ALCOA not to seek further government assistance for its Point Henry smelter

ALCOA will not seek further government assistance for its troubled Point Henry aluminium smelter, dramatically increasing the chances of its closure this year and the loss of 500 more jobs in Victoria's manufacturing sector.

The company revealed yesterday that neither state nor federal aid was being sought for the smelter, despite the Gillard government handing Alcoa $40 million in 2012 to keep the operation near Geelong open.

Its decision to eschew further assistance is expected to make it virtually impossible for the business to remain viable at a time when weak aluminium prices have forced the global organisation to review its operations.

Alcoa's national communications manager Nichola Holgate said yesterday the company, which has been aided for decades in Victoria by generous state taxpayer assistance, would not be looking for further aid for Point Henry.

She confirmed Alcoa had not made an approach for federal assistance and when asked about state assistance said: "No, I can confirm we are not seeking any additional assistance."

Alcoa's decision comes as it reaches the final stages of its review of the plant, expected to report at the end of March, which will determine its future.

It also comes amid a backdrop of angst in the federal Coalition about industry assistance, in the wake of Holden's planned 2017 shutdown and SPC Ardmona's request for $50m to remain viable.

The expected shutdown of Point Henry would be a further bitter blow to the Napthine government's re-election chances, with Geelong key to the outcome.

Acting Victorian Premier Peter Ryan claimed yesterday that the state was having ongoing discussions with Alcoa about what could be done for the company and its workers, adding that if jobs were lost, "a suite of programs" could be activated to help displaced staff.

Aluminium prices have been under heavy pressure since 2012 due to a bigger production role being played in the sector by China and economic challenges in key Alcoa markets.

The $40m offered by the federal Labor government in the middle of 2012 was to keep the operation going until the middle of this year and was seen as an attempt to shore up votes in and around Geelong. The industrial city 75km southwest of Melbourne suffered a blow last year when Ford announced it would close its Australian manufacturing operations in 2016.

With the Coalition making it clear that the era of uneconomical taxpayer subsidies for industry is over, MPs in seats affected by the position have started to position themselves for the fallout.

The Liberal member for Corangamite, previously the nation's most marginal Labor seat, announced yesterday she would be sitting on a review panel with government and business leaders to determine the design of the $100m growth fund set up by the federal government after Holden announced it would stop making cars in Australia after 2017.

Sarah Henderson said the fund, which was established in part to end so-called corporate welfare, would help deal with the fallout of the Ford closure.

"With the demise of Ford's manufacturing operations in 2016, and a black cloud hanging over Alcoa's Point Henry smelter, we are facing very challenging times," Ms Henderson said.