Norske Skog confirms Kawerau mill cuts

Last updated 15:42 10/09/2012

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Restructuring at Norske Skog's Kawerau newsprint mill is evidence of a deepening job crisis, the Engineering, Printing and Manufacturing Union says.

Norske Skog has confirmed it is halving production at its Tasman mill in Kawerau.

It is yet to detail how many of the 290 staff at the mill will be affected, but the union is warning more than 100 jobs could go.

It said the news from Norkse Skog follows the announcement of 120 redundancies at Solid Energy's Huntly East mine, up to 400 jobs in the balance at Spring Creek, and last week's announcement that 100 jobs will go at the Tiwai Point aluminium smelter by November.

EPMU national secretary Bill Newson said Norske Skog's announcement was a blow to the community and a sign of a growing jobs crisis in New Zealand.

"The local economy in Kawerau is heavily reliant on the mill, and these job losses will have an impact throughout the community. We'll be working to save as many of these jobs as possible through the consultation, but the eventual outcome will almost certainly be large scale redundancies.''

A spokesperson for Norske Skog said the consultation process was likely to take a couple of months.

Tasman mill general manager Peter McCarty said the decision was driven by falling demand and unfavourable exchange rates that made large scale exports to Asia unprofitable.

He said the mill would remain an important employer in the region and would continue to produce newsprint for the New Zealand, Australian and Pacific Island markets.

''The mill is also pursuing a range of renewable energy opportunities as part of a broader regional diversification strategy.''

Norske Skog also announced an A$84 million upgrade - partly funded with grants from the Australian Government - to one of its mills in Australia.

Newson said that was "particularly galling''.

''It's time our Government showed the same kind of support for Kiwi jobs.

"No one is blaming the Government for the state of the global economy, but there are things it could be doing to help protect local jobs and encourage a thriving manufacturing sector so that people who do lose their jobs don't have to join the dole queue or leave for Australia to find work.

"We're calling on the Government to look at ways to stabilise the exchange rate and bring it under control, for example by supporting changes to the Reserve Bank Act to protect jobs and promote growth.''
Newson called for a return to a focus on jobs.

"New Zealand will never build a high wage economy without a plan to support a modern, innovative manufacturing sector, and our Government needs to recognise that won't happen unless it takes a more active role in the economy.

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"Unless the Government changes course urgently the jobs crisis will only get worse."

- © Fairfax NZ News

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