' 1
CHECK AGAINST DELIVERY EMBARGOED UNTIL DELIVERY
SPEECH BY THE PRIME MINISTER
COMMISSIONING OF BHP'S UPGRADED ROD MILL
NEWCASTLE 17 MARCH 1989
Rob Chenery, General Manager,
Ladies and Gentlemen,
BHP and Newcastle go back a long way together.
BHP's first steelworks were opened here in 1915.
So for more than seven decades, the names of BHP and
Newcastle have been synonymous with hard work, sweat,
planning, investment all the qualities necessary to build
a big industry; all the qualities necessary to build
Australian prosperity and Australian jobs.
That's why, when you think of Australian industry, you think
of BHP Steel. And when you think of BHP Steel, you-think of
Newcastle. Today we are celebrating a new era in the partnership of BHP
and Newcastle.
I have just been shown the evidence of BHP's recent
investment of more than $ 400 million in the Newcastle
Steelworks not least, the upgraded rod mill and the new
bloom caster, the world's largest.
This investment has put Newcastle at the forefront of high
technology casting.
And I know from my talks with the managers and workers I
have met today that this new capital investment is
accompanied by a new attitude of cooperation and
consultation, a new commitment to quality and to training
in short, a new determination to ensure the future of steel
making in Australia.
That will make sure Newcastle remains what it has always
been the heart of the Australian steel industry.
It seems incredible to recall that only a few years ago, it
seemed possible that this heart might stop beating.
As we look at this new investment and the new attitudes that
accompany it, it's important to remember that in the early
1980s the future of Newcastle, and of the Australian steel
industry, was in doubt.
In the early 1980s, throughout the Australian economy, jobs
were being lost at a massive rate, investment was falling,
the challenges of international competition were being
shirked. In effect, all the deep-seated problems of Australia's long
standing preference for the relative ease of commodity
exports, and. our long-standing unwillingness to break our
manufacturing industries out of the cocoon of protectionism
all these deep-seated problems had emerged to give us the
worst recession we had endured in fifty years.
In many ways, all these problems were encapsulated in the
crisis of the steel industry.
Protected, increasingly uncompetitive and inefficient, the
steel industry was facing closure a decision that would
surely have devastated Newcastle.
After we came to office in March 1983, my Government was
determined that this must not happen.
That is why as one of our earliest priorities, we initiated
the historic Steel Industry Plan a strategy, with the
active cooperation of management and unions, to create a
viable steel industry that could feed the domestic and the
international marketplace competitively, efficiently and
productively. Each partner in the Steel Plan had a role to play, and
although there were some setbacks along the way, each
partner contributed to the resurgence of the Australian
steel industry.
The Government provided a stable environment, including
through the temporary extension of support. I pay tribute
to my colleague John Button, the Minister for Industry,
Technology and Commerce, for his pioneering role, and to the
diligence of our local Members of Parliament, represented
today by Allan Morris, the Member for Newcastle.
In exchange, BHP made a commitment to massive new investment
and to job security. Given a target of $ 800 million
investment over the first four years of the plan, BHP
actually committed itself to investing more than $ 1800
million over the five years the Plan lasted.
And for their part, trade unions undertook to exercise wage
restraint, and agreed to productivity targets and to adhere
to dispute settlement procedures.
The doomsayers said it wouldn't work.
They thought the Australian steel industry would follow the
path of the dinosaur to extinction.
But we have proved the critics wrong.
We have, together, rescued the steel industry and we have,
together, ensured that it will have the capacity and the
self-reliance to provide jobs and exports for many years to
come.
As the Steel Industry Authority noted, the Plan's specific
short-term targets for production, investment, employment
and productivity have all been met.
And the proof of that achievement lies here in this new
plant representing as it does new investment, world class
technology, secure jobs, and the basis of a new export trade
in value-added special steels.
This plant now has the capacity for annual production of
almost 2 million tonnes.
It provides jobs for more than 5,000 people and has immense
significance for Newcastle and the whole region.
The scale of BHP's investment program, and the growing
importance of exports in its marketing strategy, are
symptomatic of the changing outlook and expectations of
Australian industry.
Increasingly, there is acceptance of the inevitability of
greater integration with the world economy and a recognition
that our future prosperity depends upon our ability to
compete on world markets.
Australian industry is today less inclined to view the
prospect of greater trade exposure as a threat to be
resisted and more as an opportunity for growth and
diversification. If we are to succeed there is a need for industry to respond
flexibly to global market developments and to demonstrate a
willingness to adapt to the rapid pace of technological
change.
That ultimately is what lay behind the Government's
involvement in the Steel Plan and the other sectoral plans
for industries such as Heavy Engineering: support being
extended for a finite period through a range of government
programs and being conditional upon a real commitment by
management and workers to restructuring.
The across-the-board tariff cuts we announced last m'ay were
also designed to give impetus to the process of
restructuring. These cuts formed part of the Government's
continuing program of microeconomic reform which is aimed at
removing unnecessary regulation, improving the performance
and accountability of government business enterprises and
improving the efficiency and responsiveness of service
sector industries such as transport and communications.
In the international marketplace, it is only through seeking
increased efficiency through microeconomic reform that
Australia can make major improvements in our
competitiveness.
And the reverse is true.
Failure by Australia to match the productivity improvements
and technological innovation of our competitors could again
jeopardise the future of our economy including our great
steel industry.
Accordingly, I place great importance on, and I wish you all
well in, the negotiations taking place between unions and
management on award restructuring and other work practices.
Ladies and gentlemen,
If Australia is to have any credibility whatsoever as a
diversified, sophisticated, competitive economy if we want
to be regarded by our trading partners as an advanced
economy then we must have an efficient and productive
steel industry.
The fact that we now have that credibility the fact that
increasingly we are being regarded as a regional economy of
clout and sophistication is due in no small measure to you
people: the management and workers of BHP's Newcastle
Steelworks. I salute you for that achievement, and I wish you well as
you continue to provide this city, and, indeed, Australia,
with its backbone of steel.