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Government acts on impediments to major projects



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JOINT MEDIA STATEMENT

^.AUSTRALIA

IMMEDIATE RELEASE 5 NOVEMBER 1991 160/91

DPIE91/272J

GOVERNMENT ACTS ON IMPEDIMENTS TO MAJOR PROJECTS

The Federal Government today announced a new process aimed at encouraging more development projects in Australia and speeding up consideration of their approval.

The new process will apply to projects primarily involving new investment of $100 million or more in agriculture, forestry, mining and minerals processing.

The Minister for Industry, Technology and Commerce, Senator John Button, and the Minister for Primary Industries and Energy, Mr Simon Crean, said the new process would underline the Government's commitment to realising major investment opportunities.

But they stressed that the new process would not bypass existing commitments to proper environmental standards and Aboriginal and heritage issues.

The new process introduces a "45 day rule".

Under the process:

. Companies would submit fully developed project proposals to the relevant Industry Minister;

. The Minister would refer proposals that meet the criteria to the Structural Adjustment Committee of Cabinet (SAC), either directly or through the Major Projects Group of officials;

. The Cabinet Committee would consider action to clear identified impediments and barriers where these could be removed or minimised by Government action;

The proposals would be lodged with the Cabinet Committee within 45 days of their receipt by the relevant Minister.

All Commonwealth Ministers with Portfolio responsibilities affecting project approval are members of the Cabinet Committee.

Senator Button said the new process would focus Government action on impediments to specific projects.

"The Government has responsibility to provide the speediest possible consideration of resource development and resource processing proposals," he said.

Mr Crean said the Government was serious about strengthening Australia's ability to attract major projects.

This could be done without compromising existing Commonwealth commitments on Aboriginal, heritage and environmental values.

"Through this process, the Cabinet Committee can have a role, for example, in ensuring contact and information exchange among decision makers at both the State and Federal levels when a project is being considered," he said.

Mr Crean said the Government's aim was to develop a pro-active approach to industry development based on sound investment opportunities, particularly those realising the potential of resource based industries.

The Ministers said the new procedures would give a strong development focus to the work of the Structural Adjustment Committee and enhance the role of the Major Projects Group set up in the Government's Industry Statement in March.

FOR MORE INFORMATION: Mr Mike Roberts Senator Button's Office (06) 277 7580

Ms Catherine Payne Simon Crean's Office (06) 277 7520

ATTACHMENT

NEW PROCESS FOR MINISTERIAL CONSIDERATION OF MAJOR PROJECTS

Where Government-induced impediments or barriers to investment can be identified, prospective developers of major projects are to be invited to bring projects directly to the attention of Industry Ministers. In the case of resource projects, this is the Minister for Primary Industries and Energy and/or the Minister for Resources and in the case of secondary processing,

the Minister for Industry, Technology and Commerce.

THE PRINCIPLES TO APPLY

The SAC Committee will give priority to cases where:

. proponents are seeking the removal of impediments which will have benefits across the board, rather than direct financial assistance;

. projects are internationally competitive and encompass a net export strategy;

. support is likely to increase the potential for other projects proceeding; and

. any necessary financial support is capable of being delivered through existing programs and mechanisms.

TYPES OF PROJECTS TO BE CONSIDERED

The types of projects to be considered under this process fall within the resource development and resource processing areas of agriculture, forestry, minerals and chemicals. They should be valued at over $100 million although, in certain circumstances,

projects of a lower value may be considered, and should be at a stage where there is a substantial commercial interest in seeing the project through to completion. While the focus is on commercial ventures, consideration may also be given to related

infrastructure projects. This would be where these are judged essential to the development of particular commercial ventures, where there is a clear Commonwealth role to play in enabling such projects to proceed, and where this cannot be adequately

addressed through existing Commonwealth/State arrangements.

ELIGIBILITY FOR CONSIDERATION THROUGH THIS PROCESS

The aim of this process is to ensure that major projects are not lost through delay, confusion or indecision. The focus is therefore on substantial projects with the potential to generate significant benefits in the form of exports, employment and value-added. Proponents must ensure that proposals are genuine

and clearly identify particular impediments or barriers to investment rather than broad industry issues which would be better addressed in a more general context. In particular:

. the process will apply only to major projects as defined above; . proponents must be well established companies with a reputation in their particular field or a closely

associated one; and . proponents must provide full details of their proposal, including: . ownership structure

. nature of the project . proposed financing arrangements . market prospects . technological and/or employment considerations . potential for value adding. . the precise nature of the impediment to the project

proceeding. While generic issues such as tax policy, macro-economic policy and micro-economic policy may be considered relevant and may therefore be raised, the focus should be on the particular project and the

specific measures required to enable it to proceed. This may take the form of financial assistance or administrative arrangements/impediments that are perceived as blocking the proposal. However, the prime

focus is to address Government-induced impediments, not a lack of commercial finance.

The Government will seek an assurance that there is a reasonable likelihood of the project reaching completion, subject to relevant Government approvals processes, if support is given. The intention is not that normal environmental, heritage or Aboriginal obligations be by-passed.

DIAGRAMMATIC REPRESENTATION OF NEW 45-DAY MECHANISM FOR

MINISTERIAL CONSIDERATION OF MAJOR PROJECTS

INDUSTRY MINISTER

seeks Departmental advice on the proposal

DEPARTMENT

provides requested advice

INDUSTRY MINISTER

Decision to refer Referral to Major

directly to SAC Projects Group for

sub-committee response

STRUCTURAL ADJUSTMENT COMMITTEE

Government response, including timetable for integrated assessment process and indication of any policy issues which need to be addressed to remove identified impediments.

PROPONENT

submits detailed proposal to Industry Minister and within 45-days

Cabinet Submission submitted to SAC sub-committee

OTHER MINISTERS INDUSTRY MINISTER

Oversight timely processes as agreed with Industry Minister, Major Projects C* i* r c cr 5 A C

Oversights progress and, if necessary, takes matter back to SAC to restive any c u t s t a r . c i n c .ssues