Regional Victoria devastated
Workers left gobsmacked in shock Carter Holt closure as Valley reels
Over 200 workers were left gobsmacked by the shock announcement that New Zealand timber giant Carter Holt Harvey will completely shut down its Morwell plant by August.
Union officials and delegates were called into a meeting in late May with the company when the bombshell was dropped that 160 directly-employed full-time and a dozen more casuals would lose their jobs.
ETU Secretary Troy Gray says he can’t dispute the problems facing the plant with a shortage of appropriate logs, but the union takes issue with the timing of the announcement.
“What you’ve got is a very profitable company, running a very productive mill, owned by the richest man in New Zealand - and they drop this on the workers with barely three-months notice. It’s a shocker.”
The Morwell plant needs 360,000 tons of trees each year of at least 28-years of age for the kind of timber products it produces - thousands of trees would have been available if not for the horrific bushfires of 2009 and 2014, including Black Saturday.
Despite the foreseeable shortage, workers had not received advanced indication of the May announcement.
ETU Organiser, Peter Mooney, says the plant was processing more timber than ever in recent months. He said, “to say workers and their families were caught off guard is an understatement.”
Secretary Troy Gray said, “Echuca, Hazelwood, Myrtleford, Heyfield, Kiewa – workers in regional Victoria are taking an absolute battering. There are many reasons for it – but a constant theme is employers thinking they owe our communities nothing. That attitude makes me sick.”
“You’ve got lockouts from some employers trying to starve locals into submission, and countless job losses from others racing to abandon the workers. The Valley alone must be shedding a thousand jobs this year.”
Peter has written a letter to the state government asking that the workers be included in the LaTrobe Valley authority’s placement and retraining schemes to ensure their lives and the community wasn’t torn apart. At the time of print the state government was receptive to the union’s request.
Country Victoria economic giant Murray Goulburn crippled by appalling management, poor government decisions
The Murray Goulburn Milk Co-Operative has for generations been the economic giant of country Victoria. It has been the largest exporter of manufactured goods from the state of Victoria and, by providing thousands of well paid, secure jobs, it has given economic security to many country communities.
In the space of five years, appalling management and poor government decisions have turned this economic giant into a cripple that is struggling to survive. The announcement in early May by Murray Goulburn’s new Managing Director that the company’s Rochester and Kiewa sites were to close and hundreds of workers would lose their jobs, was the tragic consequence of all this incompetence.
For the first ten months of the 2015/2016 financial year, Murray Goulburn under then Managing Director, Gary Helou, paid the company’s dairy farmer milk suppliers 15% more than the international benchmark price. This decision was based on Helou’s vision of what he could deliver and was totally contrary to the pricing realities of the international market place.
In April 2016, the inevitable happened and the house of cards collapsed.
Overnight, Murray Goulburn reduced by 20% the price paid to the thousands of dairy farmers who supplied milk to the company. Gary Helou resigned in disgrace. While everyone was happy to finally see the back of Helou, it still left the question of what was to happen to the $180 million the company had paid to dairy farmers that was above the international price for milk.
This decision was left to a Murray Goulburn board largely made up of the same Directors who had supported Gary Helou’s vision.
This is where the Federal Liberal National party Government dismally failed Murray Goulburn employees and dairying communities in country Victoria. With Murray Goulburn desperate for Government support, the LNP government should have insisted on an immediate clean out of the company board. Instead, the government invited board members to Canberra and adopted the discredited board’s strategy of making dairy farmers pay back the $180 million to Murray Goulburn. This meant individual dairy farmers who stayed with Murray Goulburn were being told to pay hundreds of thousands of dollars to the company.
While economists sitting in ivory towers may have believed this strategy made some sense, blind Freddy in a drunken stupor would have known this strategy was going to rip the guts out of Murray Goulburn. Within weeks of this $180 million pay back strategy being announced, dairy farmers in their droves pulled up stumps and ceased supplying milk to Murray Goulburn and, to date, Murray Goulburn has suffered a 900 million litre reduction in its annual milk intake.
The recent decision to close the company’s Rochester and Kiewa sites is the inevitable consequence of the Federal LNP Government’s decision to back the discredited board rather than to back dairy farming communities and workers. In a perverse twist, when the new Murray Goulburn Managing Director announced the closures and redundancies, he also announced that the company had changed its mind and it would now not require the dairy farmers to pay them the $180 million.
As so often happens, workers are now left to bear the consequences of corporate mismanagement and poor government decisions. The Rochester site will close in the next twelve months and the Kiewa site is due to close by early 2019. The Australian Competition and Consumer Commission recently announced that it had commenced Federal Court proceedings against Murray Goulburn and Gary Helou. While this is welcome, far more than this needs to happen. We must make the corporate world and Turnbull Government fully accountable for the consequences of their decisions.