Monday, 31 October 2022

Shadow Minister for Resources and Northern Australia, Senator Susan McDonald, criticised Labor’s treatment of the resources sector in its Federal Budget, slamming anti-development policies that would severely erode investor confidence and do nothing to help ease costs of living.

“Labor’s own budget forecasts skyrocketing gas prices, over 40 per cent in the next two years, and yet they have provided no real plan to alleviate this price surge. Their latest thought bubble – price intervention – will kill gas supply and market confidence,” she said.

Senator McDonald said the Treasurer was relying on commodity prices to do his job for him, banking revenue gains and baking in long-term structural deficits all while providing less support for the resources sector and more ammunition for green lawfare groups.

“Funding for gas exploration has been cut. Labor has gutted more than half of the funding for the Cooper-Adavale Basin Plan as a part of the Coalition’s Strategic Basins Plan, ripping $31.5 million out from developing gas supplies, and slashed funding from the Beetaloo Basin Plan – cutting over $23 million and discontinuing the Beetaloo Cooperative Drilling Program.

“All while cutting support for gas supply, Labor’s price manipulation proposal will kill market confidence, leading to reduced supply, a market collapse, and further government intervention.

“As we’ve seen in other countries, when supply shrinks, rationing becomes inevitable, leading to outsized demand, and long-term price increases that will continue to drive up cost-of-living.”

In a cautionary tale, Argentina put a price cap on gas in 2012, and 10 years later, investment had plummeted, companies had left the market, production had collapsed, and the country faced severe gas shortfalls.

“The surest way to secure affordable, reliable gas is through increasing supply.”
“At the same time, in a blatant attempt to buy Greens votes, Labor has showered the Environmental Defenders Office with an extra $9.6 million, opening the door for more vexatious court actions and ‘lawfare’ to delay and stop new resources projects.

Labor also cut millions in funding from the Coalition’s critical minerals programs right when we need to be heavily investing in these future-proofing opportunities.

“The rebranded Critical Minerals Development Program now has less than $50 million left in the fund after Labor slashed more than $100 million from the program,” said Senator McDonald.

“The first $50 million, across six grants, was already announced by the Coalition in April. Labor has not announced a single new policy or grant to support critical minerals development.

“In a further sleight of hand, Labor has rebranded the Australian Critical Minerals Research and Development Centre, funded and created by the Coalition, as a ‘Hub’ and presented it as new.

“And while the headline figure of $50.5 million in funding appears the same, Labor has hidden further funding cuts by stretching it out over more years to reduce annual funding.

“It is this hypocrisy from Labor – championing critical minerals as the future of resources, manufacturing and renewable energy generation, whilst cutting over $100 million in funding – that exposes their lack of support for the resources sector.”