Govt, unions will work to save Alcoa plant

9 Feb 2012, 5:30 pm   -   Source: AAP
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Australian Workers Union (AWU) Victorian secretary Cesar Melhem said Alcoa was the state's largest exporter and any decision to close the smelter would be a major blow to Geelong. (AAP)

Australian Workers Union (AWU) Victorian secretary Cesar Melhem said Alcoa was the state's largest exporter and any decision to close the smelter would be a major blow to Geelong. (AAP)

Unions say they will work with the Victorian and federal governments to try to save the jobs of 600 workers at Alcoa's Geelong smelter.

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Governments and unions say they will work to try to keep Alcoa's aluminium smelter running at Point Henry to save the jobs of the 600 people who work there.

Alcoa on Wednesday said it would review the viability of its smelter in Geelong because low metal prices, a high Australian dollar and input costs have made it unprofitable.

Employees will have to wait until the end of June, when the review is completed, to find out whether they will keep their jobs.

The Australian Workers' Union (AWU) said the flow-on effect of shutting the smelter would mean 2000 jobs would be lost.

Victorian Treasurer Kim Wells on Thursday said the government would step in and support Alcoa, but did not specify what form that help would take.

Premier Ted Baillieu would not rule financial help in or out, adding the company had not requested any particular assistance package during meetings last week.

Mr Baillieu and Mr Wells joined the federal opposition in saying the Labor government's carbon tax would contribute to the pressure on the aluminium industry.

But federal Labor MP for Corio Richard Marles said the opposition was "deserving of condemnation" for blaming the carbon tax on Alcoa's decision to review the plant.

He said Alcoa was very supportive of the tax and the company, which already received government assistance, would also be shielded from 95 per cent of the carbon price.

The federal government "will leave no stone unturned" to secure the smelter's future, he said.

Opposition treasury spokesman Joe Hockey said Alcoa had admitted in its own statement the carbon price would be an extra cost.

But he refused to say if the company should be offered any more government handouts, saying it already received government assistance.

Australian Industry Group chief Heather Ridout said Alcoa had confirmed the carbon tax was not a factor in the job cuts.

"I think Alcoa is saying it's not a factor, the car industry is saying it's not a factor and I think that's right," Ms Ridout told ABC Radio.

"I mean, you can't play politics over a lot of job losses and a lot of pain in industries."

Australian Greens leader Bob Brown said the market should decide the smelter's fate.

The three unions representing the smelter workers said they would work with Alcoa and government to come up with a plan to save the plant.

AWU Victorian secretary Cesar Melhem, who met with senior Alcoa managers on Thursday, said the unions would conduct their own economic review of the smelter to determine its profitability into the future.

The smelter had been losing money for six months, he said, but had been profitable for the last 49 years and could be saved.

"We think the future can be bright if we're able to put the right plan together. We can arrest the bleeding if we have the right approach," he said.

"I am confident we can do it because it is not a basket case."

He said factors affecting the smelter's profitability were short-term problems and strategies could be put in place to cut costs and improve productivity.

Alcoa's Australian operations were very profitable and the company should invest some money in the plant to see it through this tough period, and to return the favour to taxpayers who had subsidised it, he said.

"The Australian dollar is not going to stay up there forever, the resources boom is not going to stay there forever, so it's a matter of getting through that period and keep smelting," he said.

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