Unions face urgent challenge to transition from coal

May 31, 2019
Coal mine in the Hunter in NSW.

The furious commentary accusing the federal Labor Party of losing the election because it was “too left” and “tone deaf” to the importance of coal is disputed by those who are closer to the ground.

Long-term mine worker Peter Kennedy believes Labor paid the price for “doing nothing” for workers in the Newcastle seat of Hunter, where it faced a 10% swing against it.

Kennedy has been operating heavy equipment in mines for 54 years and is an environmentalist. He told Green Left Weekly that, while he is not a supporter of One Nation, he is pleased that Hunter, the coal capital of New South Wales, has become a marginal seat.

The electorate of Hunter includes Cessnock, Singleton and Muswellbrook, as well as the urban areas on the western shore of Lake Macquarie. The newer industries, which include vineyards and horse studs, exist alongside beef cattle grazing, coal mining and electricity generation.

The area is ripe for transition.

But Hunter has been held by a Labor dynasty — the Fitzgibbons — since 1984, with Eric Fitzgibbon relinquishing it to his son Joel in 1996. “Labor has lost a stronghold seat,” Kennedy said. “I’m pleased that Joel Fitzgibbon has gotten his bottom smacked soundly.”

Like other rural electorates in which coal and associated industries have provided much of the local employment, the Hunter faces the challenge of finding new sources of employment. The region is one of the state’s five top youth unemployment hotspots, with a rate of 13.3% compared to 10.1% across the state.

“Neither Labor nor the Liberal-National parties had an alternative plan for a transition out of coal,” socialist campaigner Steve O’Brien told Green Left Weekly. “And without a plan, it was an easy snare for Stuart Bonds, the ‘aspirational’ candidate from Pauline Hanson’s One Nation Party. The fact that he is a coal miner and the owner of a cattle farm helped him.”

Bonds won 21.6% of the first preference votes with the donkey vote. The swing away from Labor was a massive -14.1%, while the Nationals suffered a -2.6% swing. The Liberals did not contest the seat.

No vision besides coal

Bonds has already been visited by Pauline Hanson, and declared he will recontest for One Nation next time. Like the major parties, he is adamant coal has a long-term future in the Hunter.

“We have some of the best coal in the world and the largest coal port on earth to export it from”, Bonds said on his candidate Facebook page. “All the mining community asks is it be left alone to work out the next 40–50 years in peace without being held up because of stupid things like the ‘black-throated finch’,” a reference to the bird species deemed to be at risk from the Adani coal mine in the Galilee Basin and for which the Adani group have to convince the Queensland government it has a protection plan.

Fitzgibbon, from Labor’s right faction, was quick to deflect blame for the swing. He said Labor’s “equivocation” on Adani lost it votes from coal miners. He has also welcomed Anthony Albanese’s ascension to the party’s top job, saying Albanese, from the left faction, had promised he would protect coal jobs in the Hunter.

Labor’s refusal to look beyond coal is a big part of its problem, Kennedy believes. No stranger to the vicissitudes of the mining industry, Kennedy has worked in NSW, Queensland, West Australia and even Papua New Guinea. He retired four years ago and today lives in Muswellbrook, which he describes as “the dustiest place on Earth”.

“I don’t support One Nation at all”, Kennedy said, “but I am pleased that the coal miner candidate put the heat on Fitzgibbon. The pits have gone to rack and ruin. There are no permanent positions now: they are all casual.”

Kennedy said Fitzgibbon and some Construction, Forestry, Mining, Maritime and Energy Union (CFMMEU) leaders are unable or unwilling to stand up to the mining companies.


Part of the reason for this, he thinks, is the rise of subcontracting inside the mines and another is the weakness of the union, which is not helped by its close working relationship with the coal industry bosses. https://ssl.gstatic.com/ui/v1/icons/mail/images/cleardot.gif

When the data points to a decline in the coal industry — the result of aging mines, automation, the ramshackle corporate embrace of renewable energy as prices fall and the imperatives of the climate science and the Paris Target — those who say that coal is here to stay are dead wrong. Even in the Mt Arthur North mine, where Kennedy used to work, production dropped by 6% in the 2018 financial year.

The Mt Arthur North mine is the biggest open-cut coal mine in NSW. It has now been split up, with Thiess contracted to provide workers for the BHP-run mine.

“BHP started buying people [through Operation Services] and giving them permanent jobs, but they are not directly working for BHP,” Kennedy said. “They are mainly young, not in the union, although some are joining the union,” he said. He said most of those who are subcontracted are casuals, and on lower pay compared to the permanent workforce.

While Labor opposes the rise in subcontracting, its message was not convincing for a generation of younger workers who have no ties to the union and desperately need work to pay off their mortgages.

“People need permanent employment; a safe job. Working casual jobs is no life,” Kennedy said. “But young people now need to have a big house and a big car, and they are in debt to the hilt. I call it the ‘golden hand cuffs’: one hand is cuffed to the mortgage and another to the boss.”

Bonds is an archetypal candidate for some young workers in a quest for secure jobs. “I am a little bit of an in-your-face person”, he says. He is positioning himself as the rank-and-file counter to Queensland Maritime Union of Australia’s Bob Carnegie who has called on Labor to put the transition to sustainable jobs ahead of coal jobs.

Jobs transition challenges

The CFMMEU does face some huge challenges, not least to separate itself from the fortunes of the Labor Party trying to win office as “Coalition-lite”.

“If Labor wants to start a nationwide discussion on the need for a just jobs transition from the coal industry it needs to back up Carnegie who said, unequivocally, that Labor lost the election because it stood for nothing,” O’Brien said.

The CFMMEU has talked about a jobs transition but, as Kennedy put it, “it is not the union it used to be”.

Nationals’ Senator Matt Canavan would have us believe that the number of jobs threatened by the shift away from coal is in the hundreds of thousands. But a detailed 2018 report prepared for the CFMEU, The Ruhr or Appalachia? Deciding the future of Australia’s coal power workers and communities, which sketched the opportunities and potential costs of such a transition, estimated the number of jobs in coal fired power stations and dependent mines to be just 8000, and slightly more than that number again in businesses and services that rely on the power stations.

The report compared case studies that worked (Germany) and others that did not (including Newcastle’s botched transition from the steel industry).

Its premise was that as coal-fired power is set to close down in two to three decades, and the economic case for new coal-fired power “does not stack up”, Australia has the opportunity right now to avoid the disastrous coal mine closures that led to “entrenched, intergenerational poverty and social dysfunction” in the Appalachian region in the United States.

By contrast, planning, investment in industry diversification, a “staggering of mine closures and a comprehensive package of just transition measures” in Germany’s Ruhr region “delivered a major reshaping of the regional economy with no forced job loss”.

The report strongly recommended that, as in Germany, tripartite bodies comprised of industry, unions and government should manage the transition. That sounds good in principle, but the history of coal in the Hunter, where the coal industry still benefits from huge government subsidies, means that such tripartite arrangements work well for the most powerful partners and less well for the weaker one.

Kennedy believes the CFMMEU “has lost the will to fight”. While he acknowledges the industrial relations laws make it harder for the union, he says there is more to it. “They have to organise more rallies, more stoppages and more actions”, Kennedy said, describing the recent student-led climate rallies as “brilliant”.

The Australian Council of Trade Union accepts there is a need to prepare for a “just transition”, stating that it “is a massive economic and social disruption” and that “this has often been done poorly in Australia”.

O’Brien believes we can learn from Germany’s transition. But “to do it successfully here union leaderships have to lead the discussion, and convince their members to join in sketching a plan for how a jobs-rich benign energy sector could replace the 19th century one the conservatives desperately want to hang on to”.

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