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Issue #1626      February 12, 2014

Abbott the job destroyer

The workers at SPC Ardmona (SPCA) and the farmers that supply the cannery and their communities are amongst the latest victims of a system that just throws workers and communities on the scrap heap, like fruit left to rot on the ground. SPCA is one in a number of impending plant closures. It is also one of a number of companies with their hands out for corporate welfare and threatening to close if it is not forthcoming. Toyota, Ford, General Motors and Alcoa in Geelong all look set to close their plants in the next couple of years and the agricultural sector is in crisis while the government continues to preach “market solutions”.

Abbott lashed out at the Australian Manufacturing Workers Union (AMWU) and its members who will lose their jobs at SPCA, blaming them for the death of the fruit canning industry. No sympathy for workers with “excessive” provisions in their workplace agreements – large over-award allowances, high wages, nine weeks annual leave, etc.

Treasurer Joe Hockey described clauses of the agreement as “astounding”. “If that is what they negotiate, then please do not come to the government asking for other taxpayers’ money when those agreements fail,” he said.

The corporate media have hopped on board, doing their bit to repeat what government ministers say and tarnish the image of trade unions and sacked workers in the eyes of the public.

Pure fiction

These claims were quickly refuted by the AMWU and SPCA managing director Peter Kelly. The cost of allowances for all production staff in 2013 was $116,467 – less than 0.1 percent of the business’ annual cost of goods. The “wet” allowance”, cited by Abbott had not been paid at all in 2013. Kelly said workers received a standard 20 days of leave and not nine weeks.

The closure of SPCA would have serious ramifications for the region. As many as 3,000 jobs are at risk in Victoria’s Goulburn Valley, once an important food bowl. Most of SPCA’s employees have been there 10 or 20 years. There are few other jobs in Shepparton where the cannery is.

“A lot of our workers at SPCA don’t even earn $50,000, they find it hard to pay the bills and here’s a bloke with all his politician’s allowances trying to say it’s too much,” AMWU cannery delegate Mick Cannon said.

“Abbott’s trying to make us workers the scapegoats for his government’s decisions to destroy jobs.”

Most SPCA workers are paid significantly less than the average ordinary hours wage in manufacturing of almost $67,000, or of an average worker’s earnings of $74,000.

Coalition ranks divided

With Victorian state elections looming in November, Liberal Premier Denis Napthine is concerned. His government had agreed to match the federal government if it put in $25 million towards redevelopment of the canning facilities. The company was set to spend around $160 million. The federal government refused, unless the company slashed wages and conditions which, to its credit, it has refused to do.

Abbott’s intransigence has caused sharp divisions within Coalition ranks, amongst Liberal Party backbenchers as well as with National Party members.

Local Liberal MP Sharman Stone in effect accused the PM of lying about the working conditions of SPC workers. “It is really deeply disappointing to me when I see more and more of these furphies rolled out to try and blacken the character of the workers themselves and the business,” Stone said.

“That sort of stuff is deeply hurtful. What it is saying is that the workers themselves, the 750 left … they’re responsible for the death of the industry.”

She said the government was attempting to widen its attack on the union movement beyond the building industry. “This seems to be a convenient way to draw a line in the sand to accuse this company of being destroyed by unions and outrageous wages,” she said. Stone is looking to initiate an inquiry into the food industry.

Rural crisis

Fruit growers, some of whose family farms have been operating in the area for 100 year, will go bust. Not surprisingly, National Party Agriculture Minister Barnaby Joyce has come out strongly against the Liberal-dominated Cabinet’s decision. He has the backing of three other Nationals – Darren Chester, John “Wacka” Williams and George Christensen. Christensen put forward the idea of a government-backed rural development bank.

Joyce has consistently spoken out in support of debt-ridden and drought-stricken farmers. Some farming communities have not had significant rain for two years. Joyce, not withstanding his conservative politics on some issues, has consistently fought for farmers and raised concerns over the growing number of suicides on the land. He wants Cabinet to agree to a multi-million dollar package for them, but has had no luck so far.

Joyce points out that there is a huge difference between helping out a large multinational company and farmers whose savings and livelihoods have dried up. SPCA is a subsidiary of the US transnational corporation Coca Cola Amatil (CCA). An extra $25 million would not hurt a company which recently announced its shareholders would receive more than $200 million in dividends.

Entitlements over for some

Abbott said businesses seeking government assistance needed to get their industrial relations “house in order”. Treasurer Joe Hockey said it was up to companies to do the heavy lifting, that the “age of entitlement” was over.

SPCA is being asked to cut wage rates, slash or abolish penalty rates, reduce leave provisions and other entitlements as a condition of receiving government assistance. Never mind if they are legally binding under enterprise agreements.

On the surface the refusal to give corporate hand-outs gives the impression of being “even-handed” – as if “the age of entitlement” is over for both companies and workers. But it is actually an attack on workers who would be on the receiving end of the cuts being demanded of employers. The aim of the wage and other workplace cuts is to increase company profits. Likewise the goal of budget cuts to social security and public sector jobs is to fund the next round of company tax cuts in 2015.

The “age of entitlement” is not over for big business!

Causes of crisis

There is no denying that the manufacturing and agricultural sectors are in crisis. But this is not a result of workers pricing themselves out of the market on “extraordinary” wages and conditions. The blame lies squarely with the capitalist system which is based on the pursuit of ever increasing profits and exploitation of workers and government policies aimed at facilitating these outcomes.

The high dollar hurts exports and makes imports cheaper. Floating of the currency means the government has no control over it.

The arbitrary lifting of tariffs, quotas and other restrictions on fruit has resulted in an influx of cheaper products, increased the risk of diseases and pests entering the country. The so-called “level playing field” is not very level, not when US and EU competitors receive massive government subsidies.

No farmer can compete with the dumping of fruit at below cost. This has been compounded by the monopoly purchasing power of Woolworths and Coles – forcing prices down to rock bottom unsustainable levels and then turning to cheaper imports.

A similar story can be told about the car industry and other sectors of manufacturing. The car companies also have a lot to answer for. They failed to upgrade in line with growing popularity and necessity for smaller, green vehicles such as seen in Europe. They have established production plants in “third world” countries with deregulated, slave labour conditions, all the while planning an exit.

They got what they could out of governments who feared the political backlash if they refused regular requests for hand-outs. No government has carried out a serious inspection of their books to ascertain how much intra-company transfer of profits takes place. Nor have governments imposed the sort of conditions required for their future to be ensured.

There are plenty of policy options open to any government interested in protecting and developing Australia as a food bowl for the region and maintaining a manufacturing sector. It is criminal that a country such as Australia is losing valuable farming land to mining corporations and farmers are being forced to dig up their trees. We are fast approaching, if we have not already reached, the point of being a net importer of food products.

A policy for the future

The government is not interested in whether these industries survive or not. There is no sign of patriotism when it comes to the land or manufacturing. They are more interested in financial, tourism, education and mining sectors investments by foreign capital.

When companies crucial to manufacturing shut up shop, their enterprises should be taken over by the government and either converted to other types of production (eg from cars to buses or train carriages for public transport) or continue production such as in the case of fruit canneries.

Many brand names have disappeared altogether or gone offshore or rely on imported inputs. Icons like Heinz, Edgells, Arnott’s, Golden Circle, Berri, Ardmona, Goulburn Valley, to name a few. Each restructure, closure or replacement of Australian fruit and vegetables by imported products means another hit for rural Australia.

Workers and their trade unions are not responsible. Quite the contrary, they have made many sacrifices and moderated demands in the hope of keeping their workplaces open and saving these industries.

When the government says “the age of entitlement” is over it is referring to an all-out attack by employers on workers’ wages and working conditions and the government’s attack on social welfare and the social wage (Medicare, public education, etc).

The main force capable of standing in the way of this agenda is the trade union movement, hence the government and media attempts to portray them as corrupt, having links with bikies or extracting unsustainably high wages and extraordinary conditions.

Next article – Editorial – United action, not collaboration

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