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Power crisis sending production offshore: PIAA

Wednesday, 21 February 2018
By Graham Osborne

 ‘We need to know the solution to it immediately’: Andrew Macaulay, CEO PIAA on ABC TV’s Q&A.

Printing Industries CEO Andrew Macaulay has told ABC TV’s Q&A program that the skyrocketing cost of electricity and gas prices is crippling manufacturing in Australia and already costing jobs.

“We need to know what the solution to it is immediately because the easiest solution for capital is to move offshore,” Macaulay told Q&A’s panel of guests that included Energy Minister Josh Frydenberg and Shadow Energy Minister Chris Bowen.

“It is a crisis right now and it’s crippling manufacturing in this country,” Macaulay said. “We are seeing a reduction in employment and in manufacturing in Australia as we speak. It’s already here. I was talking to a manufacturer today who is facing an immediate 200 percent increase in his electricity prices, and his gas prices are through the roof. The only way he can deal with that is to lower his labour inputs.”

Macaulay asked Frydenberg and Bowen: “What can we do immediately to provide immediate relief to industry to keep skilled jobs in Australia and keep manufacturing industry in Australia?”

‘There is no silver bullet’: Energy Minister Josh Frydenberg.

Frydenberg replied that “the biggest thing we can do to reduce power prices is to get more gas into the market because that is now setting the price of electricity.

“The answer is that we are taking action now but there is no silver bullet,” said Frydenberg. “You have to deal with every aspect of the supply chain when it comes to energy. One of the things that we can also do is bring more generation on and there are now a significant commitment, whether it is in gas, renewables, that’s been the focus – there’s even an energy company that is upgrading its coal-fired power plant. We need to get more generation into the market as quickly as possible but what’s been missing in Australia has been certainty at the policy level.”

Bowen said the country needed a bipartisan agreement on energy policy, but added that “Josh can’t get his preferred policy through his own party room” because of “the climate change deniers of the Liberal Party.”

Macaulay, who was accompanied by industry identity James Cryer of JDA Recruitment, was unimpressed with the responses.

“I’m sorry, I know both of you are trying to provide a solution,” Macaulay said. “The reality is, we are talking about employment today and investment in industry today. Policy, from all governments, state and federal, has created sovereign risk in Australia which gets directly to the issue of investment, an issue in energy production and in hi-technology which goes into manufacturing. And we need to know what the solution to it is immediately because the easiest solution is to move offshore.

“The question is: what immediate relief can be provided? And we’re talking about offsets for energy increases, we’re talking about methods of industry sustaining production and employment when we’re seeing price shocks that we haven’t seen in this country since the 1970s. The only way that production can be continued is to move it offshore and we’re already seeing that. Packaging is one of the fastest growing sectors in our economy but it can be moved offshore.”

In December, a delegation from Printing Industries travelled to Canberra to seek immediate help for printers facing massive power bills that have caused staff lay-offs.

The Q&A appearance is part of the association’s continuing campaign to highlight the energy crisis facing the industry.

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