A Shaky Government's Risky Bet With Taxpayer Money

From a taxpayer’s perspective, the decision by the Tasmanian government to provide financial support to Liberty Bell Bay, a manganese ore smelter owned by Sanjeev Gupta, is perplexing and frustrating. It feels like a handout, particularly given the state’s own significant budget issues.

It all feels a bit too familiar. The Tasmanian government, which has been grappling with a forecasted budget deficit of over $1 billion for 2025-26, is now providing a short-term loan to a company that’s part of Sanjeev Gupta’s GFG Alliance.

We, the taxpayers, are told this is “secured finance” to help get the smelter back to operational status after it paused production due to “ore supply issues” and broader financial problems within GFG.

But let’s be real. “Ore supply issues” and “financial problems” are just code for a company in trouble.

We’ve seen this movie before with Gupta’s other Australian operations, like the Whyalla Steelworks, which has also needed government support. The fact that the owner has a reputation for seeking government funds post-acquisition, and has faced allegations of running businesses into the ground, makes this whole thing feel like a risky bet.

It’s like loaning money to a friend who has a history of not paying people back.

From a taxpayer’s perspective, this is a dangerous game. We’re told the loan is for manganese ore, a critical component for the smelter. But we’ve seen this before.

The optics are terrible.

Why Not Let the Market Decide?

This is where the real frustration sets in. Why should we, the taxpayers, be the ones to prop up a private company, especially when our own state finances are stretched thin?

The 2025-26 budget is already forecasting a net debt of over $7 billion by mid-2026. Schools need funding, hospitals are under pressure, and roads are falling apart. And yet, the government has money to bail out a company owned by a billionaire.

The argument is always about jobs—the roughly 300 direct and 150 indirect jobs that the Liberty Bell Bay plant supports. And yes, those jobs are important to the George Town community. But at what cost? Is it the job of the government to protect every single job in the state, even if it means subsidising a failing business?

It’s a tough pill to swallow when you see public services being squeezed, while a private entity gets a lifeline.

The Political Bedfellows

The Greens’ media release, in its warm embrace of the loan, is striking. Just yesterday, they stood with the crossbench to defeat a Labor no-confidence motion, effectively saving the Liberal government.

Today, they’re welcoming a loan to a company owned by a billionaire with a track record of financial issues.

The timing is too coincidental.

The Greens, who have traditionally criticised corporate bailouts and advocated for fiscal responsibility, are now backing a move that puts taxpayer money at risk.

Their statement about the strict conditions of the loan feels like a necessary justification, a way to square this decision with their principles. It seems less about supporting workers and more about supporting a government they may be on the verge of joining.

A Convenient Consensus

The Liberal government, led by Minister Felix Ellis, frames the loan as a purely altruistic act to save jobs. Their media release is a masterclass in political messaging, emphasising that the support is for “Tasmanian workers and their families,” not for the GFG Group.

They highlight the smelter’s economic importance, citing the jobs and its contribution to the state’s economy.

However, read between the lines, and the narrative becomes clearer.

The government needed a win, a show of stability after a tumultuous period.

The Greens needed to demonstrate their pragmatism and a willingness to work with the government on key issues.

The smelter loan provides a perfect vehicle for both.

It allows the Liberals to appear as job-protectors and the Greens to appear as a responsible party that puts workers first, even if it means bending their own rules.

The Price of a Political Pact

For a taxpayer, this political maneuvering adds a bitter taste to an already questionable decision.

It’s not just about the money anymore; it’s about the potential for a political alliance to be bought with public funds.

The Liberals get to continue governing, and the Greens get to exert influence.

But what do the people get? A risky loan to a private company, all while our own state services are starved for funding.

The rhetoric about “long-term surety” and “bridging a critical gap” rings hollow when the underlying reality is a political deal.

The government’s priority may indeed be to protect jobs, but it seems to be doing so in a way that also protects its own political future.

The True Cost

The real price isn’t just the $20 million loan; it’s the erosion of public trust. The government claims this is about protecting “Tasmanian jobs, Tasmanian suppliers and Tasmania’s economic interests.” The Greens echo this, focusing on the “deeply important” jobs.

But the narrative feels hollow.

It feels less like a genuine act of economic necessity and more like a political transaction.

This isn’t the market deciding, nor is it about true fiscal responsibility. It’s about political survival. The Liberals needed a lifeline, and the Greens, for their own reasons, provided it.

The smelter loan is the first, tangible result of this new, unstated alliance.

We, the taxpayers, are not just bailing out a company; we’re funding a political deal, with our money on the line for a billionaire who has left a trail of financial problems in his wake.

As a long-time contributor to Tasmanian Times, Geoffrey Swan has taken on the role of Acting Chief Editor with a focus on dynamic, independent journalism.

Swan’s background is anything but conventional!

From its beginnings in architecture to concert stage hall management followed by executive leadership at Bell & Howell and Xerox to orchestrating over 3000 major events across Asia-Pacific with one of Australia’s leading event management companies, with a notable event being an APEC summit in Brunei with global leaders President Bill Clinton, Vladimir Putin, and Jiang Zemin.

In a move that highlights his commitment to modern journalism, Swan was one of just 25 journalists from the Asia Pacific region to be invited into the prestigious Product Immersion for Small Newsrooms program at the Craig Newmark Graduate School of Journalism in 2021.

For the past decade, Swan has been a voice at Tasmanian Times, fearlessly reporting on local government, championing transparency and sparking crucial public discourse.

Tasmanian Times (TT) is a community-based news and current affairs service covering the island state of Tasmania. It exists to provide a diverse view of Tasmanian issues. TT creates and supports independent media content utilising the best of modern technologies and tried-and-true practices of public-interest journalism.

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