Minerals Week – Minerals Council of Australia

MINERALS COUNCIL OF AUSTRALIA
GREAT HALL
PARLIAMENT HOUSE
06 SEPTEMBER 2017

*****************CHECK AGAINST DELIVERY*****************

I read a story the other day that said seven percent of people think chocolate milk comes from brown cows.^[1]

Nearly half don’t know where chocolate milk comes from at all.

Seems ridiculous right?

But that’s the world we live in today.

We live in a world so pre-packaged and so sanitised it is easy to forget where things come from.

The mining industry has got the same problem.

The importance of the work you do is all around us.

I am not just talking about the energy that helps power this place. 

It’s the zircon in the plates you are eating off.

It’s the silica in the glass you are drinking from.

It’s the iron and chromium in your cutlery.

It’s the bauxite in the frying pans out the back.

It’s the copper in this microphone.

The work you do is everywhere, hiding in plain sight.

There is no better example of this than this little gadget.

Everyone’s got one.  More people own one mobile phone on the planet than own a toothbrush.^[2]

They are addictive.  Boston Consulting Group did a study two years ago to find out what people would give up for a year rather than their mobile phone. ^[3]

65 percent said they would give up eating at restaurants.  51 percent said they would give up their pet.  50 percent said they would give up their annual holiday.  And 38 percent said they would give up sex for a year rather than their mobile phone.  In South Korea it was 60 percent.

And guess what? 

These addictive little gadgets are made up of more than 25 different metals, all mined here, including gold, copper, silver, nickel, tin, tungsten, silicon, aluminium, tantalum and a lot more.

And there’s the challenge.  There are a lot of people who don’t like mining but love their mobile phone.

It’s easy to forget where things come from.

MINING IN THE 21^st CENTURY

The Prime Minister often talks about how we are transitioning from a mining economy to a 21^st century economy.^[4]

I think that’s a bad description, because it creates the wrong impression.

It creates the impression that this is a dying industry.  In decline.  Fading away.

And that’s just wrong.

The fact is the mining sector is going to be just as critical to powering the digital revolution this century as it was to powering the industrial revolution over the last two centuries.

What we mine might change but its importance to our economy and our daily lives won’t.

A good example of that is what’s happening with lithium and battery technology.^[5]

The fact is the resource industry is a critical part of our economy and will be for a long time to come.

There are twice as many people working in this industry as there were before the latest boom.

All up mining and mining services employ more than a million people directly or indirectly: about one in 10 Australians.^[6] 

Most of the money we make from exports also comes out of this room.

A decade ago resources represented about 46 percent of our total exports.

It’s now about 54 percent.^[7]

It’s getting bigger.

It’s why Bill Shorten has given me this portfolio and the trade portfolio as well.

TRADE & THE ASIAN CENTURY

We talk a lot about the rise of Asia. 

The fact is there are already as many middle class consumers in Asia as there are in the rest of the world combined.

Our big challenge is to make the most of that.

You’re already doing that.  The mining industry is doing that.

Yes we have got terrific resources that the world wants, but you are also very good at what you do.

You are more productive than the companies you compete against overseas.

Austrade put out a report earlier this year that says productivity in the Australian mining industry is 42 percent higher than the global average.^[8]

That helps explain why you have been so successful.

You have also been bold.  You have taken risks.  You have invested and innovated.  And you know your market.

We need other parts of the Australian economy to take a leaf out of your book.

There are about 2.5 million companies in Australia.

Only about 53 thousand of them are exporters.^[9]

There is a reticence among a lot of Australian companies to take the sort of risks you have.

And that’s particularly true of Asia.

18,000 Australian companies currently export their products and services to New Zealand.  A country of about 4.5 million people – give or take Barnaby Joyce.

18,000 companies exporting to New Zealand.

How many Australian companies do you think export to China? The answer is only about 7,000.^[10]

Now there are a lot of easy excuses and explanations for this.  Markets like China aren’t easy to tap.  You know that.

Some Australian companies have tried and lost their shirt.  Some are just comfortable doing what they are doing.  They don’t have the appetite for the risk involved or the patience needed to succeed in Asia. 

That’s part of it, but a lot just don’t have the skills and capability.

PWC put out a report a few weeks ago that revealed only 10 percent of directors and senior executives in our top 200 listed companies have a high level of Asian skills and experience.^[11]

A lot of them, I bet, are in this room.

We have got to fix this.

We are very good at putting goods on ships and attracting students and tourists and foreign capital here, but we have got to get a lot better at what Bob Hawke called our “enmeshment” with Asia.^[12]

If we are really going to succeed this century we have got to supercharge the sort of skills Australian businesses and workers need to do business in Asia.

You’ve done it. Others can too.

If we don’t, this country is going to miss out on a once in a lifetime opportunity.

We are going to miss the boat.

BIPARTISANSHIP & THE CLEAN ENERGY TARGET

I see in the audience Ian McFarlane and Martin Ferguson. Gary Gray unfortunately can’t be here. Together they constitute what Tim Hammond calls the holy trinity of the resource industry:  the father, the son and the holy spirit. With good reason.

For most of the last 15 years this portfolio has been dominated by them.

And for most of that time they did it working together.

Real bipartisanship.

I am very conscious I follow in their footsteps.

My biggest challenge at the moment is working out who to be bipartisan with – I have already lost Matt.  Now it looks like I might lose Barnaby. Depending on what happens in a few weeks.

But whoever it is, I am very conscious how important certainty and bipartisanship in this industry is.

I heard there wasn’t a lot of bipartisanship this morning with the Deputy Prime Minister.

This is disappointing.

We are not always going to agree.

The mining industry and the Labor Party aren’t always going to agree.

It’s naive to expect that politicians and political parties and industry and unions are always going to have the same view. 

That’s why we have got this building to help sort these issues out.

But what we should do is talk to each other, and try to see each other’s point of view.

That hasn’t happened for the last 10 years in this place when it comes to climate change policy.

That’s got to end.

The Australian people are sick of it.  And they are suffering because of it.

Because of the fighting here, there has been effectively an investment strike in the energy sector, and jobs are down and prices are up.

And the thing is this is not impossible to fix.

Finkel has found a way through.

It’s not my party’s preferred solution.  I am sure it’s not yours either.

But it might just be the only solution that can squeeze through the two chambers on either side of us.

We have said if the Prime Minister can corral his own team behind this we will work with him to help make this happen.

To use an American political phrase – we are willing to reach across the aisle.  To compromise.

There have been some positive noises from the Government too.

The Treasurer has talked about meeting in the middle to deliver certainty on energy policy.^[13]

And there is a lot of support from Australian Industry.

That’s important.

The Clean Energy Target the Chief Scientist has proposed is backed by everyone from the Business Council of Australia to the Australian Energy Council.

Not because it’s perfect, but because it’s possible.

It’s also backed, I know, by a number of companies in this room.

So I am hopeful.                                 

And I hope the MCA can be part of this too.

When big reforms happen in this place this industry is often there.

When we ripped down the tariff walls and opened up our economy you were there helping to make it happen.

They were, in a sense, easier arguments.  This one is harder. 

But the fighting has got to end, and I hope that you can help to bring the opposing forces in this building closer together not further apart.

CONCLUSION

I have been in this job for about 12 months now and I have had the chance to see the work you do up close.

I have been everywhere from the Super Pit in Kalgoorlie to Mount Whaleback in the Pilbara, and from Weipa to Olympic Dam.

I also made the mistake of going to Darwin when my wife was 37 weeks pregnant.

As I found out when she rang me to tell me she was in labour, there aren’t a lot of flights from Darwin to Sydney.

She went in to labour at 2pm.  The next flight was 1am.  I got to the hospital at 6.30am.  Little Jack was born at ten past eight.

It’s been an exciting 12 months.

In another 12 months, believe it or not, we could be back at the polls.

This is an industry with plenty of challenges but even more opportunities, lots of things it can teach the rest of our economy, and lots of things we can work on together.

And I am very keen to be part of a Shorten Labor Government that works on them with you.

Thank you very much.

 MEDIA CONTACT: BENJAMIN GRANGER 02 9790 2466