Question Without Notice No. 677 asked in the Legislative Council on 11 October 2017 by Hon Robin Scott
Parliament: 40 Session: 1
GOLD ROYALTY RATE INCREASE — CONSULTATION
677. Hon ROBIN SCOTT to the minister representing the Treasurer:
(1) Will the Treasurer list the WA gold industry leaders of companies or unions who were consulted by Treasury or by any government minister in the course of formulating the plan to increase the gold royalty?
(2) Did the decision to increase the gold royalty take into account the fact that in 2016–17, within Western Australia there were 21 goldmines on care and maintenance?
(3) What research was conducted by Treasury to identify which mines are likely to be pushed into unprofitability and closure by the 50 per cent increase in the gold royalty?
(4) Did Treasury consult with Mr Sandeep Biswas, managing director and CEO of Newcrest Mining Ltd; and did Treasury receive from Mr Biswas the advice that the cost of production at Newcrest Mining's Telfer mine is more than $1 650 per troy ounce?
Hon STEPHEN DAWSON replied:
I thank the honourable member for some notice of the question.
(1) As has been the norm for many years under successive governments when considering potential new revenue measures, Treasury did not consult any gold industry leaders or unions in the development of the gold royalty changes announced in the 2017–18 budget. However, a broad range of industry representatives and other groups were consulted as part of the previous government's mineral royalty rate analysis, which recommended a gold royalty rate of 3.75 per cent to provide a fairer return on the resources owned by the Western Australian community and to bring Western Australia's gold royalty rate more into line with other states.
(2) The government recognises that there will always be mines on care and maintenance even as the gold price is at historical highs. This fact cannot dictate the state's royalty rate settings, otherwise all royalties would be set to zero.
(3) Treasury undertook an analysis of the costs and financial position of a large number of goldminers.
(4) Refer to the answer to (1).