By Ben Reid and Chris Spindler
MELBOURNE — The September 25 explosion at the Longford gas processing plant near Sale left two workers dead and millions of Victorians without gas. Hundreds of thousands of workers have been stood down.
While the media and politicians have tried to dismiss the crisis as a "freak accident", the question remains: how could such a disaster have occurred?
Readers of the Melbourne's newspapers could be forgiven for not realising that two workers died in the blast. Not long ago, the papers eulogised endlessly when two police officers were shot while investigating a series of burglaries. In contrast, there has barely been a mention of the workers killed because of Esso's lack of safety precautions.
Unions have launched a memorial fund for the two workers' families.
Politicians and the media are working overtime to convince the public that the gas crisis has nothing to with privatisation. This is untrue.
The explosion occurred at the only point of Victoria's gas supply system run by the private sector. The Longford plant is owned and operated by Esso, an Australian subsidiary of the multinational Exxon corporation. Esso refines and processes gas from Bass Strait.
Now the Kennett Liberal government wants to put all sections of the state's gas supply system into private hands.
In 1994, the Gas and Fuel Corporation was divided into the Gas Transmission Corporation and GasCor. In preparation for privatisation, large parts of the GTC's functions were outsourced to the ominously named VENCorp (Victorian Energy Corporation).
While VENCorp is still publicly owned, it is to be sold next year. VENCorp's task is nominally to monitor the "gas price spot market" — it administers the process of buying the gas from Esso and reselling it to retailing companies.
Cost cutting
The Kennett government's rationale for outsourcing and privatising these facilities is that it will make gas delivery more efficient. The gas crisis shows that claim is absurd.
Esso's thirst for profits was a big factor in the poor design of the Longford plant. To cut costs, three processing plants were linked together. Consequently, when the blast occurred in one plant, all three had to be shut down.
Cost cutting was also a major factor in reducing efficiency and safety. Dean Mighell, state secretary of the Electrical Trades Union (ETU), told Green Left Weekly, "Since the late 1980s, there has been a continual downsizing of the maintenance crews. There is a particular danger in cutting back preventive maintenance.
"It's too early to tell what the actual cause of the explosion was, but safety was more important to this company in the past. Maintenance crews used to go out in pairs to check work; now only one person goes out."
A report by the Australian Workers Union (AWU) found that maintenance crews have been halved.
"Kennett has a lack of commitment to occupational health and safety standards", Mighell said. "He has encouraged companies to self-regulate and has got rid of most of the workplace inspectors.
"In this particular event, there has been a clear breach of workers' rights. Workers have been badly injured, their rehabilitation will be lengthy, and the government has taken away the workers' and their families' right to sue. Any business can sue Esso for profits lost. The profit motive is clearly more important than workers lives.
"Loss of production is one thing, but the loss of life or injury cannot be accepted. Maintenance has to be carried out by trained personnel."
Craig Johnston, assistant secretary of the Australian Manufacturing Workers Union (AMWU), agrees. He told radio 3CR that since the state government has promoted self-regulation by companies instead of independent inspection by the Department of Labour, there has been the potential for tragedies like the Longford blast.
Johnston called for an independent inquiry into the explosion. "However, it's got to go further than that. There's got to be an inquiry into occupational health and safety across the board", he said.
Johnston points out, "A key aspect of both the 1994 and 1997 legislation to sell off the industry was the reduction in safety arrangements".
The irony is that the "savings to industry and consumers" that were supposed to flow from corporatisation have been wiped out by the crisis. Large sections of industry are facing huge losses.
Workers pay the price
The worst affected are the tens of thousands of workers who have been stood down and millions of household consumers. As many as 100,000 workers were stood down and, in many instances, forced to take the time as annual leave.
While some workers had no choice but to take their holiday pay to pay bills and mortgages, this means their chances of compensation are remote. For many, it will mean lean times at Christmas, or being forced to work during the traditional break to make up lost production.
The Kennett government has offered little compensation. A successful class action by workers against Esso seems unlikely given the state legislation passed earlier this year to halt legal proceedings against the company for losses from the freezing of gas pipelines.
The ETU, AWU and AMWU have met with lawyers who confirm that, while companies can sue collectively for loss of profits, workers are unable to sue for compensation. Incredibly, not even the families of the workers who were killed or injured can sue the company. They are eligible only for a minimal government payout.
State Emergency Service volunteers were used to turn off the gas meters of domestic and small business users. There is concern that the same volunteers will be used to reconnect gas services, a job requiring trained personnel. More than 400 gas fitters in Victoria have been sacked in the past four years.
While the state government sits on its hands, during the federal election campaign, both major parties declared the situation a national crisis and pledged funds for workers who were stood down and small businesses.
Throughout, little attention has been paid to Esso, yet the company had a similar explosion at the Gippsland gas refinery in 1970, injuring a number of workers.