In January this year, Penrice Soda Holdings, maker of soda ash and bicarbonate, announced it was closing its production plant at Osborne near Port Adelaide with the loss of 60 jobs directly. The plant is Australia’s only soda ash and bicarbonate maker. Its products are used in the glass container, glass construction, washing powder, mining and water treatment, food, pharmaceutical, medical, stock feed and personal care products industries. Penrice intends importing these products following the plant closure through a joint venture with a Dutch multinational company, SASS.The closure is part of the conscious ‘race to the bottom’ strategy of multinational companies in manufacturing in Australia. They produce or source products where profits are highest and costs are lowest. In the case of sodium carbonate, imported prices are about $280 per tonne compared with the locally produced product of between $350 and $450 per tonne.
In 2008 Penrice won a five year $50 million contract with a further five year option to supply Precious Metal’s WA vanadium mine with soda ash. The mining industry demand for soda ash products is growing at the rate of 3% per year. It expanded the plant by a third to handle demand. Demand is particularly strong in WA.A Blow To State Government “Manufacturing Works Strategy”
In late 2012 the Weatherill Government announced its manufacturing strategy for the next decade. The announcement by the Premier included his comments repeated below.“Manufacturing is a key component of a prosperous and resilient economy. For every job in manufacturing, between two and five jobs are created in the rest of the economy.”
He and Manufacturing Minister Koutsontonis both see a future for manufacturing locally, linking in to global supply chains within world- wide industries and in supplying the mining industry.On both counts, the local Penrice plant would score a tick.
Why then the silence from government with its closure?One reason is because the plant has been a pollution hazard in the suburban area where it is located. So closure means less pollution for residents. However the demand should have been from government long ago for Penrice to clean up its act regarding air pollutants.
Why was the plant’s production methods allowed to pollute for so long?The answer is really about the story of manufacturing in SA – ownership and control of industries and subservience by governments to ‘market decisions’ of companies.
For Penrice’s soda ash and bicarbonate plant, like other significant manufacturing plants in SA, have been owned and controlled by multinational companies. Profit comes before health and safety of workers and community with them.From British To American Imperial Control
The Osborne plant near Port Adelaide was set up by British imperialist, ICI in 1940, sold to Byvest (a management group) in 1989 , and with good profitability, sold to US multinational DG Harris for $100m in 1996. So decision making about the plant has ultimately been in the hands of imperialist interests throughout its history.
Proud History of Workers’ StruggleThe plant has always been a strongly unionised site with some memorable struggles. In the 1950s the workers stopped work for a half day over a wage claim. The following month three shop stewards were ordered by the Arbitration Court to lift an overtime ban and to terminate the half day stoppages. The workers persisted and went on strike for a further three weeks and eventually won their wage increase. The Penrice (then ICI) workers received strong support from other sections of the working class.
At the Islington railway works about 10 kms away, 2,000 workers at a mass meeting condemned the court action against the shop stewards. 250 workers at an electricity plant at Osborne carried the same resolution. Workers at Wallaroo in country South Australia did likewise.This working class solidarity generated in this case by the Penrice workers’ struggle is what has struck fear in to the hearts of the imperialists. The only way they have been able to temporarily retard it has been to pack up their industries altogether and move off shore.
Successive governments of Liberal and Labor brand have allowed this to happen.The current Weatherill Government has announced a plan to revive manufacturing in the state. However it is unlikely to do so unless it supports workers and takes action to prevent multinationals closing down workers’ jobs when-ever it suits their pursuit of more profit.
Manufacturing Workers Are The Core Of The Working Class In South AustraliaManufacturing jobs in SA currently stand at about 73,000, 10% of the SA workforce. This is the highest percentage for any state or territory and above the current national manufacturing employment rate of 8% of all employment in Australia.
Manufacturing jobs in SA in 1967 were 121,187. In 1997, there were 101,400.Union membership in manufacturing in SA has declined from 55% in 1967 to 51% in 1997 to 29% in 2012. Although a significant decline, the 29% is still a force to be reckoned with and a lot higher than the national private sector union membership figure of 13%-14%. They are still the core of working class collective action and lead the struggle for workers’ rights. They are important workplace ‘schools’ for socialist ideas and discussion on progressive ideas which can reverberate through other workplaces and communities of the working class.
Manufacturing unions are also significant financial contributors to the Labor Party. There should be a common interest between a self-proclaimed progressive Labor government and workers in South Australia through their unions for defending and extending manufacturing industry.Facing an election later this year, Weatherill must do more than just reshuffle his Cabinet if he is to earn the electoral support of South Australian workers.
See also: http://www.safetowork.com.au/news/fines-for-ammonia-leak-and-explosion