Stephen Jones (Throsby, Australian Labor Party) Share this | Link to this | Hansard source

On Monday this week, BlueScope advised the Australian Stock Exchange that it had posted a $1 billion loss. As a consequence, it announced that it was exiting the export steel market to focus on its profit-making domestic steel market. This means that in my region over 1,000 workers in the Illawarra will be laid off.

I am very pleased that, within hours of the announcement, the Prime Minister, the Treasurer and the Minister for Innovation, Industry, Science and Research advised that a $140 million assistance package would be made available to the workers, the company and the region.

We have been making steel in the Illawarra since 1917. It has come to define the region; it is a part of our identity—indeed, it was the name that we gave to our football team when they first entered the NRL. The decision on Monday by BlueScope will mean a fundamental change for the company and for the region. The reasons cited by the company are well known and have been debated in this House: the high Australian dollar, which is a consequence of the high demand for our natural resources, and the high cost of coal and iron ore, which is also increasing the cost of producing steel here in the Illawarra. These factors are being felt by every manufacturer in Australia but especially by BlueScope and steelmakers in the Illawarra.

Whether your favourite analogy is the patchwork rug, the multi-laned highway or the invisible hand, what we know is that these forces are transforming Australia. They also have the potential to divide us between regions, between workers who enjoy the fast lane—one of the nice patches as opposed to one of the shabby ones. It is spreading benefits but also uncertainty and insecurity. In circumstances like this, I believe, the government has a role: to explain what is going on in clear and concise terms so that all Australians understand what is happening to their economy and the consequences that has for them as workers and as families, to devise a plan which brings people along to ensure that we are able to spread the benefits of the mining boom and to provide assistance to individuals, industries and regions who are required to make a transition. And in the Illawarra we certainly need that assistance.

We are a region that has relied on manufacturing and it has been one of the great strengths of the region. We have a tremendous skill base in the manufacturing sector. We also have been transforming over the last decade. We are now the region that produces more ICT graduates from our local university than any other university in the country—a fact little known. Unfortunately, most of them do not stay in the Illawarra after they graduate, and that is something that we really need to change, by creating more opportunities for those students.

So government has a role to assist the Illawarra region make the transition. When you withdraw a significant amount of capital—and I estimate somewhere in the vicinity of $1 billion will be withdrawn from the regional economy as a result of the BlueScope decision—there is a need for both government and business to fill that hole. It is critical that we take steps to restore business and consumer confidence. I think the immediate response of the government, the $140 million package, is a good start, but we need to do more.

Together with my colleague the member for Cunningham, Sharon Bird, we are looking at other opportunities to ensure that we keep the regional economy of the Illawarra moving. The Regional Development Australia Fund, which is somewhere in the order of $1 billion, available for regional development projects, has been targeted by the member for Cunningham and me as a source of funds, together with the $500 million that has been set aside in the Education Investment Fund. We are also very keen to ensure that the minerals resource rent tax passes through this House because we see it as a critical source of revenue which will help fund sorely needed economic infrastructure projects in the Illawarra region. One project that the local region particularly supports is the completion of the Maldon-Dombarton rail link. We believe that there is a bright future for the Illawarra, but we will need assistance from the government and business to realise it.