Food manufacturers warn of carbon-tax job losses, call for imports to be taxed too

Food and grocery manufacturers have spoken out against the Federal Government’s plans to introduce a price on carbon, warning it would make local products less competitive, and therefore should apply to imports as well.

Nestle Australia, Goodman Fielder, Bundaberg Sugar, and Bulla Dairy Foods are among the 19 companies speaking out against the plans and calling for more information.

The Australian Food and Grocery Council chief executive Kate Carnell says the tax would increase the cost of food and grocery manufacturing in Australia, an industry already facing pressure from imports as the Australian dollar reaches record highs.

“Whatever decision is made, the Government must ensure that Australian-manufactured food and groceries will not be made less competitive as a result of the carbon tax,” she said in a statement.

Carnell says manufacturers are also pressured by the price wars between supermarket giants Woolworths and Coles, and higher energy, commodity and wage costs.

A spokesman for AFGC points out that food manufacturing employs more than 280,000 people in Australia, particularly in regional towns, and is four times bigger than the car sector.

The statement follows comments by Climate Change Minister Greg Combet that more than 50% of compensation will be earmarked for households.

But business is mixed on the plans.

A coalition of businesses came out in support for plans to price carbon last week, with trucking and logistics company Linfox among 22 groups publicly supporting the idea.

The others include multinationals (BP, Fujitsu, GE Australia and Ikea), super funds (Catholic Super and Local Government Super), and local companies (AGL and Pacific Hydro).

“Rather than waiting around for the ultimate model, we think it’s important to make a start,” David McInnes, Linfox Group Manager of Sustainability, told SmartCompany.

Peter Strong, executive director of the Council of Small Business of Australia (COBOA), is also calling for more information from the Government.

COSBOA says it would support a carbon tax if it was involved with discussions, and small businesses isn’t asked to pass the costs on.

“We don’t want to be given the extra costs. We want small business to be rebated,” Strong says.

The issue is a sensitive one for the Gillard Government. A survey this morning showed Labor’s primary support had fallen to its lowest point in 15 years. On a two-party preferred basis, Labor came in at 44%, versus 56% for the Coalition. Unions have also signalled a hardline on the carbon tax plans, raising concerns about job losses.