CANBERRA, AAP – The resources sector says jobs and billions of dollars of revenue are at risk if service companies can’t secure finance and insurance.
A new federal parliamentary inquiry is looking at the impact of changes in banking, insurance and superannuation practices on export companies such as Australia’s big miners.
The Queensland Resources Council told a hearing on Friday a recent study had shown 75 per cent of small and medium-sized businesses which service the sector reported accessing banking or lending services has become much more difficult in the past two years.
Nine out of 10 had experienced a major change in insurance as a result of working in the resources sector.
“Insurers and banks are increasingly trying to appease activist shareholders by reducing or cutting ties with operators connected to resources,” QRC chief Ian Macfarlane said.
“In some cases, insurance premiums are tripling, and the cost of credit is skyrocketing simply because a business is supplying goods or services to the resources sector.”
Mr Macfarlane said the irony was that by restricting the ability of such businesses to renew their insurance policies and access finance, lenders and insurers were threatening the viability of the transition to a low-emissions future.
He told the hearing the council supported the Paris Agreement and emissions reductions targets.
The Australian Banking Association told the inquiry the risk presented by a changing climate was a “key area for consideration” for the finance sector.
“Banks are working closely with their largest customers to manage the transition to a low-emissions future, as required by regulators,” the ABA submission said.
As well, the world’s largest investment funds expected banks to assess and act on climate risks.
The UN climate change conference to be held in Glasgow in November is expected to step up pressure on large companies and banks to make climate risk disclosures and develop “green finance” standards.