Victorian manufacturers betrayed after 11,000 tonnes of steel sourced from China for North East Link

Victorian manufacturers are preparing to cut jobs, saying they’ve been betrayed by “duplicitous politicians” who are allowing steel to be shipped in from China and abroad for Big Build projects.

Victorian manufacturers say they will have to cut jobs after being betrayed by “duplicitous politicians” who are allowing steel for a mega project to be shipped from China.

Local steel fabricators say they were promised a lucrative pipeline worth hundreds of millions of dollars from the Big Build, only to see some orders disappear overseas.

The state’s most expensive road project, the $26bn North East Link, recently sourced 11,000 tonnes of steel – part of an $80 million package – for bridge structures at road interchanges from China.

This follows foreign raiders winning deals on West Gate Tunnel and a Geelong footy stadium upgrade, despite concerns raised about meeting Australian safety standards.

About 11,000 tonnes of material is being sourced overseas for the North East Link. Picture: David Crosling

The industry has savaged the Allan government for paying lip service to local content guidelines and says hundreds of jobs are at risk of being lost overseas where governments subsidise steel to drive down prices by 40 per cent – just as Australia’s need for wind turbines and high voltage power lines explodes.

The government says the North East Link bridge girders being sourced overseas accounted for 3 per cent of the steel used for the project, and that a procurement shift was required because no local supplier could provide a “large-scale trial-assembly offsite”.

Weld Australia chief executive Geoff Crittenden said the excuse was ludicrous and that cost-cutting was to blame due to blown budgets.

He said the Chinese company lined up for the bridge girders in Bulleen had been banned from the US, and that local manufacturers were “at breaking point”.

“Our local industry is being held to ransom by duplicitous politicians,” he said.

A tunnel at The North East Link project. Picture: David Crosling

Mr Crittenden said the consequences of losing sovereign capability over the long term could be dire, and that an enormous opportunity to secure the future to supply a renewables boom was being squandered.

“If the Chinese turned the tap off on steel like they have with wine and lobsters, then we would be in serious trouble,” he said.

The North East Link will connect the Eastern Freeway to the M80 in Greensborough, and has a huge steel requirement due to its tunnels and spaghetti junction interchanges.

The consortium building the southern section is made up for Laing O’Rourke, Symal, WSP and Arcadis.

Government briefings this year included supplier briefings for a massive influx of work and for fabricators to reserve capacity for 2025, meaning some passed up work on other projects.

Weld Australia chief executive Geoff Crittenden. Picture: Supplied

North East Link will use at least 90 per cent locally made content, a government spokesperson said. Picture: David Crosling

One fabricator, who spoke on condition of anonymity for fear of losing out on other government work, said Victorian workers had been betrayed and local suppliers were “fighting for scraps” and were now in a price war.

“Their excuse for seeking (to) award to an overseas fabricator was in order to meet the program timelines, which a single local fabricator could not meet,” he said.

“That’s not the case; we’re a massive fabricator, but we’re also willing to enter joint ventures with other fabricators as an industry to be able to deliver.”

A government spokesperson said negotiations to purchase the bridge girders was continuing and that in order to ensure they will be safely assembled over the Eastern Freeway, a “large-scale trial-assembly offsite is required and no domestic supplier has the infrastructure space, lifting capacity and steel products to offer this full offsite trial assembly”.

“North East Link will use at least 90 per cent locally made content – maximising opportunities for Victorian businesses to benefit,” the spokesperson said.

“Any product used must meet strict Australian design, quality and compliance standards.”

The spokesperson said that as a Local Jobs First Strategic Project, builders must consider solutions to problems with local steel before changing where material is sourced from, and that a Local Jobs First Commissioner would assess whether local content requirements had been met.