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House of Assembly - Fifty-Third Parliament, Second Session (53-2)
2017-04-12 Daily Xml
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Arrium

Mr HUGHES (Giles) (15:12): I rise today, at least initially, to talk again about Arrium and administration. It was great to see both the Premier and Treasurer visit Whyalla last week to meet with the administrators and also to have a look at some of the other projects that have been happening in Whyalla. It has just been over one year since Arrium went into administration, and it has been a period of uncertainty and concern within the community.

As of just before Christmas, there was an increase in confidence in the Whyalla community about the future, given the number of bids that appeared to be on the table when it came to securing the steelworks, the mines and the other elements interstate that make up the Arrium operation. When we had the meeting with the administrators, they provided a bit of clarity about closure to this stage of the process. The community might well know who the successful bidder is by 31 May. Currently, there are two bidders still in the process.

The administrators have done what I think has been a sterling job in very difficult circumstances, but over and above that the workforce at Whyalla has performed in an amazing fashion in what have been very difficult circumstances. Many workers lost their benefits through the changes in shifts and allowances, and on top of that voted to accept a 10 per cent pay cut in order to make the sale process an easy one. We are all now looking at a date of about 31 May for a decision on the ultimate successful bidder and hoping that by the end of this financial year this stage of the sale process will have been resolved.

Both the state and federal governments need to engage in negotiations with the successful bidder over what the final package of assistance is going to be. I am sincerely hoping that the federal government will not be missing in action, that it will be there to provide the support necessary for the community of Whyalla and for the new owner of Arrium. All the way through this process I have had absolutely no doubt that the state government will be there ready to do whatever is necessary.

Indeed, and unusually in circumstances like these, the state government has provided leadership not just directly in relation to the steelworks and the mine sites here in South Australia but also in support of the contractor base that has provided services to the steelworks and the mines for so many years. Many of those contractors are family-owned businesses that have been built up over the years, and they were seriously caught out when Arrium went into administration and they were exposed to very serious cash flow issues. The state government, to its credit, and to the credit of the Premier and Treasurer, stepped in and provided a $10 million package to assist those contractors get through a very difficult period.

The state government's $50 million that was on the table was used in a strategic way during the lead-up to the federal election to try to induce both the opposition at the time and the federal government to come to the party. That had some success. If there had been a change of government, we would have had a starting package of $150 million; as it is, we have a starting package with the state government of $50 million and a $49 million essentially commercial loan from the federal government. The process is rolling to an end. Australia does need the capacity to produce structural steel, and we are hoping we are all going to get a great result for the community, for the state and the nation.

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