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House of Assembly - Fifty-Second Parliament, First Session (52-1)
2011-02-08 Daily Xml
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Ministerial Statement

KIMBERLY-CLARK AUSTRALIA

The Hon. J.J. SNELLING (Playford—Treasurer, Minister for Employment, Training and Further Education) (14:20): I seek leave to make a ministerial statement.

Leave granted.

The Hon. J.J. SNELLING: As many members of this house are aware, on 25 January manufacturing company Kimberly-Clark Australia announced that, following a global review of pulp and paper tissue operations, it would be closing two aged tissue machines at Millicent by May of this year resulting in the loss of 170 jobs. The company also announced its intention to sell the Tantanoola pulp mill, with the mill to be closed if it is not sold by the end of this year, which could result in the loss of another 65 jobs.

The loss of 170 jobs in any area is a massive blow, but it is particularly devastating for the South-East community as Kimberly-Clark Australia was the largest single employer in the Limestone Coast region. KCA also contributed $840 million to regional economic activity, and its operations supported about 850 indirect jobs in the region, many of these being contractors or companies sourcing their main revenue stream from KCA contracts.

The Premier met with representatives from Kimberly-Clark Australia before the announcement of the decision. KCA advised that the current structure of its operations had become unsustainable owing to several factors, including the ageing of their equipment, the high Australian dollar, energy prices and the dumping of international product onto the Australian market. The company advised that nothing could have been done by this government to prevent this decision. It was part of Kimberly-Clark's global restructure aimed at ensuring its long-term future.

Knowing how much this will affect the lives of mums and dads trying to make ends meet and how vulnerable so many of the people in the South-East will be feeling, the state government, in partnership with the federal government, has established a $17 million regional support package. The federal government will provide $10 million while the other $7 million will come from the state government.

The package will offer support to those directly and indirectly affected by job losses. It also aims to boost the economy of the South-East and attract new companies, new opportunities and new jobs. The cabinet yesterday approved the details of the support package, establishing a $12 million South-East South Australian Innovation and Investment Fund in cooperation with the federal government.

This will be an industry development program aiming to create sustainable jobs in the region and offering a grants program to help smaller businesses expand. The South Australian government will provide $2 million to the fund, with the federal government to contribute the remaining $10 million. The full details of the fund are currently being developed together with the federal government, and guidelines for the fund will be announced very soon.

On top of the South-East South Australian Innovation and Investment Fund, the South Australian government will contribute $5 million to a Labour Adjustment Package. The package will help ensure affected workers and associated contractors and suppliers are given the support that they need to adjust to the impact of this decision. Major elements of the package include:

recognition of the skills that they have already got;

help with résumés and job searching;

career advice;

training in part or full qualifications; and

other funded training, such as licences and tickets that they need to get alternative employment.

Representatives from the state government have already been down to the South-East to begin preliminary discussions with the company and with workers. We will continue to work with the company, the commonwealth government, local government representatives, Regional Development Australia and the relevant unions to make sure that affected workers are offered the best possible outcomes in terms of skill recognition, retraining and job placement. I will provide more detail of the KCA Labour Adjustment Package very soon.

The Rann government, together with the federal government, has a very, very good track record of providing help for workers who are affected by production shutdowns. In recent years, both governments have worked together to bring in successful adjustment funds and programs following the closure of both Mitsubishi and Bridgestone. For example, adjustment in innovation programs put into place when Mitsubishi closed its Tonsley Park vehicle assembly plant generated around 1,000 new full-time jobs.

In the closure of the Bridgestone plant, about 78 per cent of workers looking for support in April 2010 were placed in employment by December last year. The house can rest assured I will be making every effort to ensure the workers who are affected by the cuts at Kimberly-Clark Australia can return to the workforce as soon as possible.

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