From The Australian:
Clive Palmer has demanded further government subsidies for his ailing north Queensland nickel refinery, while conceding some of the sacked workers won’t want to keep working for him.
Workers sacked from the troubled Yabulu plant have no chance of being rehired this financial year — if at all — after the businessman MP yesterday admitted he could not reopen the business until at least July 31.
Adding to the uncertainty, the architects of a proposed community buyback of the refinery are relying on securing hundreds of millions of dollars in government and private loans — including from a federal fund that has not yet been legislated.
Mr Palmer today conceded it was “not a great time” for his sacked employees, but blamed the “great tragedy” on his company’s administrator and political leaders.
“In China, the government spent $30 billion supporting their industry and in Canada, they have got free electricity for the metals trading because they realise we’re in a difficult time,” he told the Seven Network today.
Truth is, I’m not sure the Palmer refinery has a future. But if it does then the example of Arrium is one of precisely what not to do, from Fairfax:
Struggling steelmaker Arrium will supply steel to replace up to 600 kilometres of ageing railway lines in South Australia under a no-bid contract awarded by a federal agency that was announced by Prime Minister Malcolm Turnbull.
The rail network is operated by the federal authority Australian Rail Track Corporation, which is bringing forward an upgrade of the rail infrastructure to deliver more orders to Arrium as it attempts to ward off a potential closure of the Whyalla steelworks.
Arrium is already the main supplier of rail track to the Rail Track Corporation. A spokesman for the organisation said there were “provisions in place to ensure we receive a competitive price”.
Mr Turnbull, who toured the Whyalla steelworks on Wednesday with Arrium chief executive Andrew Roberts, said the rail upgrade was a “clear-eyed, practical” solution and an investment in making the rail line through the Gawler Craton mining region able to take heavier trains.
“What this company needs is stronger steel prices and more customers,” Mr Turnbull said.
If the business case can be made to government that these firms are viable – and in the case of ARI I think it can – then the process needs some work. Offering giveaways such as that given to ARI does nothing but bring forward more demands for bailouts from all quarters. What we need is not rocket science, it is simple and transparent policy-making:
- give the firms the money they need to improve the competitiveness of the business if:
- the board and executive take huge pay cuts for the period of public investment or resign;
- creditors take an appropriate haircut, enough to make the business viable;
- unions agree to cram down worker entitlements, and
- the Federal Government is issued a minority equity stake to be later sold.
Otherwise, no deal. It’s not like the PM doesn’t understand the principles here, from the AFR:
The collapse of PlayUp (Revo) in a highly competitive new media environment is a story that raises a number of questions.
After researching PlayUp’s transition from social media start-up to an enterprise that could not afford to pay its staff, reasonable questions, in the public interest, arise, first, about Turnbull’s original decision to invest?
And second, why on the surface it appears he was accorded preferential treatment as a secured creditor ahead of others – after his initial investment was converted to debt in late 2014 at the time the company was experiencing financial difficulties?
In the course of preparing this story the Financial Review forwarded questions to Turnbull’s office such as whether it is appropriate for shadow ministers and ministers to invest in companies that may be impacted by their policy responsibilities.
Turnbull was shadow minister for communications at the time of his initial investment in PlayUp (Revo).
So how come the PM is happy to throw around tax-payer dollars with no process or return while he’s so busy ensuring his own have very crisp accountability and privilege?
