Bloomberg News

Gillard Backs Aussie Jobs, Rinehart Plan Bashed

May 27, 2012

Australia's Prime Minister Julia Gillard

Julia Gillard, Australia's prime minister. Photographer: Ian Waldie/Bloomberg

Prime Minister Julia Gillard pledged to protect Australian workers after labor unions criticized her government’s decision to let billionaire mining magnate Gina Rinehart employ more than 1,700 overseas workers.

“We are going to see amazing growth in our resources sector,” Gillard said in Canberra yesterday. “There will be some need for some foreign labor because of the sheer size and scale, but we’ll always put Australian jobs first.”

The government on May 25 approved an enterprise migration agreement authorizing Rinehart’s Roy Hill mining project in Western Australia’s Pilbara region to sponsor as many as 1,715 overseas workers for its three-year construction phase because of a shortage of local employees.

The plan brought renewed criticism of Gillard’s Labor government, which trails the opposition Liberal-National coalition by 15 points, according to a Newspoll survey conducted May 11-13. Labor lawmaker Joel Fitzgibbon is canvassing for votes to return her predecessor Kevin Rudd to the party leadership, Melbourne’s Age newspaper reported yesterday, without saying where it obtained the information.

Gillard, Australia’s first female prime minister, fended off a challenge for the leadership from Rudd in February. Fitzgibbon said in a Twitter post yesterday that he supports the prime minister.

“I think his words are clear,” Gillard said. “I’m looking forward to leading the team into the 2013 election.”

Union Criticism

The Communications, Electrical and Plumbing Union said May 26 that the government should reverse its decision on taking overseas workers because proper attempts to find local people weren’t made.

“The concept of enterprise migration agreements has been approved by Cabinet and it’s been around for quite some period of time,” Greg Combet, minister for industry and innovation, told the Australian Broadcasting Corp. yesterday. The Roy Hill venture “is a A$10 billion dollar project,” he said. “Thousands and thousands of people will be employed on it and it’s very good for the economy.”

Australia’s economy is being powered by demand for the energy and minerals of the nation’s north and west from emerging countries including India and China. That’s put pressure on non- resource industries such as manufacturing and tourism in the most-populous states of New South Wales and Victoria.

Mineral and energy projects worth a record A$261 billion ($255 billion) were being developed in Australia as of April 30, the Bureau of Resources and Energy Economics said May 24. Including less-advanced projects, the total value was A$504 billion, it said.

Job Cuts

Qantas Airways Ltd. (QAN), the nation’s largest carrier, will cut 500 jobs to contend with rising fuel prices and losses, the company said May 21. Norsk Hydro ASA (NHY), Europe’s third-biggest aluminum producer, said May 23 that it had started talks with workers to shut down its Kurri Kurri smelter amid falling metal prices and the country’s carbon tax. Kurri Kurri, located near Newcastle in the state of New South Wales, employs 344 people.

Hancock Prospecting Pty Ltd. has spent or committed over A$1 billion in contracts during the past 10 months to build the Roy Hill iron ore mine, the company said May 25. Rinehart, who controls the company, is the world’s richest woman, with a personal wealth of A$29.2 billion, according to BRW magazine. She is ranked the 30th richest person in the world, with a net worth of $18.2 billion, according to the Bloomberg Billionaires Index.

To contact the reporter for this story: Phoebe Sedgman in Melbourne at psedgman2@bloomberg.net

To contact the editor responsible for this story: Paul Tighe at ptighe@bloomberg.net


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