Mrs PADGHAM-PURICH - 1994-08-23
Why was the Mineral Royalties Branch taken from the Department of Mines and Energy and transferred to Treasury, who made this decision and how was the information conveyed to personnel of the Department of Mines and Energy?
ANSWER
Mr Speaker, as part of his administrative arrangements and the changes that were made, the Chief Minister decided to move the Mineral Royalty Branch from the Department of Mines and Energy to Treasury. The background for that decision, as he explained it to me, is very simple. It involves an excellent cell group within the Department of Mines and Energy that has worked extremely hard over a long period on what can be described as a very complicated mineral royalty regime that we have in the Northern Territory. The profit-based mineral royalty regime is not as easy as saying simply that it involves 18%. The information has to be analysed carefully to ascertain what are the actual profits. Many deductions are taken into account for capital infrastructure and a whole range of other issues that mining companies can claim compensation for ...
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Mrs Padgham-Purich: Then why aren't you leaving them with the Mines Branch?
Mr COULTER: The reason is that the best corporate brains are available to the mining companies to ensure that they pay the minimum level of royalties that they have to. I pay full credit to those people within the Department of Mines and Energy. What we have done is offer them the very considerable skills of the combined Treasury officers to assist them when they come face to face with some of Australia's, and indeed the world's, best accountants who represent these mining companies as well as the considerable legal resources that these mining companies can muster.
Recently, we had a case in which a petroleum company deputation visited my office accompanied by 3 QCs to discuss a matter of compensation. Those are the kind of resources to which the mining companies have access. We are talking about big dollars. Half a percentage point might amount to $2m or $3m and therefore it is worth their while to have a crack at it. What we have done now is to provide our people with the support of Treasury officers to ensure that there is no intimidation by the Australian and international mining companies that are represented and operate here. I am not sure about the means by which the information was relayed to them. Perhaps that question might be better addressed to the Minister for Mines and Energy.
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ANSWER
Mr Speaker, as part of his administrative arrangements and the changes that were made, the Chief Minister decided to move the Mineral Royalty Branch from the Department of Mines and Energy to Treasury. The background for that decision, as he explained it to me, is very simple. It involves an excellent cell group within the Department of Mines and Energy that has worked extremely hard over a long period on what can be described as a very complicated mineral royalty regime that we have in the Northern Territory. The profit-based mineral royalty regime is not as easy as saying simply that it involves 18%. The information has to be analysed carefully to ascertain what are the actual profits. Many deductions are taken into account for capital infrastructure and a whole range of other issues that mining companies can claim compensation for ...
Page 46
Mrs Padgham-Purich: Then why aren't you leaving them with the Mines Branch?
Mr COULTER: The reason is that the best corporate brains are available to the mining companies to ensure that they pay the minimum level of royalties that they have to. I pay full credit to those people within the Department of Mines and Energy. What we have done is offer them the very considerable skills of the combined Treasury officers to assist them when they come face to face with some of Australia's, and indeed the world's, best accountants who represent these mining companies as well as the considerable legal resources that these mining companies can muster.
Recently, we had a case in which a petroleum company deputation visited my office accompanied by 3 QCs to discuss a matter of compensation. Those are the kind of resources to which the mining companies have access. We are talking about big dollars. Half a percentage point might amount to $2m or $3m and therefore it is worth their while to have a crack at it. What we have done now is to provide our people with the support of Treasury officers to ensure that there is no intimidation by the Australian and international mining companies that are represented and operate here. I am not sure about the means by which the information was relayed to them. Perhaps that question might be better addressed to the Minister for Mines and Energy.
Page 47
Last updated: 09 Aug 2016