It's taxpayer money. It's not a loan – it's free money. Owner Fletcher Building has agreed, in return, to keep the thing open till 2040 and invest $150 million, phased over time.
No doubt cement is important for building the country, but so was refined oil. We offshored that. So is milled timber, which we let go. So is food production, which we're letting fall over too.
This is the problem with welfare: once you start handing it out, everyone wants a piece of the pie.
Fletcher Building is a conglomerate, listed both here and on the ASX.
Their results are due out next month, which will now be watched very closely.
Last week, the company increased its earnings guidance and turned a $45 million profit in the half year to December.
Sure, it's not been without its problems, and we've kept you updated on their restructures and legacy problems and the general state of construction.
The only reason the Government is doing this, in my view, is because unlike the other examples of paper mills and Wattie's, this one's caused not just by the price of labour and energy going north.
It's the ETS.
Fletcher buys credits to emit carbon while making its cement. This cost made the Northland plant unviable. A dead man walking.
You can import cheap cement from offshore where they don't pay for emissions.
Which makes them a cheaper option, and we get undercut.
The Government reckons they went with a bailout rather than changing the ETS rules because they didn't want companies lining up for handouts.
But that's exactly what will happen anyway. Any plant at risk of closure paying for emissions is now fair game.
This might look like a single smallish payment to a single business, but it's actually a blank cheque they've signed, and with the election round the corner, the sky's the limit.
Ryan Bridge is a New Zealand broadcaster who has worked on many current affairs television and radio shows. He currently hosts Newstalk ZB's Early Edition - where this article was sourced.
9 comments:
Typical New Zealand. Burn the environment to make profits and refuse to pay the costs of doing business. But that’s ok, the socialists current in charge are happy to fund their big business mates while pensioners go hungry. Just another week in paradise.
Our consumption of concrete is absurd.. Much work is relatively low skill and a myriad contractors thrive on the lavish replacement of footpaths, construction of speed bumps etc.
The gift of $60 million to Fletchers draws much adverse comment but repeat gifts of similalr to Insurrection Coordination Centres (marae) passes without scrutiny.
How about we just follow the science and dump the ETS completely.
When are National going to wake up? When?
The climate change political ideology bullshit is slowly but surely sending this country broke.
Until we realise that closing down industry, taxing the crap out of everything and the insanity that thinks we are going to change the weather with these sacrificial offerings is entirely unnecessary and futile, we'll just keep going backwards. And poor countries can't afford to be low carbon because it's inhabitants simply go into survival mode.
Its so marvelous that Jacinda Ardern "Captains Call" to cut gas and oil exploration in the name of climate change, has seen power prices hit the afterburners, with industry and jobs in large volumes ceasing, whilst she goes into exile in a country that didn't play that stupid game in the most expensive city and one of its most expensive suburbs in the southern hemisphere, and lives on the high in North Sydney as NZ suffers.
Add this $60 million onto the $70 million Fletchers took for the wage subsidy and never returned and you get $130 million. The carbon tax excuse is a lie = companies always complain they're at a competitive disadvantage due to overseas cheap labour, different tax systems, or whatever. On that note, Fletchers enjoys huge monopoly powers in NZ so has every advantage. Gov't building rules made it difficult to use overseas products. Our Finance Minister studied English, can't order ferries so Uncle Winston had to take it over, and has no proper business experience apart from as a lobbyist. The symbolism of our government pouring $130 million into one of the worst run monopolies in NZ = whilst screwing low earners who cant pay their bills beggars bel8ef.
So Ryan, it’s OK to hand out $25 billion per year in welfare payments to individuals (including the 14% of working age Kiwis who don’t) but $60 million to save the onshore cement industry and the jobs thereto attached is an abomination? Get real.
Jeepers, all three Newsadstalk ZB presenters (Mike, Kerre and Ryan...where's HdPA?) opining about the Golden Bay Cement payment today? Talk about a full-court press!
There seems to be an agenda here...I wonder what it might be...?
Robert MacCulloch’s comments are very pertinent to the future of industries in NZ. There is a case for Fletcher Building to receive the grant (just as the Aluminium smelter did in 2020 - $800m over 4 years) but the grant must surely be with efficiency & competitive milestones in place. Otherwise, there’s nothing to stop the begging bowl coming out again in 5 years’ time.
Anonymous 4:26 Tiwai Smelter is making huge GDP , personal Tax, GST , and exports for NZ, increasing production and high quality Aluminium . and wait there is more signed up for decades more in NZ.
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