'Cheap' consumers blamed as Heinz plant squeezed out

AS WORKERS left the Heinz tomato sauce factory in Girgarre in northern Victoria for the last time yesterday, Australian entrepreneur Dick Smith was cooking up a salvage plan.

He plans to produce his own brand of locally made tomato sauce to help fund a possible buy-back of the closed factory.

Heinz axed 146 jobs in the small country township near Shepparton to move production of tomato sauce and ketchup to New Zealand using foreign-sourced pastes, rather than fresh Australian tomatoes. Last night's shift marked the end of production at the plant.

Chris Lloyd, who had worked at the plant for 18 years, said there were some tears shed.

''We've had one person break down ? I think there'll be a few more before the day is out,'' he said.

Mr Smith described the plant closure as ''a disaster''.

''People don't realise this: you'll go to the country and there will be boarded-up towns there'll be an increasing rate of suicide as people lose their complete income,'' he said.

But Mr Smith doesn't blame the company, the big supermarket chains or government policies for the closure.

The blame, he says, rests squarely with consumers who aren't prepared to spend an extra 20 cents to buy a bottle of Australian-made sauce.

''If you want the cheapest food, everything will come from China or India,'' he said. ''It [the closure] is completely caused by us, consumers.''

Mr Smith says consumers must be willing to pay a little bit more for a locally produced item, as the price factors in Australian wages and conditions, including superannuation, for local workers.

''We have a beautiful tomato sauce from Australian tomatoes but we can't get the supermarkets to buy it from us because we've said it will be about 20 cents dearer, and they say the Australian public will only buy the cheapest of everything,'' he said.

''If I can get a sale [with supermarkets] for my tomato sauce I will jump in my plane and fly down and talk to them [the Goulburn Valley Food Co-operative] and say 'how can we make this work?'''

But whether the local co-op or an entrepreneur eventually secures the plant, it's little comfort right now for workers.

Plant employee Russell Hipwell, who had worked for the company for almost 12 years, said he'd felt a range of emotions on his last day at the factory.

''People have just got to realise that it's not just the workers who work here - it's people outside who are highly affected as well: the farmers, the people who deliver our stock, the people who take our stock away, the people who make our ingredients,'' he said.

A colleague at the plant organised for training courses in road construction and heavy truck driving, which Mr Hipwell, 47, has enrolled for, before the search for new work begins in earnest. ''You've got to keep going, and hold your head up,'' he said.