Victorian Government announces $22m assistance package for SPC Ardmona

Updated

The Victorian Government has announced a $22 million assistance package for SPC Ardmona, Australia's largest food processor and packaging company.

The Federal Government last month rejected a $25 million assistance request from SPC parent company Coca-Cola Amatil, putting the jobs of at least 2,700 people in the Goulburn Valley in doubt.

Victorian Premier Denis Napthine says his Government will contribute $22 million towards a $100 million investment in the company to transform and modernise its operations at Shepparton.

Under the agreement, SPC Ardmona has guaranteed full-time employment for at least 500 people at its facility.

The Government's contribution will be phased over three years, and will be attached to infrastructure investments.

If it ceases operating in Shepparton in the next five years, it will give the money back in its totality.

"It's a great day for jobs, a great day for SPC Ardmona, a great day for Shepparton, the Goulburn Valley, and a great day for fruit growers and the future of the fruit industry in Shepparton, Goulburn Valley and Victoria," said Dr Napthine.

SPC 'here for the long-term'

Dr Napthine says the "co-investment" will secure the long-term future for the company.

The company has pledged to grow new markets and produce new products "that better suit the modern lifestyle", Dr Napthine said.

The Deputy Premier Peter Ryan says he is confident SPC Ardmona is here for the long haul.

"They've invested significant funding, already $170 million of their own funds and now another $78 million," he said.

"If they were going to do anything other than what this very obviously demonstrates, they would be doing it now,.

"Well, they're not, on the contrary. We've got an agreement."

SPC Managing director Peter Kelly agrees.

"If closure was something that the board would want to do, today would have been the day for it," he said.

"So I think that's as strong a recommendation as you can get."

Mr Kelly says support from around the country, in particular from consumers, has been unprecedented.

"It has by a very difficult time for us," he said.

If closure was something that the board would want to do, today would have been the day for it. Peter Kelly, SPC Managing director

"We have changed many things about our business, our brands.

"Since we first approached government for help, a lot has changed, and things have been improving.

"At the heart of this improvement is Australian unprecedented support for SPC that we've received from our employees, from retailers all around the country, from our many suppliers of capital equipment and packaging, from Local Government and most importantly, though, from everyday Australian consumers."

He says the company has been severely damaged by "a perfect storm."

"It has been created by external factors not of our making," he said.

"We have a seen a deluge of cheap, imported products being dumped in Australia.

Sorry, this video has expired Video: SPC workers finishing their shift at the cannery (ABC News)

"We have seen an unfair playing field and we have been forced to operate in ways that have hit our profitability hard and this has affected investment the past."

Federal Treasurer Joe Hockey, meantime, says he was unaware that his Liberal colleagues had struck a deal with CCA but stood by his Government's rejection of a co-investment package.

"I don't know what deal has been done between Victoria and SPC or Coca-Cola Amatil, but the bottom line for us was they asked us for $25 million to buy new plant material and equipment," he told reporters in Canberra.

Prime Minister Tony Abbott says he was "delighted" by the announcement, telling Parliament during Question Time that: "We said it didn't need $25 million from the Commonwealth and it doesn't."

Local Federal Liberal MP Sharman Stone, who has lashed out at her Government for refusing the company a grant, says she is relieved by Victoria's decision.

"Those who made the cans, made the packages and cardboard boxes, all of those now literally can breath again and say they have a future," she said.

"The announcement is about the survival of SPC, but it's not just about SPC, but about the survival of Australia's last few processing manufacturer and the survival of fruit processing in Australia.

She says to date, about 25 per cent of the pears have already been bulldozed, along with about 60 per cent of peaches that were destined for the cannery.

"We can turn off the bulldozers today," she said.

"We have a future."

We can turn off the bulldozers today ... we have a future. Sharman Stone, Local Federal MP

But she says the Federal Government still has some serious reforms and changes to work on.

"We have a serious job to do in levelling the playing field for Australians," she said.

"That includes the very seriously flawed anti-dumping regime."

Federal Labor's industry spokesman, Kim Carr, says the Abbott government should have contributed its share to the assistance package.

"Well inferior package has been made to what should have been but it's still an important contribution that's being made," he said.

"Important to maintain capacity and leave open hope of future investment.

Orchardists happy, but taking a 'wait and see approach'

The Deputy Chairman of Fruit Growers Victoria Gary Godwill says the package is a huge relief.

However he says he and his fellow orchardists are adopting a wait and see approach before making any decisions about the future.

"It's certainly looking a hell of a lot better than it was," he said.

"But before I go and plant another variety of fruit and push ahead with the cannery I really need to see some hard evidence that things are improving.

"We're not out of the woods yet."

But he says there is some optimism.

"Not just because of this, but because of the upsurge in demand for the home grown product because of the publicity," he said.

"People are certainly coming on board and buying more Australian produce, especially the SPCA product."

He says it is heartening that consumers are jumping on board.

It is estimated that in the Goulburn Valley region, more than 2,500 jobs are reliant on the ongoing operations of SPC Ardmona.

Topics: food-and-beverage, state-parliament, states-and-territories, food-processing, federal---state-issues, company-news, fruit, rural, agricultural-crops, melbourne-3000, shepparton-3630

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