Abbott Offers $100 Million Employment Fund For Car Workers

In the aftermath of the announced departures of Ford and Holden, Prime Minister Tony Abbott today announced a $100 million employment fund for Victoria and South Australia.


Details of the assistance package won’t be decided until the second half of 2014 but Abbott said the money would be spent on “economically responsible” projects.

The federal government will provide $60 million whilst Victoria and South Australia will each contribute $12 million. Holden will be asked to provide $20 million.

Abbott said he would chair a taskforce to examine issues of concern to the manufacturing sector, including the future of Toyota.

The Prime Minister made it clear that the government was reluctant to provide more corporate welfare. “In the end, no government has ever subsidised its way to prosperity,” he said.

Abbott made the announcement at a joint press conference with the Minister for Industry, Ian Macfarlane.

  • Listen to Abbott’s press conference – transcript below (34m)

Media release from Prime Minister Tony Abbott and Industry Minister Ian Macfarlane.


Australia has a strong manufacturing history and will have a strong manufacturing future.

Today, the Government is announcing a wide-ranging industry initiative comprising targeted support for regions impacted by the wind-down of Holden’s manufacturing operations by 2017; reviews of the South Australian and Victorian economies; and development of a National Industry Investment and Competitiveness Agenda which will focus on our strengths, create jobs and exploit our competitive advantages.

Transitioning from heavy industrial manufacturing to higher value added production calls for a national, strategic response rather than a piecemeal one based on hand-outs and subsidies.

The Federal Government understands that South Australia and Victoria have acute pressures due to the departure of Holden and Ford.

Still, they are not alone and Australia’s manufacturing industry faces challenges across the board.

Industry policy in Australia must become proactive to ensure that our manufacturing industry is competitive and incentivised to create jobs and investment.

We will deliver support for the workers and communities impacted by the recent automotive closure announcements but will do so based on state specific economic recommendations so that scarce Budget resources can be deployed to grow the economies in both states.

To support the reviews, the Federal Government’s response will include the development of a $100 million growth fund to support economically responsible initiatives in regions facing pressure in their manufacturing sectors.

The fund will support business and research and development opportunities and will complement the direct support available to Holden workers as part of existing Commonwealth and Holden support schemes. We will also work to ensure that automotive workers have their skills and competencies recognised and certified.

The fund will be administered by the Department of Industry and commence in 2014/15. The fund will provide:

  • Support for existing component manufacturers in Victoria and South Australia to adjust their business output or business model to non-automotive and overseas customers, or who commence or expand export activity;
  • Grants to existing and/or new businesses that establish or expand manufacturing operations in South Australia or Victoria, with preference for those businesses that employ former automotive workers; and
  • Grants to aid the commercialisation of research and development in the automotive component manufacturing sector, leading to new products or processes.

The final design of the fund will be informed by the outcomes of the reviews, consultation with the South Australian and Victorian Governments and advice from the review panels.

The Australian Government will contribute $60 million to the fund and the Victorian Government will contribute $12 million. The remainder will be drawn from the South Australian Government and our expectation is that Holden will make a contribution.

GM Holden has indicated it has set aside at least $100 million for costs relating to the wind-down of its Australian manufacturing obligations. Holden workers will also be eligible for employment support with a Job Services Australia provider as part of the Automotive Industry Structural Adjustment Programme.

Two reviews of the South Australian and Victorian economies will commence immediately and report to the Government in February 2014. The outcome of the reviews will support the work of the COAG Industry and Skills Council.

The reviews will develop support plans that are local, practical and take into account challenges facing South Australia and Victoria.

Both reviews will be chaired by Industry Minister Ian Macfarlane. They will include MPs and industry leaders in the South Australian and Victorian business communities.

The reviews will look at ways to boost the competiveness of the South Australian and Victorian economies by:

  • Encouraging investment and innovation in high growth sectors in the affected regions;
  • Further investing in infrastructure to boost productive capacity;
  • Where appropriate and cost effective, relocating Commonwealth public service functions to the affected regions;
  • Considering the most pressing concerns of the shipbuilding industry;
  • Supporting the diversification of automotive supply chain companies; and
  • Supporting the training and redeployment of workers displaced by closures.

Australian Government infrastructure investments in both states could also be brought forward should the State Governments agree and where projects are ‘shovel ready’.

More than $1.5 billion has been set aside for South Australian infrastructure projects over the next six years and $6.5 billion for Victorian projects. We will continue discussions with the Victorian and South Australian Governments to determine suitable projects that could be fast-tracked.

The Government wants to see Toyota continue manufacturing in Australia and exporting. Australia must develop a plan for the future if we are to sustain and grow our manufacturing industry for the future. Our challenges are greater than the departure of key automotive players and affect all states and territories.

Therefore I will Chair a Taskforce comprising the Treasurer, Industry Minister and Minister for Trade and Investment to develop a National Industry Investment and Competiveness Agenda which will make recommendations to the Government by the end of June 2014. I will also consult closely with my Business Advisory Council, Chaired by Mr Maurice Newman AC, in the development of the Agenda.

We are determined to be a government that makes decisions in a considered way, with the best advice and in the national interest. We will move quickly to support the more urgent needs of South Australia and Victoria, but must deliver a longer term national plan for change and growth.

Work is already underway to reduce red tape and taxes which stifle business and investment. We have completed a Free Trade Agreement with South Korea and are advancing further FTAs for the benefit of Australian businesses and the economy.

Therefore, the Taskforce will focus on potential measures to promote national competitiveness and productivity including:

  • Economy wide measures to boost the competitiveness of Australian manufacturing and lower the costs of doing business, such as options to reduce the costs of energy and regulation on Australian businesses;
  • Options to encourage innovation, including employee share schemes, support for research and development and commercialising good ideas;
  • Options to accelerate the development of productivity enhancing infrastructure;
  • Options to encourage the growth of small to medium businesses; and
  • Economy-wide incentive mechanisms to boost investment in Australia.

Still, the Government understands that the best thing we can do for business in Australia is to reduce costs and lower taxes.

No country has ever taxed its way to prosperity. Similarly, no country has ever subsidised its way to prosperity.

We will do what we can to ensure the workers and businesses of this country have a strong, profitable, viable and competitive future.

We will do what we can to ensure that Holden and Ford workers move from one good job to a better job when they leave those companies in 2016 and 2017. That means ensuring they get the best possible economy in which to move.

Government’s essential task is to get the fundamentals right: that means low, simple and fair taxes; stable and predictable policy settings; prudent, frugal and effective administration; efficient services and strong infrastructure.

Legislation to repeal the carbon and mining taxes has passed the House of Representatives. If the Senate passes the legislation as its first order of business next year, 2014 can be better for Australian businesses across the board.

Transcript of joint press conference held by Prime Minister Tony Abbott and Industry Minister Ian Macfarlane.

PRIME MINISTER TONY ABBOTT: Thanks everyone for coming. I want to begin by saying that Australia is good at manufacturing. We have been a manufacturing country for decades and decades and decades, and I believe that manufacturing is a vital part of a strong economic future for our country.

And yes, we’ve got the problem in the motor industry that we’re dealing with specifically today, but in sector after sector, Australian manufacturing is continuing to do well.

A couple of illustrations that I want to make: you look at the boots that both myself my friend and colleague the Industry Minister are wearing- Australian made, in fact South Australian made and exported to many countries.

There’s that factory in West Gosford that I visited as part of the anti-carbon tax campaign, which is making 10 per cent of the world’s aerosol springs. A little workshop in West Gosford that is sending its product right around the world, which is competing in a mass-market product with the workshops of Asia because they are smart, innovative and adaptive.

I was at the Export Awards a couple of weeks back and we’ve got an Australian Company, Rode Microphones, making electronics here in this country and exporting to many, many countries because they are smart and adaptive.

So, our manufacturing can do well and our challenge, as a government, is to try to get the conditions right for it to do even better in the future.

Now obviously today, our first task is to respond specifically to the announcement last week by Holden that it was terminating manufacturing motor vehicles in this country in 2017. And this follows on the announcement earlier in the year during the time of the former government, that Ford would be ceasing their manufacturing operations here in Australia from 2016.

Today I can announce that the Commonwealth is putting together a $100 million fund to invest in potential employment generating projects in South Australia and in Victoria.

We will be commissioning reviews of the strategic prospects of both of those states, led in each case by the Industry Minister, assisted by Members of Parliament and in particular, by the leading business figures of South Australia and Victoria. And we will spend on economically responsible projects that $100 million fund, in accordance with the advice of those business committees.

But, I don’t want us to focus just on South Australia and Victoria and I don’t want us to focus just on the car industry, because I accept that manufacturing has been under pressure over the last few years. It’s not just motor manufacturing and it’s not just those two southern states.

The high dollar has obviously been a problem for manufacturers more generally. Some of the decisions of the former government, such as the carbon tax, have caused very significant problems for some manufacturing such as aluminum smelting and other sectors.

I will chair a taskforce comprising the Treasurer, the Industry Minister and the Minister for Trade and Investment to develop a national industry investment and competitiveness agenda, which will make recommendations to the Cabinet by the end of June of next year.

As well as the obvious things; getting the fundamentals right. We’ll be looking at new options to reduce the costs of energy, new options to encourage innovation, such as employee share schemes and commercialisation programmes, because it is important to give manufacturing – new manufacturing, manufacturing for the future, not just for the past – the best possible deal. But, it’s also important that we do it in a considered and comprehensive way, that we don’t simply make knee-jerk, piecemeal decisions in response to the crisis of the moment.

I want to make this fundamental point though; in the end, no government has ever subsidised its way to prosperity. Just as no government and no country has ever taxed its way to prosperity, no country has ever subsidised its way to prosperity.

And, I want to be very candid with the Australian people. This Government will be very loath to consider requests for subsidies. We will be very loath to do for businesses in trouble, the sorts of things that they ought to be doing for themselves and the sorts of things which the private sector commercial arrangements should potentially at least be doing for them.

Our fundamental task is to get the basics right. That means lower taxes, it means less regulation, it means higher productivity, it means an overall environment where you’ve got steady, reliable, competent and trustworthy government.

We want a strong and stable environment for businesses – all businesses – to operate under, and that’s what this Government is on about. We are on about getting the fundamentals right and everything that we’ve done since September, has been about getting the economic fundamentals right, a strong and prosperous economy for a safe and secure Australia.

I’m going to ask the Industry Minister to add these remarks and then obviously we’ll take some questions.

INDUSTRY MINISTER IAN MACFARLANE: Well thanks very much Prime Minister, and whilst the imperative is as a result of the announcement last week and of GMH’s closure and also of the ongoing programme to close Ford. Much of what the taskforce will do would’ve had to have been done anyway, and since I’ve taken up the Industry portfolio, I’ve been alarmed at the parlour state of industry in Australia, particularly as a result of constant changing of rules and regulations, of excessive red tape, of poor decisions of government who fail to pursue long-term, strategic outcomes and just look at quick fixes. And, if I look across the path of past Industry Ministers, I see money thrown into buckets which really has no long-term impact on the viability of companies.

So, the opportunity is there; was always going to have to happen. We will have meetings with industry groups and companies through January. We’ll call for expressions of interest basically this afternoon and commence those meetings in mid-January and we will be seeking not only solutions for those communities affected by the Holden closure, but also for industry based communities across Australia, because as I say, whilst this issue is currently focused on Holden, there are issues in the Industry portfolio that extend across other States.

QUESTION: Prime Minister, you seem to have marked a farewell to corporate welfare and yet your $100 million scheme which you’ve just announced seems to be based on picking winners. Isn’t there an inconsistency in this approach?

ABBOTT: No Denis, what we will be doing in consultation with the relevant groups of senior business figures in South Australia and Victoria, is identifying opportunities where government can help with promoting the industries of the future. Now, it may be feasibility studies, it may be investment in research and development, over time it may involve significant new infrastructure spending, because you’re absolutely right, we don’t want to see corporate welfare.

What we want to see is a country which has got the economic fundamentals right and government’s job is to foster the muscles and the sinews and bones of our economy, if you like, so that the private sector can add the bulk. I mean that’s essentially what we want to do.

So if we get the research sector strong, if we have the infrastructure strong, if we have the right regulatory environment, if we try to ensure that our people, as far as is humanly possible display a ‘have-a-go’ mindset, this, let’s face it, has been characteristic of our country, it’s been characteristic of our strengths as a nation over the years and we want to bring this same ‘have-a-go’ mindset to the manufacturing sector. We’ll go around the circle, Sid?

QUESTION: Prime Minister, if I was a manufacturer and I was trying to start something in China, for example, I’d probably get free land, I’d probably get labour incentives, I might get payroll tax holidays. Now, has Australian Government been entrepreneurial enough in attracting investment and is this something that the federal government and the state governments perhaps should look at in terms of attracting new industries and new investment?

ABBOTT: Well that’s a fair point you make, Sid. We don’t believe in corporate welfare, but we do believe in trying to give people and entities a fair start in life. There’s a difference between a fair start in life and a life on welfare so to speak and that’s why this Prime Ministerial taskforce, to look at the industry investment and competitiveness agenda, can explore some of those initiatives.

Now I’m not pre-empting the work of that taskforce and I know there are arguments for and against, but nevertheless, we want to be pragmatic about these things, we want to be empirical about these things. What we’re not going to do though is throw good money after bad, because we’ve done that at different times in our past and I don’t want to be doing that in the future. James?

QUESTION: Prime Minister, during the election you announced $100 million when you released your manufacturing policy. I’m wondering – that was to assist in export grants and also manufacturing transition – is this money drawn, I mean is this essentially the same money?

ABBOTT: No. This is new money. It’s $60 million in new money which the Commonwealth will provide. We have a commitment for $12 million from the Victorian government. We’re talking to the South Australian government for a commitment, more or less in the same order of – sorry, we’re talking to the South Australian government for a commitment in the same order as Victoria’s and we’d hope to get $20 million perhaps from Holden.

QUESTION: Just a second question. Is the Government going to save money overall with this package because Holden has to hand back the $215 million it has committed?

ABBOTT: Well, I’ll leave it to the Industry Minister to deal with the precise amounts that at different times have been committed to Holden. I suspect that what if anything might come back is something that’s still being looked at and I suspect that there will be at least some monies that will have to continue going to Holden while they continue to manufacture, as I suspect there are some monies that will have to continue to go to Ford while manufacturing is continuing.

So I’ll leave that kind of detail to Minister Macfarlane, but what we are on about is trying to ensure that the workers of this country transition from good jobs to better jobs, from the industries of the past to the industries of the future. That’s what we’re on about and we think government does have a role. The role is not to prop up private business, the role is to help us as a country and as communities explore where our future might best be determined and to add to the general infrastructure – physical and intellectual – through investing in things like roads and where necessary railways, and in education and in research and development.

QUESTION: Can I just clarify what you’re saying there – is it that none of the hundred million dollars will go in a grant to an individual company? Have you made a decision on the request from SPC Ardmona? And you said that the taskforce would look at ways to further reduce energy costs. Are you hoping that that will be an outcome of your review of the renewable energy target?

ABBOTT: I’m not saying that none of this money will be available to businesses, but they will have to make a very strong case and they will have to be able to demonstrate why it is that our money should be provided in this way because there is no prospect of them getting money from the normal private sector sources to fund something. So I’m not ruling it out. We may well make some modest investments from this fund in that way, but it will have to be a very strong case and it will have to be a case which is ticked off by sensible private business people. It’s not – we’re not here about – we’re not here to sort of build a field of dreams. We are here to make sensible economically responsible decisions. We are here to exercise very careful stewardship over taxpayers’ money.

Now on the SPC Ardmona issue, Ian, Minister Macfarlane, has been in discussions with SPC Ardmona. Those discussions are ongoing, but I’d make the same point in respect of SPC Ardmona that I’ve made in respect of Qantas – you’ve got to get your house in order. You’ve got to get your house in order. Government support cannot substitute for strong management and strong management in a company under pressure starts with getting your costs down and if you’ve got a problem in any particular area, you have got to tackle it and you’ve got to tackle it purposefully and you’ve got to be prepared to take responsibility for what you do rather than simply say it’s all too hard, government’s got to fix the problem. Sabra?


ABBOTT: And the RET, well look again, we support sensible use of renewable energy and as you know it was the former Howard Government which initially gave us the RET and at the time it was important because we made very little if any use of renewable energy.

We’ve got to accept though, that in the changed circumstances of today, the renewable energy target is causing pretty significant price pressure in the system and we ought to be an energy superpower. I mean, this country ought to be an affordable energy superpower.

We don’t have a large domestic market, we don’t have closeness – geographical closeness – to other major markets, well, not many other major market. Let’s make the most of the comparative advantages we’ve got and cheap energy – affordable energy – ought to be one of our comparable advantages and almost everything that’s happened over the last few years, starting with the carbon tax, has conspired to put our power prices through the roof and what we’ll be looking at as part of this taskforce that I will chair is what we need to do to get power prices down and down significantly.

Do you want to add to that, Ian?

MACFARLANE: Well, I mean in terms of the RET review; we’re facing an enormous challenge in terms of an excess generating capacity in electricity in Australia. To be adding large quantities of generation into that situation has to be questioned. The review process will go through those things but as the Prime Minister says, in terms of the cost of energy, the fact that a coal-fired power station is dispatching electricity at a lower price now than it was five years ago and yet businesses are facing electricity prices that are more than double, is an issue that has to be addressed.

Every manufacturing industry uses electricity. It is a significant portion of their costs and it needs to be looked at and it will be looked at both through this taskforce but also through the RET review.

ABBOTT: Sabra?

QUESTION: Prime Minister, you said that you would like Holden to contribute $20 billion to this fund. Have you spoken to Holden about that? What commitment have they given you? And based on the Mitsubishi experience in South Australia, do you concede that once Holden goes that there will be some workers who will be unable to find work again?

ABBOTT: Let me deal with the latter part of the question and Minister Macfarlane will deal who with the former part of it. Look, I accept that, particularly for older workers who spent a lifetime in a particular industry, it’s very difficult to move and to adapt when the business for which you have worked for many years fundamentally changes. I accept that. But I wouldn’t want anyone to be defeatist about the capacity of Australian workers to be creative in their own best interests.

Now, some of the Mitsubishi workers have struggled to find work, others have had, I suppose, almost a rebirth of their working lives and I dare say, it will be same for the people currently at Ford and Holden when manufacturing stops.

Some of them will find it difficult, but many of them will probably be liberated to pursue new opportunities and to get on with their lives and the point I’ve always made is that as far as I am concerned, government has a heavy responsibility to every single citizen. As far as I’m concerned this Government is not in the business of leaving people behind. But we have to accept that what was right for people 10 years ago or 20 years ago is not necessarily going to be right or possible for them far into the future, and we do have to be prepared to adapt individually and collectively we do have to be prepared to adapt.

Australians have been very good at it and I’m confident that the majority of these workers will be able to adapt although I don’t for a second underestimate that for many of them there will be some difficult times too.

QUESTION: Prime Minister, on the Budget outlook…

ABBOTT: I’m sorry, Ian, you were going to talk about Holden?

MACFARLANE: That’s right. In terms of Holden, we’ve had some initial discussions with Holden and they are receptive to contributing to the fund. We’ll get down to the detail with them but the company understands its responsibilities in terms of the workers and bearing in mind that the company is planning to continue to operate until 2017, it’s a process that we can manage.

In terms of the workers, I can only endorse the Prime Minister’s comments. Many of us and me personally, have had to go through a significant change both not only in career but in my case, in where I lived. That is a very, very challenging thing to do but Australians in the past have always been prepared to do it and I think we need to accept that we’ll have to do it again to move out of a community, to go somewhere where there is work and long-term sustainable work, or to up-skill and certainly portfolio will be assisting in improving their skills.

Many of the workers at this Plant have a fundamental intelligence in terms of skills that they should exploit and there will be a real opportunity for them to do that.

ABBOTT: Michelle?

QUESTION: Mr Abbott, you said you were not into corporate welfare. Do you think the corporate welfare we already have has gone far too far and should be cut back?

ABBOTT: Well, what we have, we have and other than as announced, Michelle, we’re not making any changes but I do make- again – the fundamental points that no country has ever taxed its way to prosperity, no way to country has ever subsidised its way to prosperity. It is profitable, private businesses which are the engine of the prosperity that all of us enjoy. It doesn’t matter where you are working, who are you working for, whether you’re self-employed or employed, in the end it is profitable private businesses, large and small, which are the absolute foundation, the essential prerequisite for the prosperity of this nation and all others and that’s what we need to promote.

QUESTION: You’re saying it’s safe from cuts?

ABBOTT: Now, the point that both the Treasurer and the Finance Minister were making repeatedly yesterday is that we will not act in ways which are inconsistent with our mandate. We will not act in ways which are inconsistent with our mandate, but we’re not going to play this game of rule this in, rule that out. We will not act in ways which are inconsistent with our mandate and when it comes to the fiscal position, we have inherited a mess. We have inherited Labor’s mess. We take responsibility for fixing it and fix it we must for the future of Australia to be secure.


QUESTION: Are you still committed to the full funding model of the National Disability Insurance Scheme, including the money that was earmarked beyond the forward estimates?

ABBOTT: Well, we are absolutely – let me give you a bit of background, David. We have supported the National Disability Insurance Scheme at every step of the way, every step of the way, because we fervently believe, I fervently believe, that the National Disability Insurance Scheme is an idea whose time has come.

I fervently believe and accept that the test of the decency of a society is how it addresses the problems of its most disadvantaged and vulnerable. Now, that doesn’t mean that everything you do in this area is equally sensible, or everything that you might do is equally sensible, but I am absolutely committed to the National Disability Insurance Scheme. When a Productivity Commission study was proposed we supported it, when the Productivity Commission reported, we supported that, when the former government introduced legislation into the Parliament we supported that, when the former government proposed a levy to part-fund the scheme we supported that.

So, we absolutely support the National Disability Insurance Scheme. What I have to say to you though is that, we do not have a scheme in place at this point in time; we have a number of trials which have started, a number of trials which have started and we absolutely support those trials. But, it is important to carefully study those trials and to learn the right lessons from those trials so that the final shape of the National Disability Insurance Scheme gives people with disabilities the support they need; the generous additional support they need, but does it in a sustainable way.

QUESTION: Can you explain for us your involvement in helping secure the release from Dubai of Matt Joyce?

ABBOTT:I’m very pleased that that matter has been satisfactorily resolved – that’s the first point to make. Second point to make is that from time to time it’s appropriate from Prime Ministers to discuss consular matters with other Heads of Government, but it doesn’t normally help the situation to talk publicly about them.

So I think the best I can say at this point is that I’m very pleased the matter has finally been resolved. I’m obviously happy for the individual and for his family and I want Australia’s relationship with the Emirates and with the Gulf generally to go from strength the strength.

QUESTION: On the National Disability Insurance Scheme, you said you want to learn from the trials to see what final shape it would take. Given that you are looking at making it a cost effective scheme, should people with disabilities perhaps reassess whether or not they think they might be included in the NDIS? Would you look at perhaps limiting the definition of who might be eligible to be part of the NDIS?

ABBOTT: You know the easiest thing in the world is to scare people and I think it’s a little disappointing that some people in this Parliament have been running around the place today trying to scare vulnerable people.

We will deliver the National Disability Insurance Scheme. We believe that the Productivity Commission has given us a good model on which to proceed. But one of the reasons why the Productivity Commission wanted to see a series of trials done in different place around the country was because they wanted us to learn as we went and make sure that we get this right.

It’s so important for people with disabilities and their carers and for the rest of us, that we get this right. That we should not rush to swift conclusions at the very beginning of this process and that’s where we’re at, we’re at the very beginning of this process, but we will have a National Disability Insurance Scheme, and it will be fair and it will be generous and it will be appropriately targeted and it will be sustainable.

QUESTION: The Government’s message is that the entire community has to be involved in the budget repair job, now I wonder whether you might be inclined to set an example because even though the PPL scheme is very close to your heart all options have to be on the table. Would you be at all open to trimming it back a bit?

ABBOTT: Well obviously it has to get through the Parliament and that may well involve some negotiation, but I am committed to the scheme that we took to the election and I believe that’s a fair scheme and I don’t think we’re in an either or situation – a good deal for people with disabilities versus a good deal for new parents. I don’t believe we’re in that situation. I think that if we get the economic fundamentals right, if we do the design work right, we can have an excellent National Disability Insurance Scheme, and at last and overdue a fair dinkum Paid Parental Leave scheme.

Two further points about – well really three – further points about paid parental leave – first of all, it’s a productivity enhancing measure, a participation enchaining measure. Second, it’s fully funded, mostly by a modest levy on the taxable incomes of larger companies. And third, it is also a fairness issue, because at the moment if you’re a Commonwealth public servant you get 14 weeks at your full salary, even if your full salary is $300,000 or $400,000 a year. If you’re working for the ABC, as I sometimes tease ABC journalists, you get your full-salary for 14 weeks regardless of how high your salary is and if you’re a shop assistant or a factory worker you get next to nothing. And so, because it’s fair, because it’s funded, and because it’s about a stronger economy I think that it should proceed and I hope it will have a smooth passage through the Parliament later in the year. Michael?

QUESTION: I just wanted to get your reaction, Prime Minister, on the High Court overruling the NSW ban on Unions being able to make political donations?

ABBOTT: Well this sounds like it’s a new decision, is this a decision that came down today?

QUESTION: Yeah, it was taken today that the High Court has overruled the NSW Government’s ban over Unions being able to make political donations.

ABBOTT: Look, I’m afraid this is the first I’ve heard of that particular decision and I’d rather not comment until I’ve had a chance to study it. Because your question has in a sense been ruled out of order, I’ll take another one. Is there another question?

QUESTION: [inaudible] Australia and Indonesia’s discussions that are going on about this code of conduct when it comes to intelligence matters. Can you give us an update of where that is at and when we might see that finalised?

ABBOTT: Ok, well as you know Foreign Minister Bishop and Foreign Minister Natalegawa, assisted by various other senior officials, had a good discussion last week and there is a protocol – a draft protocol – which is currently under discussion between our two countries.

I am confident that we can use the difficulties of the last few weeks to bring our relationship, particularly our security and intelligence relationship, to a higher level.

The point I constantly make is that we respect Indonesia’s sovereignty, we expect reciprocity there. I have enormous affection and adoration for President Yudhoyono who has been a great President of Indonesia, as well as being a firm friend of Australia. We are co-operating fully with Indonesia on the things that are important to them and I’m certainly looking forward to a swift and full resumption of cooperation from Indonesia on the things that are important to us.

Thank you.

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