In what he called an “important marker” of his government's approach to tax-payer funded bailouts, Australia’s prime minister Tony Abbott announced today that the future of SPC Ardmona was in the hands of parent company Coca-Cola Amatil.
SPC had appealed for AU$25m each from the Federal and Victorian governments to upgrade its Shepparton cannery in the state of Victoria, to which CCA was willing to pledge a further AU$150m (US$131m) on new products and technology.
“This is a government that will make sure that the restructuring that some Australian businesses need, some Australian sectors need, is led by business, as it should be,” said Abbott.
“And we will set the parameters. We will ensure that the climate is as good as it possibly can [be] for those businesses to do what is necessary, to restructure, to survive, to employ.”
CCA, according to local reports, had told the federal government it needed real encouragement to enable it to continue production at SPC Ardmona and provide up to 3,000 direct and downstream jobs in regional Victoria.
Abbott reiterated that it was important now that CCA completed its promised SPC restructure and renegotiated inefficient enterprise agreements. He said he was confident that CCA chairman David Gonski wouldn’t let SPC Ardmona’s workers down.
Coca-Cola Amatil has enough resources
“I know he will want to ensure that SPC Ardmona has a strong future, and I think that as a subsidiary of Coca-Cola Amatil, SPC does have a very strong future,” he added.
According to reports in The Australian, the government’s cabinet was divided on the question of whether to support the bid, with the industry and agriculture ministries in support of the bid.
But the request was finally declined with certain members questioning why Australian taxpayers should bail out the company when CCA had turned an AU$215m profit in the first six months of the current financial year.
“We believe that in this case the government would have to borrow money on behalf of the taxpayers to put into the proposal where we believe Coca-Cola with a very, very healthy balance sheet is able to provide that money from within its own resources,” Ian Macfarlane, the federal industry minister,
Will kill local fruit growing industry
Tanya Plibersek, acting opposition leader, called the plea rejection a dark day for Australian jobs, saying the decision would affect both the people of the Goulburn Valley and the future of Australia's manufacturing industry, she said.
“The government has effectively signed the death warrant on Australia's last fresh fruit cannery, ensuring the destruction of thousands of jobs,” she said in a statement.
According to Gary Godwill, deputy chairman of Fruit Growers Victoria, the town of Shepparton was going to be decimated because of this decision. “So many industries rely on the fruit industry, it's not just fruit growers,” he said.