Comparison of Mining Policies in Canada and Australia - Case Study Example

Comparison of Mining Policies in Canada and Australia Name: University: Course Title: Instructor: Date: Introduction Earth based resources can be a blessing if well handled or a curse if not well handled as the case of Nigeria and Congo (Noruwa & Christopher, 2012, p.16; Prosansky, 2007, p.237). This then call for proper formulation of well guided policy so as to direct the sector. However, in general overview, mining industry is an important sector in any country’s economy. This is based on the fact that it employs people, contributes to national coffers in terms of taxes, has a forward and backward linkages with other sectors and thus a ripple effect that leads to economic growth and it acts as foreign exchange earner as result of export related process making a country improve its balance of trade (Wright & Czelusta, 2003, p.4). This mean a mining policy of a country should be able to protect the sector, encourage efficiency and protect public interest (Weber-Fahr et al., 2001). Mining is key in Australia whereby it contributed 8.4% to GDP in 2009/10 and 9.4 % in immediate previous years (Australian Bureau of Statistics, 2012).The aim of this paper is to examine how government develops industry policy in the mining sector by comparing between Australia and Canada. Further, the paper will show which country among the two has powerful interest groups in the mining industry. Mining Policies Policies are important documents of aligning a specific sector with the legal, social and economic goals of a country. Policies are critical in informing a sector on how it should be driven and the legislations to be formulated forthwith (Office of the Auditor General, 2003, p.2). The underlying argument is that policies shape a sector by creating an enabling environment towards a certain direction or it creates impediments and inhibitors that deter certain actions through normative and substantive statements (Mayer, 2009, p.373 & 374). In above breadth, the signal arising is that formulation process of a policy is integral and requires wide consultation so that an informed document is presented to guide a certain sector of economy. In the policy formulation process there are different quarters with different interest. This means lobbying is the order of the day depending on their interest. However, it is the onus of the government through its relevant ministries and departments to ensure a production of policy statements that will stand test of time as aligned to the overall aspirations of that country and best practices globally (Weller, Morris & Simpson, 2001, p.46). This can be said of mining industries in Australia and Canada. Comparison of Policy Making Process in Canada and Australia Policy making process in Canada is mainly driven by the prime minister, the cabinet and the Privy Council office. This is tied to the confidence they enjoy in the parliament. In addition to the cabinet, the other important organ is the cabinet secretaries. In Canada, it is the policies that inform the priorities to be undertaken by the government during their tenure. To strengthen the process, in 1996 policy research initiative was approved so as to reinforce the government’s capacity in identifying, understanding and addressing medium and long- term cross cutting policy issues (Treasury Board of Canada Secretariat, 2006). Mining sector employs approximately 340, 000 Canadians and creates economic foundation for 150 communities. Based on this realisation the government reformulated the 1987 mineral and metal policy in 1994 (Natural Resources Canada, 2011). In Canada, the single policy dealing with minerals and metal sector is the Mineral and Metals Policy of the Government of Canada. The ultimate priority of this policy is to create opportunities in the industry based green/ sustainable development concept. The other fact that is stipulated here is that provincial administration has jurisdiction over mining activities (Minister of Public Works and Government Services Canada, 1996, p.3). Apart from the above, the policy addresses the role of federal government in mineral sector. The policy provides for federal roles in mining like significance of science in spurring growth, importance of global markets and environmental protection. The second concern addressed by the policy is the need for the government to broaden and secure external markets. This is tied to how government handles its fiscal and monetary policies in the country in relation to global context. The last is the safe use of minerals and metals at internal and global level (Minister of Public Works and Government Services Canada, 1996, p.4 & 5). According to AusAID (2012), mining policies in Australia are tied to development. In this respect the policies try to create equilibrium among interest of miners, other land user, use of environment in a sustainable manner and protection of Australian wishes and indigenous people rights. Under the extractive industries transparency initiative, the companies are encouraged to report fairly on their earning and impact on environment. The ultimate goal is to enhance better governance in exploitation and use of minerals and metals extracted from ores. In this globalised economy is good to have counter comparison of policies. The policy also advocates for government involvement through macro and micro policies so as to regulate and stabilise the industry so that they can attract and compete in global market. The strength of interest group can be seen in how the public sector/ government engage with the citizens, stakeholders and the policy community (Smith, 2003, p.22-28). From the above discourse there are similarities that can be seen from the two countries in relation to mining industry. The first theme that emerges out of these policies is sustainable development. With the emergence of the sustainable development concept in the early 1970s, the business operation framework has also shifted (Ortas and Moneva, 2011, p.17). Globally, there is the realization that firms can not only base their performance on profits recouped alone (Geraghty, 2010, p.141). The policies require those engaged in extractive industry to align their operations with green development concept. The next is fairness and transparency in the operations. The next is how government through its various relevant departments can chip in to ensure competitiveness of the sector through research, macro-economic policies and licensing. The last is the entrenchment of public and stakeholders participation so that their rights can be guaranteed and a well informed policy produced. Which Country among the Two Has Powerful Interest Groups? Phulisani (2009, p.3) notes for government to make better policy, it has to involve different actors in the process and that they have to build it on an agreed outcome. While each country is unique, while formulating policies it is critical to borrow from some precedents. The engagements to be considered include input of the stakeholders, level of lobbying and holistic participatory approach. While the government has not made significant changes in policy development process, there are some amendments that have been incorporated. To provide a platform for informed policy formulation process, in 1997, the Canadian government created a Special Committee of Council (SCC) with the undertaking that they supervise legislative issues and planning. Moreover, they are tasked with the role of approving submissions presented to governor in council and regulations done in line with statutory authority. The other is the cabinet directive pronounced in 1999. This directive outlines objective and expectations of the government in relation to development of law. The next was the creation of reference group of ministers in 2000. The ultimate goal is to engage in critical analysis of proposed policies so that the ministers can talk on common grounds. However, the group is not a formal cabinet meeting since they don’t have decision making authority (Treasury Board of Canada Secretariat, 2006). The above paragraph shows how the Canadian government value s wide spectrum of input. A country that cherishes participation has to uphold tenet principles of democracy. Cana and Australia ranks as the beacons of democracy in the world (Australian Government, Department of Foreign Affairs and Trade, 2008; Parliament of Canada, 2006). This means that interest groups are allowed to articulate their wishes. Canadian government stresses the need for participation by interest groups at all levels. The country has policy statement and guidelines on public participation (Department of Justice, 2001, p. 3-4). The same can be said of Australia where government value lobby groups as critical partners (Canberra Bulletin of Public Administrations, 2003, p.5). This shows that the two countries have powerful interest groups that are able to articulate and lobby for their positions. Conclusion The aim of the paper was to compare mining policies between two countries. The countries being examined were Australia and Canada. One of the emerging findings is that policies are critical in creating an environment that promotes or restricts an industry. The commonalities between the mining policies of the two countries are sustainable development that aims at creating balance between economic prospects and environmental conservation. The next is creation of vibrant industry that acts as employment centre and source of raw material that can compete globally. The last is transparency in the operations of the industry as a corporate social responsibility. The last finding was that between the two countries, there is no one with powerful interest groups. These countries are both governed democratically and input of all stakeholders and interest groups is guaranteed. References AusAID (2012). Mining for development. Retrieved on 23 September, 2012 from: http://www.ausaid.gov.au/aidissues/mining/Pages/home.aspx. Australian Bureau of Statistics (2012). Mining Industry Economic Contribution. Retrieved on 23 September, 2012 from: http://www.abs.gov.au/ausstats/abs@.nsf/Lookup/by%20Subject/1301.0~2012~Main%2 0Features~Mining%20Industry~150. Australian Government, Department of Foreign Affairs and Trade (2008). Democratic rights and freedoms. Retrieved on 23 September, 2012 from: http://www.dfat.gov.au/facts/democratic_rights_freedoms.html. Canberra Bulletin of Public Administrations (2003). What Role for Citizen in Developing and Implementing Policy? Canberra: Australian Public Policy Research Network. Department of Justice (2001). Strategic Plan 2001-2005. Geraghty, L. (2010). Sustainability reporting - measure to manage, manage to change. Keeping Good Companies, No. 3. Pp 141-145. Mayer, J. (2009). Policy Space: What, for What, and Where? Development Policy Review Vol. 27, No. 4, pp.373-395. Minister of Public Works and Government Services Canada (1996). The Minerals and Metals Policy of the Government of Canada: Partnership for Sustainable Development. Retrieved on 23 September, 2012 from: http://www.nrcan.gc.ca/minerals- metals/sites/www.nrcan.gc.ca.minerals-metals/files/files/pdf/poli-poli/mmp-eng.pdf. Natural Resources Canada (2011). Minerals and Metals Policy of the Government of Canada. Retrieved on 23 September, 2012 from: http://www.nrcan.gc.ca/minerals- metals/policy/4071. Noruwa, I. A & Christopher, O. C. (2012). Derugulation and Privatisation of the Upstream and Downstream Oil and Gas Industry in Nigeria: Curse or Blessing. International Journal of Business Administration Vol. 3, No. 1, pp. 16-20. Office of the Auditor General, Manitoba (2003). A Guide to Policy Development. Retrieved on 23 September, 2012 from: http://www.oag.mb.ca/wp- content/uploads/2011/06/PolicyDevelopmentGuide.pdf. Ortas, E. and Moneva, J. M. (2011). Origins and development of sustainability reporting: analysis of the Latin America context. GCG, Vol. 5. No. 2. ISSN: 1988-7116, pp: 16-37. Parliament of Canada (2006). Democracy in Action. Retrieved on 23 September, 2012 from: http://www.parl.gc.ca/About/Parliament/Publications/DemocracyInAction/Democracy- e.asp. Phulisani (2009). Approaches to policy development: A rapid review of the literature. Retrieved on 23 September, 2012 from: http://www.phuhlisani.com/oid%5Cdownloads%5CApproaches%20to%20policy%20dev elopment.pdf. Prosansky, B. (2007). Mining Gold in a Conflict Zone: The Context, Ramifications, and Lessons of AngloGold Ashanti’s Activities in the Democratic Republic of the Congo. Northwestern Journal of International Human Rights Vol. 5, No. 2, pp. 236-274. Smith, L. B. (2003). Public Policy and Public Participation: Engaging Citizens and Community in the Development of Public Policy. Population and Public Health Branch, Atlantic Region. Treasury Board of Canada Secretariat (2006). A Profile of the Public Service of Canada. Retrieved on 23 September, 2012 from: http://www.tbs-sct.gc.ca/fcer-cfre/ir-ri/ppsc- pfpc/ppsc-pfpc07-eng.asp. Weber-Fahr, M., Strongman, J., Kunanayagam, R., McMahon, G. & Sheldon, C. (2001). Mining and Poverty Reduction. Retrieved on 23 September, 2012 from: http://www.intussen.info/OldSite/Documenten/Noord/Internationaal/WB/PRSP%20Sourc ebook/20%20Mining%20and%20poverty%20reduction.pdf. Weller, P., Morris, M. R. & Simpson, D. (2010). Understanding the Formulation and Development of Government Policy in the Context of FOI. Retrieved on 23 September, 2012 from: http://www.ico.gov.uk/upload/documents/library/freedom_of_information/research_and_ reports/ucl_report_government_policy_in_the_context_of_foi.pdf. Wright, G. & Czelusta, J. (2003). Mineral Resources and Economic Development. A Paper Prepared for the Conference on Sector Reform in Latin America, Stanford Centre for International Development. Retrieved on 23 September, 2012 from: http://www- siepr.stanford.edu/workp/swp04004.pdf. Read More