Alan Ferguson (SA, Deputy-President) Share this | Link to this | Hansard source

My question is to the Minister for Innovation, Industry, Science and Research, Senator Carr. I refer to Ford Australia’s decision to shed a further 500 jobs. Why did the government’s $10 billion announcement today fail to include urgent support to stop the haemorrhaging of jobs in the car industry? Did the minister make any representations to the Prime Minister to include support for the car industry and its associated 60,000 workers in today’s announcement?

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

I thank the senator for his question. There have been media reports that have appeared over the last two days suggesting that there may be further job cuts at Ford beyond those that were announced in August. Until the company is able to confirm or reject those reports, I do not believe it is helpful for me to speculate on the numbers of jobs to be lost. As of August this year, over 60,000 people were employed in the automotive sector, representing some six per cent of the manufacturing workforce. The industry is and will continue to be an important provider of high-skilled, high-wage jobs.

There is no escaping the fact, however, that car makers are under immense pressure globally and that the pressure is also being felt in Australia. The credit crisis, combined with the challenges facing the three American car makers, is making it hard for the local industry to have access to investment funds. That is why the measures announced on Sunday to increase liquidity and to stabilise the Australian financial system are so important. That is why the $10.4 billion economic security package announced today is also important. They will help restore the flow of credit to Australian businesses, including the car industry. Combined with the recent cuts in interest rates, they will help stimulate economic activity and reverse the decline in consumer confidence that has contributed to falling car sales.

The Australian industry may be going through some very difficult times but it is doing a damn sight better than its counterparts are in the United States and in many other countries. Australian vehicle sales declined by 3.1 per cent in September compared to a year earlier. That is much healthier than the results that we have seen in the United States, for instance, where the sales have fallen by 26.6 per cent compared to the same period. In Europe, car sales fell by 16.2 per cent to August compared to the same period a year earlier.

The government has consistently said that Australia is much better placed to ride out the global financial turmoil than just about any other advanced country. That is reflected in the relative strength of our car industry, which increased its exports by some 20 per cent to $5.6 billion last financial year. That does not mean that there will not be setbacks. It does not mean that the industry is not in urgent need of reform. The best thing that we can do about these challenging circumstances is to provide support to the Australian automotive industry and continue to provide a solid policy framework for the future. That is why the government commissioned the Bracks review into the automotive industry. It is essential that the sector continue to reinvent itself and become greener and more efficient globally in the way in which it is able to respond to these challenges. The government is responding to these reviews, which of course will provide a firm foundation for new technological development for the industry’s renewal and for its growth as a cornerstone of Australian industry and Australian society.

Alan Ferguson (SA, Deputy-President) Share this | Link to this | Hansard source

Mr President, I ask a supplementary question. I refer the minister to his response to Ford’s first round of job cuts announced on 22 August. He said:

The Government is paying close attention to the recommendations of the Bracks automotive review and will issue our response shortly ...

Is the minister aware that over 3,200 jobs have been lost in the car manufacturing industry since he became minister? How many more jobs will be lost in the car industry before the government finally acts?

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

The government acknowledge that the industry is facing challenges. The government have been working very closely with the entire industry to ensure that we have a comprehensive response to these challenges. We are not responding on an ad hoc basis. We are in the business of ensuring that the industry remains strategically significant to this country in terms of its contribution to employment. We will be working with the car makers both in their operations here and internationally to ensure that the component suppliers and the unions are able to develop a much more sustainable response to these challenges by ensuring that we move towards a much greener industry in this country. We are consulting with the industry and we are working closely with the industry as part of that process. (Time expired)