FIFO makes no sense for WA

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 25 Jan 2016   Posted by admin


By Samantha James

WA’s Pilbara region has long been a major resources hub for the state; a jump in fly in, fly out (FIFO) residents from 40,000 in 2006 to more than 73,000 in 2011 made it WA’s largest FIFO region.

Despite the current mining downturn that number has remained steady, with the Pilbara still containing more than half of the energy and minerals workforce in WA.

However, Pilbara MP and former WA National Party leader Brendon Grylls has called for a change to FIFO policies, saying it no longer made economic sense for companies faced with decade-low prices to foot the bill for large FIFO workforces.

Mr Grylls said although FIFO remained the only option for some remote sites, most workers could now afford to live in mining towns and should be enticed to move to the Pilbara.

“It makes no sense to me why you would be screwing all your suppliers, why you would be trying to wash out all these costs, but FIFO would sit there untouched,” he said.

“I just don’t know why a company would be paying $70,000 to $90,000 a year to house a FIFO worker in a camp in Karratha, when just down the road that person can rent a very nice house.”

Mr Grylls said the FIFO model had been used for 10 years to attract and retain skilled employees during the skills shortages of the mining boom, and as a consequence towns in the Pilbara had benefited from improved infrastructure and community services, making them more attractive for families.

“It makes no sense to me that Fortescue Metals Group employees in Port Hedland are living in a donga camp right next to a new sports stadium,” he said.

However, WA Chamber of Minerals and Energy deputy chief executive Nicole Roocke said the industry needed to retain FIFO workforces because most people still did not want to live in regional towns.

A workforce survey carried out in 2015 found just one in four FIFO workers would stay in their job if it changed to a local role.

“People have created their lives around doing fly in, fly out,” she said.

“There is a real sense that you can’t force people to go and live in the regions.”

Ms Roocke said she agreed that FIFO labour was more expensive but that it should be up to companies to decide on the most cost-effective way to employ people.

The FIFO issue came to a head in WA when BHP Billiton refused to bow to demands by the National Party to reduce the capacity of its accommodation camp for workers outside Newman.

Premier Colin Barnett backed BHP’s request to expand its Newman FIFO camp to more than 1000 beds to house workers for its Mt Whaleback iron ore operations, despite National Party leader Terry Redman’s refusal to sign a 10-year lease extension unless the miner agreed to cut the camp to 600 beds.

Mr Redman accused Mr Barnett of undermining the Pilbara Cities program, which  aimed to build the population of Karratha and Port Hedland to 50,000 people, and Newman to 15,000 people, by 2035.