Consultation with employees started on Wednesday. Photo / George Novak
Politicians, business owners and residents are upset about 160 jobs are on the line in Kawerau, with the potential closure of the paper mill.
This comes after Norske Skog Tasman mill met with its employees to begin consultation on the future of the operation.
The paper mill has been in the community for 65 years.
In a statement issued by Norske's head office in Oslo at the weekend, the company said it had announced to employees and stakeholders it was starting a process to identify alternative production options for its Tasman newsprint mill in Kawerau.
A spokesman for the mill said no decision had been made and consultations will take place over the next few weeks.
E tū engineering, infrastructure and extractions industry council convener and site delegate Bruce Habgood said in the wake of the proposal, there was "lots and lots of uncertainty" for members.
"There's simply lots of uncertainty – until we can get around the table and have some meaningful conversation with the company.
"At this stage there are no guarantees, and a lot of people are in limbo."
More than 150 workers, including 30 E tū members, were affected by the proposal.
Habgood said although many workers didn't live in the Kawerau township itself, any potential closure would inevitably have a further-reaching effect on other local businesses and suppliers.
"The future of work and manufacturing is the issue here – the situation shows how vital industry transformation is and to ensure a just transition for all affected workers."
E tū organiser at the Kawerau mill Raymond Wheeler said the union could not draw any conclusions on potential outcomes because details had not been fully disclosed.
"Our priority is supporting our members – we are there to support both them and the community during the consultation period."
An employee at the Norske Skogg Tasman mill, who requested to remain anonymous, said management started the consultation on Wednesday.
They were informed of two main points, they said.
"The first was that there was a proposal to cease production by the 30th of June and to conclude negotiations with an interested party to purchase all the assets of Norske Skog Tasman. That is the process that is happening," they said.
"The company has said that they will honour all agreements for suppliers, customers and employees. The company is being very, very good to everybody that is a stakeholder in the business."
Local Democracy Reporting understands Norske Skog is seeking feedback on the proposal until June 10 and will cease operations by June 30.
Mayor Malcolm Campbell said he felt sorry for the people who might lose their jobs.
However, he said it was difficult to provide detailed comment until more information was released.
A major concern was that the operation was one of the town's biggest ratepayers, he said.
"The other one is those people that do live in the town, and are ratepayers, well they may have difficulty paying their rates. It is a bit of a blow."
Local business owner Sonia Markham said if the mill were to close, it would be "bloody sad" for the community.
Markham, who has run a property management company in Kawerau for the past two years, said the town was just starting to boom.
"It is really starting to come into its own. My view is that if that happens, it is just bloody sad.
"Not only have we come through this pandemic, we felt very fortunate here because it never hit here. We are all quite passionate about that - because we are very lucky. Then for this to hit the town, I don't know what is going to happen."
Kawerau resident Miria Waretini, 23, said she had been considering applying for a job at the mill.
"My uncle works at the paper mill, and he was actually telling me to give him my CV so I get a job there.
"But it doesn't look like an option now. My uncle has been there well over 30 years."
She said the potential loss of income would take a toll on the workers and their families.
Kawerau retiree Maggy, who did not want to provide her last name, said she was stunned by the announcement.
"It sounds scary, I am actually stunned, I thought it was going well.
"I have been here only three years - I come from Auckland and I have retired. I have realised that it is a big employer for the people here. The town is doing quite well, and we don't want that unemployment."
A Kawerau cafe worker, who requested to remain anonymous, said it was a sad situation and hoped the employees would be able to keep their jobs.
Workers coming to the cafe for lunch on Thursday seemed upset, she said.
Labour MP Tamati Coffey said the potential closure was a "real blow" to the community.
"The mill is a large employer in Kawerau, and many of the community have links past and present to the people that have worked there over the last 65 years and the land underneath it, has a significance to Ngāti Tuwharetoa ki Kawerau," Coffey said.
"I was out there recently and spoke to the management about their situation and was made aware of the many issues that they are going through.
"I will be seeking urgent meetings with ministers to see what can be done. I'll be heading out there again next week to offer support," he said.
Coffey said he wanted to acknowledge the tough times that the workers, management, and whānau would be going through as the future of the mill becomes headline news.
"I've been in close communications with Tane Phillips, the Pulp and Paper Workers Union on-site representative, and will continue to work alongside him to make sure that the workers and their whānau are being looked after through this process," he said.
"Many workers come from the smaller towns outside of Kawerau where the job opportunities are incredibly limited, so this will be devastating news.
"It's a real blow, after the good news this week that the Whakatāne Board Mill is in final discussions with a new owner and the workforce jobs may well be saved," Coffey said.
A Norske Skog spokesperson said the company did not intend to comment further until the consultation was complete and it had the opportunity to consider feedback from employees.
-Additional reporting by Local Democracy Reporting
Businesses say sales have dropped since the road was made one-way.