Job cuts, car rego hikes as NT Treasurer unveils $800m in savings

UPDATE: The NT Government’s world first royalties scheme on the mining industry to increase budget revenue has been labelled “a very long way from a realistic policy proposal”

Northern Territory Treasurer Nicole Manison

UPDATE: The NT Government’s world first royalties scheme on the mining industry to increase budget revenue has been labelled “a very long way from a realistic policy proposal” by the Minerals Council of Australia NT Division.

Minerals Council of Australia NT Division executive director Drew Wagner said the proposed changes would reduce investment attractiveness.

The hybrid system will obtain royalties from both ad valorem and profits-based elements.

Mr Wagner believes the changes to royalties would hurt jobs and future growth in the sector.

He said the changes would make the Territory less appealing to mining operators.

“With nearly $5 billion of investment at stake and potential massive growth of the resources sector at a time when the Government says it wants to boost economic growth and jobs, the challenge for the government should be to expand this industry, not impose measures which reduce its investment attractiveness,” he said.

Meanwhile, the Community and Public Sector Union have labelled the announcement of 200 public service job cuts over the next two years as a terrible decision.

CPSU NT regional secretary Kay Densley said job cuts on this scale would hurt services regardless if they were targeted at the executive level.

“Job cuts on this scale can only mean that public services will suffer, and that there will be even more pressure on the staff who remain as they try to minimise the impact on the public,” she said.

Ms Densley said it was also a low act to cut pay rises for employees.

“Cutting the pay for many of the workers who will remain is also a low act, particularly considering it appears the Gunner Government can still afford to give politicians their full pay rises,” she said.

Drew Wagner, Minerals Council of Australia

EARLIER: More than a hundred public service job cuts, car license and registration hikes, a levy on property owners with vacant buildings and a new royalty scheme targeted at the mining sector are among $800 million in savings flagged today in grim budget measures.

Treasurer Nicole Manison said the NT government will cut extra jobs and freeze hiring and funding in the public service, lower pay rises and increase fees and charges by at least three per cent for residents as it grapples with a loss in funds from the federal Governments GST distribution.

A controversial new land tax or changes to the payroll tax system are not included.

Up to 100 public servants will be targeted for redundancies in the first year and then 50 a year after that.

Ms Manison said the recent $1.4 billion cut to the Territory’s GST revenues over four years, on top of the $2 billion reduction announced last year are having a serious impact.

“The massive reduction in GST means the Territory has lost more than $800 million per year in critical funding,” she said.

“It is simply not possible to match these cuts with savings or revenue measures — to do so would mean shutting down every school or hospital the Territory or unfairly taxing Territorians. This Government will not do that.

“These measures are needed and are additional to the targets set in the 2017 Budget. They will result in around $800 million in total savings by 2021-22.”

The 2018 Budget savings measures include:

•A reduction in the public sector wages policy from 2.5% to 2% to reflect wages growth in the Territory, from October 1, 2018 (for enterprise agreements not already in place or that have gone to ballot)

• A reduction in departments’ operational budget indexation to reflect CPI;

• Establishment of a targeted, voluntary redundancy scheme across government

• Consideration of a position freeze within the public sector to limit full time employment growth;

• Additional efficiencies from the Territory’s Government-owned Corporations;

• Reviewing grant arrangements to ensure value for money;

• Reducing repairs and maintenance expenditure following record stimulus programs in 2017-18.

Changes to the royalty scheme include:

•The introduction of a hybrid royalty scheme to ensure all operating mines in the Territory pay a minimum royalty to Territorians for the value of minerals they extract. From 1 July 2019, the new scheme requires mining companies to pay the greater of the existing 20 per cent profits-based scheme, or a value-based royalty on their gross mineral production revenue.

Working with industry to encourage the revitalisation of the Darwin CBD through innovative land use, a Derelict and Vacant Property Levy will commence from 1 July 2019.

More to come.