Opinion
Tickets on sale: It’s the Big Australian vs the Australian government
Elizabeth Knight
Business columnistNot since Kevin Rudd proposed the ill-fated super profits tax in 2010 has an Australian government gone to war with the massive and powerful mining industry and its spiritual leader, BHP.
Not only did Rudd’s Labor government lose that fight 14 years ago, it did so spectacularly, toppling the prime minister and ultimately the government.
Today’s Albanese-led Labor government is generally more business-friendly, and BHP is a more socially aware institution that tends to shy away from overt confrontation with governments. But the mining industry has shed any veneer of polite dialogue with the government now when attacking same job, same pay law, and is busting for a fight over new industrial relations laws with a smattering of complex environmental reforms.
Before the current standoff: Prime Minister Anthony Albanese (left) next to BHP chief executive Mike Henry (second from left) at BHP’s Kwinana nickel refinery in October 2022.
So intense has this dispute become that the parties are even contesting who started the fight.
And BHP’s fingers look to be all over what appears to be a declaration of open warfare by the industry’s umbrella lobby group, the Minerals Council of Australia, and its general, Tania Constable.
The issues behind the miners’ brawl with the government back in 2010 and those at the heart of the current scrimmage are very different, but the industry is using the same playbook.
Those with a decent corporate memory will recall that Rudd’s plan to impose additional taxes on miners beyond a certain profit level was – rightly or wrongly – essentially a government revenue-grabbing exercise. It was devised at a time when commodity prices were particularly high and Rudd reasoned that the community would happily support skimming some of the miners’ mega profits.
So intense has this dispute become that the parties are even contesting who started the fight.
The industry’s rear-guard response was a textbook case in using a clever narrative, fuelled by its deep-pocketed members.
It was the “killing the golden goose” argument – that undermining the mining industry on which our country’s economic fortunes are built would damage all its citizens, not just the mining company executives and shareholders.
And it worked, with the campaign successfully frightening the public into siding with the mining industry.
The industry’s message this time is pretty much the same – threaten our profits at your peril. With that came a reminder that the industry is responsible for 10 per cent of Australia’s GDP.
Rather than hiding behind the Minerals Council, BHP’s Australian head Geraldine Slattery has amped up the company’s rhetoric.
“The $14.5 billion in taxes, royalties and other payments we made to Australian governments last financial year is around half what the federal government spends annually to run public hospitals across Australia,” she argued this week.
She went on to say that the company was a significant contributor to national GDP, injecting $50 billion into the Australian economy last financial year.
It is fair to say that the industry’s hardline response suggests that the industrial relations policy it so hates will add plenty of cost – particularly to big iron ore miners like BHP and Rio Tinto.
BHP’s Australia president Geraldine SlatteryCredit: Dion Georgopoulos
The Same Job Same Pay law has cracked down on the use of labour hire by companies and has empowered unions to lead wage negotiations in the Pilbara at worksites where the majority of the workforce is not unionised.
The cost has not been precisely quantified, but BHP suggested last year that the industrial relations changes potentially cost it $1.3 billion.
No company enjoys the imposition of additional costs, but for the big miners, this is no existential crisis.
The money wouldn’t land in the hands of the government but in the pocket of labour hire workers, whose pay would be brought into line with workers employed by the company on enterprise bargaining agreements.
The Mining and Energy Union estimates pay differences between labour hire and BHP’s direct employees could vary between $10,000 and $40,000 a year.
Resources Minister Madeleine King singled out BHP last month for peddling “hysteria” and whingeing about Labor’s industrial relations changes rather than working productively with the government.
Enter Peter Dutton, who unsurprisingly gave his full support to the industry, promising to be its new best friend if elected next year and declaring that not since the mining tax or the carbon tax had a prime minister been so out of touch with the need to keep our mining and resource sectors strong.
Anthony Albanese, however, doesn’t appear particularly swayed by the mining industry’s protestations. It is a battle he appears ready to fight.
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