2018 CMPA Annual Dinner – Chairperson’s Speech

AN EXTRACT OF THE CMPA CHAIRPERSON – GARRY CRANNY’s Annual Dinner speech for those members who were not in attendance, highlights the key issues we in the industry are now facing and into the future.

Arguably, the economic drivers, the policy settings and the performance of the Victorian economy have seldom, if ever, been more conducive to activity and investment in our Extractive Industries sector, consider:

1. Melbourne’s expanding population – Currently sitting in excess of 5.0m, ahead of the “Plan Melbourne 2017-2050” growth forecast of 10.0m people by 2050 – net increases of 120,000 to 140,000 per annum in recent years;
2. Victoria is the fastest growing economy in Australia at better than 2.3%;
3. Strong Government Infrastructure Program – $14B in 2018/19 and $40B pipeline of Government Infrastructure over next 4 Years;
4. Victoria’s economy enjoys a “Triple-A” credit rating – no impediment, if so decided, to access further government borrowing to fund additional infrastructure projects;
5. Private sector investment in residential, industrial and commercial is also continuing at peak levels;
6. In short – Construction activity in Melbourne “booming”;
7. While Melbourne is the hub of the State’s economy, regional infrastructure and development in support of job creation and thriving regional centres must also be vigorously pursued, rather than neglected.

Against this economic background there have been a series of cascading and complimentary Policy Settings announced by the Minister for Resources under the banner of ‘Helping Victoria Grow’. These seek to address numerous issues that have constrained and negatively impacted our industry for many years;

• Helping Victoria Grow, Extractive Resources in Victoria – Demand and Supply Study to 2050, July 2016 – Update in 2018/19 – Much needed foundation study, soon became apparent that improved data was required to more accurately quantify available supply and to better forecast and manage predicted shortages in demand. With demand now estimated to be in excess of 100 million tonne, or 8+ tonne per capita  by 2050, the efficacy of this work is crucial;
• Securing Strategic Extractive Resources, Pilot Project with peri-urban Wyndham LGA & regional South Gippsland (Inc. Bass Coast & Cardinia) LGA, 9 February 2018 – SERAs to replace EIIAs, mapped and most importantly, they will be incorporated into the planning system to better protect key extractive resources;
• DEDJTR/Transport for Victoria – Extractive Industries Supply Chain Study, May 2018 – greater transport efficiency, less, but larger capacity trucks, with roads, bridges and operating rules to support;
• Helping Victoria Grow – Extractive Resources Strategy, June 2018 – The Strategy nominates priority areas for action, namely:
  • Resource Identification and security for access;
  • Land Use Planning;
  • Efficient Regulation;
  • Building Community Confidence; and
  • Innovative end-land use for quarries.
• Joint Ministerial Statement of 16 August 2018, Hon Tim Pallas MP, the Treasurer and Minister for Resources, and Hon Richard Wynne MP, Minister for Planning – “Extractive Resources, Rock Solid Foundations for Victoria’s Growth”.

The Joint Statement implements priority actions contained in the July 2018 Extractive Resources Strategy; it also gives effect to numerous of the recommendations of Anna Cronin, Commissioner for Better Regulation in her report titled “Getting the Groundwork Right: Better regulation of mines and quarries”;

• The HOT LIST developed for priority assessment with the goal of halving current approval times is a commendable JMS initiative that is supported by the CMPA. The list at August 2018 contains 11 proposals – we look forward to seeing those 11 ‘fast tracked’ and replaced with other suitable applications for approval under the HOT List criteria;
• It is important the HOT LIST becomes an ongoing success story, not a short term, opportunistic exercise of “picking the low hanging fruit”.

Earth Resources Regulation (ERR) – Continuous Improvement Plan (CIP) and the Commissioner for Better Regulation, Anna Cronin’s – “Getting the Groundwork Right, Better regulation of mines and quarries”.

• When I spoke at the 2017 Annual Dinner, we were awaiting the Report with a mixture of anxiety and anticipation – we were not to be disappointed;
• The quality, depth and critical importance of Anna Cronin’s December 2017 Report to our industry sector, cannot be understated; it is a seminal piece of work that shone a light into many previously dark areas of the regulator’s operations. As outlined, the ensuing Extractive Resources Strategy and the Joint Ministerial Statement have their genesis in the work undertaken by the Commissioner at the instruction of the Minister;
• Roll-out of the ERR ‘Implementation Plan’ is progressing under the immediate stewardship of Acting Director, Letitia Hatton. As a vitally invested stakeholder, the CMPA is supportive of this work and we continue to participate and to consult in relation to implementation of the CIP on behalf of our Members;
• We also find assurance in the Minister’s direction that the Commissioner for Better Regulation, continues to undertake six monthly implementation reviews of progress against her Report – this will ensure accountability for timely, relevant and accurate implementation of the Report’s program of recommendations;
• One aspect of the Report that the CMPA would like to see accelerated is Legislative Reform – the Mineral Resources (Sustainable Development) Act 1990 and the Mineral Resources (Sustainable Development) (Extractive Industries) Regulations 2010 – both require review from a structural and governance perspective;
• Both the Act and it’s subordinate Regulations need to better reflect the nature, scale, local consumption and the domestic importance of the construction materials quarried and processed by our sector – legislation covering the extraction, etc. of stone, as defined under the Act, should not be legislatively associated with large scale coal mining, the exploration and more complex mining, especially underground mining, of export earning mineral resources as well as the potential exploration and extraction of Coal Seam Gas. The CMPA holds the view, it would be beneficial to the Extractive Industries sector if this were to happen sooner rather 2020 as currently scheduled in the CIP Implementation Plan; Another key aspect of the Report that justifies comment here tonight is the Minister’s May 2018 budget allocation of $12.7m over two years to develop a “better regulator”;
• The CMPA endorses this overdue initiative – a “better regulator” is in the interests of not only our industry sector, but the Government’s aspirations and more broadly, Victorian communities;
• In this context, the CMPA fully supports raising the technical and intellectual property (IP) capacity of the regulator, as well as having its Geoscience and Geotechnical capabilities and roles strengthened – to some extent, as Basil Natoli would promote, this is simply a sensible ‘return to the past for the benefit of the future’;
• The contracting out of fundamental ERR projects and tasks, including the partial assessment of Work Plans to external consultancy’s with limited, to no experience in quarrying and with potential conflicts of interest, is a practice that we submit should cease in favour of increased ERR resourcing and capability – that means the recruitment and retention of suitably qualified people with relevant background industry experience – as stipulated in the Act;
• In summary terms, as an industry association, we are heartened on a number of levels:
  • The Minister’s interest, understanding and elevation within government of the Resources portfolio;
  • The ongoing work and liaison by the Commissioner for Better Regulation; and o the overall direction of positive change we have evidenced over the past year in the regulator as an outcome of the CIP;

A further example of encouragement to the CMPA is the progressive, positive leadership of the Resources Division, headed by Deputy Secretary, Peter Betson;

• As a representative industry association, the likelihood is we will never be totally satisfied on behalf of our membership of over 100 Work Authority holders;
• We operate in a dynamic environment with competing demands, but ‘getting the balance and proportionality right’ must remain the common objective of all involved;
• Areas of ongoing CMPA Member concern within ERR are:
  • Risk Based Work Plans, including Standard Risk Based Pathways which appears to offer little by way of solution;
  • Resource Rights Allocation Management (RRAM) business portal – despite the $m’s invested in it to date, the portal continues to disappoint industry and is best classified as a “disaster”; and
  • Rehabilitation Bonds.
• From a “Whole of Government” Work Plan referral endorsement and planning approval perspective, the CMPA continues to be concerned about the following:
  • DELWP – Protecting Victoria’s Environment – Biodiversity 2037, in particular, Native Vegetation Clearing Regulations;
  • The role of Catchment Management Authorities (CMAs);
  • Aboriginal Cultural Heritage (CHMPs); and
  • Planning Permit approvals/amendments – hopefully the foreshadowed Planning Practice Note (Dec 2018) and other guidance for statutory planners will assist.

A Good News Story:

West Gate Tunnel Project – Lima South Quarry Group (Ashley Day)

• We all love a story of success, especially when it is about ‘one of our own’;
• The Lima South, or LS Quarry Group, located approximately 38km south of Benalla off the Midland Highway, have been selected by the CPB Contractors John Holland Joint Venture
  to supply 900,000 tonne of pre-cast concrete product to the West Gate Tunnel Project in Melbourne;

Close

• The 2018 year has not been without its challenges, but in my view, it has been a positive, potentially transformative year for our Extractive Industries sector in Victoria;
• Change for the better, especially the achievement of legislative and regulatory change, can be a tortuous, confronting journey;
• The Extractive Industries sector, not simply the CMPA alone, are on that journey and it will continue unabated until such time, that in partnership with the Regulator, inclusive of a more “holistic government approach”, which has definitely commenced, we achieve the right ‘balance’, that will herald a period of sector stability and sustainable growth for our industry to the benefit of all Victorians
• I feel compelled repeat my words of last year – We must ‘stay the course’ and in this context, the CMPA remains fully committed to a positive and collaborative working relationship with the Regulator;
• Finally, on behalf of all here tonight, I take this opportunity to convey our sincere thanks and appreciation to the outstanding efforts of our Secretariat, led by Dr Elizabeth Gibson and her small team comprised of Gavin Moreira and Alissa van Geet, supported by our Honorary CEO, industry mentor and conscience, Ron Kerr and also to our voluntary Management Committee.

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