SCATHING criticism has been levelled at the Federal Government following confirmation the region can expect just $1.4 million next financial year for its economic diversification.
Investigation of the most recent budget figures on Friday revealed the paltry sum allocated to the Valley next year.
It came as the Federal Government pledged at least $30 million to a transition plan for Geelong and Broadmeadows just a day after Ford announced it would close its doors there by 2016.
According to the Geelong Advertiser Geelong is expected to receive at least $20 million from last week’s government announcement plus further millions from the State Government.
Latrobe City Council chief executive and Latrobe Valley Transition Committee member Paul Buckley said while this region did “not begrudge support to Geelong for one minute” he was struck by how inequitable the government’s reaction was.
Geelong stands to lose 510 direct jobs from Ford’s closure, by 2016, as well as an anticipated flow-on effect.
In contrast ABS data shows Latrobe Valley lost 6220 between 1986 and 2001 through the former Kennett Government’s privatisation of its power industry, experiencing a nine per cent drop in employment from 1994 until 2001.
An overwhelming collection of data indicated the Valley had not recovered from privatisation before it was subjected to the Federal Government’s carbon tax.
The region’s social and economic indicators are among the worst in the state and, nationally, ABS data confirms two of its three main urban centres are in the top 10 per cent of Australia’s most disadvantaged towns.
Mr Buckley said privatisation of the power industry had “gutted the Valley” and a Victoria University report found the Valley had failed to “flourish” under “private enterprise control”.
Last week Federal Opposition, State Government and local government regional leaders said the Federal Government “did not understand or accept” the harsh impact its Clean Energy Future package, including the carbon tax, had imposed on the region.
They were responding to the Federal Government’s confirmation it would scrap a previously committed $200 million structural adjustment package to regions expected to be hardest hit by the carbon tax.
State Regional and Rural Development Minister Peter Ryan declared the Clean Energy Future package had already “wrought absolute havoc” in the Valley in the past 12 months “and caused so much of the uncertainty and loss of confidence we see in the business sector and the finance industry that supports that sector”.
Last year the Federal Government abandoned plans to close power generators, as part of its ‘contracts for closure’ program. This month it claimed its withdrawal of structural adjustment monies from the budget was justified on those grounds.
Mr Ryan denounced the move, telling The Express “there is no question the ‘contract for closure’ process was a severe impediment to business in the Latrobe Valley and it that impact is ongoing… we still have a carbon tax”.
Mr Buckley agreed, saying “from a federal perspective there is not enough recognition if what is happening here at all… there is a distinct hesitancy around investing here and that uncertainty has had a significant impact.”
The LVTC has submitted two key projects for federal/state funding in response to pledges of support from both parties, including a push for $15.8 million to advance the Moe Activity Centre Plan, which Mr Buckley named it’s “number one priority”.
Upon learning the budget papers show just $1.4 million allocated to ‘economic diversification’ for the Valley in 2013-14, followed by $1.3 million in 2014-2015 – assuming the Labor party is still in government – with sums expected to rise marginally in the following two years, Mr Buckley said it was “not good enough”.
“We don’t want this project to be staged but we have to deal with what we’ve got,” he said.
“It is disappointing that this is the only amount of money to be given… we have projects submitted and others we have discussed with the Federal Government over a number of years now and some require significant support when they are ready to progress,” he said, citing the Lurgi heavy industrial park as an example.
He said the $9.2 million allocated in the federal budget until 2017, which would only meet part of one proposed project’s requirements, was “not a significant sum”.
Mr Ryan said the LVTC and joint ministerial taskforce had been “established in good faith, with broad community support, and we are now looking to the Federal Government to make good on its commitment to this important initiative”, adding it was “concerning” there had been “no specific positive commentary from the Federal Government on this issue”.
The Federal Government has, over past months, placed the onus back on LVTC saying it had not presented ‘shovel-ready’ projects to the government for funding.
On Friday Mr Buckley pointed out the government had, within one day, responded to the Geelong/Broadmeadows Ford announcement with a $30 million promise “without anything tied to it… no ‘shovel-ready’ projects, they have just been told ‘you will get it’.”
He said Geelong had already benefited in past years from the relocation of the Transport Accident Commission to the region, and was now being promoted as an appropriate base for the National Disability Insurance Agency headquarters.
“We don’t begrudge that at all, there is no argument (what they face) is significant, but we deserve that same level of assistance here given what has taken place, and is happening now,” Mr Buckley said.
A spokesperson for the Federal Government said the government had “endorsed the strategic directions proposed by the LVTC” and remained “committed to working with the Latrobe Valley community on actions to support its economic diversification”.