Howarth Drilling and Nucoal

Private Member’s Statement

 by Mr Clayton Barr MP

State Member for the Electorate of Cessnock

18 June 2014

I draw the attention of the House to a matter of great importance to a number of my constituents in the electorate of Cessnock. I speak of a bill that was introduced and passed through all stages with bipartisan support in January. Of course, I refer to the Mining Amendment (ICAC Operations Jasper and Acacia) Bill 2014. One of the greatest responsibilities of members of Parliament is to understand the consequences of the legislation that passes through this Parliament. There was a level of bipartisan negligence in January that is now costing people in the Cessnock electorate their homes, their businesses and their way of life.

The Mining Amendment Bill was introduced in response to an Independent Commission Against Corruption [ICAC] investigation into the awarding of mining licences at Mount Penny and Doyles Creek. We were told at that time that the bill implemented Independent Commission Against Corruption recommendations. However, what was glossed over and ignored was the fact that ICAC also recommended that innocent parties who would be affected by any such withdrawal of the mining licences be compensated. This point is crucial.

I have met with Mr Warwick Howarth, a local constituent, on several occasions over recent months. Mr Howarth and his company, Howarth Drilling, were engaged by NuCoal to perform drilling and sampling work on the Doyles Creek site. At the time that Howarth Drilling agreed to work, NuCoal, an ASX-listed company, had a valid exploration licence to conduct mining activities on the Doyles Creek site. The contract for drilling work on the site would provide the next phase of employment for Mr Howarth and his 20 employees. It gave him certainty to invest further in his business and equipment. Based on this certainty and the assurance of work in coming years, Mr Howarth took out loans in excess of $l million and put up his family home as a guarantee. Many members would appreciate the risk that small business owners face in establishing and expanding their businesses.

It is crucial to note that in this instance Mr Howarth assessed that the legally obtained lease held by NuCoal over the Doyles Creek mine and his legal and binding agreement to provide drilling services was anything but a risk. When he took on the debt he was certain about the future of his company. Nobody could have foreseen or predicted the unprecedented actions of this Parliament in January 2014. The then Premier’s second reading speech on the Mining Amendment Bill referred to the risk involved in investing and portrayed mining investors as gamblers who might also flutter away their savings on a poker machine or a racehorse. That was a complete misrepresentation of the facts and was insulting to the mum and dad investors in NuCoal and to small family businesses engaged in honest work—businesses like Howarth Drilling.

It is a sad and tragic reality that as a result of the mining amendment Bill that was passed through this house, Mr Howarth’s life, family and business have been destroyed. This honest, hardworking man had his dreams destroyed and his employees had their financial security shattered, all for the sake of political grandstanding in this place—and I emphasise we all fell into line.

The recommendations of ICAC sought a far more just and fair outcome in seeking to protect the innocent. The Independent Commission Against Corruption must be terribly disappointed with what we have done. It is a testament to Mr Howarth that in our meetings he has shown consistent and ongoing concern for the welfare of his former employees. He wants justice for them just as much as he wants justice for himself. I have met with two former workers of Howarth Drilling. Both of them were struggling to hold onto their homes as their mortgages consumed their savings. One of these former employees had a husband who was working three jobs, seven days a week, and being deprived of seeing his newborn baby grow and thrive, in a bid to save their family home. I was told of another former employee whose family had already lost their home to the bank. All of these innocent and honest people are a world away from ICAC and this Parliament, and yet they bear the weight.

In my final note I offer this with regard to the Howarth Drilling business. The company would have been debt free in September 2013, four months prior to the Mining Amendment Bill 2014, had it continued drilling during the ICAC inquiry. It had every right and legal opportunity to do exactly that. But, in a gesture of goodwill and at the request of the Premier’s office, via former Minister for Resources and Energy Chris Hartcher, it had temporarily stood down from drilling while ICAC progressed. At first, everyone assumed that this would be a short delay, but weeks soon became months and the months soon amounted to almost a year. Keep in mind that this was all done with goodwill as there was absolutely no legal obstruction preventing NuCoal from continuing explorations as usual.

It is clear now that the goodwill extended to the politicians has cost Mr Howarth and his employees everything. While it should simply be common sense, I do recognise that it will take great courage and leadership for the Government to review the legislation and fulfil the wishes of ICAC in their entirety. I ask the Premier to consider this with great urgency.