If we want to talk ‘war’, let’s have a look at some of the recent battles.
In the lead up to the 2013 federal election, Holden presented a new business case to the Labor Government – an update on a March 2012 deal when Holden agreed to build the next generation Commodore and Cruze in Australia from 2016-2022 and the federal Government, Victorian Government and South Australian Government agreed to provide $275 million in assistance.
In September 2013 Tony Abbott came to power promising to slash $500 million in government funding from the auto industry.
Holden met with the new government on October 2 to once again present their business case. Reports at the time suggested Holden needed an additional payment of between $150 million and $265 million to build the two new models in Australia.
Abbott was having none of it.
“There’s not going to be any extra money over and above the generous support the taxpayers have been giving the motor industry for a long time,” Mr Abbott said in early December 2013.
In Parliament Hockey demanded Holden immediately announce its long term intentions.
“Either you’re here or you’re not,” Treasurer Joe Hockey told parliament.
The ultimatum to Holden came despite the government not revealing its position publicly, having said it would wait for the Productivity Commission’s findings – a preliminary report was to be released 10 days later – before making any funding decisions on the car industry.
GM Headquarters in Detroit decided it could take no more and announced it was quitting building cars in Australia 24 hours after the parliamentary assault. Toyota folded two months later.
Holden says the industry provided direct employment for about 45,000 people and estimated another three to six people were employed in supporting industries for every one direct automotive job. GM also said it invested three dollars for every one dollar of government help.
Professor Peter Fairbrother from RMIT University says the car industry should have been thrown a lifeline.
“It is effectively like a deliberate decision made by a government to move Australia out of the car production industry; it need not have happened.”
The previous government also introduced a number of small business tax relief measures as part of its Mineral Resources Rent Tax (MRRT, or mining tax) legislation. These included:
- the ability to instantly write off asset purchases up to $6,500 in value (up from the existing $1,000)
- instant write-off of the first $5,000 spent on a motor vehicle plus 15% of the rest of the purchase price, and
- ability for small companies that incur tax losses to carry those losses back against profits of the previous year, with a resulting refund of tax paid in that previous year.
As part of the repeal of the mining tax however, the current government proposed to abolish these measures, with effect from January 1, 2014 – a retrospective change that left small business very confused as to what they could claim in 2013-14 as the repeal legislation had not yet been passed.
Then along came the 2015 budget where Hockey informed us that “Small businesses will now be able to immediately deduct new assets up to $20,000.” Except now there was no income from the mining tax to help pay for it.
We also saw the hysteria from the Coalition and their big business buddies about pricing carbon. The Business Council of Australia, Australian Industry Group, Australian Chamber of Commerce and Industry and the Minerals Council issued joint statements condemning Labor’s carbon price.
But the business lobby now seem to have changed their minds with BCA’s Jennifer Westacott describing Labor’s climate change policy as “a platform for bipartisanship.”
Ms Westacott has now decided that “Australia must begin the careful transformation of our economy if we are to achieve our lower emission future. “ To paraphrase Scott Morrison, where the bloody hell were you?
Likewise, Abbott’s vindictive crusade against renewable energy is losing traction.
The Coalition went to the 2013 election with the stated intention of killing the CEFC, reviewing the RET and supporting ARENA. The party also had a solar panel policy, which through generously increased rebates wanted an additional one million homes equipped with solar panels by 2020. But then the backflips started.
The solar panel policy vanished along with their support for ARENA and the RET.
“The government didn’t contact key agencies during its review of RET, and the process was cynically stretched to 18 months,” said John Grimes, CEO of the Australian Solar Council. “The prime minister didn’t take the advice of independent experts. Then the climate commission was shut down. They tried to shut down the Renewable Energy Agency (ARENA), but that failed. So they denuded it – removed $750 million from it.”
In July last year, the treasurer and finance minister directed the Clean Energy Finance Corporation (CEFC), to cease investment in wind farms and domestic-scale solar projects.
We had a Senate committee waste time on looking into wind farm sickness and money on appointing a wind commissioner.
As Mark Butler points out
“In the Abbott-Turnbull Government’s first year, large-scale renewable energy investment fell by a stunning 88 per cent.
Small-scale renewable installations, such as rooftop solar, have also taken a tumble. In the last year of the Labor Government, nearly 413,000 such installations occurred. This year we are on track for 113,000.
This Government has done all it can to destroy this industry. Almost 3,000 jobs directly involved in the renewables industry have been lost under this Government – a sector which should be growing jobs, not losing them.”
This government also purposely “demolished” our NBN (Abbott described it as a white elephant), setting us a long way behind our competitors and denying us the huge potential gains from connecting the whole country to this game-changing technology.
Scott Morrison’s overly theatrical rants about Labor policies are rapidly losing credibility. He brings along his placards with the latest negative campaign graphic attacking Labor with made-up figures and big red crosses but when asked about his ‘economic plan’ all we hear is tax cuts are good – we know this intuitively.
When asked how he will find the $50 billion to pay for the cuts, it will come from a growing pie – something he also just knows.
Where will the jobs come from? Innovation.
What business wants now is certainty to attract investment, not more political tug-of-war where decisions are based on ideology and undoing anything achieved by Labor or automatic opposition to anything proposed by Labor.
Stability is far more important than tax cuts, particularly when public companies in Australia pay an average of 24% on their taxable income, while private companies pay an average of just 19%.
Research groups like the CSIRO need security and protection from political interference in the shape of a venture capitalist who seems determined to turn them into a marketing arm for private enterprise.
And most importantly of all for our future prosperity, we need a government who is willing to invest in our greatest underutilised asset, our human capital. A well-educated, skilled, healthy workforce is the foundation on which all else will be built.
