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

I move:

That the committee does not insist on the Senate amendment disagreed to by the House of Representatives.

How things have changed. In 2002, Senator Minchin said that ‘economies our size would kill to have the sort of car industry we have and that we would be mad to do anything to put it unduly at risk’.

Today, madness reigns. Far from killing for the car industry, the opposition is now trying to wring the life out of it. There is a lot I could say about the Liberal Party’s double standards, its political point-scoring and its indifference to the security and the wellbeing of working Australians, but frankly I think the people of this country will figure that out for themselves.

Instead, let me talk about the radical departure from practice of those opposite and focus on the facts about this legislation. The opposition says that the Automotive Transformation Scheme lacks transparency. They are wrong, plain wrong. In the last year and a half, I have made assistance to the car industry more transparent than it ever was during the 12 years of Liberal Party rule.

In 2007-08, for the first time ever, my department published a breakdown of support provided by the previous government’s Automotive Competitiveness and Investment Scheme. Last night, we heard a lecture from the member for Groom, a lecture about the question of transparency. He had the power to publish the information when he was minister. He had that power since 2003 and he never used it. Not once did the Liberals in government provide the level of disclosure that this government has already provided. We have made ACIS more transparent. We have finetuned the legislation to make the Automotive Transformation Scheme more transparent again. Those amendments have already been accepted by both the House of Representatives and the Senate.

We are proposing that my department’s annual report include the total amounts of capped and uncapped assistance paid to participants in the scheme each year. This is appropriate for a program that provides structural support for strategic investment in research and development and in plant and equipment and the production of motor cars. The disclosure requirements are different for programs that award grants for specific projects, such as the Green Car Innovation Fund. Senator Abetz has tried to blur this distinction with his remarks in this chamber and outside. The opposition is proposing that the government should report assistance to individual companies.

I come back to the question: why didn’t they do this when they were in government? They had the power to do it. Why didn’t they act on it? Not once did they disclose this information. Why not, if it was such a red-hot idea then? Not once did they come close to providing the level of detail this government has provided since last year. We are told by the opposition that the big change all comes down to the imaginary difference between a cash and a duty credit scheme. They say that there was no need to give people that level of information when they were in government because the ACIS only dispensed credits, not cash. That is pure humbug, complete and total nonsense.

ACIS duty credits worked like cash. Each one of them had a face value, a dollar value. Companies amassed these credits and used them to offset the customs duty payable for vehicles and components imported into Australia. If they had more credits than they needed, they sold them. The credits were tradeable. In other words, they converted the credits directly into dollars and cents and the opposition knows that perfectly well. They have always talked about the cash value of ACIS—always. You never, ever heard a Liberal minister say that it was a credit scheme. We always heard that the scheme was at a cash value.

When announcing the current scheme in 2002, Minister Macfarlane boasted it would ‘deliver $4.2 billion to the industry over 10 years’. That is what he said in every public statement he made on the scheme. Now the opposition is suggesting that we need one level of disclosure for cash and a much lower level of disclosure for an instrument that functions in every material aspect exactly like cash. Quite clearly, the opposition’s arguments are self-serving nonsense. They are demanding more transparency from Labor than they provided themselves because our scheme offers cash payments. They are demanding it simply to try to get a cheap populist headline because of their inherent hostility to the automotive industry, because of their contempt for jobs in this industry, because of their contempt for investment in this industry and because of their failure to understand the significance of this industry to the Australian economy, particularly in Victoria and South Australia. The Liberals profess to understand business, but their proposal is an anathema to business.

Project grants are competitive. Applications are assessed, and decisions by government to fund projects are made on merit. That is what we do with the Green Car Innovation Fund moneys. Project applications are published and recognised because of their competitive nature. The ATS is an entitlement scheme. The ATS partially reimburses participants for their investments in innovation, modernisation and the production of passenger motor vehicles. The total amount provided to the car manufacturers to component producers, toolers and the automotive services sector for each ATS will be disclosed, but we will not be providing the business plans of every one of the 193 companies that participate in this scheme. As the federation of automatic products manufacturers have explained—

Eric Abetz (Tasmania, Liberal Party, Deputy Leader of the Opposition in the Senate) Share this | Link to this | Hansard source

Automotive.

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

You understand what it means, do you? That is a big discovery. The Federation of Automotive Products Manufacturers have explained that the Liberal amendments ‘would require sensitive information to be made public, thereby undermining the commercial decision-making processes and the investment decisions’. On Monday night Senator Abetz grappled at length with the fact that companies are willing to make public some details about their operations but not others. He seemed to detect some sort of conspiracy operating on this matter. Senator Abetz might know more about conspiracies than the average senator, but in this instance he is either betraying his ignorance of how business works or being completely disingenuous. Every company makes information public. They shout some things from the rooftops, but they keep some things confidential. Even when he was a suburban lawyer, there were some things about his business he made public and some things he did not. This is an elementary fact of market life.

The automotive industry is highly integrated, and making public sensitive information about industry assistance has the potential to compromise commercial negotiations and decisions about where and when to invest. Remember: this is an industry in Australia that is doing much better than everywhere else in the world but is highly international. So we are not talking just about domestic competition; we are talking about international competition. What Senator Abetz is asking this government to do is betray trade secrets to competitors and companies further along the supply chain. This would have a particularly detrimental effect on small Australian based component manufacturers who are naturally weaker in their bargaining positions.

The Greens complained that the government is offering assistance to international car makers, but that did not stop them voting for the amendment that would give car makers an undue advantage in their negotiations with local suppliers. Their interest in domestic companies seems to wane when it comes to providing assistance to international companies in those negotiations.

Regulations to be made under this bill will give the minister discretion, just as under the old bill, to publish details of the assistance received by individual companies should the need arise. A similar provision, I repeat, was in the ASIS legislation but never, ever used. I have already said it once: we used that provision already in the case of Mitsubishi, and we will do it again in the public interest.

Senator Abetz tried to rationalise the Liberal Party’s latest backflip in terms of their appreciation of how this industry actually works by saying, ‘While certain things were done under the Howard government, we do look afresh at things in opposition.’ Having had a fresh look, what does the opposition really see? This is its chance this morning to have a fresh look at the position it has argued. Does it see that it can put thousands of jobs and massive investment at risk with impunity? Does it see that it can turn a vital industry into a political plaything and never face the consequences? Or does it see that it can jeopardise people’s livelihoods and leave others to pick up the pieces? The Liberal Party may be relishing its newfound sense of irresponsibility, but the government is focusing on the ideas, on the jobs and on the industries of the future. That is why the Automotive Transformation Scheme has been developed. That is what it is all about. And that is why we are calling on this Senate to pass this bill in a carefully considered manner, now that it has come back to us from the House of Representatives.

Eric Abetz (Tasmania, Liberal Party, Deputy Leader of the Opposition in the Senate) Share this | Link to this | Hansard source

One thing that the minister in his long parliamentary career has still not learnt is that hyperbole is no substitute for substance. There is no doubt that we on this side support the automotive sector. We have said we support the legislation. The only issue at stake here is the issue of accountability and transparency. I say to the minister and I say with great respect to the auto sector at large: you are not showing long-term leadership for the benefit of this sector if you think that you can keep on getting away with doing deals behind the scenes without the sort of transparency that the Australian people have come to expect. You are making short-term gain but for long-term pain for this sector. There is out there in the community what I have described previously as ‘auto fatigue’. The Australian people are starting to question more and more how it is that we as a nation are borrowing huge sums of money and then giving $6.2 billion over the next decade or so to the automotive sector.

Do you know the answer to the question: why it is a good investment? It is a good investment if you have transparency and if you require the minister to provide to this parliament on an annual basis the economic benefits, the environmental benefits and the workplace skills benefits that come from that taxpayer investment. But if you do not want to make it known to the Australian people it shows that you cannot really sustain and make the argument.

Turning quickly to the sector, let me say that the FCAI and FAPM are well served by their representatives in Mr McKellar and Mr Reilly. They do a fantastic job for their sector. But guess what? If grants are at stake and you do not have to disclose the grants, what do you expect those particular people might say? They might actually say, ‘We in fact do not want disclosure.’ I can understand that that is their argument and I say to them with the great respect that I hold them in: this is not a good long-term position for the sector. Whilst they might get short-term gain today, it will add to their ongoing long-term pain. I read in the media just this morning, I think, that Mr McKellar—for whom I have a great regard—said:

I could point to a range of circumstances (in other subsidised industries) where confidentiality is respected.

I sought in the second reading debate to get from the minister an indication as to where else that applied. No examples were given. Instead of all the hyperbole this morning, I would have expected the minister to come up with concrete examples of where government grants are not disclosed. He has not given us examples in any way, shape or form. The reason? There is none; there is no example.

What is more, my office then rang Mr McKellar saying, ‘If you can point to a range of circumstances, please name them.’ I am sorry to say to this place—and I do not need any hyperbole for this—that unfortunately Mr McKellar could point to none, other than a Victorian Labor government scheme. This is the way state Labor does business. State Labor has come to Canberra and that is the way it now does business in this place. A minister in the Victorian Labor government appointed former Labor Premier Steve Bracks at $550 a day for a review of the automotive sector. Guess what that former Labor Premier decided in that review? He decided that we needed an automotive ombudsman. Guess who got that job? It was none other than the former Labor Premier Mr Steve Bracks. This time round he is going to be paid $1,100 per day, if my maths is correct. Wait for the ombudsman’s recommendation for another position—which he will undoubtedly get as well—at $2,200 a day. This is the dovetailing of interests of state Labor and the automotive sector. It is not good for transparency, especially in circumstances where the Australian taxpayer is asking more and more whether this investment is really paying dividends. I would like to think that this investment is paying dividends, and that is why I have no difficulty in saying: disclose to the public who is getting the grants and on what basis.

You can go through textiles, clothing and footwear—a similar sector—and all the grants are publicly announced. When I was minister for fisheries and forestry all grants were publicly announced. The trade minister under Export Market Development Grants had all grants publicly announced. So you have got to ask the question: why hide it in this sector? We have not been given a reason. The industry body could not provide one. Mr Reilly, who represents the FAPM, said that the opposition amendment was unworkable. Unfortunately, that is the sort of hyperbole you expect. When you then ask, ‘Why would it be unworkable?’ there is nothing further in the statement that tells us why it would be unworkable. I say again and put on the record that both Mr Reilly and Mr McKellar are good representatives of their sector, and they have argued well for their sector. But I am not sure that it is in the long-term interests of their sector for them to say that the automotive industry is so different that it is worthy of $6.2 billion of taxpayer funding but that the grants should not be announced publicly.

I also indicate that when the minister had a $35 million plan for Toyota to assemble a hybrid vehicle in Australia to announce—a huge and substantial business plan—there was no confidentiality required. Indeed, the minister flew himself all the way to Japan and made a huge announcement: ‘What a great fellow I am! We have partnered with Toyota to assemble a hybrid vehicle in Australia.’ Where was the business disadvantage there? There was none; it was a good media opportunity. The $149 million given to General Motors was also announced with a lot of fanfare. It was a huge business plan announced in relation to the Delta platform. There was no difficulty there. Changing the format of their manufacturing in Australia is a substantial change in business plan. It was publicly disclosed that the taxpayer was going to make $149 million available to it. So there is a lack of consistency in the minister’s approach. Of course, that is what we have come to expect from this minister.

He then tells us that the former government did not disclose the grants that were made to the sector. That is wrong. Grants were made known. But it was previously under a credit scheme, which is completely and substantially different to a grant scheme, as the minister well knows. Those sort of credit schemes have not been publicly disclosed, but the automotive sector and the government, for whatever reason, said it would be better to move from a credit system to a grants system. I accept that. That is their judgement and we are happy to accept that judgement call. But, having made that judgement call, they have got to take the whole package and with every single grant there has to be disclosure.

In the time remaining in this committee stage, I ask the minister whether the disclosure that he says he will provide will show the division between capped and uncapped schemes. He says the answer to that is yes.

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

I will answer you in a minute. Get to your full list of questions.

Eric Abetz (Tasmania, Liberal Party, Deputy Leader of the Opposition in the Senate) Share this | Link to this | Hansard source

I also ask him about if this amendment is to be voted down. Once again, it is not about the amount of money; it is only about transparency. I ask him to refer to page 129 of the June 2009 edition of the standing orders of the Senate, under item 14, were the Senate has voted and required that:

There be laid on the table, by each minister in the Senate, in respect of each department or agency administered by that minister … by not later than 7 days before the commencement of the budget estimates, supplementary budget estimates and additional estimates hearings:

A list of all grants approved in each portfolio or agency, including the value of the grant, recipient of the grant and the program from which the grant was made.

Was the minister aware of that Senate order? Did he tell the auto industry of this Senate order when he told them it would be better to have a grants scheme rather than a credit system? Methinks not. Given the bizarre sensitivity of the auto sector to making these grants public, I ask them rhetorically: would they expect the minister to defy this Senate order? I want to know whether the minister will defy the Senate order in relation to this. Why wasn’t that included in the second reading speech? This government promised transparency. Remember Operation Sunlight—everything was going to be shown openly and publicly; we were going to have freedom of information and you name it; it was all going to happen under ‘Sunbeam Rudd’. Well, the clouds have come over quickly, and they are very dark clouds. We are not going to have any sun shone in relation to these particular grants, which the Senate in fact requires. This has been an order of the Senate for well over 12 months now. As the ATS was being developed, the minister must have been aware of his obligations. Did he tell the industry sector that this would be an obligation and ask whether they would be happy for that obligation to be met—and, if not, whether this was the best way to go?

The minister has asserted that we somehow want to put at risk all the jobs in the auto sector. No, we do not. Transparency does not put anything at risk, other than the integrity of his argument. I think that might be one of the reasons why the minister might be concerned. Let me simply say that, when we left government, we had unemployment at 3.9 per cent. Do not say that we are not concerned about jobs. We had a job-creating record second to none in the modern world—indeed, in modern Australia as well. So do not come into this place suggesting that we will jeopardise jobs because we will not. We believe in integrity and transparency, and I will be most interested to hear the minister’s response to the questions that I have raised.

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

The questions that have been asked by Senator Abetz are easily refuted. Yes, we will be providing advice on capped and uncapped parts of the scheme, and we have indicated that on many occasions. The government have already increased the level of transparency from your administration of the scheme in our administration of the scheme. We have required even higher levels of disclosure under the new scheme. So the ratcheting up of transparency has occurred under this government, not under yours, Senator. Not once did your government provide the level of disclosure that this government has provided. This bill will make more information available on the operation of the Automotive Transformation Scheme.

Senator, you asked me in what other areas we make payments to companies without disclosing them. The R&D tax concession scheme that we run—which, if I recall correctly, something like 6,800 individual firms are registered with—is governed by a piece of legislation which prohibits revealing the detail of assistance, because R&D spending is a sensitive market issue. If I recall rightly, that legislation was actually dealt with under your government and you never amended it, you never sought to change it. It is a specific provision that I am prevented from disclosing support for companies in terms of R&D arrangements.

In regard to the question of the Senate standing orders, what I think you have failed to appreciate, Senator, is the difference between a competitive grants scheme, which we have disclosed and on which we have provided much greater detail than you ever did, and an entitlements based scheme. I put to you, Senator, the analogy of unemployment benefits. Why don’t we provide a full list of payments to the unemployed in this country, individual by individual? Under your interpretation, that is what you would expect me to do. We do not do that, and the Senate standing orders do not require us to do that. The Senate standing orders refer to the payments made as part of the grants arrangements of the government. We are providing payments to the automotive industry. It is an entitlements based payment scheme. By requiring me to reveal that information, Senator, you are requiring me to reveal the business plans of individual companies, to give up genuine commercial secrets that ought to be confidential. It would seem to me that the new Liberal Party does not believe that there is such a thing as a commercial-in-confidence transaction. It seems to take the view that there is no such thing as a genuine commercial secret. That is a perverse view of the way in which market systems operate.

Eric Abetz (Tasmania, Liberal Party, Deputy Leader of the Opposition in the Senate) Share this | Link to this | Hansard source

I always love it when a left-wing senator hectors a conservative senator about how the market operates and their understanding of business matters. I would invite the minister to explain in full detail what advice will be provided. You indicated, Minister, that advice would be provided—well, how much? When? Will it be a one-sentence statement in an annual report or will it be more detailed? Let’s not use weasel words and try to fob off the substantive question by throwing the word ‘advice’ in with a whole spray of hyperbole.

In relation to disclosure of R&D tax concessions, if we are to believe that this Labor government now believes that tax concessions are grants then I dare say that Senator Carr believes that anybody that gets a tax concession or a tax deduction is receiving a grant. That is a nonsense, silly argument. I trust you thought of that one all by yourself, Senator Carr—I doubt the department would have provided you with such information. Clearly tax concessions are not straight-out grants. Everybody knows that and everybody knows that the credit system that used to apply for the automotive sector was not a grants scheme. Similarly, on your argument about unemployment benefits, Senator, you went from the sublime, in relation to the R&D tax concessions, to the ridiculous, in relation to unemployment benefits. You cannot make the substantive argument as to why these beneficiaries of taxpayer grants should not be publicly disclosed as per the Senate order.

You must, undoubtedly, have advice from somebody to tell me that the Senate order does not apply. Can I advise the minister and the Senate that I do have advice, which reads: ‘I can see no reason why payments of assistance made under the proposed Automotive Transformation Scheme would not be covered by the terms of that order’—‘that order’, of course, referring to the one passed on 24 June 2008, which I have previously read into the Hansard. I ask the minister to table his advice in relation to that or, if he has none, to tell the Senate on what basis he made that assertion. Methinks it is like the unemployment benefit and R&D tax concession analogies—plucked out of the air in fright, hoping that somehow it might give him a feather to fly with in this debate. There is clearly no substance in his arguments on these matters.

Let me discuss the issue of the sensitivity of R&D, research and development, and the argument that we should not make any of those sorts of grants publicly available because it would disclose business plans. I would believe the minister but for his senior colleague the member for Grayndler, who on 6 July 2009 issued a media release in which he talked not about big multinational companies but about very small businesses in his own electorate, one of which received $38,000:

… to develop a strategic marketing plan and to research and create better operational/financial procedures for the business. This includes mentoring, updating the communications strategy (an overhaul of the website) and business processes.

What an unwarranted disclosure, an outrageous disclosure, of a small business’s business plan for getting money for research and development. How dare the member for Grayndler make such an announcement. You see, Minister Carr, your argument falls flat—out of the mouths of your own Labor ministerial colleagues. In the press release, he went on to talk about a $36,550 grant:

… to consolidate a brand identity—

very important for business—

and develop an e-commerce profile through a new e-business system and website.

He was broadcasting to the world at large how the company were going to change their mode of operation, how they were going to do business differently. Then there was another one, a grant for $47,600:

… to purchase EMS hardware—

very specific—

and software in conjunction with appointing a business coach to assist in scoping, strategy and procedure manual development and to undertake a system evaluation. These activities will result in improved production productivity.

If it is such a sin to announce government grants for R&D to help small businesses become more competitive, more productive and more efficient, why is it that it is only in the automotive sector that we cannot have the details announced? I am one of those old-fashioned people who in general terms believe that, if you have a rule, it is beneficial if at all possible to apply it across the board, and we in the coalition are of the view that all grants should be publicly disclosed. The minister fell back on the hoary argument that under the ACIS we did not do that. We did not, for one good reason: they were not grants; they were a credit scheme, like R&D tax concessions.

In then trying to suggest that the unemployed were somehow akin to a small business, I think the minister had a point, because with their economic management there is going to be a bigger and bigger crossover between small business and the unemployed—due to their mismanagement. But I think that is as far as the analogy goes, and to suggest that unemployment benefit payments are related to these grant schemes is really stretching credulity. What it does disclose without doubt is that the minister does not have any substance to attack these transparency measures.

I repeat: we support the automotive sector and we support the jobs in the manufacturing sector. But I do detect within the economic commentator community as well as the community at large a growing resistance to these huge sums of money being made available to the automotive sector. So as shadow minister I asked myself a pretty fundamental question: how can we best inoculate against that? The best way to inoculate against that is to put as much information as possible out into the marketplace, have transparency and accountability, and show what the taxpayer return is in real terms, in genuine terms, in relation to the economic sustainability of this sector, the environmental sustainability of this sector and also the workplace skill development in this sector.

I would be very interested in hearing, if the minister could advise us, from whom he obtained advice that the Senate standing order that I read out does not apply to the Automotive Transformation Scheme. I trust it was not from the Clerk Assistant, Procedures, in this place.

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

I repeat, Senator Abetz: if you want to go to the question of motive, why you are doing this, I think it is a legitimate point to argue. You say you support the automotive industry and the 200,000 associated jobs—the 200,000 Australians who earn their living from it—and you support it because it makes such a huge contribution to this country’s research and development and such an enormous contribution to our exports. You say you support all that, but you do the very thing that you know will most undermine that industry.

Senator Abetz, what you are seeking to do is appeal to that right-wing element in the Liberal Party that actually hates this industry, that is fundamentally hostile to this industry. You want to appeal to the editorial writers in the Financial Review and the Australian. It will not save you from the problems you are facing in terms of your approach to your job, the Grech matter or anything else. It will not save you one little bit, because people will go to the heart of what you are really about, and you are about undermining this industry. You are about undermining investment, you are about undermining confidence and you are about undermining jobs for Australians. And this is at the time of the worst possible economic circumstances this industry has had to face since it began in this country—the worst possible circumstances, when competition is at its fiercest and when the difficulties faced by this industry are the most acute.

The fact that we have actually come through this crisis in the shape that we have is down to this government’s ability to work effectively with the industry, so that General Motors Holden has not been treated the way that Opel has, or the way in which we have seen the Scandinavian subsidiaries of Ford treated. Why has that happened? It is because we have been able to develop the appropriate partnerships and get the investment we need—and that is against the determined opposition of people like you, Senator Abetz, and other conservatives within the media who have a fundamental hostility towards the automotive industry and the people who work in it. Be under no illusion, Senator; you will be held responsible for this. You will bear the consequences of your hostility. You cannot speak out of both sides of your mouth simultaneously, because you will be found out.

Senator Abetz, you take a sharply different view from your leader in this place and that is well known. Senator Minchin made a statement on 14 December 2002 and he was not thanked for this then. Mr Costello was furious with this statement because he shared your views and hostility towards the automotive industry. Senator Minchin made the point:

Economies of our size would kill to have the sort of car industry we have got and we would be mad to do anything to unduly put that at risk.

That is exactly what you are doing here today. You asked me on what authority do I say that entitlements grants are different from discretionary grants. Why don’t you have a look at regulation 3A of the Financial Management  and Accountability Act? It clearly defines what a grant is and distinguishes it from an entitlement payment. That is what we are doing here.

Senator Abetz, I know you think you are a bit of a Perry Mason and you have come up with some killer point but what you have sought to do is aim a bullet at the heart of the industry in the name of a populist claim about disclosure and transparency. You are only too happy to work in the interests of our foreign competitors to achieve that outcome. You are only too happy to work in the interests of those who are seeking to undermine this industry. You seem to have this view that motor cars grow on trees. Where do they come from?

Governments all around the world provide assistance to the automotive industry because they know its importance. We are one of 15 countries in the world that has the capability to go from the point of inspiration right through to the showroom floor. How do we do that? Senator Abetz, you seemed to have failed to understand the basic lessons on how a country of our size achieves this. How do we achieve that? How do we sustain the 200,000 Australians earning their living out of this? How do we sustain the production of vehicles of world-class standard? We do not do that by playing political games with the lives of Australians. Senator Minchin understood the principle; you do not. I ask you to talk to your colleagues from South Australia and see what they have got say about the consequences of what you are seeking to do.

You are suggesting to us that tax concessions are not grants because they are entitlements. I could not agree more. Payments made under the ATS are not grants, in the sense that they are entitlement payments and not covered by the Senate standing order. The points you quoted from Mr Albanese were from the government’s announcement for stronger guidelines for the Competitive Grants Program to overcome the corruption that you built into the regional rorts program. That is right—they were about regional grants. They had to be strengthened because of the way in which your government acted in the regional rorts campaign, which demonstrated your total culpability when it came to the alleged disclosure of your political partisanship in rorting a discretionary grants scheme.

That is why we want those disclosed and why we have strengthened the guidelines. That is exactly what this government is doing. We are strengthening transparency but we understand the difference between a competitive grants scheme and an entitlements scheme. We understand that there is genuine commercial-in-confidence information. That is why I do not reveal the detail of every conversation I have with companies in this country. I would hazard a guess that the reason that Mr Macfarlane followed the same practice is because he had the same advice that I had: that to do the contrary is going to kill jobs. Your search for the cheap headline is about killing jobs.

Mathias Cormann (WA, Liberal Party, Shadow Parliamentary Secretary for Health Administration) Share this | Link to this | Hansard source

On a point of order, Temporary Chairman, the President this morning ruled that repeated finger gestures are disorderly. The minister has been making repeated gestures at the opposition frontbench. I ask you to call the minister to order.

Moore Sen Scott (the Temporary Chairman):

Senator Cormann, there is no point of order. I will keep an eye on proceedings in the chamber.

Eric Abetz (Tasmania, Liberal Party, Deputy Leader of the Opposition in the Senate) Share this | Link to this | Hansard source

Given Senator Cormann’s point of order, it may well be advisable for the President to review his statement but we will see how that develops later on. I have news for the minister about the so-called regional rorts that he referred to. The grants that I referred to, and which were announced by the member for Grayndler, his senior colleague, were in fact grants under the Australian government’s Textile, Clothing and Footwear Small Business Program. So much for his argument there: here we have small businesses having their grants disclosed publicly and exactly for what competitive purpose those grants were made.

I think I have been accused of treason, amongst other things, in this spray of hyperbole but as I said at the outset, this minister is well known for his hyperbole and his great difficulty in grasping the substance in any debate. He thinks rhetoric is somehow a substitute for facts in any debate. Mere repetition does not obviate the need for facts and detail in discussions of this nature. I set out at the very beginning that we support the automotive sector. We support the legislation before us. In fact, we have not even amended one of the bills and have allowed it through. The only thing that we seek is some added transparency.

I understand now what the minister is saying: he will be defying Senate order 14 of continuing effect that was passed over 12 months ago. We now have that on the record. He still has not fully detailed what advice will be provided; nor has he detailed to this place whether he told the automotive sector what a smart idea it would be and what the consequences would be of changing from a credit scheme to a grant scheme which would have these disclosure impacts. He was accusing me of supporting foreign companies and trying to put a dagger through the heart of the industry and all that sort of hyperbole. It is all great rhetoric, but did it answer the questions that I raised? Absolutely not.

If you were genuinely concerned about the future of this industry, you would engage in a sober, considered and mature debate on the actual points raised and not just use every opportunity that you could to get to your feet to have a spray at me personally—might I add, against standing orders, but so be it. Even if you are able to chop me off at the knees with all your personal attacks, you do not make yourself a bigger man and you do not do any favours for the industry and the sector. Underlining everything that the minister has said is this: any transparency that we are seeking, which is supported—bizarrely, if I might say so—by the Greens and Senator Xenophon—

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

The Greens are past masters at attacking the car industry. I don’t know why you would—

Eric Abetz (Tasmania, Liberal Party, Deputy Leader of the Opposition in the Senate) Share this | Link to this | Hansard source

There he goes again. We see another example of the minister making a cheap political jibe, unable to get into the actual detail of what is before us. The thesis of the minister’s contribution is this: if you allow transparency in this sector you will be undermining it. Can I say that that is the biggest vote of no confidence I have seen in any sector. For the minister responsible for this sector to say, ‘If we were to allow transparency it would undermine it,’ reinforces all those prejudices out there in the community that I expressed my concern about. That is why I said to the leadership of this industry and to the minister that if you want to have a long-term view of this industry, if you want to provide genuine, long-term support for this industry, you will say that every act of transparency is another brick in the wall of support for this industry because the evidence will be stacking up to show that the taxpayers’ money is being well invested in this area.

The fact that you and, unfortunately, the industry—at this stage, at least—are shying away from that transparency says to the average punter listening to this debate that if it were all made transparent some of the arguments that have been put out would not have the mortar between the bricks to hold them up for the long term. When you build a brick wall without the mortar to set those bricks in place, one on top of the other, to make the argument, all you need is a little push and the whole wall collapses. Sure, you can build a wall a lot quicker without putting mortar in between the bricks. You can do it a lot quicker and say: ‘What a hero am I! Look at the wall I’ve built.’ Some of us take a more conservative approach and say that if you want that wall to stand, to withstand the vicissitudes of economic perils and the vicissitudes of changing taxpayer sentiment, you put the mortar in between the bricks. In our parliamentary democratic system, you do that through transparency. If I and the coalition are to stand accused of seeking to put a dagger through the heart of the industry because we want this brick wall to stand and to withstand the vicissitudes and the winds of change and other things that might buffet against it, so be it. But the short-term rhetoric, the flourishes of hyperbole that we have witnessed, do not actually put that cement in between the bricks and do not strengthen the minister’s arguments.

I put on the record that what it will mean for the long term is a poorer outcome for the automotive sector. That is something that I personally and all my coalition colleagues do not want to see. If we have the transparency and accountability that we are seeking with this amendment, the minister will have to come into this place on an annual basis to say how this investment is leading to economic sustainability, and an argument will have to be made for that. My view is that if the minister cannot point out the economic sustainability, the environmental sustainability or the workplace skills improvements, then—you know what?—it gives this place and the industry a great opportunity to ask how we can reconfigure it so that the Australian taxpayer gets even better value for each dollar invested.

Make no mistake, $6.2 billion is a lot of money to somebody like me. It might not be to the minister. I accept that when you are running a $350 billion debt for this country $6 billion sounds like a very small amount. It is about two per cent of it—if my maths is right—but it is nothing of any great significance to the government. I am sorry, but to the coalition it is. We say that that investment is a good one just as long as we monitor it, just as long as we have transparency and just as long as we have accountability. Personal attacks or rhetorical flourishes by the minister will not undermine that fundamental principle of accountability. What the minister may well achieve today is a win in this place. He may achieve that, but it will not be a long-term win for the industry.

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

I was asked a specific question regarding the nature of the reporting. Section 27A of the bill states:

The Secretary must include the following in the Department’s annual report for a financial year:

(a) the total amounts of capped assistance and uncapped assistance paid to ATS participants under the Automotive Transformation Scheme during the 12 month period ending on 31 March in the financial year;

(b) details of the progress of the Australian automotive industry towards achieving economic sustainability, environmental outcomes and workforce skills development.

That is already in the bill—and it brings into serious question, Senator Abetz, why you are doing this.

Eric Abetz (Tasmania, Liberal Party, Deputy Leader of the Opposition in the Senate) Share this | Link to this | Hansard source

The clause that the minister just read out is labelled 27A, which suggests it was an afterthought—an insertion. The minister should be open and say to the Australia people that the clause was inserted into the bill in response to the coalition amendment. He has come some of the way in relation to recognising the need for this transparency. The minister says, ‘This is a government decision and initiative and we are going to be so much better off,’ but let him admit—and I am sure the minister will not admit it—that the record will show that that amendment was put into the legislation as a result of the coalition going public with three proposed amendments, two of which the government accepted to an extent that we were happy with. The third one has not been met sufficiently, we believe.

If the total amounts of capped and uncapped assistance are provided, I assume that will indicate two figures. I would like the minister confirm that in the annual report, despite 193 different grants potentially being made, only two figures will be stated. As a result, in relation to 27A(b), which relates to the details of the progress of the Australian automotive industry, we will be just given generalised statements rather than details of the real successes where some dollars were spent with a lot greater benefit and return than in other areas. That is what the community wants to know. When you know that sort of detail, you can rejig the scheme to provide and drive even greater productivity, greater efficiencies, greater job security, greater export markets and all the things that we wish for this sector.

So I ask the minister whether I am correct to say that the total amounts disclosed will in fact be two amounts. If not, how many amounts will be disclosed?

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

Under the provisions that I have already discussed, there will be figures for capped and uncapped assistance. There will be figures for the component providers, figures for the toolmakers and figures for the service providers.

Eric Abetz (Tasmania, Liberal Party, Deputy Leader of the Opposition in the Senate) Share this | Link to this | Hansard source

I thank the minister for that answer. Can the minister indicate where in clause 27A that is set out?

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

Those particular details will be set out in the regulations and have been the subject of—

Eric Abetz (Tasmania, Liberal Party, Deputy Leader of the Opposition in the Senate) Share this | Link to this | Hansard source

Senator Abetz interjecting—

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

Senator Abetz, I have already announced those details.

Eric Abetz (Tasmania, Liberal Party, Deputy Leader of the Opposition in the Senate) Share this | Link to this | Hansard source

When?

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

They are on the public record—and it is the current practice as well.

Eric Abetz (Tasmania, Liberal Party, Deputy Leader of the Opposition in the Senate) Share this | Link to this | Hansard source

Just because something is current practice does not mean that, given the change in this legislation, the minister cannot come into this place at a later time and say, ‘I am abiding by the legislation.’ As I read it at this stage, all it says is that capped assistance and uncapped assistance will be advised. Now we are being told all of a sudden about the toolmakers, the component makers and whoever else and that it will be split up even further. I welcome that as a further development in transparency. We know that but for our public call for greater transparency clause 27A would not be in the bill. We also know now, courtesy of the minister, that there may be certain things in the regulations, which, of course, makes my point very strongly: this is once again coathanger legislation where we are told, ‘Trust us with the regulations to do the right thing.’

Our scheme had about 120 pages of legislation; Senator Carr’s scheme only has 20 pages or thereabouts. Of course, his regulations will be a lot more detailed and we as a parliament will not have the capacity to amend them. That is why this is also very much a fundamental principle, because we as a Senate will only have the opportunity to accept or reject the regulations. We cannot amend.

I am also interested to know whether the minister did actually inform the sector as to the consequences of them coming under a grant scheme.

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

The question of coathanger legislation is customary practice here and has become increasingly customary practice—

Eric Abetz (Tasmania, Liberal Party, Deputy Leader of the Opposition in the Senate) Share this | Link to this | Hansard source

Under Labor.

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

No, under you as well. I have a long list of bills that were presented to this chamber as coathanger legislation.

Eric Abetz (Tasmania, Liberal Party, Deputy Leader of the Opposition in the Senate) Share this | Link to this | Hansard source

Table it.

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

I will ask the department to provide you with additional information.

Eric Abetz (Tasmania, Liberal Party, Deputy Leader of the Opposition in the Senate) Share this | Link to this | Hansard source

Senator Abetz interjecting—

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

Senator, you are being unbelievably petty-minded. The question of the transparency provisions is one where I think we have highlighted that you are seeking to exploit what you see as a populist manoeuvre for base political reasons. Our position on transparency has been way in excess of anything you did when in government. The powers we are putting into this bill are the same powers that were in the previous bill. You are seeking to appeal to that element within the press gallery which is fundamentally hostile to this industry, and you are making assertions that there are some secrets that we are seeking to prevent public disclosure of, as if there is no such thing as commercial in confidence for any other part of business.

The Automotive Transformation Scheme, as outlined in this bill, provides for much higher levels of transparency than has ever been the case. At a time of acute international pressure on the Australian industry, we would have a reason to expect the opposition not to take the dog-in-the-manger attitude that you have taken. I say to you, Senator: the reason the industry has expressed concerns about your approach is that they understand what is in the interests of the industry and the 200,000 people in this country who depend upon it. It is unfortunate that you do not. I can only repeat to you, Senator, that you abide by the advice of your leader, who in 2002 made a point about what it would take to damage this industry. I trust you will reconsider your position when this matter is put to the chamber.

Eric Abetz (Tasmania, Liberal Party, Deputy Leader of the Opposition in the Senate) Share this | Link to this | Hansard source

I resume, to finish the debate. We as a coalition do not believe that transparency equals undermining. Senator Carr must have a strange dictionary or thesaurus if he thinks that ‘transparency’ is a synonym for ‘undermining’. We believe that transparency would add to the robustness of the debate about support for the sector, but I note that on two occasions the minister has provided the usual hyperbole, the spray, but not the detailed information that I had sought. Time is getting on so I will not pursue the matter further, other than to indicate that this is an unfortunate short-term decision by the government which is not within the long-term interests of this sector.

Question agreed to.

Resolution reported; report adopted.