According to Networks NSW, a total of 2,750 jobs will not be funded next financial year across the NSW electricity distribution network, including 1,100 at Ausgrid, 250 at Endeavour Energy and 1,400 at Essential Energy. The losses come as a result of the Australian Energy Regulator’s (AER) decision to cut network funding.
Networks NSW CEO, Vince Graham, has briefed electricity industry unions on the consequences flowing from the AER’s final decisions released on 30 April, 2015 and began discussions on how to best address the workforce impacts.
“Ausgrid, Endeavour Energy and Essential Energy had proposed to the AER a progressive reduction of 2,200 jobs through to 2019 as part of our plans to continue to drive necessary efficiency reforms and keep downward pressure on electricity charges for customers,” Mr Graham said.
“Those proposed job reductions were in addition to the 3,700 administrative and frontline positions we have already safely removed, or will safely remove, between July 2012 and June 2015, as part of sweeping business reforms.
“Unfortunately, the AER rejected Networks NSW submissions for a transition period and in its final determination on 30 April imposed a retrospective cut, backdated to July 2014, of $1.622b or 25 percent less operating expenditure across the three networks through to June 2019.
“The AER also declined to provide any funding for the redundancy costs the network businesses are legally required to pay under existing Fair Work Commission certified enterprise agreements.
“Last week, I said we expected a minimum of 2,500 current jobs would not be funded by the AER’s determinations in 2015/16.
“Now that we’ve absorbed the detail of the AER’s decisions, and because of the AER’s decisions, we expect 2,750 jobs, or one in four positions, will not be funded in 2015/16, including 1,100 at Ausgrid, 250 at Endeavour Energy, and 1,400 at Essential Energy.
“These numbers do not include 652 voluntary redundancies and 50 external agency positions expected to be finalised with employees before the end of June this year (496 at Ausgrid, 115 at Endeavour Energy and 91 at Essential Energy).
“Today, we began discussions with industry unions on the steps we might take to sustain a safe, highly skilled and customer-focused workforce, including the number of current apprentices we will be able to employ after they graduate.
“I have proposed to our unions that we should implement:
- A wages freeze for all management and award employees for two years with savings used to fund the employment of up to 509 suitable graduating apprentices under fixed term agreements until December 2016. This will give apprentices some continuity of employment when they do graduate
- A new skills retraining and redeployment program to support our excess employees to transition to new jobs in other organisations.
- The development of a revised redundancy policy to be incorporated into new enterprise agreements to better align the future size of our workforce with the capped funding determined by the AER.
“We also know that aspects of our current enterprise agreements are simply not competitive. Unless we are able to constructively deal with this issue, more jobs will be at risk as we continue to pursue safe and effective ways to streamline our operations, including outsourcing opportunities.
“These are difficult circumstances for our people and they deserve our support and respect. No one’s interests are served by ignoring the challenges ahead.”