CMPA Annual Dinner – Chairperson’s Speech

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 facing now and into the future.

The Association remains committed to engaging collaboratively with Earth Resources Regulation (ERR) as the lead agency and regulator within government for Extractive Industries.

However, it must be said, it has been a very challenging 12 months in our relationship with the ERR. There are times, when we feel our status as an industry in this State is somewhat taken for granted, misunderstood, negatively perceived and unfairly disadvantaged.

All too often we are left to lament the introduction of another bureaucratic and/or financial impost and a loss of ground in the struggle for balanced outcomes. Not just for our members, or the Extractives sector, but more broadly, balanced outcomes that benefit the economic and social well-being of Victorians, who, it must be said, are our end-user consumers – think “housing affordability, transport, schools, hospitals, water, sewerage and other vital community infrastructure”.

This is undeniably a time of great potential for growth in our industry. It demands we respond with sound development proposals, but these must be supported by a fair statutory and regulatory regime, and a timely approvals process, that does NOT see Work Plan applications almost summarily returned to the proponent on the basis they are “inadequate” or “incomplete”.

It is also my current understanding that only 20% of ExtractiveIndustries Work Plans achieve approval within a two (2) year period of lodging with ERR, Statutory Authorisations.

Otherwise, the very substantial levels of up-front capital investment required to meet the requirements of a development application are simply not justified.

There has never been such a clear, albeit publicly unstated message, to this industry from Government and the Private Sector alike – “we need you on-board” to meet the ‘so called vision’ of politicians and planners alike, articulated in the “big is beautiful” Plan Melbourne. The “road map” that has the world’s most livable city on course to be home to 8 million people by 2050.

We certainly know “they are coming”, perhaps, regardless of whether we build it or not! The ABS’ 2016 net annual population growth figure for Victoria was 140,000.

This number and similar in recent years, are quite staggering, but they serve to reinforce the Government and Private Sector’s commitment to build a bigger Melbourne, as well as key regional hubs to meet future population forecasts. Thereby lies not only the opportunity and the challenge, but also the dilemma!

Why? Because as an industry, we continue to be burdened by the same perennial issues that severely constrain our ability to meet current demand needs for years now, let alone, the emerging future demand challenges! There is strong evidence now about our lack of capacity to meet future cement demand and the rationing of aggregates is already being practiced by some suppliers. Other examples of regulatory constraint are:

• The Native Vegetation Clearing Regulations and their associated Biodiversity Assessment and Offset Guidelines – other referrals agencies aside, these DELWP requirements are singularly rendering quarry development proposals unviable. They urgently need to be challenged and changed to allow for balanced outcomes, including recognition of our temporary use of the land and the industries rehabilitation record;
• Aboriginal Cultural Heritage – it is totally unacceptable when an unsubstantiated ‘creation story’ is the basis for a place, in fact an operating quarry with decades of compliant history, being registered as an “Aboriginal Place”, thereby preventing future extraction activity on that site/”place”.
• This unprecedented registration poses a state-wide threat to all Work Authority holders. That risk is further exacerbated, when we consider the relevant government agency, AAV, rejected the opinion of their own independent consultant, appointed to review the registration after a prolonged and costly court challenge by the Work Authority Holder. The CMPA will continue to support that particular Work Authority holder in their struggle to the best of our ability;
• The disproportionate influence of Catchment Management Authorities (CMA’s) and other like water agencies in the Work Plan referral process is an increasing concern that carries with it, the potential to sterilize not only a very significant, but readily available quantity of prime stone resource in Victoria;
• The identification, security and affordable access to natural resources within Victoria continues to call-out for attention. The Planning and Environment Act 1987 and the Mineral Resources (SD) Act 1990 and their cascading Regulations need to be jointly reviewed and amended to provide a better, more coherent, consistent planning mechanism and security of our finite construction resources. We have long advocated the introduction of Planning Practice Notes to at least assist.
• Clearer, less ambiguous and importantly, less discretionary  planning regulations, particularly when administered at local  Responsible Authority (Council) level, would better serve the interests of the great majority of Victorians along with vital industries such as the extractives.
• The complexity and associated costs of both Risk Based Work Plans (will/do they serve their intended purpose?) and the ERR Resource Rights, Allocation and Management (RRAM) business portal, remain unresolved issues of discontent between the industry and the regulator; as are
• Rehabilitation Bonds remain on our agenda; and
• The organisational structure, resource levels, the lack of relevant  quarrying/mining qualifications and industry experience within ERR is effectively, a major impediment in itself.
• A perceived lack of real-world understanding and a degree of affinity with the industry by some within ERR is a genuine cause for concern.

All too often, we feel a sense of ‘disconnect’ between government (through ERR and some referral agencies) and our industry, when in fact, we need a “collegiate” relationship, albeit one that is independently at arms-length, but nonetheless “harmonious” and far more “productive”.

We desperately need and have been crying out for years, for ERR/DEDJTR to be our “champion” and “facilitator” within Government and at VCAT. Not for them to simply be a regulator, or an arm of the bureaucracy whose major focus appears being able to withstand public and to a lesser degree, intergovernmental scrutiny or criticism.

In 2016, our positive story was the ‘Extractive Resources in Victoria: Demand and Supply Study 2015-2050 – released in July 2016.

It remains a credible body of work that appears to have stimulated the much need conversation within government, that indications suggest, has given rise to a heightened focus on the critical importance of the Extractive Industries sector to Victoria’s economic future and liveability;

This year, our positive message is around the ERR Continuous Improvement Program (CIP) being led by the Commissioner for Better Regulation, Anna Cronin, at the request of the Minister for  Resources, The Hon Wade Noonan.

The CIP will recommend specific operational and capability improvements and take a collaborative approach with industry and other key stakeholders to ensure issues are properly understood and prioritised.

All parties will be required to commit to workable solutions, which, significantly, include regulatory and legislative change – Previously this has been a “no go” area to our industry sector in discussion, workshops, etc., with ERR.

The CMPA has been actively involved in recent works with this CIP ‘policy sprint’. We certainly welcome the recognition by the State Government that there are serious issues with the Work Plan Approval process. The Cronin CIP Report is currently being written and we await the recommendations with much anticipation and trust they take into account the Association’s input.

Change for the better, especially the achievement of regulatory and legislative change, can be a very long, confronting and wearing journey. We embarked on that journey quite some  years ago and it continues unabated today, thanks to the sterling efforts of our Secretariat, led by Dr Elizabeth Gibson, supported by the Management Committee and our Honorary CEO, Ron Kerr.

However, I say with a strong emphasis on my glass being half full (not half empty) albeit with a measure of tempered optimism, that the CIP Report being prepared by Anna Cronin, with input from the Red Tape Commissioner, is without doubt, our most promising opportunity for positive change in many years!

Despite future demand forecasts for our industry, we continue to be confronted by numerous challenges that must be overcome, before we can be confident of a period of relative stability and growth.

If the legislative framework in which we operate is improved and regulatory burden reduced, I have little doubt, the entrepreneurial nature and professionalism of our membership will quickly lead to an increase in development proposals and a major lift in capital investment by the Extractives sector.

These two measures, will in-turn unlock the underlying inherent potential of Victoria’s resource sector, resulting in dramatically improved production outputs, such that the high-level future  demand forecasts before us, might then be realistically met.

We must stay the course and we must be more persuasive! With that in mind, I reiterate my earlier commitment, that the CMPA will continue to work collaboratively and positively with ERR.

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