Mark Butler (Port Adelaide, Australian Labor Party, Shadow Minister for Environment, Climate Change and Water) Share this | Hansard source

Last December, I think it was, I came across a car industry executive who was leaving the ministerial wing here in Parliament House—someone from South Australia whom I knew. I had a quick chat to him and it is fair to say he was ashen faced. What he said to me was not about the detail of the discussions he was having with the government at the time but about his deep concern that the ministerial wing was populated with people who just did not understand the manufacturing industry. It is important to say this was not about the Minister for Industry, Ian Macfarlane, who I think everyone in the parliament, across the chamber, recognises understands manufacturing very well. He was very concerned that the very senior ministers to whom the industry was talking at the time, as Holden's fate hung in the balance, simply did not understand how supply chains work; manufacturing, particularly the automotive sector; and the multiplier effect that operates, particularly in the car industry. The member for Hughes did not really go to that point. But, perhaps most importantly, from my perspective, simply do not understand the degree to which urban communities have grown up around and depend upon and are nurtured by manufacturing industries in cities like Adelaide, Melbourne and other parts of Australia.

I want to talk about the impact that this bill and the associated policies of this government, the associated decisions of this government, particularly in the automotive industry, will have on communities that I live in, that I have the privilege of representing, that my family has lived in for many, many generations. The impact of policies made in this place on community when it suits them is a favourite topic of those opposite. A favourite topic of the Prime Minister was to stand up and say the carbon tax would wipe Whyalla off the map, would wipe Gladstone off the map. It is a favourite topic when it suits them. But I want to talk about the very, very serious impact that this bill is going to have on communities in Adelaide.

I have had looked speeches made by my colleagues: the member for Wakefield, who represents the northern suburbs of Adelaide where the Holden factory is located and where so many supply companies are also located; I have seen the speech by the member for Makin, who understands this deeply and has responsibility for the opposition in this area; I listened to the speech of the member for Corio from Geelong, who understands that deeply; the member for Hotham; and a number of others. I will not go over the ground that they covered in talking about the return on investment and the comparison of the support—the coinvestment that the Australian government makes and has made for many years to the car industry compared to those other small number of nations that actually are able to manufacture a motor vehicle from the design table to it rolling out into the showroom. I know that if you look at those figures, Australia's support—the support from taxpayers to that industry—is significantly lower per capita than nations like the United States, Germany and many, many others.

My electorate encompasses a range of suburbs in what is known as Northern Adelaide and also the north-western suburbs of Adelaide. Over the last several months in particular, but over the last few years as the future of the car industry has been deeply uncertain, I have talked to so many members of those communities at functions, at street corner meetings on Saturday mornings about the impact that that is going to have. It is not just the northern suburbs and the north-western suburbs that will be impacted by this bill and associated policies; it is important to say that the car industry and the manufacturing sectors that have been able to spring up around that hub of the car industry have been utterly central to South Australia's fortunes, particularly Adelaide's fortunes, really for the better part of 100 years.

Holden, as the member for Hughes described it, is now part of a multinational car company. For a long time—not anymore, but for a long time—the largest car company in the world, General Motors. But it began as a family business about 150 years ago in Adelaide doing work for horse-drawn carriages. It very quickly set up its operations in Port Adelaide in the heart of my electorate and transformed from a horse carriage business, as the car became increasingly ubiquitous in modern society, and became a car supply company. About 100 years ago it decided to move into car body building and in 1924, about 90 years ago, Holden, still in a family company, set up the largest car body building factory outside of North America and Europe in Woodville, just a couple of kilometres from my house and my children's school, actually. It is no longer a car factory; it is now Bunnings, which I think gives you a sense of the transformation of the world economy. But back then it was the largest car body building factory outside of North America and Europe.

The fortunes of Holden really changed in the 1930s for Adelaide. South Australia's economy was hit as hard as any economy in Australian by the great depression due to its very significant reliance on commodity products, particularly primary produce at the time. Its economy was very, very deeply hurt. At the same time, Holden, which suffered a big hit to the demand for its products, decided to seek support from overseas companies and was then bought out in 1931 by the American company General Motors, which still owns the Australian operation. At the same time Holden decided to consolidate its operations around the country and had pretty much a signed a contract to move all of its Adelaide operations to Fishermans Bend in Melbourne. Had that happened, the economy in South Australia, particularly in Adelaide, already devastated by the great depression to a greater degree than most parts of Australia, would have been even more devastated.

The state government at the time did a lot of work to convince Holden to keep their operation going in Woodville. I will not go through the list of policies that were put in place. Suffice it to say that that process really sparked the industrialisation of South Australia—the diversification of an economy that had been so overwhelmingly reliant on primary produce with a bit of manufacturing on the side became the sort of industrial powerhouse for the country that we knew it to be, starting in the thirties and continuing in the postwar government, particularly of Tom Playford and later. I am sure it is only coincidence that Ted Holden was elected at about that time to the legislative council, too, which I am sure helped cement his commitment to the state of South Australia.

That postwar shift in production methods, that postwar economic boom in Australia, allowed a company like General Motors Holden, around the country but including in Adelaide, to start to become more ambitious. Instead of just building car bodies essentially for overseas designs to put together in other factories, as we know very well, Holden became the first company to put together a car from scratch in Australia, rolling off the assembly line in Fishermans Bend in 1948 with a body built at that same factory I talked about in Woodville.

The member for Wakefield talks about this passionately and often. It was then decided that, from the operation in Woodville in the old north-western suburbs of Adelaide, we would build a new suburb called Elizabeth then in the far north of Adelaide and that that suburb would not only deal with the postwar boom, the migration boom and also the baby boom, but it would also be a suburb that would house its massive expansion in the car industry. That suburb was built in 1955 to pre-empt the building of the new Holden factory in 1958. Around that hub, a whole range of supply companies—to take up the member for Hughes' point, and I am sure the Minister for Small Business will be interested in this—and countless small businesses sprang up in the Elizabeth area and the northern suburbs. They all, at the end of the day, depended on the stone that was dropped in the pond from the Holden factory, which was the behemoth in those northern suburbs. Generations of families have worked at Holden ever since—they have either worked at Holden or they have worked at the different supply companies that I talked about. My stepmother's mum, her dad and her brother all worked at Holden. Countless times I have gone to street-corner meetings, especially since the decision taken in December, to talk, particularly, to men—because it is still a predominantly male workforce in the automotive sector—whose fathers worked there, whose sons work there today or who hope their sons will be able to get a job there. These are good, secure, stable, relatively well-paying jobs that really underpin the economy of the northern suburbs of Adelaide. There are even bigger numbers in the supply companies.

This is not just in the northern suburbs. If you know the geography of Adelaide this is also in the north-western suburbs, where the bulk of the electorate of Port Adelaide is; that is where I live. Within two kilometres of my house there are four factories I can think of which are car component factories dependent upon the work of Holden and of Toyota in Victoria. These are the particular targets of this bill. We had hoped that these companies would be able to change and diversify their products to do something other than supply the Australian factories of Toyota and Holden. No-one underestimated the challenges involved in that diversification, given the degree to which factories are tooled to a particular purpose, but that already very difficult task is made so much harder by this bill.

The Minister for Agriculture, in question time yesterday, got up and had a great old time enjoying himself trying to point out how many members on that side understand the farming sector and how many members on the opposition side understand the farming sector. It is great entertainment when the Minister for Agriculture takes up precious time in question time doing that! But frankly I am not confident that members sitting around the cabinet table today—again, other than the Minister for Industry, for whom there is a great deal of respect in this parliament—or for that matter, members in the broader caucus of government, have a great deal of understanding of the significant degree to which so many communities in the north and north-western suburbs of Adelaide and parts of Melbourne depend on this manufacturing industry, not only for their economic fortunes, but for their social strength and cohesion.

This bill and the decisions going back to December will have a devastating impact on those communities. I am not confident that is well appreciated or understood by those opposite, which is why it is so critical to keep the Automotive Transformation Scheme in place and properly funded. There are thousands of workers in my electorate—not at Holden; the decision has been made at Holden—who rely for the chance of a job post 2017 upon the ability of their companies to transform. That is the purpose of this scheme—to be able to transform and diversify; to take the opportunities that are out there in the rest of the world and supply the manufacturing industries and primary manufacturing companies that are now elsewhere.

In government our investments ensured that Australia, and South Australia particularly, maintained its automotive industry in the face of the GFC and the high Australian dollar. The schemes we put in place and the approach we had in government was based on the idea of co-investment. They were based on the idea that, if the taxpayer brought in money, the multinational companies to which the member for Hughes referred would also have to put in money and give assurances about long-term certainty. It was not a handout; it was an investment. Not only was there co-investment in the direct manufacturing sense, to underpin jobs, but we also know the automotive sector was the largest spender on research and development in Australia's manufacturing industry for many years.

For a government that before the election claimed to be able to create a million jobs, they are going about it in an interesting way. The Prime Minister said before the election: 'I want to see car making survive in this country, not just survive but flourish.' Unfortunately, as I recall it, he then went away and left things in the hands of the Treasurer. And what was the Treasurer's treatment of Holden, a company that had in good faith decided to enter into a process started by the Minister for Industry and involving the Productivity Commission? The Treasurer stood up in this place and in the media and goaded Holden—a company which, whether under the ownership of General Motors or as a family company, had for 150 years underpinned the economic fortunes of tens of thousands of Australians.

We oppose this bill because this is the last hope for so many companies and so many thousands of workers to accept what has happened with Holden and Toyota but have the chance to see their company and their industry transform, diversify and create economic opportunity for thousands of families into the future.

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