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Tuesday, 9 May 1989
Page: 2044

Senator LEWIS —My question is directed to the Minister for Industry, Technology and Commerce. I refer the Minister to the report last week of the Automotive Industry Authority and his own assessment that if he had been doing an examination and had presented his parents with such a report they would have been less than satisfied. In view of that comment, and the more critical appraisal of the independent commentators about the progress of his motor vehicle plan, I ask him: What are the factors which would give him any confidence that the 1992 report will be more satisfactory from the point of view of Australians who are paying relatively more now for their cars than when the Button plan started? What action, if any, is the Government planning to try to get the car plan back on track?

Senator BUTTON —One of the difficulties about the car plan is that it has never been understood in the Opposition. Over the years I have had a series of questions about it, some suggesting that it is too interventionist and some, by implication, suggesting that it is not interventionist enough. The car plan is providing a framework for structural adjustment of the motor vehicle industry which it never had before under a series of Liberal governments. When a crisis emerged a firm went bad, sacked a few thousand workers, and off they went. Firm after firm disappeared from this country, having had a go at the market. It was a totally unstructured industry. That has not happened in the years of the car plan.

Senator MacGibbon —Ha, ha!

Senator BUTTON —Senator MacGibbon may interject `Ha, ha!' but that has not happened in the years of the car plan. There have been no closures of major firms. Instead there have been mergers and a variety of things of that kind.

Senator Lewis —But you pay $35,000 for a Falcon.

Senator BUTTON —It is very important to understand the level of intervention which is involved in the car plan. It provides a structure. We are not about intervening in the internal affairs of firms and telling them what people they should employ, what technology they should employ, what quality standards they should achieve and those sorts of things. Under the car plan those issues are left to the market. The market increasingly becomes more open as tariffs come down in the context of the car plan.

So I said I was less than satisfied. What was I less than satisfied about? Two particular issues. The first one is price, which Senator Lewis raised.

Senator Lewis —But the prices that must be paid for--

Senator BUTTON —Senator Lewis should stop his mumbling. He asked the question and I will give him an answer.

Senator Lewis —But you are not answering the question that I asked.

Senator BUTTON —If it is unpalatable to Senator Lewis he should just shut up and give a little more time and I will answer it for him.


Senator BUTTON —Senator Lewis understands what I am talking about, including my recent invitation to him. The two issues about which I expressed concern were the prices of motor vehicles and the question of quality. I must say that governments cannot make firms adopt quality standards which we would all like. That is the business of firms in the marketplace. We can exhort firms to do better. We can try to improve labour relations and structural adjustment within the work force. We can try to improve the conditions under which people work. We can try to reduce labour turnover. The Government is doing that in terms of labour market programs which I hope will yield results.

On the question of prices let me say that the report which Senator Lewis referred to drew attention to the fact that for the fourth successive quarter the rate of price increase for both locally produced and imported passenger motor vehicles has been below the consumer price index, that is, four quarters of an improving trend. Certainly car prices are higher than they were when the car plan was introduced. The major reason for that is the devaluation of the Australian dollar. Firms embarked on some practices which from the national point of view I would not approve of in terms of following imported prices up. But the trend is now in the right direction.

Senator Lewis asked me what confidence do I have that we will not get the same sort of report in 1992. It is a measure of the integrity of the car plan that it is an authority appointed under the car plan that has been the most stringent critic of the industry in respect of these matters and has been quite frank in its assessment of what has taken place.

In so far as confidence in the 1992 report is concerned, all I can say is what I have said from the beginning of the car plan. If the industry does not get these issues right they will not be here in 1992 under this Government because we will not shift from what we have said about the car plan.

Senator Bishop —You will not be here either.

Senator BUTTON —Senator Bishop says that we will not be here either. Senator Bishop will be here. I saw on the front of a magazine a week or two ago Senator Bishop in her football gear kicking Senator Puplick downstairs. Senator Chaney is next cab off the rank, I am told. He is just getting out in time. Deft old Fred is just getting out in time. We will be here, Senator Bishop, so do not worry about that. We will not back off on this issue I am talking about. Every experience of Liberal governments shows that they back off when the going gets a bit tough, just like the Liberal Party did on wheat regulation.

Senator Bishop —You are the ones to back off.

Senator BUTTON —Yes, you did. That is why Senator Boswell is looking so pained and interjecting today. The answer to Senator Lewis's question is simply that I have confidence but there is a lot of work to do.