Shadow environment minister Jonno Duniam warns biodiversity subsidies an ‘economic Armageddon’ for mining

The Opposition has warned Australia’s resources sector could face an “economic Armageddon” thanks to an agreement the Labor Government signed to phase out subsidies “harmful to biodiversity” such as fuel tax rebates and mining grants.

There are $26.3 billion worth of such subsidies, including tax concessions for the resources sector, direct funding of roads projects and infrastructure upgrades such as at Pilbara Ports in WA and the Kurri Kurri gas power project in NSW.

Shadow environment minister Jonno Duniam warned if all these subsidies were scrapped, the resources sector would be devastated.

“Our resources sector is a key pillar of our society, contributing $74 billion in taxes and royalties to our bottom line. Without it, we will have to cut back on schools, hospitals and law enforcement expenditure, just to name a few,” he said.

“Did Tanya Plibersek know that she was signing us up to economic Armageddon when she agreed to these international demands?

“Labor doesn’t get what makes the economy tick, particularly in our resource-rich states and territories like Western Australia, Queensland and the Northern Territory.”

Under the Kunming-Montreal biodiversity framework, agreed in December 2022, 196 countries signed up to targets, including the identification and scrapping of subsidies that would harm biodiversity.

A report from the non-profit Biodiversity Council identified 36 subsidies it said could be targeted under the framework, carrying a high or medium risk to biodiversity.

It said these covered $3.9 billion of one-off direct subsidies, $18.6 billion in recurrent spending and $3.8 billion for indirect subsidies.

These included all spending on road transport projects, water infrastructure, drought assistance programs, supports for mining, industry and forestry sectors, the fuel tax credit scheme, PRRT concessions and tax breaks for vehicles.

It singled out upgrades to Pilbara Ports, the Kurri Kurri gas power project in NSW and an irrigation scheme in Tasmania as high risk.

Drought assistance programs “may support some uneconomic and unsustainable agricultural industry in the absence of nature positive requirements”, while grants to resources companies were “likely to increase activity in the industry and resources/mining sectors resulting in direct impacts on biodiversity”, the council said.

The framework said the subsidies to be scrapped should be identified by 2025.

The Federal Government said it did not have to make its plans public until an agreed reporting date in early 2026.

“Australia will deliver its first national report for all targets under the Global Biodiversity Framework, as required, by 28 February 2026,” a spokesperson for Environment Minister Tanya Plibersek said.

Senator Duniam called on the minister to guarantee each of the specific projects named in the Biodiversity Council’s report would continue as planned.

A government source said there were no plans to change the Pilbara Ports arrangements or the diesel fuel rebate.

Ms Plibersek told the international Nature Positive summit she hosted last month that the government’s implementation of the biodiversity framework focused on the nine targets “where our actions can make the biggest difference”.

These focus areas, outlined in Australia’s Strategy for Nature, did not include target 18, the one related to eliminating subsidies.