Government announces steel support advance
The Federal Government has announced it will introduce a new advance facility into its Steel Transformation Plan (STP) in an attempt to counter the recent troubles in the steel production sector.
The Federal Government will aim to provide support for jobs in the sector by allowing eligible participants to draw down an advance of their future entitlements under the STP in order to address growing short-term cash flow problems in an attempt to promote productivity and efficiency in the sector.
The advance will allow troubled steelmaker BlueScope Steel to access up to $100 million in funding in the 2011-12 financial year, which would normally be unavailable until 30 June 2012.
The advance comes as the company confirmed it would be shedding at least 1,000 jobs in an attempt to offset the company’s $1 billion net loss last financial year.
The company announced that it would halt all exports from its Port Kembla steelworks, which will result in the loss of around 800.
Provision of the new facility has been made available after BlueScope made a number of commitments to the Government in relation to its restructure announced today, including:
- Any de-activation of the Port Kembla blast furnace No. 6 and metal coating line No. 5 at Western Port must be in a manner which will enable them to be reactivated in the event of a sustained improvement in steel markets that enables profitable sales to resume.
- Any workers which BlueScope makes redundant must be paid all their legal entitlements in accordance with applicable workplace relations legislation, modern awards and the National Employment Standards and any applicable industrial instrument.
- BlueScope must commit to continuing as a significant employer in the Illawarra region over the term of the Steel Transformation Plan.
- BlueScope must remain committed to steel production in Australia.
The Government will finalise the legislative design of the new facility in consultation with relevant industry stakeholders.
The STP will provide a total funding pool of $300 million over five years from 2012-13.
The announcement of the advanced STP funding comes as the Federal Government pledged $30 million assistance fund to encourage new business ventures and jobs in the areas worst affected by the job losses as well as promoting eligible workers to retrain for new careers.