Arrium

The Hon. A. KOUTSANTONIS (West Torrens—Treasurer, Minister for Finance, Minister for State Development, Minister for Mineral Resources and Energy) (14:13): I seek leave to make a ministerial statement.

Leave granted.

The Hon. A. KOUTSANTONIS: Despite months of intense negotiations between Arrium and its creditors, last week the Australian banks were successful in forcing the company into voluntary administration. This was not the South Australian government's preferred option. We believe that a restructuring of Arrium's business operations here and across Australia to resolve its debt issues could have been successfully achieved without this step. Unfortunately, our Australian banks ignored the national interest and demanded this course of action. Their having forced the issue of voluntary administration, we are now witnessing the banks shamefully squabbling about the choice of administrator.

As I have previously said, the South Australian government was happy to continue the work we began last year with the management of Arrium, the commonwealth government, and the South Australian steel task force with Grant Thornton as the company's chosen administrator. We were already in advanced negotiations with Paul Billingham, and his team, to stabilise the South Australian operations, and ensure that trade creditors and contractors that transact with Arrium could continue their work.

Through the steel task force, and in direct discussions with the administrator and creditors, we have strongly advocated that stability, certainty, and business as usual, is essential to resolving the issues facing Arrium. This is central to returning value to the steelmaking operations here in Whyalla. Today, court action has been taken to replace Grant Thornton with KordaMentha as the administrator. This further disruption by the Australian banks, and the continued use of Whyalla's future as a bargaining chip, is distressing for those who are affected by the ongoing uncertainty and constant speculation.

The Australian steel industry needs certainty and a stable platform upon which the administrators, the commonwealth government, the South Australian government, creditors and unions, can work together to restructure the operations at Whyalla and give it every opportunity to succeed. This disruption is regrettable, and something we had hoped to avoid. However, in the event a new administrator is appointed, the South Australian government and the steel task force will continue the work begun with management last year.

That work we began with Arrium is vital to forging a path for Whyalla steelmaking and mining operations, and I take this opportunity to thank those in the Arrium team who worked so hard to find solutions to the many obstacles facing Australian steelmaking. Rightly, I think the focus of everyone in this chamber has always been on the workers, their families and the people of Whyalla and the Upper Spencer Gulf. Whyalla's future as a steelmaker is vital to our local prosperity, the national interest, and our country's economic sovereignty.

The South Australian government commits to working with the administrator (whoever that may be), Arrium, its local workforce and their unions, and the commonwealth government. I would like to thank the commonwealth government, and particularly Minister Christopher Pyne for his support to this industry and our state, so far. As a nation, we must not let this industry fail. We must work to ensure we have a profitable and sustainable steelmaking industry to ensure our continued economic growth.