A peak body for the mineral sector says a proposed hydrogen production tax credit scheme is insufficient to counterbalance government policies hindering investment in Australia.
This comes as the federal Labor government pushes its Future Made in Australia (Production Tax Credits and Other Measures) Bill 2024 aimed at offering incentives to grow the country’s renewable sector.
The bill is part of a $22.7 billion (US$14.2 billion) economic plan that aims to support Australia’s transition to net zero.
At a recent parliamentary inquiry hearing, Ross Lyons, general manager at the Minerals Council Australia (MCA), which represents resource companies, said the bill does help with production costs for businesses.
But noted it was not enough to offset the impact of heavy regulation that could impede investment, job growth, and make Australia less competitive globally.
“The MCA supports the critical minerals production tax incentive because it is a positive step toward attracting investment in the critical minerals industry,” he told the Economics Legislation Committee.
“However, the development of a downstream, critical minerals processing industry will require more than this policy in isolation.
Council Says Labour Laws Too Onerous
Lyons said many investors were reluctant to commit to new projects amid a recent step-up in regulation.“Investors are also balking because of the federal government’s rewriting of industrial relations law that compounds the cost of labour by companies in red tape and litigation and further weakens productivity,” he said.
“In addition, investors are concerned about the rising tide of environmental restrictions and lawfare and access to reliable, stable and affordable energy.”
A major change was the introduction of the “same job, same pay” policy, where companies are compelled to pay labour-hire workers similar to regular employees.
The bill sparked strong protests from the business community as they cited negative impacts on their operations.
Get the Fundamentals Right First: Peak Body
Lyons said the government needed to address the above issues so that Australia could attract more investments.“Given the risk profile of projects, miners and investors always look at the full picture of government policies and regulations before approving a final investment decision,” he said.
“If the government is serious about unlocking Australia’s vast critical mineral deposits and building a sustainable and vibrant downstream processing industry, we need to get the fundamentals right first.”
