Labor will reportedly boost the car industry with a $500 million funding to the end of the decade. Source: AAP
PRIME Minister Kevin Rudd makes no apologies for Labor's latest funding injection for Australia's ailing car manufacturing industry, arguing the move provides essential protection for thousands of jobs.
The prime minister announced on Saturday an extra $500 million will be poured into Australia's automotive sector up to 2020, with a view for further support into the next decade.
"I make no apology at all to anybody out there, any right-wing economist, about what we're doing to support the future of Australian manufacturing in general and the car industry in particular," Mr Rudd said during a powerful address to Holden workers in Adelaide on Saturday, when he officially announced the plan.
"We are building Australia's car industry for the future."
The opposition slammed the move as a policy-on-the-run cash splash in response to the government's worsening polls.
"What a humiliating, what an undignified position for the prime minister of Australia to be in," Opposition Leader Tony Abbott told reporters in Perth.
"He sees some bad polls, he knows he's got trouble in his marginal seats so he's charging down the street, waving a blank cheque at the auto industry."
Mr Abbott said the coalition was prepared to offer the car industry a "substantial commitment" and would enter discussions with manufacturers after the September 7 election.
But Mr Rudd said the coalition was on track to strip $1.2 billion from the automotive industry over the next seven years, when what the sector needs is "a predictable, stable investment partner", to underpin the 250,000 associated jobs.
Compared to other car manufacturing countries which support the sector with funding of up to $96 per head of population, Australia offered a modest $18 per person, Mr Rudd said.
Unions welcomed Saturday's announcement and called on the coalition to match the government's new commitment.
But shadow treasurer Joe Hockey said Labor was short-changing Australia's car industry, taking away $1.8 billion with its changes to fringe benefit tax arrangements for business-use vehicles, and handing back $500 million in its latest policy.
The Australian Greens supported further funding for the car sector, but said that in return manufacturers must commit to a more sustainable future and guarantee jobs.
"What we need is some strings attached to this money and those strings need to ensure that the car industry in Australia transitions to electric mobility as quickly as possible," deputy leader Adam Bandt told reporters.
Labor said its pledge is already budgeted for the forward estimates but will require new funding from 2018.
It comes after Holden eyed closing its Australian manufacturing operations, leaving thousands out of work.
Ford recently announced it will close its Australian factories in 2016.
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