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Prime Minister Tony Abbott hardened his stance on government assistance to business, rejecting SPC Ardmona's request for a $25 million co-investment in the fruit processor and calling on the company to renegotiate conditions in its ''extraordinary'' enterprise agreement with workers.
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Government rejects SPC Ardmona bailout
3000 jobs at stake after Prime Minister shuns desperate pleas from Victorian fruit growers and workers, dismissing a $25 million bailout for SPC Ardmona. Nine News.
In a decision that could risk up to 3000 jobs in Victoria's Goulburn Valley, Mr Abbott supported Liberal economic dries including Treasurer Joe Hockey and Finance Minister Mathias Cormann to knock back the request after a three-hour cabinet discussion.
Industry Minister Ian Macfarlane and Agriculture Minister Barnaby Joyce had backed the company's request, which would also have triggered a $25 million investment from the Victorian government and ensured SPC's parent company, Coca-Cola Amatil, would spend up to $161 million on the canning facilities.
SPC managing director Peter Kelly said the decision would trigger a review of the company's manufacturing operations.
The Napthine government described the decision as a ''significant setback'' and is bracing for the loss of thousands of jobs in the Goulburn Valley in the lead-up to the November state election.
Mr Abbott said Coca-Cola Amatil had posted a half-year profit of $216 million to June 2013, and had signalled its willingness to invest $161 million in its manufacturing operations, and there was ''no way'' the government wanted to see workers take a pay cut.
''It is very important that they complete the renegotiation they have embarked upon. It is very important they complete the negotiation of the enterprise bargaining agreement … there are wet allowances, there are loadings, there are extensive provisions to cash out sick leave, there are extremely generous redundancy provisions,'' he said.
''The decision that came from the cabinet today sets an important marker. This is a government that will make sure that the restructure that some Australian businesses need … is led by business.''
He said Coca-Cola Amatil ''truly has the resources to ensure that SPC Ardmona is in a strong position to restructure'', challenging company chairman David Gonski to not let SPC workers down.
Deputy Premier Peter Ryan said Victoria was very concerned about the impact of Canberra's decision, vowing to work to secure the company's future in the Goulburn Valley.
State Opposition Leader Daniel Andrews said the decision was a betrayal of the valley community, which had sent Liberal and National MPs to Canberra and Spring Street for generations and been taken for granted.
The Australian Manufacturing Workers' Union condemned the decision, saying the Abbott government had shown it believed the only way to achieve productivity was to cut wages, conditions and jobs.
Coca-Cola Amatil said it would be forced to consider ''alternative plans'' for its SPC Ardmona plant as its commitment was dependent on the receipt of both the federal and Victorian government grants.
Chief executive Terry Davis said the company was disappointed as it had presented a solid business case and committed to a significant and much greater investment to transform the Goulburn Valley plant into a high-tech facility.
Federal opposition industry spokesman Kim Carr accused the government of, in effect, deciding to send thousands of jobs overseas.
With Josh Gordon, Georgia Wilkins and Richard Willingham