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Tuesday, 23 June 2009
Page: 3997

Senator CAMERON (2:17 PM) —My question is to the Minister for Innovation, Industry, Science and Research, Senator Carr. Can the minister update the Senate on the progress of the government’s A New Car Plan for a Greener Future? How are the car plan and other Commonwealth initiatives helping to maintain jobs and business activity in the automotive sector? What contribution has the small business and general business tax break made to restoring market confidence and boosting sales?

Senator CARR (Minister for Innovation, Industry, Science and Research) —I thank Senator Cameron for that question. The government’s priority since the day that we came to office has been to provide this vital industry with certainty. Even before the world was gripped by the recession, the car industry was facing acute pressures. That is why we announced A New Car Plan for a Greener Future in November last year. We took decisive action and, as a result, the Australian industry is now ahead of the game. Total vehicle sales and sales of Australian made vehicles both rose in May compared to April. Sales of commercial vehicles were especially strong. Industry observers attribute this to the government’s small business and general business tax break. It allows a 50 per cent bonus of tax reduction for assets purchased by small business. The Federal Chamber of Automotive Industries says:

The business tax break is proving extremely effective, providing a much needed boost to vehicle sales and stimulating economic activity.

The tax break allows small businesses to claim a deduction of some $28,590 on the purchase of a $60,000 vehicle plus their normal depreciation, which, in this example, would be some $14,295 over a full year. This is about providing the stimulus needed to keep people in work and to keep businesses going through the global downturn. There are more tough times ahead, but there is no question that the Australian car industry is heading in the right direction.

Senator CAMERON —Mr President, I ask a supplementary question. Can the minister inform the Senate how industry has responded to the government’s efforts to transform car making in Australia? What level of support does the A New Car Plan for a Greener Future enjoy amongst stakeholders, and how have workers and unions responded to the challenges facing the sector?

Senator CARR (Minister for Innovation, Industry, Science and Research) —We have set out to create in this industry a partnership based on mutual obligation. Managers, workers and the unions are all working closely with the government to produce the best possible outcome for the automotive industry. The research sector is also involved, including through the Automotive Industry Innovation Council. The government’s investment of up to $6.2 billion in the car plan is expected to generate three times that amount of money in new industry investment. Everyone in the automotive sector is sharing in the sacrifices needed to maintain the skills and capacity until the economic upturn returns. This is a perfect illustration of what can be achieved through dialogue and cooperation. This is the key to the success of our industry policy and stands in sharp contrast to the position taken by the conservatives when—(Time expired)

Senator CAMERON —Mr President, I ask a further supplementary question. Can the minister explain to the Senate how the situation in Australia compares with experience overseas? How well are the domestic industry and the domestic market weathering the global recession? What further steps will the government take to maintain the momentum of reform and modernisation in the automotive industry, something that lot never did in their whole—(Time expired)

Senator CARR (Minister for Innovation, Industry, Science and Research) —Thank you, Senator Cameron. Thanks to our new car plan, the Australian industry is better placed than most to come through this difficult period in much stronger shape. General Motors has indicated that Holden will be an integral part of the new GM. This is especially significant, given the brutal effects of General Motors bankruptcy on workers, on suppliers and on dealers in the United States. The Automotive Transformation Scheme Bill is to be introduced to the House of Representatives this week, and it is designed to consolidate Australia’s advantage. This is a test for those opposite. Are they going to stop whingeing and wringing their hands, or are they going to support this legislation? Are they going to support this strategic industry? Are they going to support the tens of thousands of Australians who rely upon this industry for their livelihood? When are we going to hear from this opposition as to what they actually support rather than what they oppose? (Time expired)