train Australians in both the mining and tourism sectors. Australia needs a holistic and long-term planned approach to Australian skill needs, not just a short, stopgap measure.

A review of BHP Billiton's workforce supply and demand situation is telling. A total of 1,010 fly-in fly-out roles are required for BHP Billiton Mitsubishi Alliance's Caval Ridge and Daunia mines, with 250 to be recruited from Cairns and 760 from Brisbane. Of the 1,010 roles, there are approximately 530 operator roles, 185 trade roles and 295 functional roles—management, administration, professional engineering, health and safety officers et cetera. As at 8 March approximately 30,000 applications had been received for the 715 operator and trade roles, comprising 9,400 applications for the 250 ex-Cairns operator and trade roles and 20,600 applications for the 465 ex-Brisbane operator and trade roles. The 295 functional roles—in management, administration, professional engineering, health and safety et cetera—are ex-Brisbane and are advertised and recruited on a role-by-role basis. A recruitment target of 60 per cent new to coal mining is being applied to the operator and trade roles.

I do not need to remind the House of some facts—Australia's low labour force participation rate, Australia's 5.4 per cent unemployment rate and the tourism sector's 36,000 worker shortage that is expected to grow to 84,000 by 2020. I have been previously critical of the Minister for Resources and Energy and Minister for Tourism for not properly addressing the conflicts between mining and tourism. Speaking to a mining audience, Minister Martin Ferguson delivered a speech entitled 'A new age of energy' to the Sydney Institute in 2010. In answering a question on labour force supply the minister said that Cairns will not be in the future what it has been in the past for tourism and that unemployed tourism workers in Cairns will simply go to work in the mines.

In more recent times the minister has indicated he will bring a focus to these challenges. Despite the announcement in May last year, I have not seen anything concrete come from the other side. I do not intend to be overtly critical of the minister, because I know the difficulty he faces with an erratic Prime Minister. We have all seen her complete about-face on 457 visas in the past fortnight. Through the Senate estimates process I have finally obtained a proper assessment of the seasonal guest worker scheme and the government says:

Several reasons have been identified for the low number of workers recruited to date, including global economic conditions, a lack of flexibility in the regulations under which growers can recruit workers, a potential lack of economies of scale from piloting on such a small scale, and the existence of a pool of competing seasonal labor in Australia including illegal migrants …

I am not sure if it was an intentional typo in that Senate estimates report to point to 'competing seasonal labor', but I agree that the government has been as changeable as the seasons, racked with internal competition. It is a poorly kept secret that there has been competition between cabinet ministers for immigration, tourism and agriculture over the working holiday-maker program. It seems everyone in the ALP wanted additional foreign guest workers until the PM's announcement to appease the union movement.

It is interesting also to note that the government has highlighted the existence of illegal immigrants as one of its challenges. If only the government had retained the Howard government's sensible policies on border control we would not be faced with this problem. Putting aside the government's official line, the official assessment report into the seasonal guest worker program points to extra incentives to recruit foreign workers and states:

… recent modifications of the policy have changed slightly the cost-sharing arrangements, allowing employers to recover up to A$100 in costs of internal transfers to and from the airport in Australia …

The World Bank report cites the DEEWR interim study, but the government appears to have removed it from the department's website. I am not sure if the government removed this evidence after the CFMEU launched its television commercials that would have us believe that the government is determined to ensure Australian jobs for Australians.

Beyond the eminently sensible notion that there should be an economy-wide mapping of skills, as mentioned, other recommendations to the FIFO inquiry included: (1) creation of Indigenous tourism opportunities (2) creation of demand driven tourism opportunities (3) mining to create a legacy of accommodation stock (4) establishment of a regional and remote aviation bookings portal (5) a register of mining related CSI projects (6) creation of geological tourism opportunities, and (7) royalties for the regions. I do not have time to address all of these in the time allotted, so I shall focus on the concept of a regional and remote aviation bookings portal.

While many airports servicing regional mining communities saw increases in passenger movements over the past five years, many were flights solely servicing the mining industry rather than increasing scheduled capacity for leisure travellers. Indeed, some regional airlines have chosen to transfer some of their aircraft which previously operated scheduled services to service the more profitable FIFO market.

In 1997 there were 54 regional carriers operating 237 regional routes, and today that figure, I believe, is fewer than 20 who are flying around 125 routes. The coalition believes more effort should be made to foster some positive and mutually beneficial policy development. Innovative measures should be investigated so that the real benefits from the resources sector are clearly shared by our nation's tourism industry in these areas.

The coalition believes the resources sector stands ready to work with the services sector. Indeed, in many cases, they already are working together. Arrangements already exist where regional carriers whose aircraft have been designated as primarily for FIFO services are used for scheduled services at those times when they are not needed to transport workers to the mines.

It is no secret that carriers are finding it harder to obtain regional aircraft, which are no longer being built in the same numbers as they were in previous years. An obvious solution could be that regional carriers, through innovative financial measures, are encouraged to purchase larger aircraft with extra seats being used to stimulate tourism demand in rural, regional and remote communities. Private sector expertise should be utilised so that leisure travellers, either as individuals or through travel agents, have the greatest possible access to flights through the establishment of regional aviation and tourism bookings websites. Such a project should be led by the Regional Aviation Association of Australia, utilising the knowledge and expertise of individuals like Jayson Westbury, the CEO of Australian Federation of Travel Agents, and the Hon. John Sharpe, the former transport minister and current Chairman of Rex Airlines.

At the end of the day, we need industries working together to provide the maximum benefit to all Australians. It should not be one industry at the expense of another. With a bit of forethought, planning, investment and creative working together, we can build all of these sectors and provide sustainability in town, profits for the mines, and benefits for all Australians.