Melina Bath Motion – Establishment of Inquiry into Jobs and Latrobe Valley’s Economic Future

MS BATH

I give notice that, on the next day of meeting, I will move —

That this House requires the Economy and Infrastructure Committee to inquire into, consider and report, by no later than 13 December 2021 —

(1)   on the —

(a)   impact of the closure of the Hazelwood Power Station on the economy and jobs of the Latrobe Valley, and the success or otherwise of economic recovery efforts to date;

(b)   expected economic impacts of the proposed closure of Yallourn power station in 2028 and options the State Government can pursue to offset the loss of more than 1000 direct jobs from the plant, as well as associated contractors;

(c)   success or otherwise of the Latrobe Valley Authority (LVA) to help the region transition, in light of the decline of funding made available to the LVA over successive State Budgets;

(2)   and if the Committee proposes to transmit a report for the Inquiry to the House on a day when the House is not sitting, the Chair may give the report to the Clerk and —

(a)   the Clerk must —

(i)    as soon as practicable after the report is received give a copy of the report to each Member of the House;

(ii)   as soon as practicable after the report is received cause the report to be published on the Tabled Documents Database and the Committee’s website;

(b)   cause the report to be tabled in the House on the next sitting day of the House; and

(c)   the report will be taken to be published by authority of the House.

MOTION – CARRIED IN FAVOUR 19 votes to 18

VOTED FOR

  • The Nationals
  • Liberals
  • Cross Bench (Liberal Democrats, Greens, Transport Matters, Shooters Fishers & Farmers)

VOTED AGAINST

  • Labor
  • Animal Justice Party

******************

DEBATE LEAD

Ms BATH (Eastern Victoria) (14:48): I am really pleased this afternoon to move my motion 516:

That this house requires the Economy and Infrastructure Committee to inquire into, consider and report, by no later than 13 December 2021:

(1) on the:

(a) impact of the closure of the Hazelwood power station on the economy and jobs of the Latrobe Valley, and the success or otherwise of economic recovery efforts to date;

(b) expected economic impacts of the proposed closure of Previous DocumentYallournNext Hit power station in 2028 and options the state government can pursue to offset the loss of more than 1000 direct jobs from the plant, as well as associated contractors;

(c) success or otherwise of the Latrobe Valley Authority (LVA) to help the region transition, in light of the decline of funding made available to the LVA over successive state budgets;

(2) and if the committee proposes to transmit a report for the inquiry to the house on a day when the house is not sitting, the chair may give the report to the Clerk and:

(a) the Clerk must:

(i) as soon as practicable after the report is received give a copy of the report to each member of the house;

(ii) as soon as practicable after the report is received cause the report to be published on the tabled documents database and the committee’s website;

(b) cause the report to be tabled in the house on the next sitting day of the house; and

(c) the report will be taken to be published by authority of the house.

The first section is the most important part. Paragraph (2) of the motion is really the mechanism by which this proposed inquiry and subsequent report would be tabled in Parliament. Let me say at the outset that this motion is born out of need and the desire for a bright future for the Latrobe Valley, and it is certainly an opportunity for Latrobe Valley residents, for community, for business and for industry to be at the very front of the negotiations for our future.

The announcement last week that the Yallourn Power station was going to close four years earlier than expected, by 2028, should be a wake-up call for government to work with the Latrobe Valley community to transition to a new future. We respect the fact, and this house should respect the fact, that almost 90 years ago the Latrobe Valley became the powerhouse of our state and indeed at times certainly our nation. It was the lifeblood of our communities in providing that power. And it was so very important. Lights have been kept on and industry, schools and hospitals have run for decades and decades off the back of Latrobe Valley workers, and we should appreciate that and acknowledge that service to Victoria as a whole.

The Latrobe Valley certainly, as it stands, boasts a significant skilled workforce, and we look forward to new job creation and new industries. We need a matrix of these to complement what is already there but also to acknowledge that there will be the loss of these jobs through the closure Yallourn. It needs to be a catalyst for change; it needs to be a catalyst for positive change. Latrobe Valley residents do not want to see their beautiful region become a decayed area where there are empty houses and empty buildings where once industry certainly flourished. We need to see a stimulus for this region, and that is what this inquiry will do. I understand and acknowledge the fact that our upper house inquiries are certainly busy—there are many inquiries held, often concurrently—but this one, across this year and tabling in December, is certainly a very important one for the people of Eastern Victoria Region and indeed the state.

Any plan needs to have at its basis our community at heart. In my time in this place, and I am coming up to six years as a member of Parliament, we have seen the closure, in 2017, of the Hazelwood power station—the very abrupt closure of that, and I will speak to it. We have seen the closure of Carter Holt Harvey as a viable industry and the removal of that from our economic powerhouse. We have seen certainly the announcement last year—and I still cannot fathom the notion behind it—of the closure of the native timber industry by 2030. And we have seen COVID and the dramatic and devastating impact of that statewide but also specifically in Eastern Victoria Region and now, last week, the announcement of the closure of this very important industry in terms of Yallourn.

Moving to the actual parts to this motion, (1)(a) relates to the impact of Hazelwood’s closure on the Latrobe Valley’s economy and jobs. In 2016–17 the Andrews government tripled the coal royalties tax and created a $250 million tax on those coal-fired power stations. Hazelwood as a whole received about an $88 million requirement through that tax, and it tipped Engie over the edge—to closure. Unfortunately it was not phased or planned; it was a shove. And with that there were 750 direct jobs lost and 300 other associated job losses. If you were there at the time, and I was, it was very heartbreaking to see all of those hard hats lined up on the fence at Hazelwood and the resulting impact on our families, on our workers and certainly on the economy.

Indeed one Latrobe Valley council report of the time, in 2017, stated that Hazelwood’s closure resulted in a decrease in total regional output of more than $1.58 billion. Now, it flows out of the mouth very quickly, but it means businesses were closed; it means workers were dislocated and relocated, at best. It means there were huge losses of revenue, positivity and commercialisation, and there was a loss of vibrancy and a downturn in the economy. I say this with no joy whatsoever. The estimated loss to the Latrobe City Council’s gross regional product was close to $340 million, just at Latrobe city itself. Indeed one of the comments from this report said:

The early retirement of power stations could significantly affect the affordable baseload capacity, and the security and stability of the nation’s energy supply …

Whilst I would particularly like to drill down into energy as a whole, I have kept this inquiry quite specific about where to now for jobs in our region, because the whole energy matrix, although it is certainly part of the picture, is a vast and very important discussion. But I think we need to narrow-scope it enough so that it can be achieved in the time frame. Part (1)(a) also looks at the success or otherwise of the economic recovery to date. Government, in concert with business, with industry, with education, with community, must be proactive over this next seven years. We must create an achievable outcome for our community. We must create and instil confidence back into our region, and Labor cannot keep closing regional industries without a comprehensive plan and a sustained jobs future.

My other intention with this is to empower locals. I do speak to locals very often. My office is in Traralgon, and I speak with a vast array of locals. Some of them I will quote in a moment. There need to be grassroots people. So often I believe that they feel that government is making decisions in isolation or away from the real voices who can provide very real, tangible and important understandings and experience in this playing forward.

Very important areas that we could look at are certainly in engineering, and we have always been an engineering area. How can we transfer that into ongoing and sustainable jobs? Manufacturing—we have food processing. How can we value-add that? We have other agencies, and we know we have got ASIC there from the federal government as well. What other opportunities are there? We know the Hydrogen Energy Supply Chain program, the hydrogen road program, and that is a very important collaboration between federal and state governments, the Japanese government and a consortium. These sorts of things are really positive, and we need to continue to progress them and the hows and the wheres. I note that the Committee for Gippsland is lobbying for a Gippsland hydrogen cluster and how that works. We know that there is Star of the South down there and offshore wind turbines—again, very important. There needs to be a matrix, and there needs to be a voice. We need to support these things on merit.

The ANU provided some information and insight in their report about the transition, and I will talk to some of their parts. Anything that is looking at job creation needs to be adequately resourced for re-employment of people, to retain and retrain people. We need to look at mission-oriented industry policy and smart specialisation strategies and certainly work on our strengths, long-term growth and sustainable high-quality employment. These are aspirational, but they need to be achievable as well. It is not my intention to give the government a whack. It is really to look at the importance of this area and look at how we can maximise our jobs and maximise the flourishing of our area, and we need to bring in Regional Development Victoria and Regional Development Australia as well.

Now, if we look at some broken promises that we have seen through the government—and a complete disappointment—I will state the truth. In 2018 the government stood prior to the election and announced that SEA Electric would bring 500 new jobs to the region and there would be 2400 cars annually in production. And what do we see today, two and a half years later? We see zero jobs and, realistically, zero prospect of those 500 jobs. That is borne with disappointment and frustration by people of the Latrobe Valley. Only last week we saw further information—that in essence the CEO of SEA Electric seems to have been so frustrated with the tardy and slow progress of the Victorian government that they may well be going elsewhere and overseas. We saw Steelvision—the promise of 55 jobs and $500 000 supplied through LVA—and yet there have been no jobs created from that. Those are the facts, and they are a huge disappointment. We need to make sure that these sorts of errors do not happen, and how we do that is by consulting with the community, industry and business. We saw the 2017 closure of Hazelwood, and just after that we saw the unemployment rate spike at 10 per cent.

Now, one of the local private recruitment agencies, WorkforceXS, spoke to me today about the need for sustainable industry, but they also spoke about how many in the transition from construction were looking at short-term projects to keep tradespeople in the valley for the duration of those construction projects. However, again, we still need those long-term sustainable jobs. Indeed there are many worthy infrastructure programs that have been implemented. But the Giffard West hall upgrade—which deserved implementation, no doubt about it—why was that done with Latrobe Valley Authority money that was meant for the transition to new industries? It should have been out of a different bucket of money. That is what many people are experiencing and saying to me.

The other point I would like to raise in the time I have is part (b) about the economic impacts of the closure of the Yallourn Power station. It employs 500 workers directly—at various times it is up to 1000 when there are major outages and renewals—and it also has downstream contracts and downstream jobs. This is a significant loss to our region. If we look at the age profile of Yallourn Power station, it is 49 years old, the median age. Speaking with representatives from the Yallourn Power station and from Energy Australia, many of those need to and want to continue on in work, so how will they be moved over, changed, pivoted, retrained and still use the skills that they have? Indeed Loy Yang absorbed many of the former Hazelwood members and some moved toYallourn.  Yallourn Power station workers cannot be all absorbed by Loy Yang, AGL and the like, so we need to create those alternative pathways—22 per cent of Victoria’s total electricity and 8 per cent of the national electricity market. It is really challenging for people.

Now, Energy Australia have certainly said that there will be a new battery facility—a 350-megawatt battery facility, a 4-hour facility. It sounds good, but it is way off in the future still, and that will not absorb all of those job losses—a 4-hour capacity does not replace a coal-fired power station. What next? We need to know. We also want to ensure that it is good for the community and it is good for the environment. Many of my constituents in Hazelwood North and environs are very frustrated with the fact that the government has made a captain’s call to progress the ULAB, the used lead acid battery, recycling smelter, and they are very concerned.

Now, also we know the Minister for Energy, Environment and Climate Change said only recently in Parliament that she knew last year that the announcement was coming. What planning is being done, and how is this going to be achieved? We need to have this inquiry so that government can listen to the various entities that I have outlined. As I have said before, the hydrogen operations are important, and we need to understand how that can be implemented and what possibilities are there.

The other point I would like to raise is: how is the LVA travelling? It needs to be unpacked for vitality and importance going forward. It was set up certainly to establish a transition, but many in my community—many in the Latrobe Valley community—said, ‘Really, what was the best outcome; where have those jobs gone?’. One transition worker—and I will give you a case study—a constituent, was retrained as an ambulance attendant; they were invited to retrain for the purpose of driving non-emergency transport. The training facilitator was at Federation University, and there were 16 people who went through that training. Those who participated in the course were mainly former Hazelwood and Carter Holt Harvey workers. Out of those 16, only two involved in this were able to obtain this work—and that was only part time. So there were courses completed with no road to jobs, and this constituent is still very frustrated by this. We see now the Latrobe Valley Authority has got $27 million in the next round of funding—only $27 million—with $14 million of that going to wages and under half to programs.

The other point I would like to make is: let us look at the report card of the Latrobe Valley Authority. Its previous report claims that it has created 2500 jobs from a budget of $266 million. That amounts to a little over $100 000 per worker of taxpayers money. Is that value for money? If we compare this to a previous Nationals and Liberals fund called the Latrobe Valley Industry and Infrastructure Fund, that was $15 million and it created 1200 jobs at a cost of $12 500 per job. That was partnering with business and industry and that was communicating what works for local business to empower and create—and also there was buy-in. These are important sorts of things.

Now, I spoke today with Jane Oakley. She would like to know the answers to some questions and be part of this inquiry. She would like to know: where is the replacement investment coming on? It is okay to talk about new energy projects, but what will happen? What will be the new replacement? We need future skills—retraining. The power sector workforce needs to be taken in and retrained. We cannot prepare for these new investments unless we discuss and unpack them. Infrastructure Victoria: how will that be involved? What about investment? We need to make sure these are discussed in this inquiry.

I see too that the Latrobe City Council has written to Mr O’Brien but also the Premier. They know that there is a seven-year window. They want to be on the front foot. They want to be part of the conversation, not having it kept to a specialised Latrobe Valley Authority. We need to have more knowledge and more discussion around this.

Finally, Susan Broadbent from the Moe Traders Association is really concerned that her businesses in Moe have had a downturn post Hazelwood. They need a future. She is concerned. She wants to be part of the success—and I ask members to vote positively and support my motion.