By Geoff Payne
NEWCASTLE — Share brokers have placed advertisements in Newcastle newspapers offering to "help" steelworkers sell their shares in BHP. BHP introduced an employee share scheme in the 1980s to try to get workers to identify more closely with the company. The scheme came soon after a team of rank and file steelworkers, the Militant Action Campaign (MAC), won a wide hearing in Port Kembla and Newcastle for their demand that BHP be nationalised.
MAC was formed in late 1982 to challenge the do-nothing leadership of the main steel union, the Federated Ironworkers Association (FIA). In Newcastle, 5000 ironworkers' jobs were lost and the FIA officials did not even call one mass meeting. While BHP was threatening massive lay-offs, as well as the closure of the Newcastle works, the FIA officials' only strategy was to rely on the election of a Labor government to replace Malcolm Fraser's Liberals.
The Steel Industry Plan, which the Hawke Labor government implemented after its election in March 1983, is now promoted in ALP mythology as having saved jobs. Simon Crean, ALP shadow minister for industry, is calling for another such plan to keep the Newcastle works open.
The "steel deal" of 1983-1988 provided $500 million in subsidies for downstream companies to use BHP products instead of cheaper imported steel. Seventy million of this public money was eventually handed out. In return for this guaranteed market, BHP made a commitment to invest in capital-intensive plant and technology, such as a new bloom caster at Newcastle.
The plan revolved around increasing productivity, so jobs had to go. BHP made the commitment to avoid sackings, as long as market conditions remained favourable. However, forced internal transfers and overt and covert pressure forced many workers out of the industry. In the steel processing plants, such as Comsteel and Tubemakers, sackings occurred even though these companies received the bounties for buying BHP steel.
In return for this, unions limited their claims for improved wages and conditions and signed a dispute settling procedure to end wild-cat strikes. This political approach dovetailed with the ALP's prices and income accord. This "social contract" assumed that unions, bosses and the government were partners with common interests. Those unions that stepped out of line, such as the Builders Labourers' Federation and airline pilots, were smashed.
This "voluntary restraint", combined with an economic upturn in the mid-1980s, meant that boom times soon returned and by 1986 the "big Australian" was notching up its first billion dollar profit, with hundreds of millions of that made in the steel industry.
The "steel deal" and the accord were not without their critics and the militants who survived the 1982-1983 period continued to direct their fire at BHP and the servile FIA officials (in the 1986 award negotiations, the year of the billion dollar profits, the unions barely won the value of three pairs of socks for workers). These criticisms struck a chord with workers, and in the FIA elections that year even the right-wing team which ran against the left-leaning Port Kembla branch officials campaigned on how the "steel deal" ripped off workers.
In advocating a return to the "steel deal", the ALP's Simon Crean has again embraced the logic inherent in the previous plan — that jobs must go in the name of efficiency and cost cutting. Yet the Newcastle works now produces similar tonnages with 2500 workers as it did in 1982 with 11,400.
Any new plan would continue this relentless drive to cut more jobs. The Steel Industry Plan eventually faded away as BHP did not want even the slight government monitoring which the plan implied. In any case, it had done its job of providing a cover for cutting jobs and restoring profits. Those elements which it wished to retain, such as the commitment to reduce jobs, were incorporated into plant-wide, rather than industry-wide, agreements.
Another ALP "solution" is the proposal that the steel industry, or at least its Newcastle plant, should be sold off as a going concern. A buy-out figure of $80 million has been mentioned and "buyers" are supposedly "waiting in the wings". The new owners would be driven by the same capitalist need to reduce labour costs.
There is also the suggestion that workers buy the plant. BHP has announced that it will need $100 million to pay redundancy packages to the 2500 workers due for the sack. Workers would be foolish to use their redundancy packages to buy something that would face fierce competition from BHP. If the prospect of buying up impoverished workers' shares has the stock brokers all excited, imagine their glee if they could get a cut of $100 million in workers' redundancy payments by brokering a buy-out.
Proponents of this idea are hard pressed to explain why they think BHP would agree to provide easy entry to a competitor who could potentially challenge their monopoly control of steel production in Australia.
Another "option" being touted is to create the Steel River Industrial Site on land that BHP has made available on one of its former industrial dumps by the Hunter River. These sort of projects have been promised by BHP before. In the late '80s, for example, the Newcastle works general manager promised to make available old warehouses for light industry, but nothing came of it.
Promises are cheap. Still in its exploratory phase, one of the most definite things coming out of the Steel River project is that the site has recently been found to contain archaeological ruins of the homestead of one the first white settlers in the Hunter region! Perhaps a theme park would be the go!
The leadership of the main steel union, the Australian Workers Union (the FIA has amalgamated with the AWU), is locked into the political straitjacket of relying on the ALP. The ALP believes that the interests of workers and capital can be reconciled. BHP doesn't believe that, and acts accordingly. It shuts down a plant when it only gives a 6% rate of return, because it believes it can get 15% elsewhere.
The labour movement needs to return to some of its traditional demands, such as the nationalisation of monopolies, which can offer real solutions. The present situation has borne out predictions made since 1982 by socialist militants in the steel industry who stood on the MAC ticket, that unless BHP was brought under public ownership it would continue to relentlessly shed jobs and put its corporate and shareholders' interests above those of its workers.
Right-wing demagogues like Pauline Hanson seek to take advantage of the decline in Australian manufacturing and heavy industry to build a base amongst workers in places like Newcastle. In following the ALP to the right, the labour movement has left an opening for the likes of Hanson.
BHP can only be forced to keep the Newcastle works open if an industrial campaign is launched to hit the big multinational's profits in steel, coal, manufacturing, oil and minerals. Such a fight would be more politically effective if it included the demand for the transferring of control of this vital national asset to public ownership.
BHP has refused to release its secret report into the steel industry, the McMaster report. It is thought that this report projects the eventual closure of domestic steel production. This would hit Newcastle, Wollongong and Whyalla hard. The call for the nationalisation of the steel industry is justified.
In NSW, a struggle for nationalisation could be linked to the fight against privatisation, which NSW power workers will need to wage if the ALP government goes ahead with its plan to sell the state's power assets. Nationally, it could be linked to the Qantas and Telstra workers' fights against privatisation.
This is a struggle that can be won, but BHP will never be convinced by token strikes or politicians' rhetoric. Nor will jobs be saved by utopian schemes of buy-outs, especially where workers would have to put their life's savings on the line.
The support won by the MAC steelworkers in 1982, when they specifically campaigned for the nationalisation of BHP in circumstances similar to those faced today, shows that such campaign can win support.
[Geoff Payne is a rigger at the Newcastle steelworks and steel industry spokesperson for the Democratic Socialist Party.]