Abbott gives cold shoulder to more assistance for Holden

Prime minister Tony Abbott has reacted coolly to providing government support for car manufacturer Holden. AAP

Prime minister Tony Abbott has declared Holden will receive no new injection of taxpayer funds and called on the company to declare its intentions, amid reports it is planning to pull out of Australia by 2016.

In hardline comments on industry policy the Prime Minister has also reacted coolly to suggestions that the government should financially help the embattled Qantas.

In market guidance, Qantas chief Alan Joyce has said the airline expects a first half pre-tax loss of A$300 million and will shed 1000 jobs as it battles deteriorating sales.

“If we subsidise Qantas, why not subsidise everyone? And if we subsidise everyone that’s just a bottomless pit into which we will descend,” Abbott said. “And if we offer a guarantee to Qantas, why not offer a guarantee to everyone?”

Abbott said he wanted Holden to stay and the motor industry to survive in Australia. “I do wish Holden would clarify their intentions because at the moment they’ve got everyone on tenterhooks,” he said on Fairfax radio.

The government would provide the support it promised in the election for the car industry, “but 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”.

Abbott believed Holden was weighing its options “and I think they owe it to the workforce, they owe it to the suppliers, they owe it to the people of Australia to say what they’re doing – are they staying or are they going?”

The government’s job was to try to make it easier for all businesses to compete. “That is the best thing that we can do for the businesses of Australia, not chase them down the road waving a blank cheque at them.”

Half a billion dollars a year was available to the motor industry, he said. “There’s more than enough money there on the table … there is no more.”

But Labor industry spokesman Kim Carr said: “Where else in the world would you find a discussion going on as to whether or not you want an automotive industry? It’s truly extraordinary that only in Australia do you have this bizarre discussion as to whether or not we want to keep these jobs.”

Asked about Qantas, Abbott said that ultimately all governments had to be pragmatic about these things “but Qantas has to get its house in order.”

“Qantas is a private company. Yes, it’s an iconic company and yes, it is the national carrier but it is a private company and it’s incumbent upon all private companies to run themselves effectively and profitably, and that’s what Qantas has to do.”

He said no specific proposal had been put to the government by Qantas.

Asked whether the government would be willing to legislate to allow majority foreign ownership in the airline, Abbott said if Qantas put that proposition to the government as a way forward which would not impose a cost on the taxpayer, “we’d be happy to look at it, but they haven’t come to us with the proposal”. The Qantas Sale Act requires Qantas to maintain a 51% majority of Australian equity.

“The preference, always, would be to have the company in majority Australian hands but if it’s a choice between a greater foreign stake in Qantas and taxpayer subsidy, I ask the people of Australia, what do you prefer?” Abbott said.

“Do you prefer to be paying through your taxes for Qantas or do you prefer to have it slightly more in foreign hands than it is?”

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