The Resources Sector: Queensland’s ‘nest egg’

Ian Macfarlane, Chief Executive Queensland Resources Council

In 2010-11 the Queensland Resources Council (QRC) published its report on the economic impact of the resources sector for the first time. That year, the sector supported more than 294,600 jobs and created a total economic value of $49.4 billion for the state economy.

They were impressive figures at the time that illustrated just how important the resources sector was becoming to every Queensland town and city. More than a decade later, the figures are astonishing. Even for a sector where the billions roll off the tongue, this year’s contribution is one for the record books.

The 2022-23 Economic Contribution Report

QRC’s economic contribution report for 2022/23 shows the resources sector is now worth $116.8 billion to the Queensland economy. It also supports almost 533,000 jobs, both directly in resources projects as well as in the supporting jobs that buoy up every town and city in Queensland.

Our industry now makes up one in every four dollars in the Queensland economy and supports one in every six jobs. It’s no exaggeration to say Queensland’s future depends on a strong and vibrant resources sector - every Queensland community is built on the resources sector in one way or the other.

A substantial part of the value of the resources sector comes from the royalties it pays to the Queensland Government, which was more than $18 billion this year. These royalties help pay for the roads, police, hospitals and schools Queenslanders rely on every day.

For the majority of Queenslanders who don’t work on a mine site or resources project, these are the big-ticket items that demonstrate why the resources sector is indispensable to all of our lives. But so many more Queenslanders benefit from the prosperity of our sector, even if they’re not one of the 61,430 people directly employed on a resources project.

From the tradies in engineering workshops in Mackay, to the baristas in Brisbane who brew the coffee for fly-in fly-out workers, the resources sector is the foundation on which Queensland’s diverse economic base is built.

No wonder the resources sector is often described as the golden goose. Or as I prefer to say, the resources sector is Queensland’s nest egg.

Mining is a long-term game, and it has always been the case that the multibillion-dollar large-scale, long-term investments in the resources sector deliver for Queenslanders over decades, not years.

Excessive royalties now sending negative signals to investors

Our royalty system has worked well in the past by delivering a fair return for Queenslanders while maintaining our state’s reputation as an attractive, long-term destination for resource investment.

The previous royalty regime took into account that Queenslanders own the resources in the ground and are entitled to their fair share in the benefits of mining. The rates were struck at a level that provided investors with the confidence they needed to support new greenfield projects.

However, the next wave of long-term investment in Queensland’s resources sector is now at risk because of an excessive new tax regime, and all Queenslanders stand to lose out. Our royalty rates are now uncompetitive and will send future investment to other states and other countries.

That is why the Queensland Resources Council has been unrelenting in our advocacy for the sector through a community information campaign to ensure Queenslanders are aware of what’s at risk.

Our message is simple – by introducing the world’s highest coal royalty rates, the Queensland Government is damaging Queensland’s nest egg. When you hurt Queensland’s resources sector, you hurt Queensland’s future.

Already, projects are being cancelled or delayed, and it’s not just the coal sector where the downturn will be felt. Queensland’s uncompetitive royalty rates send a signal to all investors across all commodities - from coal to critical minerals - that Queensland is now a riskier place to invest capital compared with other resources-rich areas in Australia and around the world.

Investing in the future skilled workforce

The other part of the resources puzzle causing concern is the challenge of accessing the skilled workforce needed to help deliver on Queensland’s rich resources potential.

The career opportunities in our sector are as diverse as they are remarkable. As the resources industry plays its role in the development of commodities to support lower emissions economies, there is a need for a new and more diverse skill set to facilitate the changes required.

The QRC’s latest skills campaign, called ‘Shape Your Future, Innovate Our World’, will help address this challenge through the promotion of career opportunities for ‘Gen Z’ school leavers as well as university and trade skills graduates.

The campaign centres around a video and website aimed at attracting the attention of environmentally conscious and aspirational young people who want to make a difference in the world.

Queensland is built on the resources sector – literally. This year, the QRC has taken the opportunity to travel across our state’s regional resources communities, from Mount Isa and Townsville, to Moranbah, Mackay and Rockhampton and to the Western Downs.

Everywhere we went, it was clear how highly valued our industry was to regional towns and businesses. These trips reaffirmed the importance of a strong and resilient resources sector to Queensland.

On a personal note, this will be my last article for the Bowen Basin Mining Club Yearbook. After seven years, I am retiring from the role of QRC Chief Executive at the end of this year. I will miss travelling to our vibrant resources regions, but this definitely doesn’t signal the end to my involvement with the resources sector.

As a proud regional Queenslander based in Toowoomba, I will continue to take every opportunity to support the resources sector and speak up about the incredible benefits it delivers to our state.

I hope you will continue to join me in supporting our sector through the years ahead. I wish you all the best. 