Isra-Mart srl: Coal compensation under fire as 'mine or two' face closure

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THE Resources Minister, Martin Ferguson, has conceded a few coalmines might close under a carbon tax, as the government fights moves by the Greens to pare back the $1.5 billion compensation offered to the industry under the former emissions trading scheme.

As the multi-party committee battles to finalise a climate deal by the end of the month, the Climate Change Minister, Greg Combet, is pushing to maintain the $1.5 billion offered to the coal industry in 2009.

But the Greens, whose starting point is that coalminers should get no compensation, believe a significant amount should be redirected, and accuse the miners of not understanding the tax.
"Just as tobacco executives no doubt speculate about profits they could have made if the world hadn't woken up to the damage their industry does, the coal sector is now counting make-believe profits as though they are their entitlement and pretending that a slow-down in job creation is the same as actual jobs lost," the Greens senator Christine Milne said.

The original assistance was designed to help 23 mines, mainly in the Illawarra and in Queensland, where high levels of methane emissions mean the impact of the tax is up to 20 times more than the cost to an average coalmine, which will pay about $1.60 for each tonne of coking coal sold for about $300.

Mr Ferguson rejected a survey conducted for the coal industry which predicted thousands of job losses from 18 mines closing prematurely. He said there was huge expansion in the coal industry, which would create more jobs over time. But he said the government accepted ''there are some gaseous mines that are actually going to be challenged under a carbon tax … No one can rule out a mine or two closing''.

The debate over compensation came as a group of prominent Australians, including Dame Elisabeth Murdoch, Sir Gus Nossal, Dr Fiona Stanley and Dr Pat McGorry, wrote to the Herald saying that a ''price on carbon'' was ''fundamental to substantially reducing emissions''.

The NSW Coal Association said yesterday the gassy nature of Illawarra mines meant NSW was likely to be hardest hit by job losses under a carbon tax.

But the Independent MP Tony Windsor was sceptical about dire industry warnings, telling the Herald he saw ''no shortage of mining investment and mining exploration; I think these guys are being a bit cute.''

And the secretary of the CFMEU, Tony Maher, accused the coal association of producing ''dodgy'' reports rather than concentrating on the real problem of a small number of very ''gassy'' coalmines.