I have an op-ed today in the Australian Financial Review on the bureaucracy’s decision to keep details of how the government doles money to multinational car companies secret. The decision comes off the back of Freedom of Information requests from the AFR. I argue:
Every taxpayer dollar that enlarges the revenue and profits of a corporate welfare recipient needs to be justified. And with Holden collecting subsidies valued at $89.7 million last financial year, a figure that perfectly mirrors its profit, there are serious questions to be asked about subsidy levels.
While the local car industry has done a very good job of extracting unearned profits from the hip pockets of taxpayers, it is important to understand the principle is not just about the car industry:
The same principle applies to all industries that enjoy government support. As the Productivity Commission’s 2011-12 Trade and Assistance Review outlines, total government assistance to industry is estimated at $17.7 billion. The beneficiaries ranged from renewable energy to food manufacturing.
But there is something special about the changing nature of subsidies to the car industry:
Throughout the Rudd and Gillard governments, the objective of these subsidies has changed from assistance to wean companies off tariffs to “co-investment” … Co-investment is about achieving a public interest through private companies, in effect making taxpayers pseudo-shareholders in these companies and their future.
And there is an even more important question that goes to the integrity of political decision making:
The same car companies that receive subsidies with public money are concurrently striking very generous deals with ALP-affiliated unions for their members.
When taxpayer’s money is shoveled into car companies at one end by the government and the car companies then shovel it out the other end under generous agreements with affiliated unions to the party that governs the country, there are serious questions to answer. The AFR should be commended for doggedly pursuing the doling out of corporate welfare to a declining industry that holds the Australian taxpayer in contempt.