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Tuesday, 3 February 2009
Page: 27

Senator ABETZ (2:23 PM) —My question is to the Minister representing the Treasurer, Senator Conroy. How many car dealers facing closure as a result of the government’s bungled unlimited deposit guarantee have received new financing arrangements under the government’s special purpose vehicle announced last year?

Senator CONROY (Minister for Broadband, Communications and the Digital Economy) —Mr President, are we allowed to take a point of order on the relevance of a question? On a day when we have the greatest economic crisis since the war, we are in a situation where you have an opportunity—

Honourable senators interjecting—

The PRESIDENT —Order! There needs to be order on both sides of the chamber. Senator Abetz, resume your seat. I am waiting for order.

Senator Abetz —Mr President, I raise a point of order. We now have standing orders in this place that require the minister to be directly relevant to the question that has been asked. Clearly, the answer being given by the senator for the last 25 seconds or so—about 25 per cent of the time that he is given to answer the question—has been completely off. It has not been relevant in any way, shape or form.

The PRESIDENT —Senator Conroy, you are 25 seconds into the answer. I draw your attention to the question.

Senator CONROY —The government regrets the announcement by GMAC and GE Money to withdraw from the Australian financing market. Both companies stated that the global financial crisis and the financial position of their respective parent companies were the reasons for the decision. The government has moved quickly to work with industry to develop an assistance scheme for automotive dealerships. The scheme consists of a special purpose vehicle to provide liquidity to car dealer financiers, who will then be able to assist dealerships that were unable to quickly secure alternative funding following the announced withdrawal of GMAC and GE Money.

The special purpose vehicle became operational on 1 January 2009. The government will provide support to the SPV in the form of a guarantee expected to cover a minor proportion of the transactions with dealers. The SPV is a transitional arrangement only and will remain in place until viable dealers establish new funding arrangements. The SPV is approximately $2 billion. It will operate with government support refinancing dealerships for a period— (Time expired)

Senator ABETZ —Mr President, I ask a supplementary question. I think that if he looks further into the brief he will find that the answer is zero, but we will try him on another question. Will the minister explain to the Senate the definition of a ‘viable’ business, as outlined in the special purpose vehicle guidelines?

Senator CONROY (Minister for Broadband, Communications and the Digital Economy) —As I am sure the good senator opposite is aware, I represent the Treasurer in this chamber and he has now asked quite a detailed question which deserves a very thorough and detailed response. I will seek that from the Treasurer and provide it to him at the earliest opportunity.

Senator ABETZ —I thank the minister for that answer and I invite him to do the same in relation to the first question I asked him, which he was unable to answer. Mr President, I have a further supplementary question. Given the minister’s previous answers, is it a fact that despite the government’s rhetoric the special purpose vehicle will not prevent dealership closures and job losses in the car retailing sector? Why won’t the government simply come clean and admit that this situation could have been avoided if it had consulted with and listened to the Reserve Bank before rushing to introduce its foolish unlimited deposit guarantee?

Senator CONROY (Minister for Broadband, Communications and the Digital Economy) —As I have indicated, I will seek information to answer that question. I will see whether the Treasurer has any further information that can assist, and I will make it available at the earliest opportunity.