Mining companies forced to report efforts to use Australian products

Companies performing large mining, construction and infrastructure projects will now have to report to the government every six months what plans they have put in place to use Australian products.

Industry minister Greg Combet announced yesterday that private companies that refuse to comply with the new federal government initiative will forfeit access to tariff reductions for using imported products.

A Working Group first floated the idea at last October’s Jobs Forum, following urging from Australia’s industry unions AMWU and AWU, which claimed local manufacturing content was being overlooked in favour of cheaper overseas products for use in big mining projects especially.

Australian Workers Union secretary Paul Howes said in October that the Federal Government should force miners to announce the levels of materials they source from Australian companies.

“Frankly, it is unacceptable that these mining companies won’t open up their books,” he said.

“It is a case of naming and shaming them.

“I think companies like Rio Tinto and BHP Billiton are sensitive about their public profiles, and if it was clear and there was an agreed statement of fact on how much was being used, we would have more ability to be able to pressure these companies to do right thing.”

New transparency measures will now apply from 1 July this year, in which any mining company that receives government funding of $20 million or more will have to comply with increased Australian Industry Participation requirements.

In addition, those performing projects in the private sector that are valued at $2 billion or more and seek tariff concessions from the Enhanced Project By‑law Scheme (EPBS) will have to comply with the six-monthly reporting requirements.

"This will improve the opportunities for Australian manufacturers, construction firms and service providers to win work on some of the biggest projects in the country," said Combet.

"It shows the Gillard Government’s commitment to supporting jobs and ensuring the benefits of the mining boom are spread to the wider Australian economy."

Formal guidance material for grant agreements and grantees, procurement officers, tenderers and EPBS applicants will be available from the Australian Industry Participation website from 1 July 2012, says Combet. EPBS applicants will reportedly have a further three month transition period.

[Image: publicworks.nsw.gov.au]