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Melbourne doorstop

22 December 2016

Subject: Opening of Ford’s Asia Pacific Product Development Centre; Alcoa


GREG HUNT:         

What we've seen today is that there is a long term future for the automotive sector in Australia. It's essentially in the research and development, design, the engineering side.

Australians can be and are world-class automotive engineering researchers, developers, designers, and engineers.

This is a $450 million research and development commitment for next year alone by Ford, and will lead to 2000 jobs being in place in Australia for Ford by 2018.

So there is a transition. It's been very difficult for many workers, and that's been a fundamental concern for the Australian Government.

But the transition also allows us to, as we see today, bring new investment, create new jobs, and see innovation actually delivering real job and economic benefits to Australians.

The second thing I want to talk about very briefly is I've just stepped off a plane from New York where I went in deep cooperation with the Victorian Government to meet with the global CEO of Alcoa, Roy Harvey.

We have together put the case for Alcoa to retain and restart its Portland plant, and we talked to them about the short term, the medium term, and the long term.

Now it's up to Alcoa and the electricity providers to reach an agreement. I remain quietly optimistic that there will be a long term future for the workers of Alcoa's Portland plant.

It's an important moment. It's a difficult moment for many workers in Portland, but I remain quietly optimistic after this trip.


What chance do you give for the smelter to be open next Christmas?

GREG HUNT:         

Well, as I say, my hope is that it will be, and I am quietly optimistic.

Ultimately, this will be a decision for the company, but we are doing everything we possibly and reasonably can to preserve and to protect those jobs and to give Portland a long term future.

There are those who want this plant closed. I read comments by two of the Greens representatives that they would want, effectively, 2000 people to lose their jobs.

I think that is a very disappointing position, but our position and my position is that we will fight with everything we can to do all that we reasonably can to protect these jobs and to provide a long term future, not just for the workers at Alcoa, but for the town and the region around Portland.


What sort of reception did you get from Roy Harvey?

GREG HUNT:         

It was very positive. He was exceptionally complimentary about the workforce, describing Australian workers as world-class, and indeed, their Portland plant as one of the best in the world.

They were hit with a major outage, where more than two-thirds of their productive capacity is frozen. That's a very significant impact.

That came at the same time as they were renegotiating power pricing agreements, and so at a critical juncture, there was an outage which affected them, and because of the impact of that unexpected event, that's why we've joined with the Victorian Government to make the case for the future of the workers.


And it's interesting to talk about that here, at Ford, which manufacturing closed down.

Why is the Government, why does it sound like the Government's putting up money or the offer of money to keep Alcoa open, when ultimately that money just wasn't there for the auto industry?

GREG HUNT:         

Well, I think you'll find that $7 billion was invested by the Australian Government between 2000 and the current moment.

Now, some will argue either way on that. But that was an ongoing program, so the automotive manufacturers made their decisions, as they have all explained to me, three and four years ago.

I believe the decision here was made some years ago. I know that. And that was on the basis of the size of the Australian market and the cost per unit of production.

That was a simple reality. The lesson is that we have to be innovative, which means we have to make better product in a more efficient way, and we can do that as a country, and what we see now is that in the automotive sector, the future is 2000 jobs, overwhelmingly in the research, development, design, and engineering space.


If Alcoa did go, they would obviously solve Victoria's energy crisis problem, because such a big user of electricity would be gone, even after Hazelwood closes.

Is the ongoing uncertainty about Alcoa's future could that disrupt or delay the investment needed in new electricity generation in Victoria?

Because investors just aren't sure what the electricity demand market will be like in a year or two.

GREG HUNT:         

I think the idea that the Greens have that they want Alcoa to close and therefore for 2000 workers at least to lose their jobs is an extraordinarily insensitive approach.

Now, there are those that want that. That's not me, that's not the Government. That's not even the State Government.

To be fair, we have worked in deep cooperation. The idea that you simply trash the economic future of a town, a region, and 2000 families is, I think, extraordinary.


What did you offer to keep Alcoa operating?

GREG HUNT:         

Look, we're still in negotiations, so I'll wait until those negotiations are complete, but everything that the Australian Government does will be fully tabled, but once the negotiations have been completed, which I think you would understand.


What is on the table?

GREG HUNT:         

Look, I won't go into details at the moment, but that's because there are negotiations underway, but once those negotiations are complete, the Government will fully announce any and everything that we're doing.


You were pretty critical of the Federal Government's, of the then Labor Federal Government's subsidy of Alcoa at Point Henry before it closed. What's different now?

GREG HUNT:         

Well, that was a subsidy in the face of a carbon tax. They whacked on a carbon tax, and then they put in a subsidy to reduce the impact of the damage they were causing.

By contrast, we have taken massive pressure off the electricity price. Without having reduced the carbon tax, the pressure would be enormously greater now, and I suspect there would have been no way out of it.

So what's really interesting is Federal Labor, at the same time as State Labor is attempting to preserve Alcoa, under Bill Shorten wants to whack on a new electricity tax.

They went to the last election promising a new electricity tax, and right now they want a new electricity tax, which would be the worst possible thing at the worst possible time for Alcoa, and many, many other businesses and householders here in Victoria.


Minister, Cory Bernardi is reportedly contemplating leaving the Liberal Party to spearhead a new party. What's your advice? What's your message to Cory Bernardi? Should he stay, should he go?

GREG HUNT:         

Look, I have a deep respect for all of the members of the Liberal and National Party Coalition…


Would you still have deep respect for him if he left the party?

GREG HUNT:         

We were all elected on a commitment to our party, to the Australian people that we would be there for the life of this Parliament as members of those parties, and I'm very confident that all of the members will retain that commitment.

I believe in them. I stand by them, and in particular, I have deep confidence that all of the members of the party will maintain and honour their commitment to the Australian people.


How damaging would it be, though, for the Coalition if he did do that?

GREG HUNT:         

I'm certainly not going to speculate on a hypothetical.


How concerned is the Government about the rise of the hard right, if you like?

GREG HUNT:         

I think what we're doing is getting on and delivering things.

We've been able to work with the Senate very effectively, we've delivered three major industrial relations outcomes since the election, in particular, protecting the rights of CFA volunteers here in Victoria.

We've been able to work with the crossbench. The Liberal Party is a broad church, it embraces people who believe in open markets and freedom and the capacity of small business owners to create a future in a lower taxing environment.

That's who we are, and that's a spectrum, it covers the spectrum and it allows people from a variety of different views to work cooperatively under the one movement.

And it's not just a Liberal Party here in Victoria and Australia, it's part of a global centre-right movement which has been going for over two centuries.

So it's a powerful, important way of bringing people together to focus on, in the end, creating jobs and improving lives.


So are you happy to hear these rumblings from people like Cory Bernardi, George Christensen and Tony Abbott? Or should they just quieten down?

GREG HUNT:         

I'm never going to give my colleagues advice in public.

I believe in my colleagues, I believe in the broad church that's the party, and I would say that we've delivered enormous savings to the budget over the period since the election by working with the Senate, and we've delivered huge industrial relations reforms which will make our building sites safer and protect our CFA volunteers and reduce the risk of fraud by dodgy union officials. Okay, thank you very much.


Minister, just one more question. When you're in the end of 2016, it's almost Christmas, an opportunity for you to self-indulge, what have you learned this year?

GREG HUNT:         

Look, I've learned a couple of things, firstly, that Australia is an unbelievably innovative country.

I've been able to meet with young people in our schools, in our universities, but also in the start-ups around the country to see what they're doing, whether it's in Wollongong, in Gosford, in Melbourne, Sydney, in other rural regions.

So at the end of the day I believe deeply in the creative capacity of Australians, and I think in a difficult global environment, of all the countries you would want to be a citizen of, Australia is rightly at the top of the list. Okay, thank you.