The West Australian government has rubbished claims almost 3000 jobs will be lost under a gold royalty hike, describing it as “inflamed rhetoric”, but the industry lobby group denies running a scare campaign.
The WA Chamber of Minerals and Energy claims more than 10 per cent of workers will lose their jobs, plus a loss of $44.9 million in royalties through the closure of several mines if the 50 per cent royalty increase announced in the state budget is imposed.
But Premier Mark McGowan said the gold industry was very prosperous and, like every other part of the community, must share the budget repair burden.
“This is completely overblown by the CME and by the gold industry,” he told reporters on Tuesday.
“I’d be surprised if there was any job losses over this.
“It’s rhetoric and it’s not based on fact and they’ve shown no analysis.”
Treasurer Ben Wyatt, who has met with industry leaders, says he is yet to see any independent analysis showing the royalty hike will have a “dramatic impact” on the sector.
“I think most people can understand that this is a fair and reasonable decision,” he said.
“You look at the market, you look at the banks and they know the gold sector can very much absorb this.”
CME deputy chief executive Nicole Roocke rejected Mr Wyatt’s claim that the group was running a scare campaign.
“When additional costs are imposed on a business, those costs have to come from somewhere,” she said.
“Payroll is the first area where companies look. They also look towards exploration, which is a discretionary spend.”
Saracen Mineral Holdings managing director Raleigh Finlayson said the company had just developed its second project and doubled its production on the basis of a 2.5 per cent royalty.
“We’ve invested more than we’ve earned in the past two years in development and exploration,” he told reporters.
“We may not have developed those projects and certainly deferred exploration, so it leaves us in a predicament now where we have to review our entire business.”
A vote in parliament on the royalty increase could happen next week and the government needs the Liberals to support it.