Australian Broadcasting Corporation Interview with BHP Billiton CEO Andrew Mackenzie (Australia Broadcasting Corporation – August 8, 2013)

Click here for extended interview:


LEIGH SALES, PRESENTER: You may recall last night that during a discussion with the Prime Minister, we ran a brief excerpt of an interview with the head of the world’s biggest mining company BHP chief executive Andrew MacKenzie. We had to hold over the full interview because of the need to make time for Kevin Rudd.

So as promised last night, here’s more of what Mr MacKenzie had to say when he joined the program.

Mr McKenzie, I’d like to start by getting your views on some broad economic questions. Do you think that Australia is transitioning out of the resources boom?

ANDREW MACKENZIE, CHIEF EXEC., BHP BILLITON: Not at all. I think maybe some of the best days are ahead of it. I believe, obviously as you’re hinting, that the resources industry has been pivotal to Australia, but as we go forward, demand continues to increase and everything is for Australia to play for.

LEIGH SALES: That obviously is a different view to what we’re hearing from the Government at the moment with them saying that they believe that the resources boom is basically over, that China is over in terms of the big days of China’s growth and that we’re now transitioning to a new phase.

ANDREW MACKENZIE: Well, China is going through its transition as well. It is slowly moving from being entirely investment driven to being more consumption driven. It’s rebalancing its economy in a way that I think is more sustainable in growth for the longer term. I’d also say that for many of the commodities that Australia’s resources industry produces, we’re looking at the possibility of an increase in demand of about 75 per cent in the next 15 years.

LEIGH SALES: In your speech today to the Asia Society, you said that, “… for a country to secure investment, it must create the conditions for the resources industry to prosper.” What are those conditions as you see it?

ANDREW MACKENZIE: Well, of course some of the conditions are inherited, which is good geology. Australia certainly has that. But beyond that, we’re looking at, I guess in our case, some things that will promote competitiveness. So they are simple regulation, one-stop shops, ones that continue to protect the health and safety of our workforce, the environment and so on and so forth, a range of policies which you might label fiscal, trade or foreign policy. I would argue also an industrial relations framework that more firmly draws everybody concerned into the same direction on the same page in order to drive more productivity.

LEIGH SALES: Today the Coalition announced a 1.5 per cent cut to the company tax rate, but BHP, because you’re such a large company, will presumably have to pay the 1.5 per cent levy that’s going to fund the paid parental leave scheme. Is that correct?

ANDREW MACKENZIE: Well, I – until we see the details of the legislation, yeah, I assume so, but I’m more interested in the broader tax picture. As I pointed out today, we pay a tax rate – or did in the fiscal year 2012, of 45 per cent. We’re Australia’s biggest taxpayer at $9 billion. That’s a fair rate of tax and so, as we continue to look at reforms that are out there and to hopefully enhance the competitiveness of the country, then we’d have to see fiscal policy alongside industrial policy – sorry, alongside industrial relations policy, alongside foreign policy.

LEIGH SALES: Do you think BHP pays too much tax?

ANDREW MACKENZIE: Um, look, governments need to raise revenue, and so, we appreciate that, but we’re also able to talk to governments about how the competitiveness of Australia stacks up against other parts of the world who either we’re investing in, in competition with, if you like, investments that could happen here, or even other countries where we’re not present, but we know they’re likely to compete against our investments here in Australia. So we can inform that and obviously get the right balance between what governments need to raise, what we need to do to promote the competitiveness of the country.

LEIGH SALES: Mr MacKenzie, we really appreciate you making time to talk to the program. Thank you very much.

ANDREW MACKENZIE: Not at all. Thank you, Leigh.

For the original version of this transcript, click here:

Comments are closed.