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Thursday, 26 September 2002
Page: 4991

Senator GEORGE CAMPBELL (12:45 PM) —Labor basically support the ACIS Administration Amendment Bill 2002. We are happy to give the bill non-controversial status to expedite its passage. The bill is very important to the automotive industry and Australian manufacturing in general. However, we hope the government will be able to release the Productivity Commission's final report on industry assistance and its own response fairly soon so that there can be a proper debate on the directions in which the government intends to take this industry. This will enable decisions to be made early enough so that the industry can have some security about the decisions that it has to take with respect to future investment in the industry.

Labor have already provided an initial response to the commission's position paper released in June. Labor support ongoing assistance to the industry beyond 2005. We are also interested in revamping ACIS to give greater emphasis to research and development, training and investment in the industry. The Productivity Commission has argued that there is no need to amend ACIS. Their view is that it is basically a subsidy regardless of where it is delivered. We disagree strongly with that view of ACIS. Our view is that the revamping of ACIS to give greater assistance to R&D and greater focus on investment and innovation would send a strong positive signal to the industry and provide greater assistance to those activities which are crucial to Australia building its competitive niche in the global automotive sector. Labor also see some merit in the suggestion to have separate pools for the capped component of ACIS, as well as for car makers and their suppliers.

On the issue of tariffs, Labor have called for another review in 2006-07 to determine post-2010 assistance arrangements. The Productivity Commission's own economic modelling has shown that the national gains of reducing automotive tariffs below 10 per cent would be negligible or even, in respect of this industry, negative. We have also argued that future assistance arrangements for the car industry should not be conditional on supporting the government's industrial relations war. It is our view that it was a cheap political trick for this government to try to link its industrial relations agenda to future support for an industry which is of such critical importance to the Australian economy. To do so brought no merit to the government and created consternation among the leadership of the industry. It could have created some concern among those leaders of the industry who were considering substantial future investment in automotive production in this country. But the leaders of the automotive industry did not fall for that three-card trick and they continued to pursue their argument for support for the industry into the future, separate and distinct from any issues relating to how the industrial relations environment in the industry should be progressed.

Even the Productivity Commission has argued against making a link between industry assistance and the pursuit of the government's workplace relations agenda. Labor's view is that the convening of roundtable discussions involving the auto industry and unions to achieve cooperative solutions to future workplace relations issues, including the forthcoming series of enterprise bargaining, would be the most effective and constructive way of dealing with the industrial relations issues that this industry has to comply with. One should also understand that this is an industry that has complex and fragile supply chains. There is an interrelationship not just with the plant producers but also with the auto component suppliers, who manage production in this industry on a just-in-time basis. If the industry had fallen for the clumsy attempt by the government to use future support for the industry to create an industrial relations environment that would have been confrontationist then the potential damage to this industry and to its markets could have been substantial. As I said, the Labor Party basically support the bill and we are happy to give it non-controversial status.