Diggers and Dealers: Labour shortages, skills crisis in Western Australia hurting business

Covid-19 lockdowns needs firm targets to become more than simply a ‘wish list’.

Gerhard Veldsman (left) and Barry Fitzgerald from Roy Hill

Gina Rinehart’s top iron ore executive says national cabinet’s latest plan to move beyond Covid-19 lockdowns needs firm targets to become more than simply a “wish list”.

Speaking at the annual Diggers and Dealers conference in Kalgoorlie on Monday, Roy Hill boss Gerhard Veldsman said labour shortages and skills crisis in Western Australia was hurting business, and renewed outbreaks of the delta variant in NSW and Queensland should act as a wake-up call to authorities to speed up the vaccine rollout.

“Covid is not gone. We see what’s happening in NSW and now also in Queensland. We need to start to plot a way out of this,” he said.

“It was great to see that the federal government has put a plan forward. Personally I would have liked a few more dates to that plan because most of us as miners know that a plan without dates is just a wish list.”

Mr Veldsman added Roy Hill’s weight to growing business criticism of the pace of the vaccine rollout, saying Australia risked falling behind the rest of the world if vaccination rates did not quickly reach levels of about 80 per cent of the population.

“The industry, working with government, need to actually push vaccinations to become easier and more broader – and make vaccinations available, not just to our industry, but also to school teachers, and to the broader populations,” he said.

“This is really important if we want to get our economy to open up, if we don’t want to fall behind the rest of the world. “

The skills shortages in WA would not end until travel restrictions between the states were a thing of the past, and skilled migrants were allowed to enter the country.

“In Australia we’ve always had a workforce that moves between the east coast and the west coast depending on where the projects are,” he said.

“With Covid that’s become very difficult, you actually can’t get any labour in from the eastern states at the moment.”

Competition for skilled staff is rife in the WA mining industry, with multiple speakers at Diggers mentioning rising costs and turnover rates as their best workers were poached by rival miners.

Against that backdrop, Mr Veldsman was keen to talk up Roy Hill’s rich bonus payments to its staff, as cash rolls in to the massive iron ore mine.

The profit sharing scheme, in which 5 per cent of Roy Hill’s profits would be distributed to staff, was introduced by Mrs Rinehart in 2011 before the mine was in production, and Mr Veldsman said Roy Hill was now paying bonuses to blue and white collar workers worth up to half of their annual salary.

“To put it in perspective, this year if you are a truck driver or process plant operator in Roy Hill your bonus over the year will be 50 per cent of your base salary,” Mr Veldsman said.

“I don’t think any other mining companies that share that amount of profit with employees. That is directly attributable to our chairman.”