Tiwai workers want Govt intervention

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Tiwai workers want Govt intervention

3News NZ

The smelter uses 15 percent of the country's electricity

The smelter uses 15 percent of the country's electricity

By Jeff Hampton

Unions and opposition politicians are calling on the Government to intervene to stop the Tiwai Point aluminium smelter being forced to close. The smelter is supposed to be in negotiations with the state-owned power supplier Meridian over their power supply contract, but there are fears the talks have completely broken down.

It's not the first time there's been power price trouble between Tiwai Point and Meridian, but with a backdrop of recent lay-offs at the smelter and low international aluminium prices, this time there's an extra edge.

“Everyone at Tiwai is extremely concerned about the future of the smelter,” says union organiser Trevor Hobbs.

There's a lot at stake. The smelter contributes more than a half a billion dollars a year to the Southland economy and employs round 900, directly and as contractors.

Just last month its owner Rio Tinto announced a plan to cut 100 jobs as it battles a 25-year low in aluminium prices.

Smelter workers have been told Meridian, a state-owned enterprise, has walked away from talks on a new power supply contract for next year, although Meridian denies this. 

“The Government is playing a very bloody dangerous game here,” says Mr Hobbs. “It appears to me that the Government is playing Russian roulette with all the jobs at the smelter.”

The smelter uses 15 percent of the country's electricity. Its management isn't commenting on the talks. But trade unionists and opposition politicians say the Government must get involved, calling on it to cut the value of the New Zealand dollar to help exporters like Tiwai Point.

“The smelter has been hit by a triple whammy – aluminium prices are down, power prices are up, and the exchange rate is ridiculous,” says Labour Party spokesman David Cunliffe. “The Government is complicit in two out of three of those.”

The union has produced "save our smelter" postcards to be sent to Parliament.

“You see this huge effort going into Hollywood films, but what you don't see is a huge effort going into the core part of the New Zealand productivity sector, which is manufacturing,” says Helen Kelly, president of the Council of Trade Unions.

State-owned Enterprises Minister Tony Ryall says he “can't comment on rumour and speculation. I've been advised that Meridian hasn't walked away from discussions with Rio Tinto. This is a significant commercial matter and I would refer you to Meridian.”

3 News went to Meridian. It says negotiations were initiated in August and are continuing.

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Comments

8/10/2012 10:35:59 a.m.

cant save wrote:

jim says it well there are no easy fixes to business's that arnt making money anymore, this is not the tax-payers problem to fix and you cant fix what is broke and isnt there a stop on selling SOS due to water rights disputes seems to me small country even smaller minds what on earth is wrong with trying to make movies here Australia etc tries to get them made there so why not get them here instead

7/10/2012 3:35:19 p.m.

Phil wrote:

The smelter has been in trouble well before economic down turn, so the writing has been on wall for a long while now. Also well put jim

7/10/2012 10:44:33 a.m.

Gary wrote:

Its OK National can let the smelter close lose even more jobs and then make a movie about it with all the big profits going to US. that way Key gets front row seats at the Grammy awards.

7/10/2012 8:54:12 a.m.

Mike wrote:

Look on the other side of the hypocrites from Labour.

When Labour had too little power, they had the smelter shut down. They weren't too worried about it then.

Here they are saying intervene and basically subsidise for a few jobs.

When will we get a consistent policy from Labour!

On the Dairying they are saying tax them to extinction with ETS. The ETS of biologicals has not been implemented anywhere but here by Labour and what would be the fall out of it?

Well the only way the dairying could pay for ETS on biologicals would be to double dairy prices here, and with possible reduced demand from the price hike, doubling may still not be enough to cover!

Labour here talking about 750 jobs and the effect that has on Southland/NZ ...

So how big is Dairying? Fonterra employs 15,000 people, and the farmers who supply them average 1.8 people per farm (as most are families working on the farm), so Fonterra suppliers around 20,000 more. Then there is the fact that Dairying brings in 1/3 of NZ exports. If look at the industry and support its about 40% of the NZ economy, but Labour is prepared to wave goodbye to that, while they want to subsidise a dying industry? Labour has its head up it backside!

7/10/2012 8:08:46 a.m.

z650Steve wrote:

Jim, well said!

6/10/2012 11:44:07 p.m.

Dwayne ill wrote:

Smooth news, close it down man! Stop fracking!

6/10/2012 8:59:54 p.m.

Paulo wrote:

Johnny. Cancel the overseas hobnobbing-it. It's time to pull finger and save our manufacturing industry.

6/10/2012 7:51:58 p.m.

Jim Seaview wrote:

QUOTE 1: "Unions and opposition politicians are calling on the Government to intervene to stop the Tiwai Point aluminium smelter being forced to close. The smelter is supposed to be in negotiations with the state-owned power supplier Meridian over their power supply contract, but there are fears the talks have completely broken down. QUOTE 2: "“The smelter has been hit by a triple whammy – aluminium prices are down, power prices are up, and the exchange rate is ridiculous,” says Labour Party spokesman David Cunliffe. “The Government is complicit in two out of three of those.” AS LABOUR & NZ FIRST basically have the same policies, they may as well combine and call themselves the "OSTRICH PARTY" as both seem to always have their heads in the sand. Their suggestions: (1) to let the overburdened taxpayer further subsidise the electricity to Tiwai Point even though they already receive the cheapest commercial rates in NZ; (2) They (Politicians)are going to manage the exchange rate and everything is going to be rosy. Labour did not do this while they were in Government for 9 years, but now that they are in opposition, they want the Nats to do it. HYPOCRITES!! For decades Tiwai point produced the highest grade of aviation grade aluminium. The Aviation Industry has now REPLACED aluminium with carbon fibre or similar to build their aircraft. Rio Tinto who owns Tiwai point smelter has 15 (YES Fifteen) other aluminium smelters for sale at this time. While the news is bad for Southland and they have my sincere sympathy, it is clear that the once massive traditional market for aluminium has simply gone. I do not want my hard earned tax dollar subsidizing cheaper electricity rates for Rio Tinto when the outlook is worse than bleak. If Labour and NZ First ever become Government - at least our manufacturers will know that when they are in trouble - subsidies will be available via the Hard working, overtaxed, overRated, diligent Taxpayer gravy train.