Ministry of Mines Permanent Secretary Paul Chanda says some mining companies are yet to submit their financial models explaining how the 2019 mining fiscal regime will hurt their profitability.

And Chanda disclosed that the mine audit report conducted on First Quantum Minerals’ (FQM) operations following a decision to lay off its workers was completed and submitted to Cabinet Office.

In an interview, Chanda said the Ministry of Mines had written to all of the country’s major mining companies requesting for their financial models to explain and justify the impact the 2019 mining fiscal regime would have on their operations.

He, however, explained that some mining houses have still withheld the crucial data in the format government requires.

“As a Ministry of Mines, we have also written to every mine to give us their financial model in the face of the new tax regime to show us how the new taxes could have affected them in terms of profitability and cost. But we are not yet done in the sense that some mines are not giving us the information in the format we needed and the clarity we expect so we have written to them; once they re-submit, we will start the analysis and evaluation,” Chanda said.

And Chanda disclosed that the mine audit report conducted on First Quantum Minerals’ (FQM) operations following a decision to lay off its workers was completed and submitted to Cabinet Office.

This followed a multi-ministerial task force that was constituted to investigate FQM’s move to lay off 2,500 local and expatriates.

FQM had forecast job cuts of up to 2,500 workers following implementation of the 2019 mining fiscal regime that has seen an increase in mineral royalty rates by 1.5 percentage points at all levels of the sliding scale effective January 1.

Chanda, however, said the Ministry’s recommendations on the way forward regarding the 2019 mining fiscal regime could not be disclosed at this stage.

“We had more than four Ministries. So, it was just a multi-sectoral kind of team; we did a report and submitted to the one who constituted that committee, and that was Secretary to the Cabinet Office. It is difficult to bring out what our recommendations were,” Chanda said.

Asked what the Ministry’s overall impressions of both FQM’s Kansanshi and Kalumbila’s submissions were in justifying the job cuts, Chanda could, however, not disclose the outcome at this stage, but explained that the audit process only took one week.

“For the two mines (Kansanshi Mining Plc and KML), it just took a week and we were done,” he said.

Meanwhile, Chanda expressed concern at some mining companies’ deteriorating safety standards and called for urgent improvement to prevent any further loss of life.

“It’s very sad. We have tried to institute and enforce safety standards in mining companies. And our officers are always on the ground to ensure that people comply with our safety standards. Secondly, we have also introduced a system whereby miners themselves can call the Ministry, through Mine Safety (Department), if they have been forced to work in an unsafe place or they haven’t been given the right equipment to do some tasks, and this is anonymous; they can call without mentioning their names,” said Chanda.