Chapter 3 ‘Fly-in’ communities
The primary concern about the use of FIFO operations is their impact on
established communities and the perceived rejection of towns and their way of
life in favour of high wages and temporary camp living environments.
Established resource communities were keen to emphasise that they did
not oppose resource companies and development. On the contrary, these towns expressed
great pride in the resource operations that they sustained and that had
sustained them, in some cases for generations. However, these communities expressed
concern at an apparent shift in the balance where companies are prioritising
quick profits over long-term sustainability.
Long-term resource communities such as Kalgoorlie, Broken Hill and Mount
Isa have no agenda but to see the continued growth and sustainability of the
resources sector, however they also want to remain communities, not just work
The Mayor of Kalgoorlie-Boulder expressed the pride that many local
I sit here today representing a true goldfielder. … I am very
proud of that … I grew up in a community where families were created and grew
together, living close and sharing their lives. Parents became grandparents and
so on and multiple families lived in the same area. That was in the day of the
eight-hour shifts, of course. Together we lived, worked and played in the one
community. That was Kalgoorlie-Boulder. You knew the name of your neighbours.
As you walked down Hannan Street or Burt Street, you could say hello to the
majority of people, even though the twin towns had anywhere between 20,000 and
30,000 people at times. …
It is the small regional communities that have laid the
foundations for this booming industry, and spurning those communities will be
to the ongoing detriment of our great nation. The government need to make a
decision: do they bow to what I think is appropriately called ‘the cancer of
the bush’—fly-in fly-out—or do they go proactive and do something to foster the
continuing existence of small towns?
The General Manager of Broken Hill welcomed the resurgence in mining
activity in the region but made the point:
The objective is to ensure that we have a residential
workforce, first and foremost. That is a factor of having a city that is
liveable, that people want to move into and live in with their families, as
opposed to the fly-in fly-out option. I know that is easier said than done—the
easier option potentially is the fly-in fly-out—but I think these regional
cities offer a real alternative for accommodating supporting housing
communities, which is why the whole infrastructure argument is critical. If you
do not have regional cities such as Broken Hill, Kalgoorlie and Mount Isa
supported, funded and liveable then fly-in fly-out will always be the cheaper
alternative. But it is not cheaper in the longer term.
The Mayor of Mount Isa reiterated that the community was not opposed to
the industry, but wanted industry to work with, rather than against the
We accept the fact that, where you are going to construct a
new mine, construction workers will fly-in fly-out. There is no debate; there
is no discussion. … about 97 per cent of Xstrata’s employees are residents of
the city. At times, they have to fly crews in to do specific work. We do not
see ourselves as them and us. There will always be a need for fly-in fly-out. …
What we are saying is let us be realistic.
We are not demanding; we are simply saying: let us work
together with the industry.
The negative impacts of FIFO are heightened for non-traditional resource
communities, such as Roma and Narrabri and new workforce source communities
such as Mackay that are experiencing a rapid change in town identity and diminishing
The majority of submissions from local governments and individuals
suggested that FIFO was overwhelmingly negative, whereas industry submissions
focused on its positive aspects.
This chapter focuses on the concerns, frustrations and challenges faced
by regional host communities. From the Pilbara and Goldfields in the West to central
Queensland the same story was reported about the impact of FIFO. Communities
are finding that:
- community image,
identity and social cohesion are declining and there is a marked divide between
residents and FIFO workers;
- community safety is
- engagement in
community life is declining, in part due to the pressure of 12-hour shifts; and
- in drive-in,
drive-out (DIDO) regions, road safety is of serious concern with a mounting
accident and death toll.
Many local councils also argued that the economic cost for supporting
FIFO workers was having a significant impact on council budgets. In Western
Australia, the ‘Royalties for Regions’ program was widely lauded, and councils
in Queensland called for a similar program. However, the lack of targeted
analysis about the real cost of the FIFO workforce for host communities means
that royalty money from state governments and company support initiatives, can
be inappropriately targeted.
This chapter continues to identify areas where empirical evidence is
needed to support communities in planning infrastructure, community facilities
and population growth. There is also a need for resource companies to engage
local government with forward planning and focus their community support on
addressing the priority needs of those living in the area.
Presenting these concerns in a comprehensive way and identifying the
root of some of the concerns may provide a catalyst for a conversation between
resource companies and communities.
Resource companies and many accommodation providers do make a real
effort to engage with communities through funding community infrastructure and
sponsoring community events. The following observations are not intended to
detract from their efforts in this regard. However, aligning a FIFO workforce
with a residential community presents a complex array of challenges that could
benefit from a different corporate approach.
The Commonwealth Government should pay particular attention to the
community concerns reported in this chapter. It is concerning to note that a
government publication to guide resource company engagement with communities
states that the social impact for FIFO operations is ‘likely to be less than
for residentially-based operations’. Indeed, it was
comprehensively argued by the resources sector that FIFO operations have less
of an impact on local communities than a local workforce.
This is clearly not the experience of communities throughout Australia
and this argument fails to distinguish between positive and negative impacts. Regional
communities welcome the addition of new residents that can help their towns
grow, rather than hosting the burden of a ‘shadow population’.
While the Committee was in Canada, a senior officer within a major
international resources company suggested that for companies, tough decisions
were tougher to make while living in the community; FIFO gives executives the
capacity to have some separation from the decision making. She admitted that
union-driven workplace agreements had forced the company away from a preferred
FIFO model but having moved away from FIFO, a residential workforce is now the
preferred model as the company has found a greater capacity to react to
operational requirements and is clearly accountable for corporate behaviour.
Community image and social cohesion
Whether built around agriculture, tourism or mining, regional towns in
Australia have a strong sense of identity and community. A large influx of non-resident
workers is a permanent disruption to the social fabric and feeling of a town
and this ‘shadow population’ has a serious and negative impact on the safety,
image and amenity of communities.
The equating of FIFO with social instability is generating significant
discord in communities as well as making them less desirable as a residential
option. Communities with significant FIFO populations are finding themselves torn
between wanting to support the major employer and wanting to maintain the
culture of their towns.
Many who submitted to the inquiry expressed pride in their towns, the
lifestyle they had and the fact that they had raised children in a safe and
open environment. They expressed dismay that non-resident workers were
unwilling to relocate and felt that with a better introduction to the lifestyle
afforded in regional communities that they may make a different decision.
However in some towns, such as Moranbah, where the FIFO worker presence
is starting to dominate, the resulting transient feel to the town is making it less
desirable for both existing and new residents.
The Isaac Regional Council estimated the number of non-resident workers
(20 000) to equal the resident population (22 650).
The impact on future residency plans is significant: a study undertaken in 2009
found that planned length of residency in Moranbah fell by an average of
sixteen per cent if major work camps were to be developed, due to the presence
of FIFO workers.
Many individuals noted the impact on the amenity of their homes and
lifestyle and the feeling that the economic drivers could override community
concerns. Even simple things like unmaintained properties are seen to ‘bring
down’ a town:
Declining visual amenity due to growth in the number of
houses occupied by multiple temporary residents who did not care for gardens or
premises. The more houses in the street taken up by miners sharing the rent,
the bigger the decline in neighbourhood status with many large vehicles parked
in the area and increases in noise levels.
Industry needs to be concerned about the decline in supporting
communities, particularly in areas with long project lives and untapped
resources. Isaac Regional Council noted:
Communities who feel they are not invested in or connected to
major industry employers become strong advocates for change. A social licence
to operate, and positive legacy is important for companies to ensure further
operations are assessed and approved swiftly. A non-resident workforce brings
many corporate reputational risks.
The Minerals Council of Australia (MCA) also noted the impact declining
communities has on recruitment:
Research suggests that communities that do not have
sufficient infrastructure, social amenity and economic diversity will not
attract new residents and this will in turn constrain the industry’s
Communities find themselves in a catch-22 situation where without a
strong residential base they cannot attract new residents to build the
population and infrastructure of a town. The inquiry heard many stories of
individuals choosing to leave towns like Karratha and Moranbah to pursue
training or for their children to complete secondary schooling simply due to
the overwhelming feeling that the towns were becoming ‘FIFO’ towns.
Communities also expressed concern that FIFO is rapidly becoming the
only response to the growth in the resources industry and that resource
companies are making no effort to build communities. Unfortunately, this is causing
significant community discord which is further impacting on social cohesion in
‘Us’ versus ‘them’
An ‘us versus them’ mentality was reported throughout the inquiry, with submitters
from across the country revealing a concerning trend in anti-FIFO worker
sentiment, which, in some circumstances, is leading directly to social disorder.
Isaac Regional Council noted:
Aside from visual amenity, the proportion of residents to
non-residents also contributes to the sense of being ‘taken over’ by work camps
... Small rural towns have a strong identity and sense of community – an
important part of the social capital of these towns – that is being threatened
by the dominance of mining. Lack of integration between resident and
non-resident workers creates a strong ‘us vs them’ mentality and non-resident
mine workers are blamed for a disproportionate share of crime and anti-social
behaviour. There are also increasing level of fear being reported.
Several residents of Karratha in Western Australia suggested that the
demographic of young male workers was particularly problematic:
A community relies on families. A FIFO workforce is often a
large influx of men 25-40 years old. This can have law and order issues, as
well as social issues regarding the development of an “us versus them”
Karratha school students also reported hostility towards FIFO workers:
Yes, I think there is hostility in the community towards
them. It is like, 'We are the locals and they should not be here because it is
The inquiry received evidence of the ‘us versus them’ attitude leading
directly to violent behaviour. Unfortunately, the FIFO demographic of
predominately young men can prove to be a volatile mix when faced with some
‘If there was trouble brewing, the glares across the bar as
soon as the police aren’t around, bang: it would be on... It’s very much us and
them; they sit there, you don’t look at them or talk to them and the only words
really exchanged are: F… you, let’s fight... F… FIFOs, it’s them.’
Conversely, for the majority who are peacefully working FIFO rosters,
the perception that they are responsible for violence and disruption in
regional towns is equally disturbing. A support group for FIFO families raised
concerns about the attitude in the national media:
Because FIFO/DIDO work practices have grown relatively
quickly in Australia, it almost seems like there’s a divisive ‘FIFO families
versus regional communities’ mentality starting to
appear in the national conversation. This is not helped by media reports
headlined along the lines of “FIFO workers destroy regional communities:
expert” (WA News, 21 June 2011).
Overwhelmingly, it was felt that the divisiveness between resident and
non-resident workers could be mitigated with efforts to provide more positive
opportunities for interaction:
There is also some work to do in improving social cohesion
within mining communities, particularly in the smaller mining communities—some
activities which provide opportunities for non-resident workers and residents
to come together and break down some of the us versus them mentalities
prevailing in those communities. That is about looking at ways to celebrate
diversity but also encouraging workers and families to see that it is not so
bad living in Moranbah—you can actually have a great life in those towns.
As discussed below, many residents feel that FIFO workers are simply
disregarding the fact that they are within communities that deserve to be
treated with respect.
A number of submissions called on resource companies to develop
corporate volunteering programs to help improve relationships between locals
and FIFO workers but also to help showcase the local community to potential new
residents. It was noted that many of the men living in camps are highly skilled
and would have a lot to offer in positions like men’s sheds or youth mentoring.
Area for corporate action – community volunteer days
Many residents called on the opportunity to showcase their towns
to FIFO workers and families. Companies reported holding FIFO family days on
site and corporate volunteering programs for office-based staff. Extending
these programs into host resource communities would be beneficial in breaking
down the divisiveness developing between FIFO workers and host communities as
well as showcasing regional communities to potential residents.
One of the key features of regional communities is the liveability of
the community – the fact that safety is unquestioned and young people are able
to play and travel without adult supervision.
FIFO practices change community demographics, typically injecting a
large number of young men living in temporary accommodation and with no
community connection and little to do when off shift. These changes can
heighten community concerns about declining safety.
Communities across the country expressed fear, mistrust and uncertainty
about the presence of FIFO workers. The following statements from the senior students
of Moranbah State School highlights the concerns repeatedly reported from many
Samuel Vella: You mentioned safety. With fly-in
fly-out workers, while most people are pretty respectable you always have the
ones who are not. When girls are bored and have nothing to do, they go out with
their friends, go to parties and walk along the streets at night. With more and
more of these fly-in fly-out guys, how can you know that they are not going to
try anything? If they have less respect for the community, they might think: This
isn't my town. I'll do what I want, go back to Brisbane and everything will be
okay.' That is another concern. I have seen it get a little [less] safe. It is
a safe town; it is a good town.
Chantelle Winter: I am 17. I would never walk the
streets, even at eight o'clock, because there are so many guys driving around
and things and it is a bit scary sometimes. I do not really go out at all
because I do not feel safe.
Kevin Hackney: The fly-in fly-out people do not treat
Moranbah as a community. I work at the workers club behind the bar. I have my
RSA so I can earn money for my family. I used to know a lot of the regulars.
But lately, over the past two or three months, there have been a lot of fly-in
fly-out people. Regarding safety, when we close up it gets violent sometimes—out
of control. We always ask people whether they are fly-in fly-out people just to
check. If we ban them, we have to know if they live here or not, because we
have to alert the police either way. When that happens, it is hard to ban
someone who is a fly-in fly-out worker because you might not see them for a
With the violence, you see them walking down the streets and
running amok. They go nuts along the streets, shouting and kicking and stuff.
The cops are always getting called over to the workers club and the Black
Nugget pub, because a lot of the fly-in fly-out people do not care. When I am
walking home at night, it is scary sometimes. I like walking along by the MAC
camps. You see drunken guys who do not live in the MAC camps and it is scary.
They run amok and do silly stuff, destroying stuff because they know that it is
not their community. 'We got the money; we don't care.' That is their attitude
towards us. And that is while we struggle and try to make the community the
best it can be.
There were many more reports over the course of the inquiry about
violence, predatory behaviour and high alcohol and drug use. This indicates
serious problems with the implementation of FIFO work practices.
This is an issue that the resource companies need to address directly.
As discussed in the next chapter, accommodation providers make serious efforts
to provide facilities to ensure that workers have entertainment options at-camp
rather than impacting on local towns. Nonetheless, where FIFO workers are
disruptive the deleterious effect on the social fabric of communities
contributes to the ‘anti-FIFO’ sentiment.
For police, keeping control in towns with a high FIFO population is a
challenge. The Police Federation stated:
Police, generally, in smaller, regional communities … know
the people in their own patch and who they might need to keep a closer eye on.
It is called community policing. In these communities it is the unknown factor.
With an ever-changing group of residents it is hard to keep track of who is who
in the community and who might need closer attention.
I am also advised it appears that a number of companies and
contractors have a mindset of, 'We don't care what happens after-hours as long
as they show up for work and don't misbehave in the camps.' A number of my
colleagues also suggest that the old concept of 'one fight; next flight' does
not seem to exist in many locations nowadays and perhaps this is because so
many companies and contractors are desperate for staff and they are prepared to
turn a blind eye to such behaviour.
Even with concerns about community safety and amenity, the majority of
evidence supported connection between camps and towns so that local businesses
could benefit, and a number of submissions criticised those camps that
replicated facilities (bars and gyms) available in town. However, the
underlying theme also sought for employers and accommodation providers to
insist on a standard of behaviour from FIFO workers that respects local towns.
Whilst most accommodation providers require commitment from residents to
some form of behavioural code of conduct, these are linked to accommodation,
not employment, so the consequences for breaching an agreement of this type are
From the experience of Canadian companies managing the same issues, addressing
these issues will build far greater social capital for resource companies than
many other community support initiatives.
For example, as part of contracts with resource and contracting
companies, the Town of Labrador City has insisted that all workers in camp
accommodation sign a social contract as a condition of residency. These
contracts are linked to employment, so a breach can result in dismissal. The
contracts have been developed in conjunction with a community advisory group so
while the company sets the consequences, the standard of behaviour expected is
set by the community. The Labrador City Mayor, Karen Oldfield, confirmed that
the contracts were making a practical difference by emphasising to workers that
they were living in a community that deserved to be treated with respect and
were contributing to more positive relationships between FIFO workers and
Area for corporate action – social contracts
A key concern throughout the inquiry for communities is the lack
of respect shown by FIFO workers towards the town. This has been proven to be
effectively managed by employers requiring social contracts to be signed by all
FIFO workers, linked to employment, about the standard of behaviour required by
the community and companies operating Australia should consider the
implementation of these contracts.
In every town visited through the course of the inquiry, residents
reported being unable to field sporting teams, provide coaches for kids sport
or run the Rotary club because they are unable to fill volunteer rosters. In
small communities, volunteers run many of the services taken for granted in
larger towns, indeed small communities are absolutely reliant on volunteers for
the delivery of some basic services, such as the ambulance.
As well as providing essential services, volunteering has been shown to
… social capital, the networks of social relationships, of
trust and reciprocity, which form the basis for social and emotional well-being.
Leading social researchers have demonstrated its importance as the ‘glue’ which
holds communities together. Social ties can be both informal (e.g. friends and
family) or more formal (as in volunteering) but these create the basis for
systematic improvements in crime rates, education, economic growth and health.
The decline in volunteering was seen as an example of the decline in
social and emotional investment that people are willing to put into regional
A number of factors were blamed for the decline in community engagement,
including 12-hour shifts, ageing population and less willingness in young
people to actively volunteer. However, the primary concern raised was a
declining permanent population through the move to a FIFO workforce.
There were also many concerns expressed about FIFO workers not
understanding that community assets are often in place due to the efforts of
FIFO workers are coming from
all parts of the country and ‘take for granted’ the infrastructure that
community volunteers have fund raised for, or built, over many years. We hear
complaints about what we don’t have – eg hospital in-patient whingeing because
the TV was not a flat-screen! He was quickly informed there was no TV at all
until the community pulled together to raise tens of thousands of dollars for
the supply and installation.
In some cases, the resource companies themselves were causing a drain on
volunteer services, instead of providing employee services:
One of the disadvantages and anomalies of having a mine as
closest neighbour is that, when there is a mine injury, they often call on the
local St John Ambulance volunteers to come out and collect the injured patient.
Even for a squashed finger, it seems … that in order to claim workers
compensation (or such), the ambulance service must be called and must be used
to transport the patient. This puts a lot of unnecessary extra strain and
demand on Hyden’s small volunteer brigade. Whilst we understand that some
donations are made to St Johns in lieu of this, having a small team of
volunteers overworked for non-emergencies – is not reasonable or sustainable.
It is not just the host communities that are finding a drain on their
volunteers, source communities also complained that having workers away for
long periods on FIFO shifts meant that they are unwilling to participate in
volunteer activities due to fatigue and because they could not commit to regular
The absence of a high proportion of adults from a community
for extended periods may affect family and community relationships and reduce
the number of volunteers available to deliver community services.
While this is not an exclusively-FIFO issue, for those resource-rich but
resident-poor communities, the issue is compounded by the impact of the
explosion in FIFO work practices and the feeling that communities are being
degraded, rather than built by the resources industry.
Most mines operate twenty-four hours, seven days a week; their workforce
rosters based on two 12-hour shifts. The use of 12-hour shifts has drawn
considerable criticism, with concerns ranging from employee fatigue and mental
health to the inability to participate in local community activities.
A recent report by Griffith University found that despite the resource
industry being the first to achieve a 35 hour week, it now has the second
longest hours of any industry (second only to road transport.) The report also
found that the long working hours were leading to an erosion in family life and
the choice to move away from residential to FIFO work.
The Australasian Institute of Mining and Metallurgy (AusIMM) stated that:
Members have observed that since the minerals industry went
from five days per week, 8 hour shifts to continuous 12 hour rosters, the
fabric of regional town societies has fundamentally changed with significant
impacts on sporting clubs, volunteer groups and social events. The economic need
to work assets continuously has been the driving force behind this in many
towns, but the quality of life for town based families has been reducing across
the country and often acts as an impediment to choosing to live residentially.
Many single professionals and minerals families believe that with these rosters
and having so much time off in blocks that there is little point remaining in a
town especially when they want coastal standards of living.
Moranbah residents noted the challenge that 12-hour shifts pose to
maintaining active community organisations:
Moranbah has many active sporting, and social clubs, which
helps to keep a thriving healthy community together, but with the introduction
of 12 hour shifts and people deciding they might like to reside elsewhere and
commute, which is their choice, to FIFO, DIDO, & BIBO, many of these clubs
have had to devise alternative and flexible hours to retain team memberships.
The Australian Manufacturers Workers Union argued that shift work
patterns could be contributing to the skills shortage:
In current circumstances, there appears to be an
unwillingness of sufficient workers to apply their skills to the resources
sector under the terms and conditions of employment offered to them. Terms
which may affect the decision of these workers range from wages paid, the
location of work, to conditions such as FIFO employment, non-permanent
contract-to-contract employment and 12 hour shifts, worked for 13 day
fortnights, often five weeks on one week off.
Accommodation provider Sodexo stated that they offer variable shifts
depending on whether workers were local or FIFO, simply in order to attract
Our experience is that people who are doing FIFO want to do
12-hour shifts because it means that they can maximise their time at work but
they can also maximise their time at home, and people who are coming from the
local community want to do shorter shifts because they still have all of the
obligations at home, particularly to do with child care and keeping a family
running at the same time as they are providing a service at the mining
operation. We have found over time that we need to be incredibly flexible in
how we offer work. …
For example, we do some operations in Dysart, where the FIFO
workers would work 11-hour days. The local workers could choose to work an
eight-, nine- or 10-hour day. They could also choose to work just Monday to
Friday or a five-day week out of any seven days. That is one example. We do
that in many places. Roxby Downs is another place and there is Karratha, Port
Hedland and Cloncurry. There are lots of communities where we do that. What is
interesting is that, when you give people the opportunity to do that and give
them the opportunity to have assistance with rental, many of them still choose
to do FIFO.
The Communications Electrical Plumbing Union (CPEU) argued that, even
with a corresponding reduction in wages, most workers would choose to work a
more lifestyle friendly eight to ten hour shift than a 12-hour shift:
If we were to go out and do a survey of workers in the
industry and they were given an opportunity and an actual choice with respect
to whether they wanted to work 12-hour shifts or eight-hour shifts and what
that meant to them and their families, I reckon there would be a resounding
response that they would go back to eight-hour shifts. I am happy to be put on
record on that and am happy to be challenged about that. Quite simply, there
were enormous numbers of disputes when 12-hour shifts were introduced. There
were enormous numbers of disputes when seven-day rosters and equal-time rosters
were introduced, simply because people understood at the time the need to have
that family life balance. Those 12-hour shifts, seven-day rosters and
equal-time rosters take away the opportunity to have equal time with family and
life balance. I am happy to have that challenge put out there.
I think that it is now ingrained in such a way that people
just come to accept that those are the terms they have to work with and they do
their best around them.
In contrast, the MCA stated that ‘there would be World War III if we
tried to change some of those workers back out of 12-hour shifts back onto
For FIFO workers, the preference for long shifts is understandable as
the long shifts mean they do not need to find activities to fill their down
My son's FIFO roster for construction is again different. He
works 10 hours per day and is away for four weeks and back with his family for
one week. During this time away, other than depression, his other concern is
that he is working away to make money for his family and there is no room to
negotiate overtime. He says that he is working to get more money and he would
rather work more hours than sit depressed in his room for longer hours.
This was reiterated by BHP Billiton:
Hiltaba will have its own facilities to accommodate people,
but typically—you see it at the Olympic village and at the Roxby village inside
the town—people who work 12-hour shifts are not too boisterous post the 12-hour
shifts. They go in there, they have their meals and they tend to want to sleep
and be ready for the next day's shift, especially when they are working those
long rosters, under those conditions. So putting them out there really is a
solution that we think best reflects the attitude of the majority of people in
Nonetheless, it is clear that 12-hour shifts have a negative impact on
residential communities. The Committee heard repeated stories of families
choosing to move to larger centres and FIFO for work, simply because the burden
of a 12-hour shift meant that FIFO work offered greater family time.
Drive-in, drive-out after 12 hour shifts
Of most concern is evidence of DIDO workers completing a 12-hour shift
and driving three or more hours home, leading to a high accident and death rate
on regional roads. The accident rate in the
Bowen Basin is particularly high, and as DIDO workforce
arrangements increase throughout southern Queensland and New South Wales, there
can be little doubt that a similar trend will develop in new mining areas.
Understandably, after a long period of 12-hour shifts, workers are keen
to get home as quickly as possible and some DIDO employees are putting
themselves at an unacceptably high risk of accidents:
Concerns have been raised by Annette Hennesey, Qld State
Coroner, about fatigue related accidents and mortalities due to non-resident
workforce arrangements in the Qld mining industry (Queensland Courts, Officer
of State Coroner, 2011). Under current conditions, fatigued non-resident
workers are more likely to be killed or injured in motor vehicle accidents as
they commute either end of work cycles than in the workplace.
Isaac Regional Council reported a significant number of fatigue and
congestion-related incidents on the highway and an increasing number of traffic
fatalities. While many employers provide bus services to Mackay, the Australian
Services Union noted that the practice of employing workers on individual
contracts (that is, without direct employer supervision) was leading to people
taking higher risks to get to and from worksites by driving before and after
the end of long shifts.
Employers and accommodation providers were quick to condemn fatigued
driving because of the related risk between fatigue and traffic accidents. A
number of employers noted that they insist on a ‘bus-in, bus-out’ only policy,
however, they had little control over those who did not live ‘in camp’.
Accommodation providers reported being very aware of the need to provide resting
rooms for workers who had finished shifts to utilise before driving home but
had little control over the uptake.
The Committee travelled a common DIDO route – the Peak Downs Highway
between Moranbah and Mackay – and observed the traffic congestion on a road
that was only built to be a rural link but now hosts heavy industrial and
It is worth noting that the oil sands operators in Fort McMurray,
Alberta, Canada, have collectively agreed to have no car parking on site. This
means that that all workers, including locals, have no option but to take a
company-provided bus to site. This has significantly reduced fatigue- and
congestion-related traffic accidents and is worthy of consideration in areas
such as the Bowen Basin.
Area for corporate action – mandatory ‘bus-in, bus-out’
Fatigue- and congestion-related traffic accidents (including a
high rate of fatalities) are a serious concern in areas, such as the Bowen
Basin in Queensland, with a high concentration of mines and DIDO employees.
Resource companies acting collectively can have a significant impact on the
accident rate by instituting mandatory regional ‘bus-in, bus-out’ policies.
One of the most significant concerns for local governments is a lack of
investment by resource companies in host communities. Despite the provisions
made for FIFO workers (accommodation, meals and entertainment), local
governments stated that they still have a significant economic impact on the
region, which is not compensated for under existing models for local government
funding nor resource company investment. Indeed, as has been alluded to at
various points throughout this chapter, the provision of amenities to FIFO
workers can limit benefits to businesses in host communities.
Many councils affirmed that they were carrying the economic burden of FIFO
workers on provision of local government services and infrastructure without
adequate compensation for these costs. Councils reported infrastructure
infrastructure and services;
- rail and road
- town services,
including water, road and sewerage;
- airport, including
airstrip, infrastructure; and
Local governments have little capacity to plan for their future
infrastructure needs. This is because there is a lack of planning, control and
forward projection of FIFO numbers and a complete absence of any robust,
independent research about the real cost impact of FIFO workforces on host
communities. Indeed, a recent KPMG discussion paper on the ‘infrastructure
ripple effect’ suggested that the required infrastructure investment to support
the resources industry ‘must run into several hundreds of billions of dollars’.
The Pilbara Regional Council stated that the planning framework for FIFO
in the Pilbara is not soundly based because there is no real overall
understanding of the number of people being impacted:
- there has been a
systemic failure to establish ‘existing conditions’ with an under-estimation of
residential population by the ABS of at least
12 000 people;
- the State planning
commission has underestimated FIFO figures by 20 per cent for 2010, 60 per cent
by 2015 and up to 90 per cent underestimated by 2020.
Little evidence of the actual dollar cost of the FIFO workforce for
local governments was reported. In a report released in May 2012 on this issue
by the Local Government Association of Queensland (LGAQ) found the same dearth
of robust research. However, the LGAQ did report that a 2010 survey of resource
community councils found the following budget impacts as a direct result of
resource industry growth:
- the five-year capital
outlay for eight councils totalled $421 million or between three and 21 per cent
of council budgets;
- combined capital and
recurrent costs was estimated to be $770 million;
- projected total rate
revenue from increased resource activity was
$87 million, or 3.5 per cent of total expected project royalties and falling
well short of estimated expenditure.
In addition to the infrastructure costs to a local government area,
there is an impact on the indirect economy of a local region. There are very
few studies of which this Committee is aware that has analysed the direct and
indirect impact of the FIFO workforce on local communities.
The Pilbara Regional Council recently commissioned the AECgroup to
undertake an economic impact assessment of the Pilbara FIFO workforce and to
analyse the expenditure patterns of a FIFO versus residential worker in the
Pilbara region. Based on an estimate of 33 100 FIFO workers in the region
in 2011/12, the economic contribution (through expenditure at local business)
was estimated to be:
- $339 million in
- $180 million in gross
- $123 million in wages
In contrast, had these 33 100 workers been local residents, the
local economy would have benefitted from:
- $2 126 million
- $1 087 in gross
- $709 million in wages
This constraint on economic growth through loss in expenditure reinforces
constraints being imposed by a lack of affordable housing discussed above. Many
councils reported being unable to fill essential positions and reported lost
opportunities for economic development due to a lack of housing, ‘for example,
McDonalds has decided not to open a store in Newman because of the lack of
affordable housing for workers.’
Despite the substantial body of work that has been undertaken for the
Pilbara Regional Council it is concerning that the bulk of evidence regarding
the economic impact of the FIFO workforce practice is at best anecdotal.
The lack of research and data available to local governments is
hindering their ability to plan for future impacts on infrastructure and
hindering the capacity for state governments and the Commonwealth to adequately
fund local governments.
The Committee recommends that the Commonwealth Government
commission a comprehensive research study to determine the actual economic
impact on the demand for and consumption of local government services and
infrastructure from fly-in, fly-out/drive-in, drive-out workforces.
Considerable evidence was presented that FIFO workers are having an
impact on the provision of medical services. Anecdotal evidence indicated long
waiting times and significant additional workload burdens placed on doctors.
The Shire of Yilgarn, in southern Western Australia noted that FIFO
workers were placing a considerable burden on the local general practitioners,
particularly when managing workplace accidents and emergencies:
we have 1 200 more people in our shire at the moment
just in Koolyanobbing alone—in that area to the north. They all need a doctor.
They make appointments and come in for medicals. If they have an accident on
the mine, they come back in and are transported by volunteer ambulance
officers. They use our medical facilities. That is another population that we
have. Some of those camps have 400 people in an area no bigger than a footy
field. They have their own little problems, as you are aware and as the inquiry
has heard, in terms of health problems and health issues. They do demand—and
command—the services of our doctor. Sometimes, with the accident and emergency
in particular, the doctor is called away from the clinic to attend to someone
in an emergency situation.
The increasing workload burden on doctors is impacting on doctor-patient
relationships and there were some implications made that medical staff did not
have the capacity to proactively manage the health of residents:
In order that Aboriginal people to participate in the Mining
Industry opportunities they must be fit and healthy and/or able to control
their health status. This will not happen if services by the Health Services
are not proactive and effective.
Table 3.1 illustrates the burden that FIFO workers are placing on
Moranbah Medical’s services, with 35 per cent of all patient presentations over
the course of a month identifying their place of usual residence as a place
other than Moranbah. Even excluding the seven per cent of patients that live in
nearby Coppabella, Nebo and Dysart, 28 per cent of patients identify their
residence as well beyond the catchment area for Moranbah Medical’s services.
Moranbah Medical also provided figures that show that non-resident
patient presentations (excluding Clermont and Dysart) have risen from 18 per cent
in June 2007 to 23 per cent in June 2011, with a further increase to 28 per cent
in September 2011.
Table 3.1 Moranbah Medical: Patient location, September 2011
Patient identified location of residence
Percentage of total patients seen
Number of patients
South East Corner – Brisbane/Gold Coast
NSW, ACT, Victoria, WA, Tasmania, NT, New Zealand
Sunshine Coast and hinterland
Gin Gin/Bundaberg/Gladstone/Childers surrounds
QLD – other
Toowoomba/Darling Downs surrounds
Medical, Supplementary Submission 2.1
Moranbah Medical noted that non-resident worker presentations to
Moranbah Hospital were also high, but was unable to provide data to support
this claim. In Moranbah, as well as most other small regional centres, the same
doctors service the hospital as well as provide private practice services,
therefore the increased workload at one detracts from services on offer at the
There can be little doubt that ‘continuing to mistakenly assert that
non-resident workers do not place pressure on health care and other essential
services is dangerous and short-sighted in the extreme.’
Not only does a FIFO workforce place a burden on medical service
providers, it restricts access to these services for local residents. However,
there is a lack of consistent data about the extent of this issue and the cost
to regional medical services.
Without robust empirical evidence about the extent of the impact of
non-resident workers on regional medical services, it is difficult to develop
policy of funding models to address the issue.
Chapter 6 of this report makes recommendations about the need for better
planning at the local and national level to support regional health delivery.
However, this will be difficult to achieve without a baseline analysis of the impact
of non-resident workers on medical services in regional resource areas.
The Committee recommends that the Commonwealth Government
commission a study of the impact of non-resident workers in regional resource
towns on the provision of medical services and as a result of this study
develop a health policy response that supports the sustainability of regional
Growth in the resources industry and an influx of FIFO workers has the
capacity to bring great wealth to regional areas and, in some cases, the
development of a new mine is diversifying local economies:
… if given the choice we would rather have fly in fly out
mining as close as we do, and in some ways reaps some benefits, rather than be
just an agricultural-centric town with a single facet economy and no mining
interests at all.
The lack of economic diversification in many resource communities is obvious:
It is indicative of the lack
of economic diversity, that ‘logo emblazoned’ fluro safety shirts are the main
attire seen at the shopping centres, airports, hotels. This attire is not
restricted to FIFO, neither is it restricted to males, but it does re-enforce
the image of Karratha being a ‘work camp’ vs being the cosmopolitan community
that sits below this veneer.
Despite the opportunities, however, the development of a mine does not
necessarily translate to diversification in the economy, and in some cases actually
degrades the level of diversification already in place.
Tourism is a natural focus for economic diversification for many resource
communities. While some are not traditionally thought of as tourist
destinations, many resource communities are located in extraordinary parts of
Australia and have the capacity to promote themselves as key holiday
destinations for both domestic and international travellers:
The Pilbara’s natural and
cultural heritage assets, such as its coastline, Karijini and the Burrup
Peninsula’s rock-art galleries, are planned to be ‘conserved, celebrated and
cherished’. In particular, the tourism sector has significant development
potential, and strategies must be found to facilitate this expansion
notwithstanding the various impacts, some detrimental, that resource
development activities have on accommodation and services costs to visitors.
Indeed, some areas are capitalising on the resource industry and
featuring tours of operations, such as the KCGM Super Pit in Kalgoorlie.
Tourism is a significant contributor to the national economy. The
National Tourism Alliance (NTA) noted that tourism:
- contributes $34
billion, or 2.5 per cent of Australia’s GDP;
approximately $23 billion in export earnings, over 9 per cent of total exports;
- directly employs 500 000,
4.5 per cent of total employment, and indirectly employs 320 000;
- generates almost $7
billion in taxation revenue; and
- in regional areas has
generated over 220 000 jobs with 46 cents in every tourism dollar being
spent in regional areas.
Nonetheless, while the two largest mining-dependent states, Queensland
and Western Australia have a national gross value add from mining of 24 and 51
per cent respectively, the dependency on tourism is comparatively low. Queensland’s
tourism dependency is 3.7 per cent, while Western Australia has the nation’s
lowest tourism dependency at 2.2 per cent.
Growth is being experienced in Western Australia in the business travel
sector and this is directly attributable to FIFO. Unfortunately this growth is having
a significant impact on the leisure sector of the tourism industry.
The capacity of the tourism industry to attract and retain staff is well
documented, with 30 per cent of tourism industry leaders ranking ‘the shortage
of skilled labour among their top three business impediments.’
The Tourism and Transport Forum (TTF) Australia has identified that labour and
skills are the greatest supply challenge in meeting growth targets.
While there are reasons specific to the tourism industry for this supply
challenge, TTF Australia noted that:
The concern is acute in regional areas, where tourism
operators are having difficulty finding and retaining skilled staff as they are
unable to compete with the wages offered by other sectors such as resources.’
The tourism industry is directly competing with the resources sector for
labour, particularly in Queensland and Western Australia where growth in the
resources sector is growing at three to four times the rate of growth in the
tourism sector. Tourism Research Australia noted:
Increased wages and lower profitability and productivity of
affected industries, are in some sectors reducing the incentive for investment
and limiting the ability to attract capital and labour.
Tourism providers are also finding it difficult to house staff who are
unable to pay high rental prices, the consequences of which were discussed
earlier in this chapter.
Access to transport and accommodation
Even when tourism operators are able to find sufficient staff, access to
transport and accommodation for the leisure sector is being seriously hampered
by the rising trend of FIFO work.
Tourism Research Australia has found that flights and accommodation are
being ‘crowded out’ by business and employment use. The Tourism and Transport
Forum confirmed that ‘the growth in seats to resource areas leaves a net
reduction in tourism seats.’
In areas where DIDO predominates, road safety is of serious concern. The
Queensland Government raised concerns about road safety in a state where road
touring is popular:
traffic generated by DIDO workers has the potential to increase traffic and
reduce safety on the road networks in regional areas, making them less
attractive for the self-drive touring market. The safety, reliability and
efficiency of Queensland’s
road network has direct impacts on Queensland’s
tourism industry because of the regionalised nature of our population centres
and tourist attractions/destinations.
Conversely, some have argued that FIFO has enabled investment in
regional aviation which directly benefits tourism.
The aviation industry has clearly benefited from the growth in FIFO, for
example, Tourism Research Australia (TRA) has found that between 2006 and 2010
the ‘available seat kilometres between Perth and Karratha grew at an average
annual rate ... of 25 per cent’. Similarly, the Brisbane-Mackay route has grown
at an average annual rate of 14 per cent between 2001 and 2010. 
However, the growth in seats does not translate to better tourist
access, TRA noted:
While there has been significant capacity growth on
mining-related routes, load factors have also remained high suggesting strong
demand for these additional services which potentially restricts seat
availability for leisure tourists.
A number of submissions also complained about companies ‘block booking’
aisle and window seats on commercial flights, resulting in families being
unable to sit together and the presence of FIFO workers at small regional
airports. Many comments were also made about the appearance of workers going
directly from a shift to a flight:
When I do manage to get a booking I notice they have a hefty
contingent of ‘orange jackets' flying. They are often quite objectionable in
presentation in that they are not socially clean in dirty working clothes,
exude the smell of stale alcohol and exhibit rowdy behaviour. It is a relief to
get off at the other end!
Area for corporate action – reducing impact on regional airports
A number of local councils noted that they would like to have a
process put in place that would streamline on-site check-in for workers so they
were transported directly to the flight rather than waiting at the airport and
impacting on the amenity for leisure and local travellers.
Where leisure travellers are able to access airline seats, they have
difficulty sourcing accommodation. Shortage of tourist accommodation is seen as
a key impact on the decline in tourist activity levels in some resource areas.
The NTA noted:
Tourism is losing accommodation and product capacity as bed
stock is taken over by corporate and FIFO along with accompanying price rises.
In some cases, destinations have become virtually off-limits to leisure tour
operators as all available accommodation has been contracted to mining
operators, for up to 6-10 years in some cases.
Research undertaken by Tourism Research Australia supports this finding.
Across the country, business nights as a reason for travel have declined in all
states except Queensland and Western Australia, with 30 per cent of business
nights in regional Australia attributable to FIFO workers.
Indeed, the percentage of FIFO visitor nights as on overall proportion
of business nights is growing across all regions engaged with the resources
industry. As demonstrated in Figure 3.1, over 40 per cent of business nights in
some regions are attributable to FIFO.
This is concerning because increased accommodation prices push travel to
affected communities out of the average leisure traveller’s affordability, and
in some cases removes them from the leisure market altogether. The Town of Port
Currently the Town of Port Hedland has no backpackers
facilities ... and there is little incentive for anyone to operate a
backpackers accommodation business when they can rent out their premises to
FIFO companies for in excess of $2 000 per week.
Cobar Business Association outlined the conflict they feel about rising
occupancy rates as opposed to the downturn in tourism capacity of the town:
While it is good that our local motels are fully booked, it
makes it very difficult for other businesses in town, including the local
Council and contractors, to find accommodation for visiting professionals. It
also has a significant impact on our local tourism industry with many tourists
who intended to stop in Cobar forced to continue their journey due to a lack of
Figure 3.1 FIFO/DIDO visitor nights as a proportion of
business nights, 2010
Government, Department of Resources, Energy and Tourism, Tourism Research
Australia, Snapshots 2011: The Impact of the mining boom on tourism, November 2011 from National Visitor Survey 2010.
Regional tourists expressed frustration at this situation. For instance,
Diana and Gordon Plowman stated that, during two trips covering 12 000
kilometres of outback Queensland, they could not find weeknight accommodation
in many towns and advance bookings were cancelled with little notice due to
block company bookings.
The Queensland Government noted:
The FIFO/DIDO model has the potential to reduce the capacity
of regional Queensland to benefit from tourism. For example, tourist
accommodation in local towns that would typically be used by leisure visitors
may be utilised - particularly during the pre-construction and construction
phases, by the FIFO/DIDO workforce, putting pressure on the availability of
tourist accommodation. In some cases, employers of FIFO/DIDO workers have booked
out accommodation premises for an extended period of time, even if not fully
utilised. In other cases, mining companies have purchased accommodation
premises (e.g. caravan parks). Reports of complaints from travellers about the
unavailability of accommodation in towns that tourists wish to visit are not
isolated. As a result, these destinations have lost these visitors and the
economic benefit (in terms of expenditure) tourists would have otherwise
A decline in tourism service capacity not only has serious consequences
for individual business operators, but also has consequences for the ability of
towns and regions to develop an economically diverse base that will be
sustainable beyond the life of the supporting mine.
One of the key complaints about FIFO related to the failure of
accommodation providers to source basic services from the local community:
There are concerns at the lack of investment from FIFO
dominated projects in regional communities. There is evidence of projects in
the Pilbara which have assessed the production change and found that there was
effectively no input or integration with the local or regional economy. Even to
the extent some projects weren’t even buying basic services such as bread from
the region - even though there were suitable providers of this.
The co-location of work camps containing mini supermarkets, bars and
other services, despite the town’s facilities being in close proximity, erode what
little benefit the camps could provide.
Whilst communities may have service providers willing to provide goods
and services, they may not have the capacity to meet the supply demand. Geoff
Dearden, General Manager Development of The MAC Service Group, a national
accommodation supplier, stated that some local suppliers had been able to grow
with The MAC’s growth:
When the business started 10 or 12 years ago it was obviously
much smaller. We started buying meat through a local butcher in Mackay for the
Bowen Basin sites. We still use that same butcher. He supplies 7 000 meals
a day. He has decided to invest with us and we have remained loyal to him. So
there is that opportunity.
Understandably, Mr Dearden noted that one of The MAC’s purchasing
criteria is supply certainty to ensure the capacity to deliver services 24
hours a day, seven days a week and small businesses in regional centres are often
unable to meet this requirement.
The Pilbara Regional Council also noted that the provision of FIFO trade
and service industries restricted the availability of these services to the
These arrangements operate to the severe detriment of local
residential communities. More specifically the FIFO services (eg. Electricians
and refrigeration engineers) are restricted in their operations to the resource
operations and are not available to the general population. Furthermore,
potential, locally based services which do not have access to resource based
work are unable to survive servicing the domestic market alone. Often, the
result is local communities are deprived of many of the services and trades
which would normally be found in communities of comparable size.
The Committee took significant lessons from its experience in
Newfoundland and Labrador in Canada about development of local businesses
through community benefits plans. In short, for a resource company to operate
in the province, they must adhere to a community benefits plan. These plans
cover local hiring, Indigenous and gender equity plans, contribution to
infrastructure and skills development and supplier development.
For example, the Hebron offshore petroleum community benefits agreement
specifies the following activities to take place in the Province:
- fabrication and construction
in the Province;
- front-end engineering
and design (specified 50 000 person hours);
- detailed engineering
(specified 1.2 million person hours);
- project management
office in the Province (specified one million person hours plus locals-first
- procurement and
contracting (proponents will develop local supplier capacity);
development, education and training ($120 million contribution to local
supplier development and $1 million to local tertiary education institutions
for project skills development); and
- gender equity and
Recognising that the Hebron Project is a long-term project for the
region, the industry stakeholders and the local and provincial governments have
addressed the need to build in-province capacity – both in terms of skills and
local small business capacity.
Area for corporate, state/territory action – small business capacity
In many small towns, particularly the new resource areas, local
businesses may not have the capacity to service FIFO operations whether camp
services, workforce training or product development. However, with some
capacity development, many local businesses may be able to position themselves
to take advantage of service delivery to the FIFO workforce.
Furthermore, despite the apparent opportunities for Aboriginal companies
to establish business relationships with resource companies, there is a lack of
support for them in navigating mining and business regulations.
In Mongolia, the Committee learned that as part of community engagement
alongside the Oyu Tolgoi mine, Rio Tinto is supporting the growth of small
businesses in the nearby town of Khanbogd that will eventually become the
residential community servicing the mine. This very small community currently
does not have the capacity for rapid expansion, but by assisting businesses to
develop in a sustainable manner, Rio Tinto envisions that the town will be able
to grow with a diversified economy.
The Commonwealth Government recently established a Small Business
Commissioner to provide information, advice, advocacy and representation of
small business interests. The Committee believes that one of the Commissioner’s
key priorities should be to develop initiatives to build supply capacity in resource
The Committee recommends that the Commonwealth Government
charge the Australian Small Business Commissioner to enhance the capacity of
small businesses in resource communities to participate in servicing the
demands of the resource sector.
It was argued consistently throughout the inquiry that FIFO work
practices were necessary because workers needed to be afforded choice about
where they lived and worked. However, it was clear that the impact of FIFO work
practices was effectively limiting the capacity of workers to choose to
relocate closer to their workplace due to high housing costs, limited education
opportunities and, in some cases, mandatory FIFO positions.
The Committee encountered disturbing reports that existing residential
workers were being forced onto FIFO contracts, despite a desire to remain as residential
My husband has been told that his contract will now be fly-in
fly-out. If he wishes to take that contract up, it is his choice. He has worked
for the company for 26 years and we have lived up here [Karratha] for 28. 'The
time has come whereby your job now is fly-in fly-out, whether you like it or
The assertion that locally-based permanent workers are being forced to
work FIFO and live in accommodation camps is deeply concerning. While the
Committee does not accept the arguments for imposing FIFO quotas, it does
believe that all permanent FIFO positions should be identified and have
justified reasons for not being locally based.
FIFO is often the best employment practice for a construction workforce.
However, for permanent workforces, the Committee is of the very strong opinion
that FIFO should only be used in very limited circumstances.
It would be inappropriate to recommend mandatory residential or FIFO
levels. These are matters for local and state governments and employees and employers
to negotiate. However, there are very many things that can be done to encourage
the growth of a residential workforce.
One of the key lessons that the Canadian experience may provide Australia
is the use of community benefits plans. Impact benefits agreements with local
Indigenous communities are a common feature of resource development,
particularly in Western Australia, but are often focussed on compensation for
land use. While resource companies are very aware of their role as contributors
to community infrastructure, this happens in an ad-hoc manner, contributing to
the perception that companies do little to build residential towns.
The community benefits plans in place in Canada focus less on
compensation and ad-hoc provision of facilities and more on building community
sustainability and economic diversity, including local business and skills
development as noted above.
Community benefits plans are linked to mine approval, and required
through whatever powers the local government or province may have – including
in some case being required for environmental approvals.
Some of the features of community benefits plans include:
- local hiring targets
including specified in-Province employment hours;
- in existing
communities, FIFO limited to construction, with permanent employees allowed to
FIFO on an exception-only basis;
- negotiated layout of
FIFO camps – for example, locating camps close to town with studio rooms that
include a kitchen and no mess or bar facilities so that workers must purchase
- designing FIFO camps
to integrate to the urban landscape of the town and ensuring that the design
can be put to alternative uses when no longer required as FIFO accommodation;
- housing development
and infrastructure upgrades; and
- seasonal mining
employment for university students and agricultural workers.
In addition to community benefits plans, some companies had also negotiated
specific Aboriginal FIFO plans that identified Aboriginal communities that
wanted to either run FIFO camps or take advantage of FIFO employment.
Similar to some of Australia’s Indigenous communities that have access
challenges during wet/dry seasons, some of Canada’s Aboriginal communities are
isolated until winter opens ice roads so they were being engaged in seasonal
employment which has a range of community benefits, including suiting cultural
Newfoundland and Labrador provincial authorities advised that the
community benefits plans were mandatory for any resource development and
included monthly reporting requirements. Officials also noted that companies
had accepted the need for community benefits plans and time had shown that they
did not impact on profitability or competitiveness.
The resource companies are not alone in implementing community benefit
agreements. Alongside company commitments, the provincial government supported
business growth through targeted investment in skills and business development
to bring local companies up to a competitive level.
Indeed, resource companies stated that they embraced the community
benefits plans as they put structure around what otherwise was ad-hoc (even if
significant) contribution to the community.
The Committee acknowledges that many resource companies do make
significant contributions to communities and there are many company-supported
initiatives funded by resource companies. All of the companies and industry
organisations that provided evidence to the inquiry expressed their commitment
to community support initiatives.
The Chamber of Minerals and Energy of Western Australia (CMEWA) has
issued guidelines regarding best practice FIFO integration.
The eight guiding principles to apply best practice in FIFO integration reflect
the evidence received during this inquiry.
However, many local councils advised that infrastructure investment is
focussed largely on ‘headline’ projects such as new swimming pools and sporting
facilities without legacy maintenance funding.
The rise in the use of FIFO workforces and the degradation of regional
communities, both actual and perceived, means that corporate support needs to
be undertaken in a way that is more strategic, transparent and accountable.
Very few resource communities stated that they did not want growth in
mining operations, they simply want more consideration taken of their
communities in the process. Part of the frustration by local governments was focussed
on their exclusion from the approvals process and lack of engagement with
resource companies in productive and proactive planning.
There is a clear lack of empirical evidence about the social impact of
FIFO workforce practices on communities. However, it is clear from the anecdotal
evidence that residents’ experiences of FIFO are overwhelmingly negative.
Although social impact assessments are undertaken for all new and
expanded mining operations and these are used to inform the approvals process,
councils argued that the assessment outcomes focused more on state than local
Area for corporate, state/territory action – social impact assessments and
community benefits plans
The Committee encourages the implementation of more rigorous
social impact assessments and community benefits plans mandated as part of any
mine approval process.
Social impact assessments are generally undertaken for state approvals
processes and requirements vary across jurisdictions. Queensland currently has
the most rigorous scheme, but local governments often feel excluded from the
process and outcomes. The Committee urges all state the territory governments
to implement the requirement for social impact assessments prior to any mine
approval and fully involve local governments in the consideration of these
Local government involvement in planning
Local governments are key stakeholders in the management of the impact
of FIFO workforces, however they have limited opportunity to influence these
impacts at the key stage of regulatory approval.
For example, the Pilbara Regional Council stated:
- Section 120 of the
Western Australia Mining Act 1976 limits the authority of local government
based town planning schemes, (although there is significant debate as to
precise limits imposed by this particular legislation);
- The operators of most
of the more major and established resource projects, particularly those
relating to iron ore and natural gas (both of whom are major employers), have
entered into agreements with State government of Western Australia and those
agreements are enshrouded in statute (ie “State Agreements”). These pieces of
legislation often limit local government input to planning processes to little
more than consultation; and
- In many cases, the
“State Agreements” referred to above limit, or restrict completely, the ability
of local governments to collect anything other than minimal “Unimproved Value”
(UV) rates, of operations which are internationally commercially significant.
Similarly in Queensland, local councils raised the following concerns
about the resource approval process:
- tenure approval
process – non-transparent tenure approval process and inadequate local
government consultation and time to respond to applications;
- no legislative
requirement to notify councils of tenure applications, therefore councils are
often unaware of applications until approval has been granted and cannot
adequately plan for their impact;
- no requirement for
social impact management plans to be incorporated in environmental impact
- no processes to
financially compensate councils for the workload associated with participating
in the approvals process.
As discussed above, resource companies should not be responsible for
service provision as part of their core business; however, they and state
governments are failing to adequately communicate the extent of a FIFO
workforce to those responsible for planning.
The need for better planning was consistently repeated throughout the
inquiry, but most local governments simply do not have the basic information
they need to plan for services:
The region needs better planning – but this would mean coming
up with a better / different way of counting the users of services. At the
moment nobody is even sure of how many people there are at any given time in
Moranbah, so planning around service provision is simply not possible.
The Queensland Resources Council (QRC) argued that the shortfall in
service provision is not the fault of FIFO workers, but rather a failure of
government planning for infrastructure and service provision.
The Committee agrees with this argument to some extent, however, where resource
companies are injecting a significant additional population in the form of FIFO
workers to a region, they have some responsibility to ensure that these workers
have adequate access to services – even if only through the provision of
information to assist local councils with early planning.
Area for corporate, state/territory action – earlier engagement with local
Local governments, as the key service providers in local
communities, as well as being the group that can communicate with local
businesses about future growth and planning needs, must be involved at an
earlier stage of the planning process.
Royalties for regions and local government capacity
The Western Australian Government’s ‘Royalties for Regions’ program was
cited regularly throughout the inquiry as a significant driver of growth
capacity in the resource communities of Western Australia. The program
reinvests 25 per cent of mining and onshore petroleum royalties into regional
Western Australia to fund projects in health, education, community assets and
infrastructure, housing and water.
Western Australian local governments largely supported the scheme and
the Committee was impressed by the number of developments it observed in
communities as a direct result of the funding. Regional Development Australia
Pilbara (RDA Pilbara) stated:
Potentially the cornerstone of planned and positive change in
the Pilbara Region is a new approach by the State Government, encapsulated in
its Pilbara Cities Vision and in the Royalties for Regions initiatives and
funding programs. These are intended to change forever any remaining
perceptions of the Pilbara as a group of mining towns and with little to offer
lifestyle-wise apart from the richness of the Region’s natural attractions.
Queensland councils called for similar royalties schemes to be put in
place. In late November 2012
the Queensland Government made a commitment of funding under a ‘Royalties for
the Regions’ scheme, although this is a base level of funding, and
substantially less funding than available in Western Australia.
The inquiry heard a range of stories from local governments about the
investment that companies were making in local communities that ranged from the
very positive to the non-existent. Some argued that the payment of royalties
was making companies reluctant to make additional investment:
Before the royalties came in, we got a far better response
than we are getting at the moment. Now that royalties have come in, the mining
companies turn around and say to us, ‘We’re paying royalties to the state
government; therefore we shouldn’t have to double-dip to assist you with
building roads and so forth.’ … we do not have any formal structure but we do
have regular meetings with them and we do impress upon them the need to be part
of the community, to be good citizens and to make some contribution.
The MCA identified that there is a need for increased capacity in local
Local governments in several jurisdictions struggle to
provide services in the rapidly changing environment to populations with
increasingly high expectations. In Western Australia local governments are
struggling to manage the large inflow of funding generated through the
Royalties for Regions scheme. In some cases a shire’s operating budget has
doubled but has not been accompanied by an increase in staffing levels
necessary to effectively manage the increased budgets. There is a need for the
capacity of local governments to be enhanced, particularly those that are
receiving Royalties for Regions funding to maximise their potential for
delivering desired outcomes.
Local councils need greater support to develop the skills base and
capacity to effectively service resource communities. All the local government
representatives that the Committee met over the course of the inquiry were
highly skilled individuals who were serving their communities effectively and
professionally. However, many also recognised the need for greater support in
managing their ever-widening portfolio of responsibilities.
Accordingly, the Committee is recommending that the Commonwealth
Government, in consultation with state and territory governments other
appropriate stakeholders, identify areas where local governments affected by
FIFO work practices would benefit from enhanced skills sets and develop
training programs to meet the needs of senior officials in local government bureaucracy.
The Committee recommends that the Commonwealth Government
identify areas where local governments affected by fly-in, fly-out/drive-in,
drive-out work practices would benefit from enhanced skills sets and develop
training programs to meet the needs of councillors and senior staff in local
A key issue encouraging the use of FIFO is the lack of housing
availability and affordability in resource communities. A basic lack of
available housing is pushing prices beyond the reach of many workers and making
resource towns an unattractive option for new residents.
The primary cause of the current accommodation crisis in resource
communities is a lack of adequate planning and appropriate land release.
FIFO is not the solution to housing affordability in resource
communities. The continued failure to address this issue simply has a flow-on
effect for non-resource, or ‘source’ communities. For example, the cost and
lack of availability of housing in Moranbah has pushed up the cost of housing
in Mackay and, as in resource communities, service workers in Mackay are now
struggling to find affordable accommodation.
The consequence of unaffordable housing in resource communities
High housing costs are not only discouraging permanent migration to
regional towns, but encouraging permanent residents to ‘cash out’ by selling
their properties for a high price and moving to more affordable towns and
cities – many choosing to take up FIFO work back to the original town.
Service workers including teachers, doctors, police officers, public
servants and council workers are being forced to move due to a lack of
affordable accommodation and small business owners report difficulties
recruiting workers simply due to a lack of affordable accommodation.
The Moranbah Traders Association stated:
We have plenty of examples of businesses in this town already
having major difficulties obtaining staff, including my own—but I am only a
small example. There are people being forced to leave town because they cannot
afford to live here.
In the Pilbara, it is common practice for employers, including those
outside of the resources sector, to provide accommodation to their employees.
However, as the cost of accommodation increases, this practice is becoming
unsustainable. In Karratha, the Shire President advised:
If you have a small business, you cannot shell out $1 million
to accommodate a worker who earns $35 000 a year, and the reality is that,
if you work in retail, that is what you do earn.
Not only is this encouraging residents to leave their home town, but it
is discouraging workers who want to relocate their families to resource
communities. Rio Tinto stated that ‘there is a shortage of available housing in
Clermont and a waiting list of employees wanting to live locally.’
In fact, many Rio Tinto projects have had to turn to FIFO (or DIDO)
practices as a result of the lack of available housing:
DIDO options for RTA employees and major contractors at Gladstone
are being reviewed as a consequence of critical regional housing affordability
and availability issues.
Due to the high demand for accommodation within resource communities,
even basic housing is increasingly beyond the financial reach of people within
the community. A local school teacher in Karratha stated that she loved
teaching in regional areas, but housing affordability and infrastructure is a
major burden on teachers:
For my little flat here and thank God we get a stipend from
CEO [Catholic Education Office], costs $1 200 a week. I pay what I would
pay in Perth, which is $160 a week, so the Catholic Education Office actually
has to pick up that extra cost so I can teach here in the Pilbara.
In Moranbah, available accommodation presented as a major obstacle to
… Moranbah is well placed to … attract doctors. I think the
work is interesting. It is financially rewarding for them, and there can be
clear career pathways as well with the age of the current practice owners. The
major challenge is accommodation. We have long been lobbying for some kind of a
partnership between various stakeholders in terms of putting together some kind
of a medical workforce housing precinct. Possibly—this is just pie in the
sky—Queensland Health provide land; council, you possibly do this; industry,
that and have a real collaborative effort to put together some kind of a
precinct. You might have a couple of duplexes, some units and a full family
home, because that is the other thing: doctors come in all shapes and sizes.
Expand that not just for doctors but for the medical workforce, because the
pharmacies are in the same boat. The physios are in the same boat. The
dentists—that is another story. It is about attracting and retaining health
professionals to this town, not just doctors. That is the first thing, and for
us what has been key is affordable accommodation.
The cost of accommodation is having an even greater impact on
financially vulnerable members of the community. In Mackay:
That is where the problem starts with accommodation for the
employees of small businesses, even for the small businesses themselves, for
young people, for unmarried mums and the elderly who want to stay in town
because all their family is there.
Apprentices and those who are undertaking tertiary education are
frequently unable to afford to live in their home town. In Karratha, a high
school student stated:
I think the cost of rent affects people's choice to stay
here. For us, next year, if we do not work at the mining stuff, it will be hard
to pay the rent because it is quite high so most kids are resorting to moving
down to Perth where the housing is a bit cheaper.
The lack of affordable and available accommodation is also impacting the
availability of housing for Indigenous Australians in Western Australia. In
All of this is happening while some local Aboriginal people
live in tents and makeshift camps in the shadow of 1,000-room fly-in fly-out
An Aboriginal elder confirmed this: ‘What I am saying here is that we
are getting blocked off. As Aboriginal people, we cannot get houses.’
In Narrabri, Centacare referred to the difficulties in sourcing
emergency accommodation for their clients, including: youth, families, people
from Indigenous and culturally and linguistically diverse backgrounds and
people impacted by mental health and homelessness:
Competition for such bedspace was challenging prior to the
roll out of the FIFO mine workforce. Competition for such bed space has since
become impossible. Bedspace is pre-booked well in advance by the mines and
Despite this desperate need for affordable housing, the Social Housing
Initiative (SHI), a part of the Nation Building Economic Stimulus Program,
constructed very few social housing dwellings in resource communities. The
program constructed three dwellings in Karratha; two in South Hedland; nine in
Roebourne and fourteen in Kalgoorlie.
There is high demand for social housing across Australia, but it is
disappointing that the lack of available social housing in resource communities
has not attracted greater attention from the Government. The Committee is
concerned with the frequency with which people in resource communities are
being pressured to leave their homes and towns as a result of the high cost of
Many residents who own their homes are taking advantage of the high
market values to ‘cash out’ and move to more affordable areas. Allen Cooper,
the Chief Executive Officer of the Shire of East Pilbara described this trend:
To use the term, they have snatched the money and ran. They
have actually left town. You are losing people who have a good connection with
the town and who have been there for a long time. You are losing local
Case Study - Karratha Service Workers Accommodation
Service Workers Accommodation project was supported by the Royalties for
Regions program (the program). The program allocated $30.4 million in funding
to deliver 100 affordable rental accommodation units with the facility to
house up to 250 eligible people in the Warrambie Estate in Karratha.
To be eligible
for a Karratha Service Workers Accommodation lease, a worker must:
employed in a job designated as providing an essential service to the
community. This may be in:
not-for-profit, non-government organisation;
b. a local, state
or federal government department where the services are located in the Shire
of Roebourne and directly service these communities;
business enterprise providing services within the Shire of Roebourne.
2. Due to
income constraints require assistance in finding suitably priced
accommodation and may be still eligible for Governmental rental assistance. .
services to the broader community and not directly or largely to the
Resources Sector Clients.
weekly rents are: $300 per week for a one bedroom home; $400 per week for a
two bedroom home and $500 per week for a three bedroom home.
White-Hartig, the Shire President for the Shire of Roebourne, expressed her
support for the program and the Council’s appreciation of the State
Government’s support; however she also warned that although the rates were
comparatively less expensive, they might still not be ‘affordable’ for many
members of the community.
Those who are renting must choose between attempting to keep up with the
cripplingly high rents and leaving their home town. In Moranbah ‘the reality is
those price pressures remove all choice for families in housing and their
capacity to live in our region’.
The housing crisis is limiting the options available to people to both
work and live in resource communities. The high cost of housing is making the
choice to live in resource communities less and less feasible.
One solution – adequate land release
The only way to adequately address housing affordability is a staged,
planned, process of land release. The availability of land for the development
of new housing in resource communities is essential to increasing the supply of
affordable housing. The support of state governments is essential for
successful planning and development of large housing projects in resource
In the Pilbara, the West Australian Planning Commission (WAPC) is
working closely with local government in the form of the Pilbara Regional
Planning Committee. In January 2012, the WAPC released the Pilbara planning and
infrastructure framework which provides a detailed outline of the Pilbara
Cities vision, a strategic plan for the development of the Pilbara region over
the next decade and beyond.
The Queensland Government has shown itself to be less willing to develop
its regional towns, instead encouraging the use of FIFO workforce practices in
towns such as Moranbah. The situation in Moranbah is complicated by the
existence of mining leases close to the town but a history of state government
decisions have nonetheless played a role in shifting the balance in Moranbah
from residential to FIFO.
The Queensland Urban Land Development Authority (ULDA)’s approval of the
MAC Village over the development of permanent residential dwellings illustrates
not only an unwillingness from the State Government to consult and work
together with local government, but also implies that it favours the
development of FIFO over the development of Moranbah itself.
In contrast, the Western Australian government, in collaboration with
local councils and traditional land owners, has been involved in a number of
land release and development projects in the Pilbara and Goldfields resource
regions. In Karratha:
The state government through Landcorp and its other agencies
has been involved getting some major developers involved in what are called
broadacre developments, so this is not just about providing housing but
providing the other infrastructure, the villages within the new communities and
so on. There is an enormous amount of work being done there.
Case Study – Isaac Regional Council
resource community of Moranbah, in Queensland’s Bowen Basin, the Isaac
Regional Council is struggling to come to terms with the Queensland
Government Urban Land Development Authority’s (ULDA) decision to support the
development of a 3 258 room FIFO accommodation village on land which
could be used to develop more than 750 permanent residences.
proximity to existing and planned mining developments means that land zoned
for residential purposes is extremely limited. The Council described the
approval of this development as, ‘reprehensible and tantamount to future
has strongly urged with the Queensland Premier to avert the planned
development, stating that, ‘the ULDA has arrogantly and disgracefully ignored
our community at every turn on this development.’
Area for state/territory action – land release
The Mayor of the most famous of Canadian FIFO-impacted towns,
Fort McMurray in Alberta, advised that the solution to managing a FIFO
workforce is to make land available for housing. However, this can only be
adequately managed with the capacity to plan with the support of robust and
reliable research about current and future population and workforce intentions.
This must be undertaken with some caution so as not to undermine the current
market in resource communities.
Commonwealth departments outlined programs currently available to assist
people struggling to afford housing.
These programs include the:
- Housing Affordability
- Building Better
Regional Cities Program (BBRC); and
- National Rental
Affordability Scheme (NRAS).
The projects being undertaken as part of the HAF and the BBRC are
currently focusing on FIFO source communities such as Geraldton, Mackay and
Broome but do not provide affordable housing in resource communities.
The NRAS is equally ineffective in resource communities. Under the NRAS,
incentives are provided to successful applicants for each dwelling which is
rented to eligible low and moderate income households at a rate that is at
least 20 per cent below the prevailing market rate.
However, in resource communities, many families and individuals who are unable
to afford housing are not considered low to moderate income and therefore would
not be eligible for assistance under the scheme.
Additionally, as a result of the incredibly high rents, which often exceed
$2 000 to $3 000 per week, the scheme does not provide sufficient
financial incentive offered to encourage owners to offer their properties at 20
per cent below the prevailing market rate.
National Housing Supply Council
The National Housing Supply Council (NHSC) was established in 2008 by
the Commonwealth Government to monitor housing demand, supply and affordability
in Australia. In its most recent State of Supply Report, little attention is
given to the housing crisis in resource communities. The only mention that the
report makes is:
In addition, regional issues – such as a spike in demand and
housing prices occasioned by a mining boom – may have a displacing impact on a
wide cross-section of affected communities. This may endure in regional economies
that fail to attract a significant supply response because of risks associated
with a narrow economic base or volatile resources price.
The State of Supply Report highlights a number of areas for further
research over the next two years, one of which is a more detailed review of
regional, provincial and city submarkets across all tenures and how they
Accommodation is not a new issue in resource regions, in 2008, the
Senate Select Committee on Housing Affordability recommended that the
Commonwealth Government, ‘develop a coordinated response to the housing
affordability crisis in the Pilbara.’ However, there appear
to be no future plans for programs tailored to target the accommodation crisis
which is decimating Australia’s resource communities.
The Committee has received no evidence that current Commonwealth
programs are able to provide the essential assistance required. The programs
are too broad and do not take into account the unique circumstances of the
housing crisis in resource communities.
Measures must be undertaken to find a solution to housing affordability
in resource communities without simply pushing the problem onto ‘source’
communities through the use of FIFO workforces.
The National Housing Supply Council is best placed to develop a strategy
for addressing the supply of affordable housing in resource communities and
this must be completed as a matter of urgency.
The Committee recommends that the Commonwealth Government
task the National Housing Supply Council to urgently develop and implement a
strategy to address the supply of affordable housing in resource communities
and report to the House of Representatives by 27 June 2013 on the progress of