Kim Carr (Victoria, Australian Labor Party, Minister for Innovation, Industry, Science and Research) Share this | Hansard source

I want to respond to the opposition’s amendment. Currently, there are 193 participants in the scheme. We would like to ensure that 193 will participate in the new scheme but, as we know, the state of the industry is such that that number may well reduce.

Senator Abetz, the fact of the matter is that there are genuine commercial secrets. There is such a thing as commercial-in-confidence. That is a reality of commercial life. We are dealing, as I have indicated, with a highly competitive industry and a very large number of companies who are trying to operate in what is an extremely competitive environment. My concern is that the disclosure of amounts in the form that you are proposing may have adverse commercial consequences due to the highly integrated nature of the automotive industry in this country. You will indeed compromise investment decisions. A motor vehicle producer can rely on automotive component producers who, in turn, rely on other component producers, automotive machine toolers and automotive service providers.

Disclosure could well distort commercial negotiations between automotive firms. This is the view of the Federation of Automotive Products Manufacturers. Their concern is that revealing sensitive company information may well have a detrimental effect on a company, particularly when it is conducting purchasing and pricing negotiations with original equipment manufacturers and other companies within the supply chain. This may well disadvantage smaller Australian based component manufacturers, limiting their ability to continue investment in innovation and modernisation. The Federal Chamber of Automotive Industries, FCAI, has told us that, given the significant investments required to develop new products, reporting of company specific payments provides clear signals to competitors of product development and time frames and perhaps the nature of these products. It could be concluded that the business plans of companies may well be revealed by the provision of this information. FCAI believe that public disclosure of this information could compromise the decision-making processes within the parent companies with regard to future investment and research and development decisions within Australia. The coalition amendment—and I take it that Senator Abetz has not deliberately set out to cause this outcome—may well have the unintended consequence of discouraging investment in innovation, especially within the supply chain.

The regulations will contain provisions that will allow the publication of individual assistance, subject to the minister’s discretion. Senator Abetz, that has been the position under your government since 2003. From 2003, Mr Macfarlane had that capacity. Senator Abetz, can you recall the circumstances in which the former minister revealed that information? The answer is no. It did not happen. And the reason it did not happen is that Mr Macfarlane would have received exactly the same advice that I have received. The government has already amended the bill in the House of Representatives to reinforce what I say is already very stringent accountability and transparency requirements of this current scheme.

The amendment is adding new reporting provisions requiring the department to report in its annual report on the total assistance under the scheme and the progress in achieving the bill’s objectives. This demonstrates the government’s commitment to openness and transparency in terms of public expenditure. In addition, clearly and openly details of amounts of assistance provided to the car industry under ACIs for 2007-08 financial year have been published in the annual report. This is the first time that a level of detailed assistance provided to the automotive industry under the current scheme was in fact published—under this government. If this was such a red-hot idea, why did my predecessor not act on it when he had the power? Why did he not seek to use that power in the manner in which you are now asking subsequent ministers to do?

The requirement of separate reporting details of the ATS assistance, as opposed to the department’s annual report, is frankly a duplication and totally unnecessary. The department already prepares an annual report with total amounts of assistance to the automotive industry, which is presented to the parliament on or before 31 October for the previous financial year. This report is prepared in accordance with section 63 of the Public Service Act 1999 and meets the guidelines approved on behalf of the parliament by the Joint Committee of Public Accounts and Audit. So, Senator Abetz, a question arises in terms of your amendment where it clearly and explicitly states that you are requiring the individual details of companies’ payments under a production based scheme. You are in fact asking the government to provide ipso facto the business plan of 193 companies which are participants in this scheme. There would be untold damage to companies should that proposition be accepted. The government will not be accepting your amendment. The numbers are here tonight and it is quite clear that your amendment will be carried and the matter will have to go back to the House of Representatives.