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Statement by Senator: BlueScope Steelworks

Speeches in Parliament
Lee Rhiannon 12 Aug 2015

Senator RHIANNON (New South Wales) (13:04): The call 'Save our steelworks' is resonating around the Illawarra and today 'Save our steelworks' resonates in this parliament. Members of the South Coast Labour Council, the Illawarra branch of the Australian Workers Union and other unionists have travelled to Canberra to speak to MPs about the future of the Illawarra and the future of the steel industry. Action is needed by the New South Wales and federal governments. Steelmaking is vital for the Illawarra and critical to the economy of the whole country.

This is a hot issue as rumours of the possible closure of the BlueScope steelworks are swirling around Wollongong and swirling around Port Kembla. The threat to the steel industry and to thousands of jobs in this area is real unless governments take action. The Abbott government needs to urgently engage with this issue. It needs to undertake this work because jobs are on the line and we know that the steel industry plays a critical role in the overall economy. Jobs are also critical to people's wellbeing.

The steel future plan of the union movement that a number of unionists are putting forward to MPs in this parliament today has great merit and provides real solutions to the challenges that the Port Kembla steel industry is facing. The need for this plan is shown by a recent study undertaken by the University of Wollongong. This study was commissioned by the Australian Workers Union Port Kembla branch and examines the possible complete shutdown of steel production and the direct and indirect job losses. The findings are very disturbing. The study found a complete shutdown of the plant would result in an estimated $3.3 billion loss to gross regional product. That comes in at about one-fifth of the total gross regional product for the Illawarra which stands at about $15.5 billion

This should be a top priority for all governments-from New South Wales to the federal government-and it is a real credit that unionists have come here today, because of the failure of the New South Wales and federal coalition governments to engage constructively on this issue.

Approximately, 10,000 jobs are at stake here-they could be lost. This would be across the Illawarra, and already there is serious unemployment in the Illawarra running at about 8.3 per cent. When you look at youth employment, it is much more serious: young unemployed people aged between 15 and 24 years in the Illawarra is at 20.5 per cent. As we know, because of the way these figures are calculated, that does not capture people in part-time work. So, if we then look at the figures for young people aged 15 to 24 years who are actively looking for full-time work, we see the figures are very alarming: in Wollongong alone the unemployment rate for these young people is 25.3 per cent-a quarter of young people in that region want full-time work, and the jobs are not there. The increase in the number of unemployed, if the steelworks close, would be enormous. This is so serious: it deserves the urgent attention of the decision makers in this place.

The University of Wollongong study is a wake-up call for community leaders, all levels of government and therefore all MPs and Illawarra businesses. On the issue of Illawarra businesses, I have to say it was disappointing and concerning to see the response from the Illawarra Business Chamber. Their CEO called on the community to remain calm-those were her words. She then went on to assert that the research undertaken by the University of Wollongong was in fact overstated.

At a time when the steelworks could close, how irresponsible that the Illawarra Business Chamber takes that approach rather than the constructive leadership role that they should be displaying by working with all the stakeholders here. Arthur Rorris, secretary of the South Coast Labour Council, put this into perspective when he said:

... shooting the messenger is not really helpful at the moment.

I hope that that is a reminder to the Illawarra Business Chamber about the role they should be playing here. I urge that this business chamber work with unions, the community and their own members on the very big challenge facing this area.

Clearly, there is the threat of closures. You do not have to go far in the Illawarra to get a sense of how serious this is. You just have to read some of the comments from BlueScope to understand the urgency here and appreciate why the concerns are so real. I urge the Illawarra Business Chamber to constructively engage with the union plan. Unemployment levels are already so high that surely a business chamber and the local MPs from the state government right up to the federal government should be addressing this issue.

As I said, it is not just an Illawarra issue; it is a state and federal issue. To put this in context: New South Wales only raw steel-making facility-BlueScope steel, formerly BHP-is at risk of closure, because of competition from imports and weak export prices. That is why it is a federal issue. That is why the unionists are in the building today.

The unions lobbying here are calling for government procurement regulations to require that 50 per cent of the raw steel content in all state funded infrastructure projects be sourced from Australian blast furnaces-that is what we are asking the businesses, all governments and the opposition to engage in. Similar government purchasing policies in Canada and the US have secured steelmaking in those countries. Again, we have seen that this plan can work. Let's get behind it.

This plan would be a wise investment, because it would provide a massive investment not just in economic terms but also in social returns. If many thousands of people end up without work, it would not only be a tragedy for those individuals but the burden on government to make additional social security payments would also have to be considered. The additional costs to government for infrastructure would be substantially less than the economic, social and human costs of the unemployment. We need to ponder that message very closely.

The proposed security of the market would not be a free gift to BlueScope or its shareholders. So just saying, 'That is a form of subsidies. We shouldn't go down that track' is again avoiding engaging in what is a very constructive plan. Significant requirements to be imposed on the mill, including towards zero emissions steel manufacturing when the technology becomes commercially available, to clean up the steel industry while retaining a steel industry go hand in hand.

This is the current state of affairs in Wollongong. You can imagine the enormous pressure it is putting on local people. Port Kembla has been producing steel since 1928. You meet so many families where generation after generation have worked there. They have dignity. They have learnt so much, and they have become skilled workers and valued members of their local communities. To not engage with the issue of the steel industry closing and working to avert that would be highly irresponsible for any political party. We have a responsibility to ensure that there aren't large-scale job losses in that area.

I have noted that BlueScope steel is refraining from saying what its plans are, but some of its statements add to people's concerns. They have said 'costs of manufacturing steel are too high, and the company is 'seeking a game-changing approach that will significantly reduce costs'. That can be read that they are preparing for large-scale job losses. It can also be read that they are out there to bleed the workforce so that there will be a run-down in the conditions of the workers at that plant. The government can go down one road and drive down working conditions even further-we have seen so often that that is the path this government takes-or it can engage constructively with the unions and the communities in the Illawarra to ensure that the manufacturing of steel that started in 1928 can continue. (Time expired)

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