The state government's multi-million-dollar lifeline to BlueScope Steel was "unique" and other struggling industries should not expect handouts, the treasurer says.
NSW Treasurer Gladys Berejiklian was at the company's steelworks at Port Kembla, just south of Wollongong, on Monday morning after brokering a deal that allows BlueScope to defer payroll tax of up to $60 million over three years.
"I wanted to make it very clear that this was a specific package given the unique situation BlueScope finds itself in, and given the unique number and scale of jobs at risk - we're talking 4500 jobs," Ms Berejiklian said.
Ms Berejiklian did not explicitly rule out any further state government assistance for the company should its viability falter past the three-year mark but said: "It was about making it very clear that this was a specific solution for BlueScope and BlueScope alone."
BlueScope, which had already cut labour costs by $60 million per annum through 500 job cuts and a pay freeze, said the agreement with the NSW government was crucial to keeping the doors open.
The company wants to achieve $200 million in operational savings by 2017.
Its workforce will be cut from 5,000 to 4,500, with a three-year enterprise agreement awaiting ratification.
BlueScope Steel chief executive Mark Vassella acknowledged the Port Kembla plant still faced "a really tough time" as it prepared to let go of 500 workers.
Nor could he give any assurances about the plant's longer-term future.
"The viability of this plant is all about us being competitive going forward, so the challenge is not over," Mr Vassella said on Monday.
"This is a cyclical business and we're right at the bottom of the cycle, one would hope ... and when commodity cycles turn, we've given ourselves the opportunity to take advantage of that.
"Closing the steelworks would have removed that optionality and would have been extremely devastating for this region."
He wants the federal government to step up and respond more proactively to steel "dumping" - the process whereby foreign competitors flood markets with artificially low-priced materials.
Independent senator Nick Xenophon said the steel industry had been given a second chance but it would go to waste without further action.
Senator Xenophon said local steelmakers were losing out to imported products that did not meet the same standards and, in some cases, could be poorly made with consequences for the consumer.
"Unless there are changes to government procurement policy ... then we could be in the same position in a few years' time," he said in Sydney.
"(Governments) need to take into account the social and economic impact of buying locally."
Share
