SKILLS TRAINING IN THE AUSTRALIAN MINING INDUSTRY WITH EMPHASIS ON SAFETY AND PRODUCTIVITY OUTCOMES

Phillip Martin Warren General Manager - Hunter Plant Operator Training School Ltd.

Safety and Productivity are critical factors in the performance of the Australian Mining Industry. Safety due to the expectation of the Australian community that no one should die at work and productivity is the key to survival in an increasingly competitive world marketplace. Where does training fit into the safety improvement equation? Is it critical or peripheral? INTRODUCTION The Commonwealth of Australia is a federation of six states and two territories with national government being responsible for the economy, defense and trade. The state and territory governments are responsible for education, health and infrastructure (all with commonwealth taxation revenue) and, in the context of this paper, occupational health and safety. The mining industry peak body, the Minerals Council of Australia has a vision of An Australian minerals industry free of fatalities and disease. 1 National turnover in mining was A $37.3 billion (US $23.5 B) in 1998/99 and with reducing manpower levels productivity is trending upwards. SAFETY All governments in Australia are committed to the reduction of workplace fatalities and serious injury in all sectors of the Australian economy. Mining has a reputation as being a dangerous injury sector with a high rate of serious injury and fatalities.

Each State (through its Department of Mines or Department of Minerals & Energy) is responsible for developing and administrating its own mineralsrelated activities and laws. For example, in Western Australia, "the Mines Safety and Inspection Act 1994 provides for the competent management, inspection and regulation of mines and mining practices relating to the safety and health of employees in the industry and to the safety of persons in the wider community, who may be impacted on indirectly by mining operations". The Minerals Council of Australia is the national industry representative organization for mining companies. In December 1996 the board of the Council accepted safety as its most important priority. There are currently a raft of safety reviews before the various State Department of Mines especially in the states of New South Wales and Queensland where virtually all underground coal mines are located. The Minerals Council has stated that improving safety requires a new safety culture rather than new technology or government regulations. It has been concerned that the response to disasters has usually been to change regulations and/or increase the number of mine site inspectors. It is arguing that the change in workplace culture needs to filter from management down. 8 During the last ten years a huge effort has been made by the industry to improve its safety record. There has been an improvement in the lost-time injury frequency rate (LTIF - the number of injuries with at least one full shift absence per million hours worked). However, no improvement trend has been noted in the fatality rate.
Year Fatalities - Open Cut & Other Fatalities Underground Total LTIF 19 33
AND

1992/93 1993/94 1994/95 1995/96 1996/97 1997/98 1998/99 1999/00 7 12 14 6 20 28 14 18 32 25 3 4 7 21 11 22 33 18 6 13 19 15 3 7 10 12 18 14 32 10

TABLE 1 FATALITY INDUSTRY

1

LOST TIME INJURY FREQUENCY AUSTRALIAN MINING

Dick Wells, Executive Director, Minerals Council of Australia observed in a speech in August 1999 the adoption of risk management approaches and improvements in safety management systems certainly appear to have brought down the number of lost time injuries. But there is no corresponding, sustained reduction in the number of fatalities or potentially fatal incidents 3 The volatility in the fatality rate is evidenced by the column graph with the LTIF tending downwards over the eight years.

Australian Mining - Fatalities and LITF

35 30 25 20 15 10 5 0 1992/93 Year 1993/94 1994/95 1995/96 1996/97 1997/98 1998/99 1999/00
35

30

25

Fatalities

20

15

10

Fatalities - Open Cut & Other

Fatalities - Underground

LTIF

FIGURE 1. FATALITIES AND LOST TIME INJURY FREQUENCY AUSTRALIA 1 Australian mineral industry safety and health performance generally compares favorably with the performance of USA, South Africa and Ontario mining industries.

LTIF

Australian fatality injury frequency rates are significantly lower than South African rates, Australia performs slightly better than the USA overall and in all sectors except underground metalliferous mining, where the USA rates are slightly better than Australia. 1 The human cost is significant while the cost of injury/poisoning claims was some $ 40 million in 1996/97. 1 It has been estimated that the indirect costs to the employer such as loss of productivity, investigation of incidents and claims, rehabilitation, damage to equipment and tools, employee turnover and training costs, etc., can more than double the cost of claims. Taking this into account the total cost to the minerals would be in the order of $ 80 millionwhich amounts to 16% of mining industry net profits of $ 567 million in 1997-98. The mining industry in Australian has adopted safety management systems to track and plan safety training and compliance tasks and, more recently, the industry has embraced a risk management approach to safety at all levels of operation. 6 A survey of employees at Australian mines has shown high levels of dissatisfaction with safety management systems particularly in the quality of programs and training. 3 This dissatisfaction was described as a gulf by Barry Cusack, Senior VicePresident, Minerals Council of Australia in a speech to the MineSafe International 2000 Conference in Perth, Western Australia. The survey found that, despite management successfully communicating that safety is important, the workforce did not believe that management valued them, or adequately recognised safety and safe work practices. 4 Mr. Wells advocates a behavioral approach to meet the challenge of improving safety in Australian mines. He noted the safety culture survey suggests that any good safety management system must be accompanied by a behavioral

based component that incorporates management flexibility and a teamsapproach in order to be truly effective. 3 Australia has made a strategic effort to improve its safety record in the mining industry. Real improvements in the fatality rate are proving to be elusive. The industry is looking for methods that will produce the improvements sought. The combination of good safety systems, risk management coupled with programs that recognize the human dimensions that manifest in culture and commitment to safety. PRODUCTIVITY Australia has, since 1990, embraced an economic rationalist approach to management of the countrys economy. This approach has led to industry taking action to reduce the manning levels at all points in the production chain. This trend has led to improvements in productivity through the nineties. Many argue that real improvements are yet to be realized as bad industrial arrangements had led to an overly large mining workforce. In the two-year period until 30 June 1999, the Australian Mining Industry lost over 9,000 positions to close with 47,300 positions. The worlds largest coal exporter, the Australian black coal industry is the countrys largest export industry and was reviewed by the Productivity Commission. This review, completed in July 1998 sought to identify the factors that were affecting the productivity of an industry that accounted for 10 per cent (over A$9 billion) of Australias merchandise exports, and more than 1 per cent of gross domestic product. The report detailed a range of issues affecting productivity including: 5 Management structures Industrial relations Rail transport to seaboard

Overly regulated industry Shift and roster arrangements Excessive union involvement in decision making

Similar to the whole of the Australian Mining Industry, the Black Coal sector has been shedding jobs in an effort to remain internationally competitive, from a maximum in 1986 of 32,700 employees down to 23,800 in 1997. Average annual coal industry output (saleable) per employee has increased continuously from 2800 tons in 1980 to 8400 tons in 1997, a compound annual growth rate of around 6.7 per cent. Note that the Report cautions that these figures mirror greater emphasis on the open-cut sector, and the use of improved technology in the use of longwall techniques in the underground coal sector. 5 Hopkins in the Journal of Occupational Health and Safety Vol. 10 No. 5 reinforces the impact of technology on productivity. Productivity, or output per worker, is sometimes naively assumed to be a measure of how hard a person is working. The fact is that the major productivity trends have nothing to do with the effort made by workers. The primary factor which influences output is the technology in use or, more simply, the kind of machinery which he or she is operating. Hopkins also argues that, in the context of long-wall underground coal mining in Australia that the quest for greater productivity leads, at least potentially, to greater safety. Improved safety is an incidental by-product of increased productivity, not its cause. 9 A project carried out at Macraes Gold Mine in New Zealand sought to reduce accidents and to increase productivity. McDonald et al report The data do not suggest outright success. The paper reports on the reduction of both the number of lost-time injuries, together with the severity of injury. However, there was an increase in the number of injuries requiring some form of treatment. The mine management regarded this as a success, as it had a key feature of management policy is that all incidents, no matter how minor, are reported.

The study also notes that there was a cost control program introduced that prevented effective use of the productivity and efficiency measures. 10 McDonald et al note that the absence of clear data made the study prove as frustrating as it can appear enlightening. They do observe the ability to integrate training, career progression and wages advancement in a clear structure that has proven of particular value to the organization, and they further caution that creating a multi-skilled workforce because it is widely advocated, may be of little benefit, unless a systematic and comprehensive needs analysis indicates that it is also practical. 10 Globalization has underpinned Australias efforts to continually improve the productivity of the countrys economy. In mining, Australia has competitors in most, if not all, of our key exports. Australias Share of 1999 World Production Product Bauxite Alumina Black Coal Copper (Mine) Gold (Mine) Iron Ore and Concentrate Lead (Mine) Unit Mt Mt Mt kt t Mt kt Quantity 48.5 14.5 234 719 299 719 681 Share of World Production 37.9 % 29.4 % 6.7 % 5.8 % 11.6 % 14.4 % 23.1 % World Ranking 1 1 7 4 3 2 2

TABLE 2 AUSTRALIAS W ORLD RANKING AS A MINERALS PRODUCER 12

Australias Value of Exports (1997 to 2000) Product Bauxite Alumina Black Coal Copper (Mine) Gold (Mine) Iron Ore and Concentrate Lead (Mine) Note: A $1 = US $0.55 Australians recognize the cost impost of transporting our raw materials exports to major markets in Japan, Europe and North America. This recognition underpins many of our efforts to improve productivity. The productivity picture in Australian mines, when benchmarked against a US sample provides evidence of where Australian mines are performing well. The large open-cut mines are comparing well with operations in the USA in truck and shovel and also dragline operations. At the other end of the scale small mines are, understandably, finding it difficult in the highly competitive world market. 7 Queenslands dragline operations, as a sample group, were identified as best practice, operating at productivity levels around 20 to 25 per cent higher than similar mines in the United States and NSW (Australia) samples. This good productivity performance was consistently achieved in the Queensland operations, and appeared due to good engineering, management and labor practices. 7 1997 A$ m 122 2 887 9 532 822 5 234 3 791 140 1998 A$ m 135 2 910 9 239 968 4 470 3 844 213 1999 A$ m 161 3 470 8 308 765 3 875 3 820 241 2000 A$ m 133 4 220 8 933 468 4 558 4 299 261

TABLE 3 AUSTRALIAS VALUE OF RAW MATERIAL EXPORTS 12

The productivity of Australias mining industry, at the best operations, is comparable to the best in the world. The imperative that Australia remains competitive in the world market provides an incentive for improving less productive operations and the difficult decision in the case of small mines of amalgamation or closure. TRAINING Australia embraced a National Training Agenda in 1990 that sought to address training in the terms of Industry Competency Standards that defined what skills were needed to perform the duties in all occupational groups. Governments in Australia will spend in the order of A$3 400 million in 2001 on vocational education and training. Since 1990 the national government has invested in the order of A$1 000 million on its agenda of change to make training more responsive to the needs of industry. The focus of the change has been the development and implementation of competency based training. The economic driver for this initiative has been the need for Australias export industry to remain competitive in world markets, as competition has increased from Asia and from other factors such as the end of the cold war. Competency based training by its definition seeks to analyze what a person must be able to do in his/her skilled occupation. The delivered training then addresses the actual skill required by a fitter, a welder or a mine production worker. To allow the industries of Australia to advise government of their training needs a set of Industry Training Advisory Boards have been established (See Figure 2). The National Mining Industry Training Advisory Board (NMITAB) advises the national government, and its agencies of the training needs of the whole of the mining industry in Australia.

National Government and State Governments

Taxation Monies

Australian National Training Authority (ANTA) Set policies and funds each of eight states

Advice

National Industry Training Advisory Boards For each sector

State Education Authorities Allocates funds based upon training priorities Advice

Feedback and Advice Industry Sectors e.g. Mining Construction Government or Private RTOs provide funded training.

State Industry Training Advisory Boards For each sector

Feedback

FIGURE 2 DIAGRAMMATIC REPRESENTATION OF FEEDBACK AND ADVICE MECHANISMS

IN AUSTRALIAN VOCATIONAL TRAINING

NMITAB has been charged with the responsibility of developing the national competency standards for the drilling, quarry, coal and hard-rock mining sectors. This and other national priorities for training are funded using taxation monies through the Australian National Training Authority (ANTA). The national competency standards are used as the basis of training programs and, importantly, assessment tools that measure the level of skill being demonstrated by an individual, say, as a front-end loader operator. All nationally registered training providers whether government or private is readily able to use the national competency standards as the benchmark for their service provision. In Australia vocational education providers are

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designated Registered Training Organizations (RTO). To be classified as an RTO a training provider must satisfy a set of registration criteria on the quality of staffing, range of courses, training delivery and records keeping. Each RTO can issue nationally recognised qualifications that are part of their unique registration. The certificates issued by each RTO have national codes and must be recognised by all other RTOs. Another cornerstone of the Australian vocational training system is the delivery of training and assessment by what are termed workplace trainers and assessors. A National Assessors and Workplace Trainers Advisory Board (NAWTB) has been established to oversight the competency standards and training for workplace trainers and assessors. Workplace trainers deliver training to their fellow employees in either an ad-hoc or formal manner. This training is generally for tasks that are more suitable for training on-the-job than in an educational institution (e.g. adjusting a diesel injection system). Similarly experienced workers who have workplace assessor qualifications may perform assessments of the skills of fellow workers to the appropriate national competency standard (e.g. assess a candidate in the process of adjusting a diesel injection system). The mix of on-the-job training to off-the-job training is seen to be important depending upon the occupation. Mining plant operator training is generally about 90% on machines while supervisor training may be 60-70% in the classroom. Relevance is also a key to the success of training. In Relationships Between Training and Productivity, DTEC says there was high awareness of the need to make training relevant to the overall needs of the business as well as to the needs of employees, in order to fulfil both their immediate job needs and broader career aspirations, and of high quality and high efficiency and effectiveness.
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A debate is current in Australia about the value of competency based training, when high productivity levels are required. For example, a person who is deemed competent to operate a drilling rig may have satisfactorily completed a theory and practical assessment that addresses all of key safety and technical skills aspects of drilling rig operations. However, no effort is made to evaluate the efficiency of operation. Some companies are making an effort to address the concept of efficiency, by providing training that extends beyond competency to proficiency. Proficiency allows measurement of both competency and the ability of a person to perform tasks at an acceptable level of productivity. For example, a dump truck operator will be assessed as competent, when he can perform pre-start checks, routine maintenance, safe-working procedures and all other required operations. When extended to proficiency, measures such as round-trip cycle-time, effective placement of the truck for loading, response to road and weather conditions and so on are evaluated. Deficiencies are identified and training is used to remedy any shortcomings. Caution has to be shown to avoid any compromise of safe working procedures in the effort to increase productivity. DTEC like Macraes Gold Mine notes the difficulty is measuring improvements in skill and productivity. The study found that there were difficulties in isolating the effects of training on productivity given the inter-relationship between factors of production, especially in an environment of rapid organizational and economic change. Nevertheless, it was clear that training had a positive influence on productivity. 11 DTEC reports some of the comments to its survey of a range of businesses. Appropriate training is the most sensible way to improve productivity and job satisfaction. Training is imperative for on-going success and growth. Training is part of our core change management strategy. 11

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The report concludes While the multiple dimensions of both training and productivity make it difficult to quantify the relationship, it is clear from this study that organizations that conduct training consider that there is a very positive link. Training is seen as a very important activity by the vast majority of organizations surveyed, and is an activity from which they consider they are gaining significant, and often very substantial productivity benefits. This augurs well for productivity of Australian enterprises which invest in training. 11 REFERENCES 1. Safety & Health, Safety Survey Report for 1 July 1990 to 30 June 2000; Australian Minerals Industry. 2. 8414.0 Australian Mining Industry 31 October 2000; Australian Bureau of Statistics. 3. Wells, Dick; Executive Director, Minerals Council of Australia, Safety culture highlighting the next steps for safety and health improvement. Speech at Queensland Mining Industry Health and Safety Conference 23 August 1999. 4. Cusack, Barry, Senior Vice President, Minerals Council of Australia. Corporate Responsibility and Leadership More Than Words. Speech at Minesafe International, Perth, Western Australia, 3-8 September 2000. 5. The Australian Black Coal Industry, Productivity Commission, 1998, Inquiry Report, AusInfo, Canberra. 6. Safety & Health, Performance Report 1997-1998 Australian Minerals Industry. 7. Benchmarking the Productivity of Australias Black Coal Industry, June 1998 Tasman Asia Pacific Pty Ltd. 8. Mining Industry Equipment Australia Author John Kanawati 1997 US & Foreign and Commercial Service and US Department of State. 9. Hopkins, A. Is productivity related to safety? The case of coal mining. Journal of Occupational Health & Safety Australia New Zealand 1994 Vol. 10 No. 5.

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10. McDonald, S; McDermott, D; Theunissen, T; and Crossley, W. Training for safety and productivity in the mining industry: a case study. Journal of Occupational Health & Safety Australia New Zealand 1994 Vol. 10 No. 2. 11. Strategic Planning, resources, Research and Industry Network Services, DTEC, Relationships Between Training and Productivity. Department of Training and Education Co-ordination, March 1997. 12. ABARE, Minestats Australia, September 2000. Australian Bureau of Agricultural and Resource Economics.

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