Senate debates

Monday, 9 December 2013

Matters of Public Importance

Automotive Industry

5:29 pm

Photo of Bridget McKenzieBridget McKenzie (Victoria, National Party) Share this | Hansard source

It must be preselection time. Anyway, ultimately the decisions made by Holden and Ford are made in foreign boardrooms with their only consideration being profits, and there has been significant risk to those profits placed on those foreign entities by the past government, the carbon tax being one of them. It is a classic case of crocodile tears about manufacturing job losses when one has been listening to the rhetoric of those opposite, bemoaning the automotive job losses, as they are, and claiming that those of us on this side of the parliament are not concerned about job losses in manufacturing.

Our former member for Indi, Sophie Mirabella, was very loud about our concern about manufacturing job losses under the previous government, and that continues now that we are in government to ensure that our manufacturing industry remains strong and is released from the burden of the carbon tax imposed on it by the past government. It is the same tax that they are using refusing to support us in rescinding. But we are going to keep our commitments in government. We want a viable car manufacturing industry in Australia and the Prime Minister has made that clear and the minister has stated our support. We have a plan of how to deliver a sustainable car manufacturing industry going forward and it is important to follow due process, so that all the details are properly considered—and that is why we made it very clear going into the election. We knew there was an issue and we stated what we were going to do about it and we plan on going forward with that commitment.

As for the Productivity Commission review, Senator Kim Carr stands up and critiques that approach. He critiques the strategic response, the holistic response, towards the crisis within car manufacturing in this country. How typical of the former minister that came up with the plans that he did! Who can forget the Green Car Innovation Fund or the multitude of other responses across a range of portfolio areas that his government was quick to have a thought bubble over but nobody actually sat down to do the strategic hard work of working out a plan for the long term for the 21st century—and that is exactly what this government plans to do under Minister Macfarlane. We have been consulting with car makers and with the components industry, and that will continue until we have the full report next March. We have also moved quickly to remove another burden that the former government had placed on the car industry as we got rid of Labor's $1.8 billion fringe benefits tax albatross and we are moving quickly—as we are trying very hard in this chamber—to get rid of Labor's carbon tax, which adds up to $400 to the cost of every vehicle manufactured in Australia. If Labor were even half sincere it would get on board with our positive actions to strengthen the economy and boost the prospects for car manufacturing. Senator Carr has also made reference to the sovereign risk scenario and situation at the moment. Labor belted the car industry when it was in government. Senator Kim Carr, in his book this year, said:

Unfortunately the—

Green Car Innovation—

Fund was abolished, leaving international company executives wondering just what they had to do to get a consistent government policy commitment in Australia.

So if we are worried about sovereign risk and if we are worried about increasing the risk level that foreign international investors and boards are considering as they consider their investment and their businesses within the Australian context, then really even Senator Carr recognises the risk that the former government posed particularly to international car manufacturers' operating plants in Australia.

The government, unlike Senator Carr, respects the in-confidence nature of the discussions that we, as a government, are having with automotive industry officials, and we are going to continue to do that. But it is not a new issue. Australian cars account for less than one in 10 new vehicles purchased. When Labor took office, the vehicle production in Australia was over 335,000 units a year. When they left, it was down to 221,000 units a year. I wish Senator Carr were still in the chamber hearing the concerns when we consider he presided over a 34 per cent decrease in the amount of Australian car manufacturing. This has also had a major adverse impact on the automotive supply chain. When Labor took office, there were over 200 businesses in the supply chain. Now there are fewer than 150, and over 25 businesses that were in the supply chain are no longer in business—many of them located in regional Australia. The previous government cut assistance and then cut it again. As I said, we are committed to working with industry. What I would like to put on the record is that we are continuing to support the automotive industry.

Senator Farrell interjecting—

Listening to the opposition you would think it is at zero, Senator Farrell. But, no, we are just simply not increasing government assistance. We are continuing government assistance; we are just not increasing it. We are going to implement all of our election commitments including reducing the Automotive Transformation Scheme by $500 million. Something is wrong and we recognise that, which is why we set up the Productivity Commission review into the automotive manufacturing industry, and I am looking forward to its report, which will actually look very widely into the sustainability of the industry, and I encourage unions and the small manufacturers that support the wider industry community actually to have input into that process as we move forward to the reporting date in March. So we do recognise that there are significant challenges as our automotive industry does adjust to the high value of our Australian dollar and a highly competitive and fragmented market in this particular sector, and we have been working hard with industry.

The leasing industry was blindsided by the previous government's approach to the fringe benefits tax and almost immediately was hit with job losses—so here we are with those opposite not concerned about the job losses incurred under the previous government across a whole range of industries and sectors and I find that a little ironic. There were also claims that the policy of the previous government, with regard to the fringe benefit tax on cars, would see a decrease in Australian manufactured cars by more than 100,000 cars a year.

I briefly want to talk to some comments made by Senator Carr with regard to government assistance given to a variety of industries. He made some claims about agricultural industries where he said that the estimated effective rate of assistance measured as the value of assistance as a proportion of value-added primary production, in all its forms—sheep, aquaculture et cetera—is 3.3, whereas motor vehicle and parts is 9.4. It is simply false for Senator Carr to come into the Senate and quote misleading statistics.


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