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Abbott's $100m Holden recovery package

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Prime Minister Tony Abbott today declared an end to subsidies for struggling industries, as he unveiled a manufacturing task force and a $100 million fund to encourage investment in businesses that could employ former car workers.

In the wake of the announcement of the Holden closure, the Prime Minister will personally head the taskforce, which includes the Treasurer, Industry Minister and Trade Minister.

“What we’re not going to do is throw good money after bad,” Abbott said.

“We will spend on economically responsible projects.”

Abbott conceded, however, that subsidies will continue to be paid to Holden and Ford while they wind down.

“Some monies will continue to go to Holden while they continue to manufacture, and the same for Ford,” he said.

The $100 million investment fund will be jointly funded: $60 million from the Commonwealth Government, $12 million from the Victorian State Government, a yet-to-be-confirmed “similar amount” from the South Australian Government and $20 million from GM Holden.

Premier Jay Weatherill slammed the package, saying Abbott did not appear to understand the urgency or the enormity of the Holden closure.

He said Abbott didn’t show any empathy to automotive industry workers and their families.

“The Federal Government’s response to the closure of Holdens is pathetic,” he said.

He criticised the size of the package and the fact that the funds would not begin to be distributed until the middle of next year, saying the Federal Government did not appreciate the need for immediate action.

“We will be taking our steps and those steps begin tomorrow through the calling together of an automotive industry roundtable,” Weatherill said.

He said former Labor government minister Greg Combet, appointed by Weatherill this week to oversee the SA Government’s response to the Holden closure, would present a plan to the roundtable. The State Government would be proposing new measures to the Federal Government, and would campaign for “the things that we need to transform the automotive sector” and look after the workers and their families.

“We’ll be asking for the resources that match it,” he said.

Weatherill said he would negotiate with the Federal Government until South Australia received what it needed.

The Federal Government had not responded to his request for fast-tracked spending on infrastructure, such as the Torrens-to-Torrens South Road upgrade.

Abbott said it would be wrong to focus on the car industry’s woes when other parts of manufacturing were advancing.

“You’ve got to get your house in order.

“I don’t want to focus on the car industry.

“Our manufacturing can do well; if we get conditions right to do it better in the future.”

Addressing the media outside his parliament house office, Abbott said that while he felt some concern about the impact of Holden’s closure on its workers, there were opportunities ahead.

“I don’t want anyone to be defeatist about the capacity of workers to be creative.

“Mitsubishi workers had some difficult times.

“Others have had a rebirth of their working lives.

“I dare say some (Holden workers) will find it difficult but many will be liberated to pursue new opportunities and get on with their lives.

“The majority of these workers will be able to adapt … but we must recognise that for many of them, there will be some difficult times.”

Industry Minister Ian Macfarlane said he would immediately call for expressions of interest and meet with industry groups and companies to discuss proposals for use of the $100 million fund.

The minister said the previous concept of subsidies had not worked, saying he was amazed at the “parlous state” of some manufacturing businesses.

“I see money thrown into buckets which really has no impact on the long-term viability of companies,” he said.

– additional reporting by David Washington

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