Cadbury is to sack 80 people in Hobart, as the venerable chocolate maker's rocky road rolls on following the loss of a $16 million federal government grant.
The announcement by parent company Mondolez International on Friday coincided with a visit to Tasmania by Prime Minister Tony Abbott, who described the cut as disappointing, and said it was sad the company walked away from the grant.
A Cadbury's spokesman said the timing of the announcement had nothing to do with Mr Abbott's visit, and the jobs would not have been saved by the grant.
Tasmania Labor leader Bryan Green said the Prime Minister should be embarrassed by the turn of events.
In the last election campaign, Mr Abbott controversially offered the money to build a visitor's centre at the 93-year-old Hobart "Home of Dairy Milk".
Mr Abbott's decision to offer the cash to support 200 jobs as part of a $66 million upgrade was greeted with disbelief when a short time later he failed to support Victorian fruit packer SPC Ardmona.
After 18 months of negotiation, Mondolez International withdrew any claim to the $16 million in March, denying it had become an embarrassment, but saying the project failed to meet grant criteria.
Mondelez Australia managing director, Amanda Banfield, said then: "The grant criteria required us to be growing volumes about 20 per cent on site, but today we don't have that kind of volume increase available to us from confirmed export orders."
The company spokesman said on Friday that it employed 600 on site, but would be making shift changes to bring some areas of the plant back from seven to six days, and other areas from six to five days.
He denied suggestions a slump in sales was to blame for the redundancies. "We need to improve the efficiency of the site," he said.
Shadow regional development minister Julie Collins said Mr Abbott had to tell Tasmanians where the money and jobs he promised at Cadbury had gone.
