Budget acknowledges mining revenues while undermining future projects, Minerals Council of Australia claims
Industry bodies have offered mixed responses to a Federal Budget that has reinforced the critical importance of resource earnings to Australia’s finances.
The Minerals Council of Australia (MCA) said the Budget had forsaken an industry that is driving the nation’s economic growth.
MCA chief executive officer Tania Constable said the government’s own figures confirm the mining sector has helped deliver higher-than-anticipated export earnings.
Mining sector abandoned
“By quietly abandoning the Junior Minerals Exploration Incentive, the government has sent a clear message: Australia’s mining industry is being ignored at precisely the moment we should be securing our resource future,” Ms Constable said.
“The decision is a severe setback for exploration investment, undermining investor confidence and weakening Australia’s long-term mineral resource pipeline.”
“Without this pipeline, there is no downstream processing and manufacturing.”
Severely compromised
Ms Constable said that Australia’s ability to respond effectively to global trade pressures and tariffs had been severely compromised by domestic policies that have eroded our industrial base and competitiveness.
“Rather than implementing urgently needed reforms to strengthen productivity, attract business investment and control spending, the government has missed yet another opportunity, continuing to rely on mining revenues to cover uncontrolled expenditure.”
“Treasury’s subdued outlook for mining investment underscores an urgent need for government action to reverse declining competitiveness and attract new investment to underpin Australia’s economic future.”
The MCA did welcome the continuation of the Future Made in Australia production tax credits, saying the incentives are important for Australia’s critical minerals processing sector.
Measures welcomed
The Western Australia Chamber of Mines and Energy (CME) was another to welcome confirmation of several Future Made in Australia measures in the Budget.
CME chief executive officer Rebecca Tomkinson also noted that strong commodity prices had helped record the first consecutive surpluses in nearly two decades, with the resources sector again forecast to make a significant contribution to the national balance sheet through taxes and royalties in FY25.
“Around one quarter of corporate tax comes from the resources sector, while workers in Australia’s highest-paying industry are also an important source of income tax,” Ms Tomkinson said.
“That revenue has helped the Commonwealth fund a range of cost-of-living support for Australians.”
“These include $17.1 billion in new income tax cuts, a $1.8b extension of electricity bill subsidies, an $8.4b expansion of Medicare bulk billing, $689 million to cap PBS medications at $25 and $427m to increase childcare subsidies.”
Substantial work to be done
However, she said substantial work remained to improve Australia’s investment attractiveness and ensure the resources sector remained well positioned to continue supporting national prosperity into the future.
“The minerals and energy produced in WA are also critical ingredients in low-emission technology, including solar panels, wind turbines and batteries, helping both Australia and the rest of the world to decarbonise.”
“We know the globe needs our resources and the Commonwealth has acknowledged it needs the private sector to ‘lean in’ and invest to ease pressure on the national balance sheet.”
“The missing piece is fundamentals that give business the confidence to deploy their capital in Australia—including affordable and low-emission energy, efficient project assessments and stable and predictable workplace laws and environmental reforms.”