Roy Hill’s 4,000 Government Approvals

Roy Hill the mega iron-ore project is the recipient of the Project of the Year Award at the 2016 Project Management Institute Australian Awards. At which Mrs Gina Rinehart, Chairman of Roy Hill Holdings spoke of the 4000 government approvals, permits, and licenses required pre-construction.[i] The ultimate scope of red tape in Australia is troublesome, as it stems from many different regulators spanning thousands of pages of legislation.[ii] Many obligations are spread and duplicated across jurisdictions, between state and federal governments.[iii] Mrs Rinehart went on to say that red tape is Australia’s largest industry, according to the IPA’s cost of red tape to the Australian economy.[iv] The Institute for Public Affairs has found that red tape costs the Australian economy $176 billion each year in forgone economic output.[v]

A Deloitte Australia report reported that compliance with public sector rules in Australia alone amounted a $95 billion cost for the economy.[vi] The total cost of red tape for Australia raises to $249 billion when you add in the additional time for employees compliance with rules and regulations from the private sector.[vii] While, self-imposed rules costs annually $21 billion and $134 billion for compliance costs. Project delays caused by red tape inhibit a business’s incentives to invest as their ability to for new market opportunities diminishes.[viii] Another prominent example in Australia includes thermal coal where the average project can experience an additional 1.3 years of delay relative to other countries.[ix] In 2006 alone the mining workforce spent 7.6 per cent of its time completing compliance activities, and by 2011 the number increased to 8.9 per cent.[x] According to the government’s registry, Australian businesses and individuals are now burdened by over 30,000 licenses, permits and approvals.


Endnotes

[i] Hart, B. (2016). Media Release: Roy Hill Wins PMI Australia’s Project of the Year Award Australia’s Premier Project Award. Retrieved [17/10/2016] from <https://www.royhill.com.au/wp-content/uploads/2016/05/Roy-Hill-Wins-PMI-Project-Award-1.pdf>.

[ii] Allen, D. (2016). Red Tape the Big Hurdle for the Mining Industry. Institute of Public Affairs. Retrieved [17/10/2016] from <http://ipa.org.au/news/3505/red-tape-the-big-hurdle-for-the-mining-industry>.

[iii] Allen, D. (2016). Red Tape the Big Hurdle for the Mining Industry. Institute of Public Affairs. Retrieved [17/10/2016] from <http://ipa.org.au/news/3505/red-tape-the-big-hurdle-for-the-mining-industry>.

[iv] Hart, B. (2016). Media Release: Roy Hill Wins PMI Australia’s Project of the Year Award Australia’s Premier Project Award. Retrieved [17/10/2016] from <https://www.royhill.com.au/wp-content/uploads/2016/05/Roy-Hill-Wins-PMI-Project-Award-1.pdf>.

[v] Allen, D. (2016). Red Tape the Big Hurdle for the Mining Industry. Institute of Public Affairs. Retrieved [17/10/2016] from <http://ipa.org.au/news/3505/red-tape-the-big-hurdle-for-the-mining-industry>.

[vi] Deloitte. (2016). Tracking the Trends 2016: The Top 10 Issues Mining Companies Will Face in the Coming Year. Retrieved [17/10/2016] from <https://www2.deloitte.com/content/dam/Deloitte/global/Documents/Energy-and-Resources/gx-er-tracking-the-trends-2016.pdf>.

[vii] Deloitte. (2016). Tracking the Trends 2016: The Top 10 Issues Mining Companies Will Face in the Coming Year. Retrieved [17/10/2016] from <https://www2.deloitte.com/content/dam/Deloitte/global/Documents/Energy-and-Resources/gx-er-tracking-the-trends-2016.pdf>.

[viii] Port Jackson Partners. (2012). Opportunity at Risk: Regaining our Competitive Edge in Mineral Resources. Minerals Council of Australia. Retrieved [17/10/2016] from <http://www.minerals.org.au/file_upload/files/presentations/mca_opportunity_at_risk_FINAL.pdf>.

[ix] Port Jackson Partners. (2012). Opportunity at Risk: Regaining our Competitive Edge in Mineral Resources. Minerals Council of Australia. Retrieved [17/10/2016] from <http://www.minerals.org.au/file_upload/files/presentations/mca_opportunity_at_risk_FINAL.pdf>.

[x] Allen, D. (2016). Red Tape the Big Hurdle for the Mining Industry. Institute of Public Affairs. Retrieved [17/10/2016] from <http://ipa.org.au/news/3505/red-tape-the-big-hurdle-for-the-mining-industry>.

Featured image supplied free from Pixabay.

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