Call for mining companies to publish payments

A coalition of organisations and individuals is asking Australian mining giants to make mining payments to governments more transparent.

The coalition is asking Australian mining, oil and gas companies based here and listed on the ASX to report all payments to governments in the countries in which they operate.

The call comes from the Publish What you Pay coalition as hundreds of government officials, mining companies and NGOs meet in Sydney for the Extractive Industries Transparency Initiative Global conference today and Friday.

“This week, all eyes are on Australia to see if we follow the rest of the world in introducing new rules that aim to stamp out corruption and help people in poverty,” Publish What You Pay Australia coordinator Claire Spoors said.

The coalition has a voluntary initiative called the Extractive Industries Transparency Initiative. When countries sign up for it, they require mining companies operating in those countries to publish their payments to governments.

Spoors said more than 60 per cent of the world’s poorest people live in countries rich in natural resources but rarely have access to the wealth.

“There is no accountability of the government for the money that goes to them so corruption and conflict is quite rife in countries where there are lots of natural resources,” Spoors said.

“So if you look at a country like Nigeria they have corruption problems and also conflict around the Niger Delta where the extraction occurs.”

Under legislation in the US and recently agreed EU rules, companies will be required to disclose payments such as taxes, royalties, fees and bonuses to governments where they operate at a project level.

The reporting period in America will come into force in October.

“So we know mining companies are already preparing to disclose information. There are Australian companies that are cross listed in the US. So BHP and Rio will have to disclose.”

This means local communities can find out how much their government will receive in return for the extraction of their finite natural resources.

The payment disclosures will be public and can be accessed by anyone. They can utilise this information to hold their local governments to account for money they know they have received.

Disclosure of payments will restrict cases of bribery or embezzlement as the government will be held accountable for any inconsistency.

Spoors said secrecy and corruption often meant income from mining goes missing and does not benefit communities.

This denies them access to basic facilities like clean water and health care.

“The starting point for tackling corruption, fraud and poor governance in the natural resource sector is transparency,” she said.

Calls to report payments are garnering support from the likes of UK Prime Minister David Cameron, who called on other countries to bring in payment disclosure legislation last week.

According to Spoors, her coalition group has been campaigning to get Australia on board since 2011.

Delegates at this week’s Mining for Development conference said transparency was crucial for countries like Mozambique, which should benefit from minerals buried in their resource-rich land.

Director-general of AusAID Peter Baxter, who organised the conference, said last week developing countries had maximum mining potential and saw this as an opportunity to decrease poverty.

“Mining can help poor people directly by employing them and buying their products – but relatively few people get jobs in mines,” he said.

Mozambique became a member of the EITI in October last year. Mozambique Minerals Resources Minister Esperanca Bias said mining giants must show social responsibility in the countries they operate, including giving back to local communities.

“Mineral resources are not renewable,” Bias said in Sydney on Monday.

“How they are removed from the surface, [from] underground or [the] water may only be done once, but the impacts of that removal shall forever impact the natural and economic environment.”

According to the SMH, Rio Tinto had to write down the value of its coal reserves in Mozambique’s Tete province by $3 billion this year.

It came as the government forbade it from taking coal from the company’s mine down the Zambezi River.

The government now wants the company to construct a railway line to a new port at Macuse on the east coast.

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