House of Assembly Fifty-Third Parliament, Second Session (53-2) 53 2 Parliament of South Australia House of Assembly published Grievance Debate Whyalla Steelworks Whyalla Steelworks Mr HUGHES House of Assembly Giles Mr HUGHES (Giles) (15:31): I rise again to talk about Whyalla and the profound uncertainty that we face as a community. Uncertainty stalks the steelworks and the iron ore export operation, and it does so despite the concerted efforts on the part of the workforce to reduce costs. The human cost of the unavoidable costcutting is high. The jobs lost to date are many and they are growing, and those job losses are likely to continue. Indeed, another 30 job losses were announced today, with the prospect of the mine workers having to accept a 10 per cent cut in their pay. Families that thought they had secure jobs—especially younger families—are now finding they have mortgages and other debts that they are finding difficult to service. I say 'younger families' because they often bought houses at or near the peak of the market and now have negative equity. There are hundreds of houses on the market. The impact of the job losses and the ongoing uncertainty are cascading through our community and will, in one way or another, impact on all sectors of the Whyalla community. The decisions that got us to this point were not made in Whyalla; those decisions were made in Sydney, but it is the people of Whyalla who are paying, and will continue to pay, a very high price. The sheer scale of the collapse in steel prices driven by the record 110 billion tonnes exported by China in 2015 has hit steel producers around the world. The collapse in iron ore prices adds to our profound challenges as a community. This is beyond politics, or at least petty political pointscoring. I am sure nobody wants to see the steelworks go under, given the devastating effect that will have in the Whyalla community and the wider ramifications for the regions and the state. The last time the steel industry was under real threat in Australia, in the mid-eighties, there was a clear political response from Canberra and the Hawke/Keating government. Real leadership was demonstrated with the development of the Button steel plan and the tripartite agreement between the federal government, the union movement and BHP. The plan and its implementation helped secure the future of the steel industry in Australia. We are now at another crossroad when it comes to the future of steelmaking, and we need clear political leadership. BlueScope, with its different product line based on flat product, looks like it has turned the corner. Our structural steel producer has not—at least not yet. The latest announcement on refinancing by GSO Capital Partners, and whether that refinancing is signed off by 5 April, raises a whole series of questions. What happens if the parties do not agree and there is no sign-off? What happens if there is a sign-off and an American private equity outfit assists or dominates in determining the direction of the company and the nature of its restructure? My fear is that community interest will not figure strongly in its deliberations. I say we need clear political leadership, and I know that at a state level there is a strong commitment to do what is within our power. I hope that the commitment is there at a federal level. When it comes to the clarity of leadership, there is now some murk as people assess the potential implications of the GSO financing proposal. People can draw their own conclusions about the implications, but I know the workers in Whyalla will continue to do their best to work toward ensuring a viable steelworks. We need to do what we can to assist them in that endeavour. Other communities in my electorate have also suffered big job losses. Roxby Downs, over a two to three-year period, lost a lot of jobs. Those job losses inflicted a lot of pain. It is now going through a consolidation phase and we can probably expect incremental job growth in the future. There always appeared to be a light at the end of the tunnel in Roxby. Whyalla is in a race between a one-company town vulnerability and opportunity. It is a race forced upon us by the collapse in steel and ore prices. We face the prospect of an existential crisis. We need to do all we can to back opportunity and make sure opportunity wins the race.