The federal government has thrown Holden workers a $100 million lifeline, but the deal was swiftly labelled “pathetic” and “manifestly inadequate” by South Australian premier Jay Weatherill.
Prime Minister Tony Abbott announced the government would contribute $60 million towards a new fund to support regions impacted by Holden’s decision to stop producing cars locally by the end of 2017.
The Victorian and South Australian governments will each contribute about $12 million and Holden will be asked for $20 million.
The details of how the money will be spent will be worked out in talks between Industry Minister Ian Macfarlane, the two states and industry groups, but the fund won’t start operating until the 2014/15 financial year.
Mr Abbott also announced he would chair a task force to develop a national industry agenda – which would consider such issues as the future of Toyota and its supply chain – to make recommendations to the government by the end of June.
“I believe that manufacturing is a vital part of a strong economic future for our country,” he told reporters in Canberra. “We’ve got the problem in the motor industry we are dealing with specifically today. But, in sector after sector, Australian manufacturing is continuing to do well.”
South Australia enraged
South Australia Premier Jay Weatherill says the Commonwealth should contribute much more to help create jobs in the state’s manufacturing sector and the wider economy.
“The federal government’s response to the closure of Holden is pathetic,” Mr Weatherill said after the deal was announced.
“The federal government doesn’t understand the urgency of responding to this and they don’t seem to care. Prime Minister Tony Abbott didn’t speak to Holden workers, didn’t speak to component manufacturers and their workers.
“This is manifestly inadequate help for workers making a transition into new jobs.”
Opposition leader Bill Shorten joined Mr Weatherill in criticising the package, saying arrangement treated Holden workers and the car sector with contempt.
“Today’s announcement from Prime Minister Abbott is woefully inadequate,” Mr Shorten said in a statement. “It shows a prime minister who continues to treat workers and businesses in the automotive sector with absolute contempt.”
Holden to pitch in
Holden has indicated it has set aside at least $100 million for costs relating to the wind-down decision and workers will be eligible for employment support through Job Services Australia.
Mr Macfarlane will head two reviews, in SA and Victoria, to look at ways to boost the states’ economies with reports due in February.
Among the options are retraining workers, shifting federal government agencies to regional areas, new infrastructure projects and ship building.
Mr Abbott said he expected Holden would continue to use some federal money already allocated to assist its manufacturing operations.
The prime minister said it was time to end piecemeal decisions in relation to industry assistance.
“No country has ever subsidised its way to prosperity,” he said.
Private companies struggling to survive had to get their houses in order and better manage their costs, he said.
“We are not here to build a field of dreams. We are here to make sensible, economically responsible decisions.”
Asked whether some Holden workers would struggle, Mr Abbott said: “Some of them will find it difficult, but many of them will probably be liberated to pursue new opportunities and get on with their lives.”