Whyalla Steelworks

Mr TELFER (Flinders) (14:46): My question is to the Treasurer. Is the Treasurer concerned about the ongoing viability of GFG Alliance and what potential impact this may have on the Whyalla Steelworks? With your leave, sir, and that of the house, I will explain.

Leave granted.

Mr TELFER: The Financial Review reported on 15 October that ratings agency Moody's had downgraded the credit rating of one of GFG's two major Australian subsidiaries, InfraBuild, describing it as 'unsustainable' given its materially high debt cost which we expect will result in negative free cashflow over the next 12 to 18 months.

The Hon. S.C. MULLIGHAN (Lee—Treasurer, Minister for Defence and Space Industries) (14:47): Of course we want the steelworks to succeed. We want the steelworks to be invested in. We want the large number of South Australians employed at the steelworks to have a secure, productive and well-paid future working at those steelworks, producing steel products which are not produced anywhere else in our country.

We need this sovereign steelmaking capability for the benefit of our nation and where better to have it than in the state of South Australia, not only making a substantial contribution towards our state's economy but employing many, many hundreds of South Australians both directly and also in many other businesses that provide contract labour for the operation of the steelworks, as well as the much more significant wider economic benefit of having such a large industrial operation in Upper Spencer Gulf as the steelworks.

Are we concerned? Of course, as we are with the fortunes of every major employer in South Australia. We want them to grow, we want them to employ more South Australians and we want to see their contribution to the state's economy continue to increase. In many other areas of the economy over the last 2½ years, I am pleased to report to the house that that has occurred. But what we would really like to see in the context of the member for Flinders' question is that that also happens at the steelworks.

As members would be aware, there have been commitments made by GFG about investing in the steelworks. We want to see those investments happen because we want to see not only the productivity and the output of those steelworks continue and continue to increase into the future, we want to see the workers be gainfully employed into the future, but we also want to make sure that South Australia is the home to this sovereign steelmaking capability for the benefit of the rest of our nation and to those many other countries that buy these products from Australia.