Resources underpin state but still under pressure

The latest Queensland budget update once again reinforces the importance of the resources sector to the state’s economy with Treasury citing coal royalties for leaving a $754 million revenue hole in 2025-26.

The coal sector, which contributed $76 billion to Queensland’s economy and supported more than 363,000 local jobs in 2024-25, is forecast to raise $5.4 billion in coal royalties this financial year – well down from recent years due to lower coal prices.

The Queensland Resources Council (QRC) said the sector was hurting under sustained and mounting pressure from the world’s highest royalty rates even during lower pricing coupled with escalating production costs.

Declining coal royalties were compounded this year with the Commonwealth’s decision to redistribute GST to other states, while direct spending in regional Queensland decreased by $3.44 billion according to QRC’s 2024-25 Economic Contribution Report.

QRC Chief Executive Officer Janette Hewson said the latest budget update again demonstrated how important the resources sector was to Queensland’s way of life.

“We expect the hard times will continue for regional Queensland with more job losses and less royalties flowing back to regional communities,” Ms Hewson said.

“We recognise that the Government is in a challenging position with the state’s budget and royalty relief is sought at a time when the cost of living is tough for all.

“While overall royalties have declined, many companies are still paying at 30 and 40 per cent royalty tiers while trying to absorb rising operational costs. This means slow to no growth for the sector.

“The resources sector can play an important role in helping the government address the challenges if we have the right policy settings to attract investment.”

Miguel Holland – [email protected]

Matt Dunstan – [email protected]