Tuesday 19th Dec, 2017

WA gold royalty could cost 3000 jobs: industry

Gold ingot. Photo: Public Domain
Gold ingot. Photo: Public Domain

Western Australia’s gold miners have warned the State Government its proposed royalty increase could claim as many as 3,000 jobs if implemented.

The McGowan Government included a royalty hike for the gold industry, from 2.5% to 3.75%, in its recent State Budget, with plans to implement the change as soon as January next year.

WA’s gold industry has taken strong action against the proposal, with over 1000 workers marching through Kalgoorlie in September to oppose the tax hike.

This week the Chamber of Minerals and Energy of WA released new modelling, suggesting the hike would cost almost 3,000 jobs.

“Treasurer Ben Wyatt said he wanted to see the numbers from the gold industry,” managing director of Chamber member Saracen Mineral Holdings said.

“Well here are the numbers, and they are devastating. Up to three thousand jobs to go from WA gold mines and a further two thousand if the gold price were to drop to A$1,400. This does not include the flow-on impact on the many small businesses and suppliers that support the sector.

“Thousands of men and women out of work due to an ill-informed, ham-fisted decision by a Labor Government which was elected on the promise of putting jobs first.”

Sandeep Biswas, chief executive of major gold miner Newcrest Mining, reportedly flew to Perth on Monday to meet with politicians and debate the proposal.

The tax hike would increase the WA Government’s takings by roughly $20 per ounce of gold mined. Gold prices are currently around $1,630 an ounce.

While Treasurer Wyatt has said the high price of gold justifies the royalty hike, the industry has argued its costs exceed those of just about any other mined commodity.

“In one of my mines alone, the drill database for the last 20 years has more drilling metres in it than the whole of BHP’s Pilbara iron ore division in the last 50,” Northern Star Resources executive chairman Bill Beament was quoted as saying in September.

“It gives you an idea of how much expenditure we need to put into the ground, just to be able to replace our resources and reserves.”