Miners march on Parliament
Miners concerned about job losses marched on Parliament today, but Prime Minister John Key said changes were necessary because of unrealistic coal price expectations.
Solid Energy yesterday announced more than 400 job losses at its Spring Creek mine on the West Coast, at head office in Christchurch and at the Huntly East mine in Waikato.
Key said the Government took a "deeper dive" into the state-owned company because of plans to partially sell it and three state-owned power generation companies.
It found Solid Energy has unrealistic coal prices built into its forecasts.
"When people say the mixed-ownership model isn't very good, this is actually a reflection of exactly what we're talking about, that governments often aren't the best owners of companies."
Solid Energy had a "reasonable pool" of debt that was not normal for coalmining companies, Key told TV3's Firstline.
"Now that the coal price is collapsing, essentially Spring Creek is not viable."
Low coal prices also reduced the likelihood of selling Solid Energy, he said.
The Government had been negotiating with the company for about 18 months and had waited for a new chairman to be named to see whether solutions, other than job losses, could be found.
Despite yesterday's announcement, Solid Energy miners arrived at Parliament this afternoon in an attempt to save their jobs.
They want the Government to give the one-off $36 million payment needed to keep the Spring Creek mine open.
Operations at the underground mine were suspended four weeks ago, sparking an outcry from the community, including a protest by more than 1000 people.
It is a massive blow to the West Coast, with more than one in 100 of its population of 31,000 losing work.
Stony-faced workers emerged from a packed meeting in a hall at Dunollie near Greymouth - some teary, others reeling.
Grey District Mayor Tony Kokshoorn said he was "gutted".
"It is the miners who bear the brunt of this when it's entirely the fault of poor management,'' he said.
"If someone had said to me two years ago the Pike River coalmine and Spring Creek won't be here in two years, I would have said they're crazy. It's a kick in the guts for us."
He feared the skilled work force would be lost to Australia, but he planned to fight.
"Greymouth will not become a ghost town. We will get through it."
Labour leader David Shearer said Solid Energy was making itself attractive for foreign investors as part of the Government's asset sales programme.
If the Government was looking to keep the mines open it would be working to keep the jobs, he said.
"If you're looking at it on the other hand as a proposition to be sold off, then you'd be doing exactly what the company is doing right now," he said.
Key said Solid Energy's financial woes meant it was not in any state to be put up for partial sale.
"It's never been in the position where it was going to come on to the market today,'' he said.
"It's been a five-year programme, and if you ask me in three, four, five years' time, the anwer might be different.'' .
CHRISTCHURCH JOBS ALSO CUT
Solid Energy also announced proposals to cut more than half the jobs at its corporate, support and development divisions.
Staff numbers would plummet from 313 to 150, it said, with most of those affected working at the Christchurch head office in Addington.
The loss of the 163 jobs is double what Solid Energy flagged a month ago when it said it expected to cut 65 jobs at head office and 17 support jobs around the country.
After the meeting, Solid Energy chief executive Don Elder said he hated giving such awful news and felt for those losing their jobs.
"My job is basically to make sure the company stays alive. When you're losing $8m to $10m a month, the place is going to bleed dry,'' he said.
"We have looked at every angle and we couldn't make it work."
STUNNED MINERS COOL ON REBUILD
City leaders say opportunities in Christchurch's rebuild could soften the blow for the soon-to-be-unemployed.
Canterbury Employers' Chamber of Commerce chief executive Peter Townsend said Christchurch was poised to move into an extraordinary period of reconstruction and he hoped many skilled people at Solid Energy would find jobs there.
"I really believe the opportunities are just beginning to grow," Townsend said.
Mayor Bob Parker said that while it would be stressful for staff losing jobs, he was aware of several organisations looking for skilled people in the services sector .
"I think there will be opportunities here, even if in the short term for some people they are not the ideal opportunities."
He said the city needed "engineers, builders, plumbers, painters, construction workers and administration staff".
But Sping Creek workers were less than impressed at suggestions they could move to Christchurch.
Mine deputy Kirk Neilson said workers were numb with shock at the closure and the idea of leaving their homes for work.
"It's a kick in the guts in the worst way. They've taken our livelihood off us and now they're saying, ‘We'll take you off the Coast, too'. The guys are just shaken."
Neilson, a third-generation mine deputy with 23 years in underground mining, including the past 10 at Spring Creek, hoped to be one of the lucky 20 to work on the mine's care and maintenance, such as flood management and gas monitoring.
If not, he planned to move to Australia for an underground mining job.
Another miner, who declined to be named, had tears in his eyes as he criticised Solid Energy for failing to foresee such financial problems: "They should have made provisions for that."
He started work at Spring Creek only a few weeks before last month's initial announcement, after working for three years at the doomed Pike River coalmine.
"They would have known when they offered me a job that the mine was in trouble," he said.
A third miner, who also declined to be named, criticised Elder's suggestion that workers could get jobs on Christchurch's rebuild.
"How do you pay your mortgage and pay rent over there?" he said.
"And what sort of wages are they going to pay over there?" asked another.
After the announcement, Elder said Solid Energy had several employers eager to offer jobs to redundant workers, including in Australian mines and on Christchurch's rebuild.
They would hold recruitment meetings after the consultation period finished.