Feb 10 – When the going gets tough, the tough ask for tax relief. If you are looking for a sign that the end game of the commodity downturn is getting closer, witness the clamour for more support from Australia’s embattled resources sector.
Asking for government help is one of the last steps a mining company can take to stay alive, assuming it’s already exhausted every conceivable cost saving, emptied the pockets of its owners and reached the limits of what its bankers will lend.
The latest call came this week from the Queensland Resources Council (QRC), which said the coal mining industry needs support to keep the remaining 60,000 workers employed, following the loss of 21,000 jobs in the past two years.
“We are not looking for bailouts or subsidies but our entire sector needs certainty and support in the shape of commitments to reduce red tape and unjustified government-imposed and government-sanctioned costs,” QRC Chief Executive Michael Roche said in a Feb. 8 statement.
“At the top of our list are royalties, local government rates and the charges from government and private sector providers of rail, port, power and water services,” he said.
The preceding two paragraphs from the statement illustrate the problem facing the resources sector, insofar as they don’t want to be seen to be asking for government handouts, although in effect that’s exactly what they want.
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