Senator CHAPMAN (2:18 PM) —My question is directed to the Minister for Industry, Science and Resources. Will the minister advise the Senate how the budget will boost Australia's car manufacturing industry, creating further jobs and investment? Is the minister aware of any alternative policies?

Senator MINCHIN (Minister for Industry, Science and Resources) —I thank Senator Chapman for his very good question. This budget is fantastic news for Australian car manufacturers, and indeed the Australian newspaper summed it up well today with its headline, `Cars on top of Budget winners,' which does great credit to that newspaper. Our decision to allow business to claim full GST input tax credits on their vehicle purchases is going to save Australian business $670 million a year and mean additional throughput for the car industry of about $1 billion a year. It means a business buying a $35,000 car today will save $3,200 in tax.

Australia's four car manufacturers and their workers are the biggest beneficiaries. Almost half the cars sold in Australia are business purchases—70 per cent of those are Australian made and 70 per cent of Australian made cars are bought by business. It is very good news for Australian car makers. The industry itself expects car sales to rise to near record levels as a result of this decision. It is going to mean an extra 40,000 car sales a year alone. Of course, it is not only the car manufacturers and their workers who benefit: component suppliers, car dealers and every business—large and small—that buys cars are going to be winners out of this decision by the government.

This decision simply highlights the benefits to Australian car manufacturing from our overall tax reforms. The single biggest winner out of our abolition of Labor's 22 per cent sales tax is the Australian car industry. It is to the eternal shame of the Labor Party that they tried to stop us removing that 22 per cent tax on cars. Just this morning, we had one of the Labor Party's trade union bosses—Senator Peter Cook's very good friend Doug Cameron of the AMWU—threatening to campaign against the government and its record on manufacturing in marginal seats, which of course terrifies us! Mr Cameron should be campaigning against the Labor Party. He does campaign against Senator Cook, but he should campaign against the whole Labor Party, because it was Labor that voted to retain the 22 per cent tax on Australian made cars. By abolishing that Labor car tax, we have done more for Australian car manufacturing than Labor ever did in its 13 years in office. Cars are much more affordable under us than they ever were under Labor. The budget decision is particularly good news for Mitsubishi in Adelaide, which is working very hard to secure long-term support from its Japanese parent. I note that 75 per cent of the Australian made Mitsubishis go to fleet purchasers.

As a South Australian senator, I was stunned to see another South Australian senator, the Democrats new leader, come out and—and I quote her—condemn our decision to support the Australian car industry so strongly in this budget. South Australia is clearly the state that is the biggest winner from this decision, and Senator Stott Despoja had the hide to oppose this magnificent decision. All South Australians should condemn Senator Stott Despoja for her failure to support a measure which will be an enormous boost to the car industry in South Australia, the state that she represents in this place. Our budget decision on tax credits for car purchases shows demonstrably that it is the coalition, not Labor or the Democrats, which is really standing up for Australian car manufacturing.

Senator CHAPMAN —Madam President, I ask a supplementary question. I thank the minister for his answer. Would the minister also explain the benefits to our environment of the updating of the Australian car fleet which this tax concession will allow?

Senator MINCHIN (Minister for Industry, Science and Resources) —The one thing that really is demonstrable about what we have done to improve car purchasing in this country is that more and more Australians can buy new cars. While Senator Bolkus, who is absent today, is running around trying to buy green votes, we are doing something to ensure that Australian cars are much more environmentally efficient. The newer the car fleet the better it is for the environment. By making cars much more affordable with our tax reforms, it means that Australians are driving safer, more environmentally friendly cars. It is a policy Labor should have supported instead of doing everything it could in this place to oppose it.