A lucrative community investment trust funded by WA's booming mining sector is being established by the state government to help pay for critical infrastructure in remote communities, as well as significant "legacy" projects.
An initial $750 million has been committed to the fund, which is being touted as a means for the state to get permanent and tangible outcomes for the benefit of the community from the ongoing resources boom.
Among the miners contributing to the fund are Rio Tinto and BHP ($250 million each), Hancock Prospecting ($100 million), Woodside ($50 million), Chevron ($50 million) and Mineral Resources ($50 million).
It's hoped the fund will ultimately net well over $1 billion, with other miners to be asked to contribute.
Marking 'a good time'
Premier Mark McGowan said the initiative would help pay for "major legacy projects" and was a way for mining companies to give back to the community, "considering the very good times we've had over the course of the last few years, and the very strong results that they've achieved."
Projects to be funded include an Aboriginal Cultural Centre for Perth's CBD, the refurbishment of the Perth Concert Hall and upgrades to the Perth Zoo.
The $400 million Aboriginal Cultural Centre, to be built on the banks of the Swan River or Derbarl Yerrigan, in Perth’s CBD, is due to be completed by 2028 and has already attracted $50 million in state government funding and $52 million from the federal government.
"So this is a way of Western Australia, receiving some support the state that provides the huge bulk of the revenue to these businesses support for some of those important legacy projects," Mr McGowan said.
Remote community upgrades
Rio Tinto chief executive Simon Trott said the fund was "a great example of industry and government working together to progress projects that will touch the lives of generations of West Australians".
Mr Trott said the funding was for specific projects “that align with our objectives” and was not an ongoing or open-ended commitment.
Mr McGowan said mining companies would be able to nominate projects they wanted to be funded, especially in the remote areas in which they operate.
He said a board of governance with an independent chair would be appointed to oversee the fund, including representatives from government and the Chamber of Minerals and Industry.
Mr McGowan said the initiative would be particularly important for remote Aboriginal communities, which no longer received any federal government funding, and there was a significant backlog of work that needed doing, including new housing.
It comes as a September audit of WA's finances found an extra $344 million in operating surplus, taking the total surplus to $6 billion for the last financial year, an Australian record.
Risk to GST share
Opposition Leader Mia Davies welcomed the mining company money, but questioned why the government needed it, given the size of the surplus.
"It's unusual in a state which has a $6 billion surplus for the Premier to be going cap in hand to these mining companies and not expecting anything in return," she said.
"Perhaps this gives the government the opportunity to use the $6 billion its got in the Premier's back pocket to spend on the basics he's failing on like health, housing, cost of living initiatives for Western Australians."
She said the government appeared to be "chasing a good news headline" to distract from its mismanagement of other issues.
Opposition treasury spokesperson Steve Thomas said he was concerned about the GST implications of the project if mining companies ultimately ended up paying less corporate tax as a result, which could lessen WA's share of GST receipts in the future.
"There's a cost to be had for this in the future, and that cost is the risk to the GST over time," he said.
He was also concerned about the availability of workers to build the new infrastructure, given the widespread labour shortage.
