Tony Zappia (Makin, Australian Labor Party) Share this | Hansard source

I note the member for Wakefield saying that they are not working hard enough. In this respect I particularly acknowledge the work of David Di Troia, the state secretary of the Liquor, Hospitality and Miscellaneous Workers Union, and the role he has played in supporting Bridgestone employees, most of whom are LHMU members. I am sure that the member for Wakefield and I will be watching this very closely because the last thing we want to see is those workers being given a raw deal of any type, given that many of them have been working at that plant for so long. I know that from speaking to a number of the employees, on the day that we were there, there were people who had been working at that plant for 25 to 30 years, in fact most of their lifetime. For them, I am well aware that it would be difficult to transition to any other form of employment after having spent all of their lives effectively doing one particular job.

I was also pleased to read an announcement only recently, on 16 November, that the GM operations here in Australia, which did survive the global rationalisation and restructuring, are stepping up production. At the Holden plant at Elizabeth they will be increasing the production of their motor vehicles from 310 to 340 cars per day and the global V6 engine facility in Port Melbourne is increasing its engine production from between 240 and 320 engines produced per day now to something like 440 engines per day. It is great to see that because the GM operations here in Australia have always endeavoured to be self-sustainable regardless of their connection to the global operations of the rest of the GM organisation. GMH in Australia has always made sure that they were sustainable in their own right. That has only been because of the terrific working arrangement that has been established between the workforce of GM, particularly at Elizabeth—where I can speak from experience, having gone out there on many occasions—and the company itself.

There is another brief example I want to give which highlights the volatility of foreign ownership. I refer to the video games industry and the company Ratbag Games. Ratbag was quite rightly celebrated as a South Australian success story. Founded in 1993, it became a world leading developer and producer of video games and had titles published worldwide across a range of platforms. The company employed over 50 South Australians in this emerging industry, an industry for which many young people have a passion and aspire to work within as a career. It made the front page of South Australia’s daily newspaper the Advertiser when Ratbag was taken over by Midway Games in August 2005.

Midway Games is one of the largest and most established video games companies worldwide. This takeover was celebrated, with a local company started by a group of friends now becoming part of one of the largest international companies in the industry. In December 2005, just four months after the takeover, Midway closed some of its international operations to cut costs as a result of its financial difficulties. This included the Adelaide studio that had previously been Ratbag, with the loss of over 50 jobs. I understand that many of the former Ratbag employees found employment with other companies in the industry, but we see the same situation where a successful local business through no fault of their own has been closed down. The parent company’s financial difficulties have meant that the decision to close the operation in Adelaide is again made by a far-off boardroom.

I just want to close with a few other issues that are related to foreign investment in this country. One can only speculate as to how often foreign acquisitions are made with the sole purpose of either closing down a competitor or of ultimately transferring operations to an existing offshore facility. It is something that we need to watch, because ultimately it will be the people of Australia that are affected when that happens.

The last matter I raise with respect to foreign investment is the alleged practice by overseas parent companies of structuring global operations so that profits are declared in low-tax countries. This is a practice that is extremely difficult to prove particularly when overseas operations of the same company are charging the Australian operations inflated prices for raw materials, products or services, the clear intent being for the sole purpose of tax minimisation, with Australia again missing out on this legitimate tax revenue.

These are clearly issues that I am sure that the Treasurer is concerned with and matters that have to be taken into account when we consider foreign investments into this country. I know that this bill goes a step further in ensuring that decisions are made in the national interest, and for that reason I commend the bill to the House.

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