Bill Shorten has announced Labor will provide $100 million to help save the Whyalla steelworks if elected to government in July.
The Opposition Leader made the announcement in Adelaide this morning ahead of a planned visit to the beleaguered industrial town.
“The Labor government, if elected, will support the South Australian proposition of saving Arrium,” he said.
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“Specifically, we will provide $50 million in grant funding, and another $50 million in loan facilities to help line up with South Australia’s offer of $50 million dollars, and use that as the basis for the administrator to be able to ensure that there is capital expenditure to secure ongoing steel production in Whyalla, and the related steel operations.”
He also called on Prime Minister Malcolm Turnbull to match the proposal.
“I extend the invitation to Mr Turnbull to make the rescue of Australian steel a bipartisan proposition,” he said.
Arrium is Australia’s only industrial steelmaker. It went into voluntary administration in April, with more than $4 billion owing to creditors.
The company’s administrator, KordaMentha, is currently seeking both local and international buyers.
Steelworks 'to break even' in 2016/17
The Whyalla steelworks is set to break even in the coming financial year while the group's mining business will make a slight profit, KordaMentha administrators say.
Mark Mentha has found $300 million in savings across Arrium for the 2016-17 financial year, mainly in reduced supply contracts and savings introduced by previous management.
"Arrium is a far more efficient company today than it was yesterday," he told Adelaide's 5AA radio on Thursday.
"With the plant and capex initiatives that we're looking at, this money will move the dial in making this business far more viable long term and therefore makes it a realistic long-term proposition for a buyer."
This comes after state and federal Labor pledged a combined $150 million to support a new owner of the steelworks.
Opposition Leader Bill Shorten, who will visit Whyalla on Thursday, says Labor refuses to let the steelmaker fail.
"If these jobs went, 3500 families would suffer enormously - that's completely unacceptable to me," he said.
Arrium was placed in administration in April after failed negotiations with its lenders amid a sustained low in commodity prices.
- with AAP
