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Thursday, 11 May 2000
Page: 16357

Mr ZAHRA (10:00 AM) —You will probably recall that, when I last spoke on the report from the House of Representatives Standing Committee on Industry, Science and Resources Of material value? Inquiry into increasing the value added to Australian raw mate-rials, I was unfortunately interrupted, so I welcome the opportunity to continue my remarks today. When I last made remarks in relation to this issue, I was talking about the very passionate way we in the Labor Party view the importance of value adding. We are very serious about it and we see it as fundamental to Australia's economic future. I gave a wonderful example in my constituency of the Bracks Labor government committing $2 million to value adding infrastructure: the establishment of an energy park in the Latrobe Valley. Energy is our natural advantage in the Latrobe Valley. No other part of Victoria has the same size or scope of infrastructure. It is good to see the Bracks Labor government investing in this, making sure that we get a natural advantage from our energy resource.

I have spoken about the commitments which the Bracks Labor government made in its recent budget. It is useful to make a comparison of the commitments made for the Gippsland region in the Bracks Labor government budget versus the commitments made for the Gippsland region in the Costello budget, which has just recently been brought down. The important items of infrastructure which the Bracks government has funded in my electorate are: of the order of $5 million to upgrade the West Gippsland Health Care Group Hospital in Warragul; around $3½ million to upgrade the Warragul Regional College—the public secondary college in Warragul; as I mentioned, $2 million towards the establishment of an energy park in the Latrobe Valley; around $11 million for the establishment of an education precinct in the Latrobe Valley; $5 million for the building of a new police station in Moe; and around $5 million for the establishment of a refurbished campus for the Central Gippsland Institute of Technology in Newborough. The commitments which the Bracks Labor government has made in my electorate are enormously significant and will have a huge impact on the lives of many people living in West Gippsland and the Latrobe Valley. By comparison, out of all the money announced there was not one cent for the Gippsland region in the federal budget. This needs to be viewed in the light of the Productivity Commission report into the impact of national competition policy on rural and regional areas which was brought down between the last federal budget and the federal budget brought down this week. Littered throughout this report are references to how Gippsland has been the most profoundly affected region in Australia as a result of national competition policy. The economic impact of national competition policy is four times as bad on the Gippsland region than it is on Newcastle. Other regions that have a high profile have been savagely impacted on as a result of NCP.

Despite this report, there is not one cent in the federal budget for the Gippsland region to help us get on and make a future for ourselves, to attract new industries and the high skill, high wage jobs which go with these new industries and to make sure that our kids have a future in the Gippsland region. What I have been calling for for some time is the establishment of a Gippsland advantage fund. This is no more than we in the Gippsland region deserve. It really is not. When you look at the impact of the loss of, I think, 1,100 jobs in the Hunter Valley when the steel mill closed there, some $25 million was put in by the federal government, the state government and BHP towards the establishment of what was called the Hunter Advantage Fund. As my colleague the member for Bass mentioned a little earlier, when the cannery in Eden closed some $3.6 million was put into that community by way of an adjustment package. So all we are calling for is some consistency in federal government policy in relation—

Mr DEPUTY SPEAKER (Mr Nehl)—Order! I am loath to disturb the flow of eloquence from the member for McMillan, but I would remind him that we are taking note of the paper which is dedicated to adding value to Australian raw materials. Perhaps building a new police station may be adding value, but I would be grateful if the member could perhaps get to the subject of the debate.

Mr ZAHRA —I am very happy to do so, Mr Deputy Speaker. If I could just go on, I am sure it will become very apparent exactly how the commitment to—

Mr DEPUTY SPEAKER —The chair certainly hopes so.

Mr ZAHRA —I can assure you that it will, Mr Deputy Speaker. What this is all about is an adjustment package attracting new industries to these regions. These new industries more often than not are value adding industries, and this is what we in the Labor Party believe so passionately about. When we talk about the need for adjustment packages, it is to attract those new value adding industries, and that is what we in the Gippsland region are being deprived of. Opportunities have flowed to the community in the Hunter Valley and to the people who live in the Eden district. They are being given opportunities to take advantage of new value adding industries which we in the Gippsland region have not been allowed to do. I think what everyone wants to see from the federal government is consistency in regard to the opportunities which they grant to regional areas. That is the point I am making.

More recently, there has been a factory closure in my electorate, the closure of the Bonlac plant at Drouin. This has meant the loss of around 150 jobs in a community of around 5,000 people. Obviously this has had a savage impact on the Drouin community, and I know there are people in Canberra today from the Baw Baw Shire Council who will be meeting with various ministers and other departmental officials with a view to getting assistance from the federal government towards helping the Drouin community overcome the obvious economic disadvantage which it will suffer as a result of the closure of that plant.

This is important in a value adding context. What we want to see for the Drouin community is some of that money which we fought hard for in the dairy regional community's package put back into the Drouin community, which is a dairy dependent community. Then Drouin can take advantage of value adding opportunities and replace those 150 jobs which have been lost at the butter factory and attract a new value adding industry, and the people there will not have to suffer as large an economic consequence as they would if no money was available to them from the federal government.

It is important to note that, when it comes to involvement by government, the federal government would do well to have a look at the involvement of the state Labor government in working with the Drouin community to try to do something to overcome the economic devastation which the closure of that plant will cause to that community. The state Minister for Finance and Minister for State and Regional Development, John Brumby, has been very active in working with the community, Bonlac and the workers who stand to lose their jobs at the plant to try to attract new value adding industry. My state parliamentary colleague and good friend Ian Maxfield and I have been working closely with Minister Brumby on this issue to try to ensure that the economic downturn which would affect Drouin as a result of this closure can be lessened as a result of the attraction of new value adding industries.

Just on the subject of value adding, I recently hosted a visit to my electorate by my colleague and friend Dick Adams, the member for Lyons in Tasmania, and also by another good friend of mine, the shadow minister for transport and regional development, Martin Ferguson. One of the important districts to which I took Dick and Martin was the West Gippsland region which is, I think it would be fair to say, a great example of where there is an opportunity for value adding. People there are taking advantage of the opportunities offered by value adding.

The first port of call was Drouin West Timber, where they are exporting high quality finished timber products into the building market in Japan. After that we went to the Tarago River Cheese Company, which has gone from employing 20 people some seven or eight months ago to employing 43 people, nearly all of them in the export sector. I think it is a great success story and the manager there, Laurie Jensen, can take great pride in what he has been able to achieve for his business and for the district.

It is interesting to note that the Tarago River Cheese Company is actually exporting cheese to New Zealand. For decades we have had to put up with New Zealanders telling us that they are cheese makers to the world and that they make the best cheese in the world, yet we have a cheese company in my electorate which is producing cheese for the New Zealand market. By their own admission, New Zealanders consider themselves connoisseurs of fine cheese. Obviously, their local produce is not good enough for them, but the cheese produced in my electorate is good enough for them. That says a great deal about the quality of cheese being produced at the Tarago River Cheese Company.

There are opportunities for people who are prepared to work with their work force and work as partners with progressive governments to take advantage of value adding opportunities. Those two companies are just two small examples of some of the innovation which my region is famous for. I think it is important that we in this parliament recognise just how much these exporters in regional areas contribute to our nation and, importantly, to the rural communities in which their workers live. In the case of Drouin West Timber, it employs some 75 or 80 people. Once again, that is a company which has seen substantial expansion over the years. It employs a lot of people relative to the size of the Drouin community.

When we consider the impact of the closure of the Drouin Bonlac plant on the community in Drouin, we must always remember the human impact of that closure. When people talk about the loss of 150 jobs, these are not just statistics on a piece of paper, these are 150 people who have families and responsibilities, mortgages and lives to live. These people deserve our attention in the federal parliament. That is why I am calling upon the federal government, to whom I have written on behalf of the community, to release some of the money in the dairy regional communities program, some of that $45 million over three years, to assist the Drouin community to take advantage of new opportunities in value adding.

If you look at what happened at Eden, Eden was provided with $3.6 million when the cannery there closed. Eden has a population of 5,000 and 200 jobs were lost there when the cannery closed. That is almost exactly the same situation as what we are faced with in Drouin. I am calling for some truth and some honesty in regional development policy so that people in the community can have confidence that there is an open and transparent process. I urge the federal government to move swiftly to address the concerns of the Drouin community, who I think most people would agree are deserving of federal government support. That support should come quickly.