Gillard naive on Ford subsidy: opposition
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MELBOURNE, July 18 AAP
July 18 2012, 7:01PM
Billions in subsidies for the car industry must be tied to transparent benchmarks and tough rules, the federal opposition says.
Opposition industry spokeswoman Sophie Mirabella says Prime Minister Julia Gillard was either naive or lying when she said in January she expected 300 new jobs would be created by a $34 million subsidy for Ford Australia.
Ford announced on Tuesday it would axe 440 jobs at its Broadmeadows and Geelong plants by November, due to a slump in large-car sales.
"The prime minister was either grossly, naively incompetent or was lying," Ms Mirabella told reporters in Melbourne on Wednesday.
"The prime minister needs to explain why she lied about 300 jobs being created with this $34 million, why she did not extract a guarantee for jobs when she handed over this money and why there were no transparent criteria."
The money was part of a $103 million package supplied by Ford's US parent company and the federal and Victorian governments.
The federal government has committed $5.4 billion until 2020 to the car industry.
Ms Mirabella said a coalition government would work with the Productivity Commission and industry to establish guidelines tied to subsidies.
She said the coalition was committed to supporting the car industry but would not say whether more or less government money should be spent on it.
Industry Minister Greg Combet said the coalition wanted to cut $1.5 billion in funding for the automotive industry.
"Labor is committed to working with the industry, as the sector deals with the challenges of a high Australian dollar, increased international competition and changing consumer demand," he said in a statement.
Parliamentary Secretary for Industry and Innovation Mark Dreyfus said the job losses would have been in the thousands if it had not been for the government's intervention.
"You can only imagine what might have been the case had we not provided the support that we've provided," he told ABC Television.
"We'd be seeing thousands of job losses, not hundreds."
Union officials met with Ford on Wednesday in a late bid to stem the job losses.
"Our members are gutted out here. There's no doubt about that," Australian Manufacturing Workers Union assistant state secretary Leigh Diehm told reporters in Geelong.
"The reality is, there was an expectation with large-car sales being down there was going to be some sort of redundancies ... but nowhere near that amount was expected."
A company spokesman said he could not comment on the details of negotiations due to confidentiality arrangements between Ford and the union.
Premier Ted Baillieu said the job losses did not appear to be in breach of any benchmarks tied to the January funding agreement.
"We believe it's important to maintain the capacity of the automotive sector in Australia and particularly in Victoria," he told reporters.
By Melissa Jenkins and Steve Lillebuen