The "Big Australian" shrinks Australian industry

by Peter Mac 

Australia's monopoly steel manufacturer, Broken Hill Pty Ltd, is 
to largely  quit the steel business in Australia by selling off 
all its remaining  plants except for its sheet steel works in 
Port Kembla(r) It was only six  months ago that the company 
announced its intention to close most of its  Newcastle 
operations, which has now resulted in the loss of 2,000 jobs. 

The proposed sale of its other steel businesses will threaten the 
jobs of  another 1,500 workers at BHP plants in Whyalla, Brisbane 
and Rooty Hill in  Sydney, as well as 1,100 employees at its 
remaining Newcastle operations. 

There is no guarantee that the plants will all find a buyer, and 
for the  employees of those that don't, the outlook is grim. 

The jobs, pay and conditions of workers at plants that are sold 
will be at  risk, as any new buyer will immediately seek to 
maximise profits by  reducing employee numbers, cutting pay or 
conditions, and/or lengthening  hours of work. 

The current rash of sales of BHP plants follows a long line of 
ill-advised  decisions on the part of BHP executives, involving 
investment in industrial  "get-rich-quick" schemes. 

These resulted in massive losses for the company from ventures 
like the Ok  Tedi mine in Papua New Guinea(r) Compensation for 
the appalling pollution  from that mine is likely to cost untold 
millions of dollars and take  decades to clean up — if it ever 
can be. 

At the same time, many of the slower-earning but more reliable 
steel making  plants languished, with inadequate levels of 
investment in the new  equipment and technology needed to keep up 
with international competition. 

Even so, the productivity of BHP steel production did rise 
steadily(r)  According to Kevin Maher, Joint Assistant Secretary 
of the Australian  Workers' Union in Newcastle, between the early 
1980s and 1999, output at  the Newcastle plant rose from 180 
tonnes per person per annum to almost 700  tonnes. 

Even now the BHP plant is clearly capable of turning a handsome 
profit. 

Although there has been speculation about the heavy sums involved 
in  modernising parts of the BHP plant, one commentator noted 
that the sale of  parts of the BHP businesses to be sold are 
"likely to trigger a frenzy of  bidding activity from local and 
offshore buyers", and may realise as much  as $4 million for the 
company. 

Despite its historic rise to industrial pre-eminence, BHP has 
always cried  "poor", and has received numerous grants and 
concessions from government as  a price of continued operation. 

After threats of closure of the Newcastle works in 1983, the 
Newcastle  steel workers were forced to accept the loss of some 
8,000 jobs, and the Hawke Government made a grant of $90 million 
to BHP. 

Despite this generous gift from the Australian taxpayer, the 
company has  now decided to close the whole Newcastle plant. 

But is BHP really intent on getting out of steel altogether, as 
the  headlines insist? Not a bit of it! 

While the company's Australian plants were being allowed to run 
down over  the last 20 years or so, BHP has been establishing new 
plants overseas, in  Indonesia, China, Malaysia, Sri Lanka, 
Vietnam, Papua New Guineau and the  US. 

BHP's US operations are also to be sold, but other than those 
industries  it's only the steel-making plants in Australia that 
the "big Australian" is  closing down! 

The company's decision to dump most of its involvement in steel  
manufacturing in Australia will reinforce the tendency in 
Australian  industry to reduce involvement in heavy manufacturing 
industry in favour of  extractive industries such as mining and 
timber. 

If unchecked, in industrial terms this tendency will eventually 
lead to  Australia becoming simply a "quarry" for the rest of the 
world. 

Unbridled greed 

BHP's corporate behaviour is typical of multi-national companies. 

Their unbridled greed led them to invest in numerous quick-profit 
ventures  which brought them savage losses. 

The same corporate greed is now driving them to abandon the 
plants which  formed the backbone of Australian heavy industry, 
even though these plants  are still capable of making a tidy 
profit, and to seek megaprofits  overseas. 

BHP is now seeking to not just to make profits, but to maximise 
the profits  of any industry they are in, at any cost(r) And if 
this means closing down  their Australian industries, sacking 
thousands of Australian workers and  weakening Australia's heavy 
industrial base, then so be it, says the greedy  "Australian".

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