Transcript: Radio National 'Breakfast with Fran Kelly' - Holden
11th December, 2013
Warren TrussActing Prime Minister
Minister for Infrastructure and Regional Development
Radio National
7:36am, 11 December 2013
Breakfast with Fran Kelly
FRAN KELLY: The Abbott Government has dramatically stepped up the pressure on Holden about the car maker's future in this country. Acting Prime Minister Warren Truss has written to Holden's managing director, Mike Devereux, demanding an immediate statement clarifying whether the company will continue to operate in Australia. And in a full frontal assault in the parliament, Treasurer Joe Hockey insists Holden, quote, come clean with the Australian people and be honest.
[Excerpt]
JOE HOCKEY: Because if I was running a business, and I was committed to that business in Australia, I wouldn't be saying that I haven't made any decision about its future. Either you're here, or you're not.
[End of excerpt]
FRAN KELLY: Treasurer Joe Hockey. In a moment, shadow industry minister Kim Carr, but first we're joined by the Acting Prime Minister, and National Party leader, Warren Truss. Warren Truss, welcome back to Breakfast.
WARREN TRUSS: Good morning.
FRAN KELLY: Minister, your letter to Mike Devereux noted his comments to the Productivity Commission yesterday, quote, failed to provide a commitment that Holden will remain in Australia well into the future. Have you heard back from the Holden boss?
WARREN TRUSS: Well, not so far but hopefully we will get some kind of a statement of confidence about Holden's future in Australia very soon.
FRAN KELLY: Well, Mike Devereux did tell the Productivity Commission yesterday that Holden has told the Australian Government what it wants, the Government is aware of the figure. That suggests Holden wants to stay and keep operating here if the price is right. Do you believe that they do?
WARREN TRUSS: Well, his statement that there's been no decision made simply really added to the uncertainty. There was no clear commitment that Holden really actually wanted to stay manufacturing in this country, and at a time when there had been widespread speculation in the media, both here and in other places, that Holden had already made a decision to leave, I think some greater level of reassurance would have been appreciated at that Productivity Commission inquiry. It was a chance for Mike Devereux and General Motors to make it clear that they wanted to be in this country, that they were talking to the government seriously about their future, rather than having just made up their mind and looking for a cover for a decision that had already been made.
FRAN KELLY: Well, are they talking to you about the price of keeping of keeping Holden here? There are suggestions that $150 million a year on the table would keep Holden in Australia. Is that what Holden is asking of you?
WARREN TRUSS: Well, I don't think we've had anything that's quite that specific, but bear in mind the Automotive Transformation Scheme has had more than a billion dollars made available to the car industry and there's at least another billion available under the scheme in the years ahead. So the reality is...
FRAN KELLY: But the point was there was going to be $1.5 billion available in the years ahead and the Coalition has wound that back half a million - half a billion. Is that what this is about?
WARREN TRUSS: Well, there's over a billion that's not spent. So to be talking about $500 million that's not - that was never allocated is certainly going way ahead of where we are at the present time. There's still a billion dollars available in the Automotive Transformation Scheme and that should be more than enough money for at least any kind of interim period to respond to what Holden may want for the future. Now, I don't think that this can be a never ending money stream. No industry can survive when it's - if it's going to have to rely on subsidies all along. But let's remember less than two years ago Holden said that it had achieved sustainable profitability in Australia. Now, if it had achieved sustainable profitability in Australia just two years ago, what's gone wrong since?
FRAN KELLY: Well, two years ago though it was also told by the government of the time that there was going to be $1.5 billion in this fund for those five years from 2015 to 2020. Now it's one billion. So the equation has changed.
WARREN TRUSS: Well - and on top of that, the current government has got rid of the $1.8 billion change to the FBT statutory formula that was going to hard hit the car industry and manufacturing in Australia. We've got the legislation into the parliament to get rid of the carbon tax, saving the industry hundreds of millions of dollars as well, so, indeed, this government has put in far more into the car industry than the $1 billion and, indeed, this so-called 500 million which is not even really being called for at the present time.
FRAN KELLY: Minister...
WARREN TRUSS: There's completely adequate funding there to deal with automotive transformation scheme requirements in the medium term and if, in fact, there's a need to deal with other issues, well, that will be a time and place for them to be dealt with.
FRAN KELLY: It's always and always has been a cost benefit analysis discussion for an Australian government when dealing with the car industry, though. The Treasurer and you say Holden have to come clean and outline their future plans. But why isn't it fair to say that Holden's plans relate directly to your policies and your answer on subsidies, which will be given after the Productivity Commission? That's the - that was the whole point of the Productivity Commission, wasn't it, with Ian Macfarlane urging Holden to hold off on a decision until a Productivity Commission reported.
WARREN TRUSS: Well, I think the Productivity Commission can be helpful in charting the course and in identifying how specific amounts of assistance might be provided. But the billion dollars is still on the table.
FRAN KELLY: No more money, that's it?
WARREN TRUSS: So General Motors have got every reason to have confidence that this government has money available that can be used to assist the car industry if a successful plan can be devised to deal with the issues in the years ahead.
FRAN KELLY: So there is never going to be more money on the table for Holden beyond that billion dollars.
WARREN TRUSS: No one can ever talk about never, but what is on the table is adequate to deal with the current needs, comfortably adequate to deal with the current needs. Bear in mind that Ford has already taken the decision under the previous government to leave Australia, so there's less manufacturers now for this money to be shared amongst. We've already lost Mitsubishi in years earlier, so the reality is that there is a significant amount of money available. The key question is does Holden want to participate in the future Automotive Transformation Scheme or have they already made a commitment to leave the country? And I think that Holden owes it to its workers and to the people of Australia to come clean and if a decision has been made, if, as has been reported in this morning's media, all it takes is a mark by a pen of a general manager in Detroit, not even having to go to the board, well, then that further adds to the uncertainty and the question about whether General Motors is genuine in trying to seek a solution to its problems in Australia.
FRAN KELLY: Minister, the Financial Review quotes an unnamed industry source saying that your government is chasing Holden out of the country and the perception is you're the one trying to get cover for the fact that Holden will leave this - leave the country because - as a result of your policies.
WARREN TRUSS: Well, we are - we have already in the short time we've been in government made substantial decisions which will benefit the car industry, specifically things like getting rid of the FBT statutory formula that Labor had proposed, which was going to add $1.8 billion cost to the sector, and what we're doing in relation to the carbon tax. All that makes a huge difference to the bottom line of a car company manufacturing in Australia. So we have a very substantial...
FRAN KELLY: Well, is - I mean, the point for you is, though, is Holden listening? Do you believe Holden has made up its mind to leave?
WARREN TRUSS: Well, we've made very substantial contributions and I think it's time that Holden responded.
FRAN KELLY: Do you think they've made up their mind?
WARREN TRUSS: Well, there is speculation to that effect and I think it's up to Holden to make it absolutely clear to people that they are committed to Australia, that they're looking for a genuine solution, that they want to be fair to their workers in this country, and that the sustained profitability that they claimed they had achieved two years ago can't be continued into the future.
FRAN KELLY: And Minister, just finally, overnight the news from General Motors in Detroit was a new company CEO, their first female CEO, Mary Barra, has been named. Do you think that appointment has anything to do with the prevarication, as you see it, on this announcement of Holden's future in Australia?
WARREN TRUSS: Well, I doubt it. I think that Holden has been working on this issue for a very long period of time and it's time they levelled with the Australian people.
FRAN KELLY: Warren Truss, thank you very much for joining us.
WARREN TRUSS: You're welcome.
FRAN KELLY: Acting Prime Minister and National Party Leader, Warren Truss.
[ENDS]
