Please Sir, I Want Some More

On King Island where I grew up, it was called the King Island Handshake. These days I call it the Tasmanian Handshake: hand out, empty palm up, Oliver Twist-like "please Sir, I want some more [free money]"

It goes like this. Big business (note, it's never small business) tells Government that they are going to close and sack x-hundred workers unless they get a better deal on energy prices; or perhaps just give us some cold, hard cash instead. Government swears not to be bullied by big business into giving in to their demands, but ultimately falls over itself to do exactly that.

Hence on Thursday, after months of threats and promises not to be bullied, we saw the unedifying sight of a cavalcade of politicians of all shapes and colours, from the Prime Minister and Premier down, jostling for the limelight at Bell Bay Aluminium in the State's north. For the small price of just $200 million of your money, these politicians proclaimed, they had "saved" 550 jobs. Crude maths tells you that's more than $360,000 per job, and that's before the secret cut to the company's Hydro electricity bill, down further from a rate apparently already about a quarter of what regular Tasmanian households pay.

And don't dare anyone mention that the owner of Bell Bay Aluminium, Rio Tinto, made a profit of $US10 billion last year.

In all, over the past few years the Tasmanian Government has pledged more than $170 million in cash and loans to big business in Tasmania to try and keep them afloat. Apart from the Bell Bay Aluminium example above, there's been $30 million to zinc smelter Nyrstar, a $15 million loan along with $4 million cash to the paper mill at Boyer, and nearly $25 million in a futile attempt to "save" Liberty Bell Bay.

Meanwhile, the Tasmanian state budget is forecast to be in a deficit of nearly $600 million this year (well, you can add another $20 million a year to that now), net debt is forecast to reach nearly $10 billion, and the Government is aiming to shed 1,700 jobs by the end of the decade (yes, that's a little over three times as many jobs as they just "saved" at Bell Bay).

Yet, as far as I can tell, not a single politician, state or federal, questioned the multimillion-dollar Rio Tinto handout. Those not blessed to be there in person for the announcement rushed out their support via media release or social media, mostly somehow trying to claim credit for it. No one even asked the somewhat obvious question: why is the seriously cash-strapped Tasmanian Government paying half of the contribution (not to mention the electricity subsidy) when the Federal Government's pockets are so much deeper?

Earlier in the week I even heard former State Greens leader and now MLC for Hobart Cassy O'Connor calling for a deal to "save" the business. It seems while Ms O'Connor and her Green colleagues are desperate to lead the pitchfork brigade against a new industry that is actually offering to pay rack rate for our power, and doesn't want cash handouts (AI data centres), even to the Greens endless subsidies for polluting aluminium smelters are a-okay.

With apologies to Lambassador Sam Kekovich, you know it doesn't make sense.

The pity is that we already know how this story ends, because we watched it just a few months ago. Barely a kilometre from Thursday's photo opportunity sits the now closed Liberty Bell Bay: nearly $25 million of your money, 200 jobs gone anyway, and a $20 million pile of manganese taxpayers apparently now own, but which nobody can process. The Tasmanian Handshake didn't save the factory. It just delayed the inevitable, and sent us all the bill.

Bell Bay Aluminium now has another five years. Does anyone seriously think Rio Tinto won't be back in 2031, palm up, with the same threat and a bigger number? Why wouldn't it be? It worked. Frankly, I wouldn’t be surprised if they came back earlier asking for more.

And it isn't only smelters. Let's not forget the biggest boondoggle of them all – the Macquarie Point Stadium. The AFL, a business turning over more than a billion dollars a year, offered the same sort of "deal": no stadium, no team. So the Tasmanian taxpayer is up for a $1.2 billion (and counting) stadium and a $105 million "High Performance Centre", not to mention $12 million a year in cold, hard cash on top of that to help fund the team.

Of course, the rules are rather different if you're not big enough to hold the State to ransom.

A month or so ago potato processor Simplot, in the words of one farmer, "bullied" Tasmanian growers into accepting a 2.5 per cent price cut for their spuds. The response of Primary Industries Minister Gavin Pearce: it's a commercial matter and he couldn't possibly intervene. Perhaps so. But the power contract between Rio Tinto and Hydro Tasmania was a commercial matter too, right up until it wasn't.

None of this is to say the 550 workers at Bell Bay don't matter. They do. So do the 1,700 people whose jobs the Government plans to shed to repair a budget that can't afford the Bell Bay handout, and the tens of thousands of hard-working Tasmanian small business owners who seethe with anger every time they see free taxpayer cash being offered to big business.

It's easy to spend money when it isn't your own. Until someone in Parliament is prepared to say no, the palm will stay out, and we will all keep on filling it.

• BRAD STANSFIELD was Chief of Staff to Premier Will Hodgman and is an owner of this newspaper.