The 2022 Federal Budget will commit over $150 million towards critical minerals projects to be informed by the forthcoming National Critical Minerals Strategy, as well as delivering additional university places and fee-free TAFE and vocational education places to deliver the skilled workforce needed.
An initial four-year spend of $50.5 million will be committed to the new Australian Critical Minerals Research and Development Hub alongside a three year commitment to the $50 million Critical Minerals Development Program, building on a recent $50 million investment in six critical minerals projects.
The Hub will combine expertise from Geoscience Australia, the CSIRO, and the Australian Nuclear Science and Technology Organisation to work with Australian industry to address technical challenges and support international research and development collaborations.
The Government will also allocate $50 million over three years to the Critical Minerals Development Program for competitive grants to support early and mid-stage critical minerals projects, building on the $50 million recently committed to six key projects across Australia.
The investments will be informed by the National Critical Minerals Strategy developed in consultation with industry and community stakeholders, including traditional owners.
The Strategy will complement other Government initiatives including the National Battery Strategy and the Electric Vehicle Strategy.
The National Reconstruction Fund will also include the $1 billion Value Adding in Resources Fund which will work alongside the $2 billion Critical Minerals Facility.
Prime Minister, Anthony Albanese, said the initiatives would support further development in the critical minerals and resources sector.
“Australia’s natural resources have powered our nation and we are committed to supporting the critical minerals sector and new clean technologies to reach our target of net zero, and make our nation an economic powerhouse with a clean energy future,” Mr Albanese said.
“Today’s new initiatives will ensure we can create and support local jobs, diversify global supply chains and meet the growing demand for batteries, electric vehicles and clean energy technology.
“These minerals will be critical to Australia achieving net zero emissions, and to helping the rest of the world make that transition as well.”
The International Energy Agency projects mineral demand for use in electric vehicles and battery storage could grow at least 30 times to 2040.
Australia is the world’s largest lithium producer, and latest figures forecast the value of lithium exports are due to increase more than ten fold over two years, from $1.1 billion in 2020-21 to almost $14 billion in 2022-23, with continued growth over future years.
The development of a battery industry could contribute $7.4 billion annually to our economy and support 34,700 jobs by 2030.
The Chamber of Minerals and Energy of WA (CME) welcomed the announcement. CME Chief Executive, Rebecca Tomkinson, said the opportunity to help fashion such an important strategy would be well received by the West Australian mining and resources sector.
“Australia has a massive opportunity in the critical minerals space, to create jobs and attract investment that helps communities flourish, and to add value through mid and downstream processing,” Ms Tomkinson said.
“But taking full advantage of that opportunity requires collaboration and conversation across state borders, and for there to be a clear national vision for what Australia can achieve with its critical mineral wealth.
“I know our member companies will very much welcome the opportunity to have a ‘seat at the table’ and help mould a strategy that is going to plot the path for a key part of the mining and resources sector for decades to come.
“On behalf of the CME membership, I’d like to thank the Albanese Government for its willingness to listen to what’s important to industry and engage a wide range of stakeholders in formulating this strategy.”
The Minerals Council of Australia (MCA) shared similar sentiments. MCA Chief Executive Officer, Tania Constable, said a comprehensive critical minerals strategy will drive economic prosperity in the sector.
“A comprehensive strategy and national approach is essential to ensuring the mining industry continues to drive Australia’s economic prosperity, as it has done for over a decade,” Ms Constable said.
“This strategy is vital for both Australia and our trading partners aiming to reduce the carbon emissions to net zero by 2050.
“The government’s new strategy must focus on the broad policy settings required for Australia to maximise its share of this investment opportunity.
“Australia has some of the world’s largest reserves of critical minerals, but will face significant competition for the capital required to develop these assets. Improving productivity lies at that heart of this challenge and urgent policy changes are needed.”
Consultation for the National Critical Minerals Strategy will be open until 2 December 2022, for more information visit the Department of Industry, Science and Resources consultation website, here.
Combatting the skills shortage
The Federal Government is delivering more university places and fee-free TAFE and vocational education places to deliver the skilled workforce needed now and in the future.
More teachers, nurses and engineers will be trained after 20,000 extra university places were allocated to courses in areas of critical skills needs, providing extra places for people studying bachelor and sub-bachelor courses in areas of skills need across 42 successful higher education providers.
The five higher education providers receiving the most funding for additional places are:
- Charles Darwin University
- University of Wollongong
- Curtin University
- Edith Cowan University
- University of Newcastle
Higher education providers have been allocated places in a variety of areas of skills shortage, including 1,738 in engineering. The additional places will be for students starting in 2023 and 2024, with an investment of up to $485.5 million over the next four years.
The 20,000 additional places will be allocated to students under-represented at Australian universities including those from poorer backgrounds, Indigenous Australians and students from rural and remote Australia.
The extra places will mean more Australians from these backgrounds will access training to be teachers, nurses, health professionals, engineers and other areas facing a skills shortage.
The government is also delivering 180,000 fee-free TAFE and vocational education places, with extra support for participation of women and other disadvantaged groups.
This initiative is a key Budget measure of the Federal Government and is part of the broader commitment to deliver 480,000 fee-free TAFE and vocational education places – commencing with the 180,000 training places in 2023 – to support industries experiencing skills shortages to be delivered in partnership with states and territories.
Extra training places will be delivered in the critical skill shortage areas:
- Technology and increasing digital skills
- Construction
- Increasing sovereign capability in areas like manufacturing, and Defence
It also comes with a commitment to provide access to priority cohorts including women, Indigenous Australians, and those living with disability.
The Federal Government will deliver $550 million this Budget as part of the 12-month National Skills Agreement, with funding matched by states and territories, with discussions underway regarding the specific funding and places in each state and territory consistent with other Federal Financing arrangements.
Federal Education Minister, Jason Clare, speaking about the Budget, said, “This means more teachers, nurses and engineers and it means more Australians from poor families and rural and remote Australia doing these jobs. That’s life-changing.”
Federal Skills and Training Minister, Brendan O’Connor, said, “After a decade of inaction by the previous Government, Labor is wasting no time to address the skills shortages the country faces. These fee-free training places will provide Australians opportunities to get trained for the jobs in demand now and in the future and deliver to business the skilled workers they need.”
Comments from industry
The Queensland Resources Council (QRC) said the latest Federal Budget has again confirmed how important the sector is to Australia’s economic future.
QRC Chief Executive, Ian Macfarlane, said continuing international demand for Queensland’s coal, gas and metals is the major contributor to Australia’s record terms of trade.
“For every three months commodity prices remain high, the resources sector is forecast to contribute an additional $43.8 billion in GDP, and $10 billion of tax revenue over the next two years, which is a staggering result that shows just how important mining is to our economic future,” Mr Macfarlane said.
“Resources and energy exports were the biggest contributor to a record 12 per cent increase in Australia’s terms of trade, underpinning our economic strength.
“It is good to see the Federal Government acknowledge the importance, and the contribution, of the resources sector to the nation’s economic security.
The QRC welcomes the Commonwealth’s focus on boosting skilled worker numbers by offering free TAFE places.
“Skilled worker shortage is a major issue for the Queensland resources sector and it’s vital the Commonwealth remains focused on the issue to ensure the industry can reach its full productivity and maximise jobs and economic opportunities for all Australians,” Mr Macfarlane said.
The Minerals Council of Australia (MCA) has said mining’s contribution to the Federal Budget is extraordinary and highlights once more the importance of mining investment to the Australian economy.
According to the MCA, employment in mining in the past 20 years has tripled and wages have doubled, benefiting hundreds of thousands of Australians, especially in regional areas.
MCA said that it is clear from the economic outlook presented by the Treasurer in handing down the Budget that the government must embark on the productivity reforms needed to secure the nation’s economic future, including attracting a large slice of the $4 trillion of mining investment required to transform the world to net zero emissions by 2050.
MCA believes it is increased productivity that will drive business growth and with the right policies Australian mining can undergo another major expansion in investment, however, to fully capture the economic potential of this opportunity, government policies must support investment in exploration, mining, minerals processing and mining-related manufacturing.
According to the MCA, measures such as the new programs for funding students at universities and in technical and further education, particularly those in regional Australia, are a good start, as are government initiatives on critical materials such as funding the new research and development hub and other development programs.
The Chamber of Minerals and Energy (CME) of WA welcomes the Federal Budget announcement and its focus on developing Australia’s critical mineral industry, encouraging low-emissions technology and decarbonisation, and growing the country’s workforce of the future.
CME Chief Executive, Rebecca Tomkinson, said the Budget again highlighted the significant contribution the Western Australian mining and resources sector made to economies and communities around the country.
“CME and its member companies are incredibly proud of the way the WA mining and resources sector positively influences people’s lives across the country,” Ms Tomkinson said.
Among the other significant announcements contained in the Budget, or unveiled in the lead-up to it, and welcomed by the WA mining and resources sector:
- $50.5 million to establish an Australian Critical Minerals Research and Development Hub
- $50 million for a Critical Minerals Development Program, to fund competitive grants supporting early and mid-stage projects
- The Pilbara being among three regions sharing in $672.7 million over seven years from 2022-23 towards enabling infrastructure to support emerging industries and economic transition
- $4.7 billion over four years from 2022-23 (and $1.7 billion per year ongoing) to deliver cheaper child care, easing the cost of living for families and reducing barriers to greater workforce participation
- The Rewiring The Nation initiative, with $20 billion provided to rebuild and modernise the energy grid
- $275.7 million over four years from 2022-23 towards establishing a strong Department of Climate Change, Energy, the Environment and Water
- Expansion of the Migration Program to 195,000 places in 2022-23, with more than 90 per cent of new places for skilled migrants, and more than a quarter targeted to regional areas
- Establishment of a $1.9 billion Powering the Regions Fund to help transform regional industries and help regional Australians access the economic opportunities of decarbonisation
- $100 million to the New Energy Apprenticeships and New Energy Skills programs
- $105.2 million to support First Nations people to respond to climate change in their communities
- Grants of $113.6 million for manufacturing upgrades to boost Australia’s competitiveness, invest in its regions and reduce carbon output
- $634 million to fund transport infrastructure in WA, including the $400 million for the Alice Springs to Halls Creek Corridor upgrade
- Provision of 20,000 additional university places for disadvantaged Australians
- $10.0 million over three years from 2022-23 to support research and development to advance new commercially viable projects for methane abatement in the resources sector
- $14.2 million over four years from 2022-23 to develop a National Rail Manufacturing Plan to ensure more trains are built in Australia, support skilled manufacturing and expand the local rail industry
- $47.2 million over six years from 2022-23 to support the development of talent and leadership in Australian science and technology
- $5.8 million over five years from 2022-23 to support women in science, technology, engineering and maths (STEM) through the Women in STEM and Entrepreneurship program and to undertake an independent review of existing STEM programs
Ms Tomkinson said it was pleasing to see the Budget address areas of priority for the Western Australia mining and resources sector.
“The commitment to the $15 billion National Reconstruction Fund to transform and strengthen industries is most welcome,” Ms Tomkinson said.
“Up to $1 billion of that being allocated to a Value-Adding In Resources Fund very much aligns with the progress the Western Australian mining and resources sector is already making in expanding its mid and downstream processing capabilities.
“Our industry, along with many others, has spoken openly about ongoing challenges with skills shortages.
“It’s encouraging to see this Budget tackle the situation through training measures such as an additional 465,000 fee-free TAFE places, and also by expanding permanent migration and committing more than $42 million to accelerate visa processing and reduce backlogs.”
Ms Tomkinson said CME and its member companies also welcome Budget measures aimed at boosting the Australian critical minerals industry and decarbonisation across a variety of industries, saying the measures align with the work the sector is undertaking to grow its ability to extract and refine forward-facing commodities, and to reduce emissions, working towards net zero targets.
“We also applaud the $42.5 million allocated over four years to implement the Federal Government’s response to recommendations of the Respect@Work Report, and the $1.7 billion committed over six years to support women’s safety,” Ms Tomkinson said.
