FORTY jobs – equivalent to about ten per cent of the workforce – are to go from the Murray Goulburn factory at Leongatha as part of an organisation-wide change program at the dairy giant.
When the redundancies come into effect at the end of June, the factory, MG’s main plant for retail branded products and a major employer in the region, will be left with 359 employees.
The Murray Goulburn Co-operative’s total workforce is set to reduce by about 12 per cent or 301 positions. This includes: 74 roles previously removed through natural attrition (excluding changes at Rochester announced in March); 168 roles mainly across MG processing sites and distribution centres, including Leongatha, which will be made redundant by the end of next month; and a further 59 head office roles, which will be made redundant by the end of September.
The changes follow a detailed review of MG’s processing sites and head office requirements which examined current work flows and resource allocation and identified opportunities for significant productivity gains.
These changes, according to an MG spokesperson, will improve manufacturing efficiencies and reduce head office costs. They aim to increase MG’s global competitiveness and deliver higher farm gate prices.
MG Managing Director Gary Helou said: “The change program embarked on by Murray Goulburn is even more critical given the recent significant decline in world market prices due to higher global milk supply. This initiative will help reduce the impact of falling world prices and a high Australian dollar on our supplier/shareholders.”
He said that all MG processing sites will remain open and the announced changes will not affect MG’s production. MG will continue to receive all the available milk from its suppliers and continue to supply its customers in the domestic and international markets.
“These are difficult but necessary decisions to ensure that Murray Goulburn can remain competitive. It is in the interests of our suppliers, shareholders, employees, communities and customers that MG remains a strong business into the future. We will continue to invest in programs and initiatives to significantly lower our operating costs, improve manufacturing efficiencies and strengthen our dairy foods portfolio,” Mr Helou said, adding that the changes would make a significant contribution to Murray Goulburn’s goal of reducing operating costs by $100 million this year.
A media release issued by the co-operative states that all employees whose roles are made redundant will receive full entitlements and MG will also support staff with counselling and job transitioning services.
After the changes, MG’s total work force will comprise approximately 2,100 people employed mostly in rural and regional Australia.
Murray Goulburn is Australia’s largest dairy foods processor and marketer and contributes an estimated $6 billion to the Australian economy.
UDV: “A BITTER PILL”
United Dairyfarmers of Victoria (UDV) President Kerry Callow said the loss of 301 MG jobs was a bitter pill for regional Victoria to stomach.
“But it’s a loss that’s been forced upon the company to ensure its survival,” Ms Callow said. “The high Australian dollar, carbon tax, supermarket discounting wars and draining of the Murray Darling Basin have all contributed to this moment.”
“This is a tragedy for many country towns who are already struggling with the uncertainty of other food processing plants’ retrenchments and closures.
“But Murray Goulburn has been forced to find $100 million in savings to remain globally competitive.
“The UDV holds MG to its promise to keep all its sites open and commitment to take all suppliers’ milk. Ultimately this must mean a stronger and more viable MG, given the cost to regional communities.”
VFF President Peter Tuohey said Victoria’s food manufacturing sector was struggling in the face of cheap imports and competition from supermarkets’ house-branding strategy, but state and federal governments were standing idly by.
Heinz, SPC Ardmona, National Foods and McCain Foods have all been forced to close processing plants across south-east Australia.
“Governments have told us we will be the food bowl of Asia, but their decisions are hindering the growth and viability of food processing and manufacturing industries.
“We need government to have a real look at their policies and reassess to make sure they provide real support for processing and agriculture,” Mr Tuohey said.