Carbon price v privatisation -- which is worse in the Latrobe?
A new report suggests the Latrobe Valley will fare better under a carbon price than under electricity privatisation. Not that that was how it was reported.
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VIC
Jul 3, 2012
A key report commissioned by the federal and Victorian governments into the future of the Latrobe Valley has found that, regardless of the impacts of a carbon price, the region faces long-term structural challenges across its key big-employing growth sectors such as health care and agriculture.
That should have been the lead for media reports on a new report released yesterday into the restructuring of the Latrobe Valley region. AAP, in a piece run in the Herald Sun under the headline “Call for action on Vic’s Latrobe Valley” got it pretty right. The Australian had, shall we say, a different take.
“Carbon tax ‘a threat to power jobs’, says report” screamed the headline. “Deep uncertainty among the Latrobe Valley power generators and potential sweeping cuts to the local economy and employment have been sheeted home to the new carbon pricing regime,” began John Ferguson’s article. On and on it went about the impact of a carbon price on power generation jobs.
The few people who will bother to read the report will find Ferguson’s article bears minimal relationship to it. For a start, the report makes the interesting point that electricity and coal mining, even combined, are only the sixth-biggest employer in the region. Health, retail, agriculture, construction and education all employ significantly more people in the region than coal and electricity, although that sector is just ahead of health care as the largest sector by output.
And the impact of the carbon price? “The introduction of a national carbon price will drive substantial change in the Latrobe Valley’s economy over the next decade and beyond,” the report concludes. But the committee overseeing the report “believes that regardless of the short-term uncertainty associated with the introduction of the Commonwealth government’s Clean Energy Future (CEF) policy including the Contract for Closure program, there will be major structural change in the Latrobe Valley’s power generation sector over the next decade and beyond.” It also notes that the region is still recovering from the Kennett government’s privatisation.
But wait — still recovering? How could that be? We’ll be coming up to 20 years since privatisation. Well, see, the impact of privatisation in the Latrobe Valley was massive. According to another report cited by the committee from 2011, employment in the utilities sector in the region fell from more than 8000 jobs in 1986 to less than 1800 in 2001. Full-time employment fell 9% in the region between 1994 and 2001. The current number of electricity sector employees in the Latrobe Valley is 1570, with another 1000 contractors. Even if a carbon price were to wipe out the entire electricity sector in the region in one go, it would have much less than half the impact of Jeff Kennett’s privatisation.
Which, needless to say, failed to attract such widespread concern about job losses among commentators.
The report recommends that, in order to ensure workers displaced by structural change, including the carbon price and possible closure of a generation facility, can move into growth sectors such as health and agriculture, skills and training should be a priority. As well, infrastructure investment should be better co-ordinated, private sector investment should be facilitated and the region’s “liveability” should be targeted.
For anyone who’s read regional development reports before, there’s very little that’s new. The Latrobe Valley is in the fortunate position of having growth industries already present — a lot of regional communities have to work out ways to lure growth industries into the area — which means the challenge is primarily of reskilling its workforce and ensuring investment continues to flow into the area. But let’s not allow any of that to sully a good anti-carbon price yarn.
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33 thoughts on “Carbon price v privatisation — which is worse in the Latrobe?”
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Wasn’t The Oz campaigning to dob in Goldilocks to the RSPCA for animal cruelty?
Do nothing to assist the Latrobe Valley restructure their economy? Get slammed by The Australian.
Commission a sensible report to assist the Latrobe Valley restructure their economy? Get slammed by The Australian.
This sort of report is essential for good governance and yet it gets turned into a ridiculous anti-carbon tax article by the hopelessly partisan “quality” paper.
Does anyone here seriously believe Abbott would have an election winning lead without the support of Murdoch and the shameless shock jocks who just make s%it up with impunity?
Of course retraining and reskilling is going to be hampered somewhat by the massive loss of TAFE courses thanks to Bailleau’s recent cuts.
Also, a small correction (not reading the report, maybe you’re just quoting it). the job losses were all form corporatisation, which happened before privatisation. The sale of the assets went through with already trimmed workforces.
You do kind of wonder what sort of a closed shop was operating when you can lose two thirds of your workforce yet still generate just as much product.
Another example of why we need a media enquiry, if only for it to legislate so “opinion” is properly marked thus, and news is news …
Of course it could also legislate (for News Ltd) for items to be compulsorily but relevantly labelled “fantasy”, “laughable”, etc …
Plenty of work available to rehabilitate the massive holes in the ground left by the mining companies in the Latrobe Valley when they find it is all uneconomic and pull up stumps. The question is who is going to pay?
I’m pretty sure it won’t be the miners who will have taken their profits and left the mess to us. You won’t see the Murdoch media whining about that..
Privatisation is one of the greatest scams foisted upon us by both parties.
Short term gain=long term misery.
Re Wilful: I worked in the Latrobe Valley power industry from 1969 until 2011 and I can confirm that most of the job losses occurred when the power industry was still public-owned (The SECV). Without doubt the industry was massively over- staffed from the top to the bottom. I believe both management and unions were complicit in poor work practices and over-staffing. At corporatisation most of the job losses were over. For too long the Valley has been too reliant on what I regard as an industry with a questionable future, based as it is on abundant and cheap brown coal. But the days of brown coal are probably numbered unless carbon capture and storage technology can remove CO2 at a cost which will not make brown coal fired power generation more expensive than say gas or emerging renewables. The valley economy needs assistance to further diversify, perhaps into renewables. It deserves assistance as it has been pivotal in Victoria’s economic development as a source of cheap power. The old SECV did do some good things: it was a good employer, trained a lot of tradespeople and technicians and gave work to people who quite honestly would not have found work elsewhere.
Interesting policy of using market forces to drive reform gets touted as a good thing despite massive job losses and long term negative effects and while the other which will have a minimal impact on such things gets canned.
And where are all the Kennett liberals now when Abbottt is backing govt interevention above market forces?
Great piece Bernard, thank you. Thanks to Fatty O Barrell and his coalition (coagulation?) of clowns in Macquarie St getting into bed with the rednecks much of NSW’s power generation sector will be going through the same “restructuring” shortly. The result will be increasing prices and drastic job losses and fat profits for a few, while “services” drop in quality.
Wilful above beat me to it – it’s all very well reports recommending that “skills and training should be a priority. As well, infrastructure investment should be better co-ordinated, private sector investment should be facilitated…” etc etc. but what good will that do when Bailieu & co are cutting governmetn expenditure, sacking stafff and decimating TAFE and public education? It’s the same in NSW and Qld – so-called “conservative” governments – elected after significant failures of state Labor – who all know nothing about runnign the place and whose sole answer is to sack tens of thousands of government staff, many of whom valued their work and brought many years of experience and expertise to the task.
And of course the only thing the OO and Limited News and the usual loudmouths can do is bleat the “carbon tax baaad” mantra. This country really is pathetic.
You are so right Jimmy. What I omitted in my post is the devastation caused by those job losses, widespread social problems and the communities arguably bear the scars today. It would have been better for the government to mandate a gradual reduction in staffing and perhaps stop the reform at the corporatisation stage rather than the ideological privatisations which did little for the consumer, the employees and the environment. Kennett did virtually nothing to ameliorate the serious side effects of his neo-con policies. Yet the Valley is represented in parliament by coalition MP’s. Go figure!
Spot on Bernard.
Privatisation has been much more expensive, much more job destroying and much more hurtful than this tax on the 500 most polluting companies in the country.
But we hardly ever talk about it! It is so good to read this and to remember what is really going on.
Harry1951
Glad you added that last bit Harry . The for sale signs around Morwell were everywhere you walked and it seemed like at least one for every street . Of course the big ticket item hardly ever talked about regarding privatisation is the loss of a steady stream of revenue from public utilities . Its like selling your house and then having to rent a place to live in with less income .
GEOMAC62
Yes the government and hence the people forego lose the loss of the revenue from public utilities when sold. And of course those benefits will then be harvested by the new owners. This “capture” of an asset that once provided benefits to all by the few is perhaps the real agenda of the privateers. Slogans such as “governments should steer and not row”, or the “private sector does it better” or “we must reduce government debt” are thus convenient excuses.
Harry – “Slogans such as “governments should steer and not row”, or the “private sector does it better” … are thus convenient excuses.” And yet even these seem to be invalid when the libs talk carbon pricing these days.
“When WE do it, it’s ‘creative destruction’ . . .”
Privatisation is the biggest con ever invented by the rich and greedy. Here in SA we have had a privatised electricity system for a couple of decades, and we now have the most expensive power supply in the world! Now that’s progress – NOT!!!
The public voted for the Liberal coalition in Victoria/NSW and the LNP in Queensland; the cuts and privatisations have started. There is only one conclusion that can be drawn from the current situation and future voting trend if the polls are correct about a federal government change to the coalition. We, the Aussie voters just love being shat on!
I think it’s more a case of Aussie voters “believing in the Trooth Fairy”?
Sell off assets now rather than take the hard unpopular fiscal decisions – leave those for later generations – how much did Costello and Coward sell off to earn their “financial miracle”?
“Sell off assets now rather than take the hard unpopular fiscal decisions”
But that’s the lie we’re all being sold – there are no “hard fiscal decisions” here. This is one of the world’s biggest exporters of minerals and foodstuffs – especially coal and iron ore. This isn’t Greece.
I’m talking Telstra etc to pay down debt.
Ignorant voters will get the govt they deserve. The minority who are less ignorant have to suffer with the rest of them….
I
I see in the UK press that even Camoron has realised that PFI is a total rip-off – hardly surprising that it was intitiated by li’l johnny minor and enthusiastically endorsed & continued by Blaahh (whom MrsT called her “greatest achievement/legacy”). Never mind that anybody with a modicum of mathematical ability or, for those edjakated after 1975, a $5 calculator could see that numbers were bullshit.
However, as this article points out, facts have SFA to do with the attitude of people who are allowed to handle sharp implements and VOTE!
Perhaps apart from the oldest of professions, show me a single industry that was around 20 years ago and today employs the same number of people. There isn’t any. As an example, 20 years ago the SECV required 5000 people to manage its accounts in Melbourne alone, today 50 people will do the same. It is called technology not privatization and these comparisons are plain dumb even by Crickey’s standards!
I can’t believe the voters are falling for the News Limited propaganda. Shows how powerful and dangerous a media monopoly can be.
WTF
A well named moniker as I expect thats what a lot say after reading posts like the one above . Now lets say there are 5 retailers in Vic for power , there are more but lets say five . That would be ten people to do the work including managerial , accountancy , sales , problems and IT . Thats just the retailers without adding the power stations themselves . All are making a profit and all are doing what used to be done by one utility that trained a large workforce including apprentices , very important for skilled workforce . Forward planning that had the citizens of the state in mind not the bottom line but still managed to provide a healthy dividend to the state of Victoria every year . Now the state depends on gambling taxes and stamp duty .
I have been a resident of the Valley since the old State Electricity Commission – SEC – (which was also known as ‘Safe Easy Comfortable’) was generating power. While there certainly was a lot of fat to be trimmed from this institution, Australia is now suffering from a labour force shortage. In the past many apprentices and trainees were trained by such old public service behemoths as the SEC – leaving such training to private industry without significant incentives just aint gonna happen.
When the LV was restructured in the 90’s there really wasn’t any federal gov’t assistance that I am aware of, which was a bit galling when some steel industry town in NSW (cannot remember which) got assistance thrown at them when they went through restructuring.
Sick and tired of this carbon-tax fear mongering. Since the restructure it is sad to see my old hometown of Morwell looking very old – parts of the valley seem to be enclaves of welfare dependents – which is great for the health industry down here – growing at rapid. Despite the predictions of the doom sayers in the Oz, The valley is one of the fastest growing areas in Australia on my estimates Traralgon grew from 20,000 to 24,000 between the census of 2001 and 2006 – 20% in 5 years – havent looked at the latest….but the town has grown on all boundaries since then.
Paul Odgers
I think you may be thinking of Newcastle in NSW Paul . On the other point you raised it seems to me Morwell and Traralgon will only be separated by a line on a map soon . If memory serves me right the area across from the LRH is designated for housing .
‘News Corp hack selective with the facts’ … shock, horror … just like LNP officials working as corporate lobbyists, thats how they get the job.
The real surprise is how privatisation brings joy to the most extreme luddites – sure the SEC was overstaffed, but they also sacked most of the maintainence staff, hence the infrastructure crumbles, brown and blackouts here we come, and don’t mention the powerline-bushfire death toll. Ain’t capitalism grand.
The evidence is now overwhelming that the Murdoch corporation is run by liars who employ lying executives to manage teams of liars who fabricate ‘news’.
The message must be hammered home: those who buy Murdoch publications or support the corporation in any way are working against a just and sustainable world.
Pass it on.
Alan,
There is one consolation. The headline that appears in the Australian today, lines the bird cage tomorrow.
I would thus consider this rightful justice.
Does this mean that those people with the highly prized skills of feeding coal to the generating plant can go back to their rather mundane day jobs of being doctors and nurses?