Friday, August 9, 2013

TIWAI POINT ALUMINIUM SMELTER

For my sins (and I know they are many) in another life I had the experience of working with Clayton Cosgrove.

He was then and remains today a quite unlovely fellow; with all the attributes (and looks) of a Mafia thug but without the compassion.

And there he was on the TV1 News last night dishing the Government for their $30m subsidy to keep the Bluff Aluminium Smelter in operation until at least 2017 when perhaps the world economy has rebounded and the demand for high quality aluminium (and the smelter produces the highest quality product) means that industry can again return to profit.

Cosgrove failed to answer the one simple question ... would Labour let the Smelter go to the wall?    Clearly that was the inference one could legitimately take from his comments.

All he could rabbit on about was that the Government, in granting the subsidy, was making Meridan Energy a more saleable proposition when it is partially privatised later this year.

Of course that is a flow-on effect of the decision but the greater flow-on effect is the retention, directly or indirectly, of 3,200 Southland jobs and a reported $535m (10.5%) contribution to Southland's GDP.    Those figures alone justify the $30m subsidy.

But nary a word about that from Cosgrove.   Clearly in Labour's lexicon people and jobs don't count and that's why 'Labour' is a swear word in the deep South.

9 comments:

Anonymous said...

Not that long ago Rio Tinto was claiming it couldn't afford to keep the smelter running.

Now this
"Tiwai Point aluminium smelter's majority owner Rio Tinto has ditched plans to sell off the plant, after posting a US$1.7 billion (NZ$2.12b) profit within hours of picking up a NZ$30 million dollar subsidy from New Zealand taxpayers."

LOL




Adolf Fiinkensein said...

Anon @ 2:49

Not sure what you find so funny. You'll likely find their profit represents less than a 1% return on capital.

Noel said...



"All he could rabbit on about was that the Government, in granting the subsidy, was making Meridan Energy a more saleable proposition when it is partially privatised later this year."

So the claim is the main Government driver was the Southland jobs.

Media is reporting.

"The move was broadly seen as means of clearing the last obstacle standing between Meridian and its partial listing on the NZX before the end of the year, with Tiwai accounting for about 40 per cent of the firm's revenue."

The Veteran said...

Noel ... thought you had more intelligence than to fall for that particular media line.

A more considered view is that the decision was a pragmatic one that took account of both the drivers.

Afterall, 3,200 jobs x the unemployment benefit (Job Seeker Support) at $230.40 per week = $38.3m p.a. more than balances that side of the equation.

I thought that as ex military you would understand that people matter. Clearly Labour is prepared to write those people off in the knowledge that they are unlikely ever again to win any of the Southland seats.

A cynical decision from a Party my Dad was proud to tramp the streets for and a Party that would now have him turning in his grave.,

Judge Holden said...

Cynical corporate welfare on a massive scale for Rio Tinto while forcing solo mothers to take up truck driving to feed their children. This is a government that cares about the right things people!

Then there's the matter of massive incompetence. Firstly Joyce got totally owned by Sky City and now English has been played. It's only your money though fellas.

Paulus said...

Good thing that Thug Cosgrove is not trying for a Southland Electorate.
Even trying to return as a Christchurch MP is proving difficult for him - do you think some in Labour Party do not like him ? - after all he is a man - or a mouse.

Paulus said...

Second go -
The Government will factor the $30 million into the 49% Meridian share price, which will cost the new Shareholders $14.7 million part of the $30 million.
Nice deal for National - make sense too.

The Veteran said...

Gueez Judge ... I can normally follow the logic of your comments even though, in the main, it is flawed logic.

But your comment about the Govt forcing solo mothers to take up truck driving is just plain stupid ... but then I guess stupidity goes with your territory.

But thank you for confirming that Labour's position on Rio Tinto is to let it go to the wall.

That was the point of my post. Slam dunk.

Judge Holden said...

Rio Tinto wasn't ever going to the wall, but good to see the National Party policy is to use taxpayer's money to prop up the inefficient bits of global multi-nationals. A slam dunk, certainly. How many hip replacements would $30m buy I wonder.

"The Government will factor the $30 million into the 49% Meridian share price, which will cost the new Shareholders $14.7 million part of the $30 million."

Paulus, are you a special needs student? Just askin'.