The South Australian government is pushing for a key industry assistance program for the automotive sector to be restructured to give more companies at risk of closing their doors access to the remaining federal funds on offer.
The South Australian minister for automotive transformation, Kyam Maher, used an appearance before a Senate hearing on Friday to attack the Abbott government’s actions earlier this week concerning the immediate future of the automotive transformation scheme (ATS) – and also to press for a fundamental redesign of the assistance program.
On Tuesday, the industry minister, Ian Macfarlane, said the Coalition would not proceed with plans unveiled in last year’s budget to axe $500m from the ATS between now and 2017.
The backflip recognised the reality that the budget measure was blocked in the Senate, and it was also an attempt to boost the Coalition’s flagging political fortunes in South Australia.
But the announcement was badly fumbled.
The Adelaide newspaper was briefed ahead of time that $900m was back on the table, then Macfarlane clarified the amount was actually $500m, then other government sources said the funding was actually more like $100m because the industry is winding down in anticipation of the exit of the car manufacturers in 2017.
Maher told the hearing Tuesday’s announcement had caused significant confusion, given estimates of the funding on offer were different “depending on which Liberal was leaking at the time”.
He said the funding on offer presently was “entirely inadequate” to help the components industry transition beyond the time Holden was due to quit Australian shores in 2017.
Maher argued the Abbott government needed to reinstate $900m for the ATS – the entire budget for the scheme out to 2021 – and allow companies to use the funds on offer to help their diversification either into global supply chains, or into other industries entirely.
SA officials said current indications suggested 20% of tier one components firms would survive if they continued with their diversification plans. “We are very firm in our call for the $900m to be spent,” Maher said on Friday. “And very broadly we would like the ATS broadened to allow for diversification.”
Liberal senator Sean Edwards asked Maher whether he was prepared to confirm that the industry was operating under exactly the same policies that had been in place under the previous federal Labor government.
The SA minister contended there was a world of difference. “If the current government hadn’t chased Holden out of Australia, we wouldn’t be here today,” Maher said.
