Gold Royalty will not change, Victorian government says, rejecting miners' calls

Picture: NONI HYETT
Picture: NONI HYETT

THE Victorian government has rejected calls to rewrite a new gold royalty that two central Victorian mines will pay from January.

The decision has been lambasted by peak mining body the Minerals Council of Australia, which said it would have a "harsh and damaging impact on regional economies and jobs".

Four gold mines including at Fosterville and Costerfield will now pay of 2.75 per cent of market production value for the gold they dig up.

While the industry does not oppose the royalty it has mounted a campaign for change, fearing it has not been fully thought out will have unintended consequences.

"Any gold royalty imposed in Victoria must be fit for purpose," the Minerals Council's James Sorahan said.

Central to the campaign were protections for miners to keep exploring for new seams of gold.

Mr Sorahan characterised exploration as the "lifeblood" of the industry, which must constantly search for the next areas to dig to remain viable.

"A royalty hitting in only six months time at a rate higher than Western Australia's will eat into exploration expenditure. That puts long-term viability at risk," he said in August after pitching an idea for an "exploration offset" that mines could take off their royalty bills to government officials.

However, that idea was knocked back by the government.

Money being spent on exploration in Victoria is at record highs and would likely stay strong as new tracts of land is opened for exploration east and north of Bendigo, resources minister Jaclyn Symes said in a notice of the government's decision.

No other mineral had an exploration offset, she wrote in the notice, which was published in the Victorian Government Gazette.

Ms Symes also rejected calls to delay the royalty for 12 months for more community consultations.

"Any delay from the government's publicly announced plan would create significant uncertainty in the market and may have adverse consequences on industry," she wrote.

Not included in the notice was a response to the City of Greater Bendigo's calls for all funds raised by the royalty to stay in the regions gold was dug up.

It had argued that mines in the area will produce the most royalty revenue for Victoria.

"The case for directing proceeds from the royalty back to the gold producing areas of Victoria has strong merit when it is considered that many of these communities are experiencing a range of disadvantages when compared to other parts of the state," the council wrote in a submission during public consultations.

Those included higher levels of unemployment, poverty, high waiting lists for public housing and poorer educational outcomes.

The Minerals Council is vowing to lobby the opposition and upper house cross-benchers to delay the royalty coming into effect.

The government has been contacted for comment.

This story Government rejects calls to rewrite gold royalty first appeared on Bendigo Advertiser.