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Monday, 19 March 2012
Page: 3356


Mr STEPHEN JONES (Throsby) (21:55): I regret to inform the House that last week a gas and oil pipe production plant in my electorate of Throsby announced that it would close. The plant has been operated for many decades by the company OneSteel, a former part of BHP. Fifty workers are directly affected and probably 150 indirectly. It is a blow to the workers and their families, but I argue also a great blow to the region and the industry.

The withdrawal of OneSteel from the long-distance pipe market means that there are no domestic producers for this product in Australia. That comes at a time when the resource sector is booming—the Treasurer is often telling the House that over $400 billion worth of investment in the resource sector is in the pipeline over the next five to six years, particularly in the gas sector, and there are many other products that use pipelines as a means of transmission, particularly the coal-seam gas area where the demand for gas pipe is booming—but when demand for Australian-produced pipe has absolutely tanked.

OneSteel's closure or withdrawal from the long-distance pipe market follows the closure of two other plants in the last month, including an Italian multinational that operated a coating plant, Socotherm, and another multinational company by the name of Bredero Shaw which also operated a pipe-coating plant. What it means is that the ecosystem for producing this sort of product is now virtually lost to the Australian economy.

That does not mean that we do not have a viable pipe industry in this country; that is far from being the case. We still have a very viable industry when it comes to the construction, operation and maintenance of these pipelines, but a vital cog in the system is lost. It means that in the future we run the risk of being at the mercy of international producers who are, at the moment, able to flood our markets, often, it is alleged, with produce at below cost price. In the future we fear that Australian purchasers of these products will be asked to pay increasing costs.

Many speakers have got up in this place over the last year and spoken of the dramatic changes that are occurring in the Australian economy. I would argue that the restructuring that has been occurring over the last two to three years has been occurring at a pace and to an extent that has not been seen at any time over the last 30 years. I would also argue, further, that these are changes that are little understood in the capital cities of this country but well understood in regions such as my own which rely heavily or have traditionally relied heavily on manufacturing, particularly heavy manufacturing, as the mainstay of their employment and their regional economic product.

It is true that some regions—and indeed the country as a whole, when taken as a whole—are obtaining an enormous benefit from the resources boom. That is seen in our relatively low unemployment rate when compared to just about every other country in the world, our high exchange rates and the fact that we are paying, increasingly, less for many of our imports. With equal force: some regions, arguably very few regions, are suffering a disproportionate burden, and I would name my own region, the Illawarra, and the regions of Geelong and the northern parts of Tasmania as three which are suffering because of the restructuring that is occurring within this economy. I argue that more needs to be done to support workers and families in these regions and that we need intensive assistance in retraining and job search to make the transition that is being forced upon the regions and the businesses within this region. I also argue that more needs to be done by government in cooperation and in partnership with the private sector to ensure that new investment is going into these regions. Some work is being done, and I welcome it. In my own region the government has recently set up a $30 million co-investment fund, and I hope that announcements will be made in the very near future about new investment and new jobs that will be generated as a result. Without this more strain will be faced by workers who will flood from the regions to the capital cities, and we will see a loss of our skill base and important sectors in regions such as my own.