LABOR Senator Kim Carr is backing Liberal MP Sharman Stone’s claims the federal government has lied over its reasons for rejecting SPC Ardmona’s (SPCA) rescue proposal last week.
“It is a lie to claim that ‘over-generous’ wages and conditions are behind the company’s difficulties,” the Shadow Minister for Industry said in a statement this afternoon.
“The Abbott government’s reasons for not backing SPCA and the more than 3000 jobs it supports are fast being exposed as utter fiction.”
SPCA released details of its workers’ allowances publicly today to refute “union shop” claims.
“The total cost of allowances for all production staff at SPC Ardmona for the entire year of 2013 was $116,467, which represents less than 0.1 per cent of the business’ cost of goods for the year,” the company said, also noting employees get 20 days annual leave, not nine weeks.
Dr Stone - Liberal Member for Murray - called the Coalition government’s attempts to “scapegoat” workers and unions a “witch hunt” this morning.
“And sorry, I don't like witch hunts, which are… unfair and in this case could lead to us losing an industry.
“It is a complete furphy what is being said about the troubles of this last fruit-preserving industry,” Dr Stone told ABC radio.
“Perhaps it's a distraction from the facts which would require some government action.”
The Coalition government rejected supporting SPCA’s request for $25 million after the January 30 cabinet meeting. SPCA was seeking $25m from the Commonwealth and $25m from the Victorian government in conjunction with a proposed $150m from parent company, Coca Cola Amatil (CCA).
Prime Minister Abbott said the financial strength of CCA meant the company was well placed to advance and complete a current restructure process, and criticised “overly generous industrial relations deals” in the Australian manufacturing sector.
Senator Carr claimed Prime Minister Tony Abbott and Employment Minister Senator Eric Abetz were pointing to obsolete clauses in SPCA’s Enterprise Agreement to “divert attention from their failure to support Australian jobs”.
“This is a seasonal industry with the majority of work concentrated over a three-month period. This is reasonably and sensibly reflected in the working arrangements – facts the government is wilfully overlooking for its own cheap political purposes,” Senator Carr said.
SPCA managing director Peter Kelly said the company had been assessing work practices for many months, and had made significant improvements in productivity.
“Since 2011, 32pc of positions across the business have been made redundant,” Mr Kelly said. In December 2013 alone, 73 employees in maintenance and trade function were made redundant.
“The business has been severely damaged in recent times by a ‘perfect storm’ created by external economic factors," he said.
“The high Australian dollar, which appreciated more than 50pc from 2009 to 2013, has both enabled the flood of cheap imported product to be sold in Australia below the cost of production here, and also decimated the company’s export markets.
“Our export market volumes declined by 90pc in the past five years.”
Senator Carr said the labour cost component of a can of fruit is only 16pc of total costs, with allowances making up less than 1pc of that figure.
“The real challenge for SPCA is the high Australian dollar and cheap imports. The exchange rate has had a 40pc impact on the company’s competitiveness,” he said.
SPCA also pointed to cheap imports as undermining the company’s viability.
“The other major factors not of our making have been the dumping of cheap imported fruit and vegetable products into the Australian market from countries which do not have anything like the stringent safety, labour and environmental standards as we do,” Mr Kelly said.
“And (also) the fact there are no, or very low tariffs imposed on imported fruit products from countries such as China and the EU while these same countries impose tariffs of up to 20pc on average on SPCA products into their markets.
“We have also seen examples of imported Chinese-produced and processed fruit carrying lead levels which are twice the allowable standards in Australia – how do these products get into our markets without being tested and banned?”
The Victorian Farmers' Federation (VFF) slammed the government’s rejection as "a slap in the face to cannery workers, growers and the entire Goulburn Valley community".
VFF president Peter Tuohey said the decision was "unconscionable".
Opposition leader Bill Shorten said in Shepparton on Monday the government "needs to start fighting for Australian jobs".
"The consequences of the Abbott government allowing SPC Ardmona to close on (its) watch are diabolical for the Goulburn Valley," hew said.
"There are 70 empty shops in Shepparton already - 25pc of the adult population in Shepparton is not working at the moment.
"To trash jobs in the Goulburn Valley will see hundreds of people put on the unemployment queue and will have a disastrous effect for thousands of others involved in growing fruit and beans, not only in the Goulburn Valley, but throughout Australia."
Victorian opposition leader Daniel Andrews pledged $30m to SPCA, should Labor win the next State election.
"A Victorian Labor Government will provide $30m to... support the implementation of the strong business case that was put together and ought to have been supported by the Abbott government and the Napthine State government," he said.