Whyalla Steelworks in administration as Prime Minister Anthony Albanese announces $2bn rescue package
Steel city saviour? Whyalla’s long wait for help is over as the PM flies into town with a massive funding package for the steelworks.
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More than $2bn will be pumped into the crisis-ridden Whyalla steelworks and saving jobs in the steel city, after Sanjeev Gupta’s GFG Alliance was spectacularly ousted in a state government legal blitzkrieg.
The government funding package aimed at driving a green steel and iron revolution will be unveiled in Whyalla on Thursday morning by Prime Minister Anthony Albanese and Premier Peter Malinauskas.
It is understood the state and federal funds will be pitched as supporting the steelworks, saving Whyalla jobs and supporting and encouraging green iron and steel production in South Australia and across the nation.
Prime Minister Anthony Albanese told The Advertiser Whyalla steel was needed to build Australia’s future.
“Whyalla steel has forged some of our country’s biggest projects – rail lines, airports and stadiums. That’s why we will work with the Malinauskas government to save the Whyalla steelworks and back local jobs,” he said.
Mr Malinauskas said long-term government “investments necessary to secure the future of Whyalla and Australian steel making” could be made “now that the steelworks is no longer under the control of GFG”.
“I was never going to allow a taxpayer-funded bailout of GFG,” he told The Advertiser.
The news emerged after the state government spectacularly ousted Whyalla steelworks operator Sanjeev Gupta’s GFG Alliance in a bombshell move to take control and install administrator KordaMentha.
Extraordinary legislation was rushed through state parliament that meant the government could send GFG subsidiary OneSteel Manufacturing into administration and guarantee ongoing payment to workers and creditors.
Mr Malinauskas said the company was given “every opportunity” to pay creditors.
BlueScope, the only other steel manufacturer in Australia operating mainly from Port Kembla in NSW, would be appointed to help the administrators.
“The South Australian government has intervened. The steelworks is now in the hands of an administrator, who will stabilise operations and explore a possible sale to a new owner,” he said.
A BlueScope spokesperson said the company “stands ready to provide technical and operation support” and “we also believe the Whyalla Steelworks provides important sovereign capability for the nation”.
Opposition Leader Vincent Tarzia was taken by surprise when rapidly convened briefing meetings about the drastic action occurred yesterday morning, and while he said the Liberal Party was “team SA” the government should have acted sooner.
He wanted more transparency and said $50m on the table for vital investment at the steelworks should have been released to support suffering creditors.
“A lot of this has been veiled in secrecy,” he said.
Mr Tarzia along with the Premier, Energy Minister Tom Koutsantonis and local Giles MP Eddie Hughes were all expected in Whyalla for the announcement.
A GFG Alliance spokesperson said “GFG is assessing what this means and is seeking advice on its options. Our concern is first and foremost the wellbeing and safety of our employees”.
The spokesperson also distanced GFG Alliance’s subsidiary scrap metal recycling and steel manufacturing business InfraBuild from the announcement.
Energy Minister Tom Koutsantonis told state parliament yesterday that the administration was fully funded and hoped problems with ships in the Whyalla port being unable to access the wharf would be quickly resolved.
“I think what you are going to be seeing in Whyalla now is a lot of activity really, really quickly including a lot of maintenance that has not been done,” Mr Koutsantonis said.
KordaMentha confirmed that partners Mark Mentha, Michael Korda and Lara Wiggins had been appointed as administrators of the steelworks and the firm intended to continue the steelworks and mining operations.
“This will preserve around 4000 direct and indirect jobs, as well as support local businesses in the Whyalla community and the nation’s steel industry,” Mr Mentha said.
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