25/05/2004 - 22:00

Flow-through chance missed

25/05/2004 - 22:00

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THE mining community may well have lost a good friend during the pre-selection process for the Liberal seat of Tangney.

Flow-through chance missed

THE mining community may well have lost a good friend during the pre-selection process for the Liberal seat of Tangney.

While I don’t profess to know much about the views of scientist Dennis Jensen, who won the pre-selection tussle, it was interesting to have a chat to contender Jonathan Huston, who withdrew his nomination at the last minute.

Mr Huston, an army officer turned businessman who has been involved in some interesting work since he left the military in 1996, told me that one of the key issues he wanted to take to Canberra was that of flow-through shares – a tax-break for investors the minerals sector says is needed to rejuvenate exploration in Western Australia.

He points to Canada as an example where it has worked and said, if he had got through the process to take over Daryl Williams’s seat, this was the biggest issue that he planned to pursue in the hallowed halls of parliament.

Like many, he believes the activity in the mining community – both at production level and the strength of recent floats – belies the lack of exploration that will sustain our minerals sector into the future. But it was not to be, it seems, for Mr Huston said he was confronted by the thought of the never-ending regime of travel required by a Western Australian member of our Federal parliament.

With three young children, Mr Huston said he could not justify spending half his year on the east coast with a fair bit of air travel thrown in, and so decided to quit the contest.

“I made my decision based on family reasons,” Mr Huston said.

But he didn’t rule out taking another shot at a Federal seat in a few years, which shouldn’t be surprising for someone who has politics in the blood. Many readers may recall Mr Huston’s brother, Michael, ran against independent and former Liberal Dr Liz Constable for the State seat of Floreat.

Another election away might well be too long for some of WA’s miners, who need every friend they can get to have their voice heard properly in parliament.

Why only Mitsubushi?

SPEAKING of flow-through shares, it came to mind as I heard about the Federal Government’s $50 million commitment to promote jobs and retrain workers in South Australia due to the partial withdrawal of Mitsubishi.

I guess the workers in the Adelaide engine making facility can count their lucky stars that Mitsubishi’s problems came to a head during an election year, because I reckon such assistance would not be so forthcoming in the off-season, so to speak.

They are also lucky, if that’s an appropriate word, to be in a State with relatively little going for it economically at the moment and a bunch of key seats the Federal Liberals will dearly want to hold on to.

So what of this assistance and how does it relate to mining?

Well, I just wonder at the Federal Government’s ability to find such sums to limit the damage of the failure of a giant multi-national when it continues to ignore the pleas of minerals companies to inject new life into flagging exploration – an area where the beneficiaries will be small Australian companies at first, and the Federal Government later on down the track.

Of course, the mining community of WA is obviously not seen as an electoral threat. It is unlikely they’d put their electoral muscle behind Labor and risk the end of Australian Workplace Agreements, which are common in the sector.

In the electorate, there is also less for the Federal Government to gain.

Apart from the voters of Kalgoorlie, there may not be much flow-on from the flow-though shares. As much as I hate to admit it, the voters in Perth are far more divorced from the reality of mining’s impact on their lives than Adelaide’s residents are regarding the automotive industry that is helping to keep that economy alive.

Under the circumstances it is understandable, if not cynical, the Government has declined to pay the higher price for flow-through shares – $250 million over five years according to the Chambers of Minerals and Energy.

It is up to us to change this, and convince the powers that be it’s in their interest to use such funding positively to boost an industry where we have world scale.

STANDING BY BUSINESS. TRUSTED BY BUSINESS.

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