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Australia’s mining boom puts pressure on local communities

Posted by Ram Kumar Shrestha on June 30, 2012

As towns near mines become dominated by contract workers, rents rise and the economic and social landscape changes

Australia mining

Contract workers in one Australian town, Moranbah, number 6,500 to the 8,500 locals, with accommodation to house another 3,500 workers under way. Photograph: AFP

It’s still dark on a chilly winter’s morning in central Queensland and a large city bus enters a residential cul-de-sac. The bungalows here wouldn’t be out of place in a rural version of Neighbours, their large grassy verges perfect for kids to play cricket on.

But the bus has not come to pick up the children. It’s here to take contract workers to their shifts in the town’s mining and construction industries.

Denise Robertson has lived here with her husband and three children for a decade. “We came to Moranbah because it was full of families and children. Every year, we used to have our Christmas BBQs on the street,” she said. “Now it’s full of contractors and we don’t know who is coming and going.”

Seven three-bedroom apartments have been built for fly-in fly-out (Fifo) or drive-in drive-out (Dido) mining industry workers on a single block at the end of the cul-de-sac. Five more apartments have been approved behind Robertson’s house and there is an application in for another three to be built directly opposite.

“Cars come in and go out so often that I don’t know how many people live in the street any more,” said Robertson.

Moranbah, like many towns in Queensland’s Bowen basin, is in the grip of the country’s once-in-a-generation mining boom. The area, 600 miles north of Brisbane and two hours’ drive inland from the Great Barrier Reef, is home to Australia‘s richest coal reserves and is experiencing the highs and lows of a rapidly expanding industry. The mining boom is helping the Australian economy buck global economic woes. But there are downsides too, as the burgeoning industries skew local economies and make it that much harder for other businesses to thrive.

“There’s nothing anywhere else like what we’re seeing in Moranbah,” said the demographer Bernard Salt, who recently completed a study into the area for the local regional council. The town has a permanent residential population of 8,500. Its non-resident Fifo/Didoworkers are estimated to number another 6,500. Accommodation to house 3,500 more single workers has just been approved, to be built on the southern side of the town.

“It’s towns like this which are at a tipping point,” said Salt. “The fear is that as the non-resident population which works in the mining industry rises, the services in the local area will become so stretched that the town will cave in on itself,” he said.

In the town square, shops have closed as rents rocket. Some people prefer to drive the four-hour round trip to the coast to do their weekly grocery shop because the local supermarket often runs low on essentials.

Across the regional council area, the picture is much the same. The number of non-residents is predicted to grow by 40% over the next year, as more mines come on line. Workers are mostly attracted by the high salaries, currently estimated to be more than double the national average. But non-mining businesses in the town can struggle to get staff. Roger Ferguson, who runs a motel in Moranbah, said he has had to hire three workers from Thailand because he can’t get local staff to fill vacancies. “People don’t want to work for A$25 [£16] an hour when they can earn A$60-70 an hour working in the mines,” he said.

Moranbah’s mayor, Anne Baker, said her town is pro-mining and a large proportion of its permanent residents work in the industry. But, she said: “It’s hard to sustain livability in your community if you’re going to be inundated with non-residents.”

She cites housing as the single biggest barrier to bringing families to the town. A four-bedroom house in town often costs A$10,000 a month to rent. To buy one would cost close to A$1m.

“We need more affordable family accommodation,” said Baker, who is calling on greater investment into the region’s infrastructure.

The federal government’s controversial mining tax on iron ore and coal, starting on 1 July (a 30% tax on company’s annual profits over A$75m), is intended to spread the benefits of the mining boom to all Australians. The government estimates it will raise A$13.4bn over the first four years, some of which will be returned to low and middle income earners in the form of tax breaks and pension concessions. Small businesses will also get tax breaks and a regional infrastructure fund will put money into critical infrastructure in country areas.

For Salt, it will take more than an injection of cash from the government’s mining tax to save towns like Moranbah.

“There needs to be a nationbuilding commitment to places like Moranbah, including improved infrastructure and services for the people who live there,” he said. “If we don’t address this, we will end up with just a series of hotel towns with hotel services where the population will be transient and come in and out just for work.”


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