In a paper that seeks for the first time to put a dollar amount on the assistance that state governments give to Australia’s mining and energy industry the research body the Australia Institute (AI) reveals a staggering $18 billion has been handed over in the past six years.
The research body has published a new paper called Mining the Age of Entitlement: State Government Assistance to the Minerals and Fossil Fuel Sector.
The report shows the bulk of such assistance, through subsidies, concessions and cheap access to infrastructure, has occurred in Queensland and Western Australia.
The institute’s paper published today shows that since 2008-09, the Queensland government has provided more than $9.5 billion in direct support to mining and energy companies, while the Western Australia government has provided more than $6.2 billion.
The Institute says state governments are more usually associated with the provision of health, education and law enforcement than industry assistance.
As a result AI says it may surprise taxpayers to learn that state government assistance for the mineral and fossil fuel industries consumes significant amounts of their money.
Drawing comparisons AI said as an example, Queensland’s expenditure on fossil fuel industries in 2013-14 was similar to the amount to be spent on disability services and capital expenditure on hospitals.
“In other words Queensland will spend as much on supporting the mining industry as it does on supporting some of its most vulnerable citizens.
“Similarly, industry assistance in Western Australia is substantial when compared to police and health, and in New South Wales, it is comparable to other important budget items such as managing the state’s national parks and providing accommodation for those with disabilities.”
The Institute said supporters of Australia’s mineral and fossil fuel industries were quick to argue that royalties paid to state governments demonstrate those industries’ value and importance.
“Rarely, however, are these contributions compared with industry assistance. State expenditure on industry assistance makes up a significant proportion of what states receive through royalties, particularly in the big mining states of Queensland and Western Australia.
“In 2013- 14 Queensland is planning on spending $1.5 billion on industry assistance, almost 60 per cent of the $2.6 billion it expects to receive in royalties.”
The report is based on an analysis of state government budget papers that are produced by state treasuries each year.
Australia Institute executive director Richard Denniss said his paper was not meant to present an argument for or against government assistance to these industries; however, it should highlight that these industries were beneficiaries of government assistance too, just like other industries.
