By James Wells
Diageo Australia managing director Tim Salt has confirmed it has cut 60 staff members nationally or one-eighth of its workforce since the implementation of the RTD tax hike and has also cut all casual workers from its Huntingwood factory in Sydney.
"Diageo certainly has suffered as a business because of the RTD tax hike," Salt told TheShout.com.au.
"We really value our people, they make our business what it is. But when we have to lose staff as a result of a tax policy based on budget politics that is not achieving its stated intention of addressing alcohol misuse, it is particularly hard," he said.
Salt said the impact of the tax has been felt right down through the product supply chain and that throughout the months following the tax increase, Diageo had to impose reduced production hours and extended the time it shut down its Huntingwood plant for routine maintenance.
"Sales of RTD products have been hit hard, with the category down by over 20 per cent. Three-quarters of our RTDs are actually dark-spirit products such as Bundy and Cola consumed mainly by mature males. These consumers have become the victim of what the Government claims is a tax intended to address teen binge drinking," he said.
“As a result of the tax impact, Diageo has had to reduce costs across the business over the past year. This includes implementing restrictions on staff travel and other overheads. Where possible the company has avoided implementing job cuts, but since the tax increase, it has had to take out over 60 roles, approximately 12 per cent of the organisation. In addition to these job losses, Diageo also had to release all casual labour from its manufacturing plant in Huntingwood.”