Trade minister Andrew Robb and others within the federal government are showing their opposition to industry assistance, expressing concern that help to SPC Ardmona could send the wrong message to struggling companies.
The Australian Financial Review reports that Robb and some of his colleagues were in favour of letting economic forces run their course, and not impeding natural “continuous structural change” through subsidies and other measures.
“Continuous structural change is a fact of life,” Robb told the AFR.
“It affects different industries at different times and the government mustn’t stop it.”
The comments appear to be a rebuke to Liberal MP Sharman Stone, whose Murray electorate takes in SPCA’s major operations. SPCA is a subsidiary of Coca-Cola Amatil.
Stone spoke out against free market ideologues earlier this week, saying “the interests of the economy [should] be considered, not just dogma”.
SPCA is a major employer, with 3,000 jobs said to be at risk if it decides to quit Australia, and its Shepparton factory is the country’s last fruit cannery.
The Greater Shepparton City Council has claimed that economic research suggests the region’s unemployment would rise from 8.6 to 11 percent if SPC Ardmona closed.
There is fear among the Liberals that co-investment at SPCA – which wants $25 million each from the federal and Victorian governments and will invest $90 million of its own to upgrade its facilities – would lead to more companies seeking taxpayer funds.
“It’s not the amount, it is the principle involved,” said an unnamed senior government member.
“It sets the precedent and there are going to be a lot more.”
Shadow industry minister Kim Carr said that economic differences in the government needed to be resolved, and there wasn’t much time left to assist SPCA.
“In the face of unprecedented opportunities for growth in Australian agriculture and increasing demand from Asian markets it would be absolute madness to allow Australia to lose its fresh fruit processing capability,'' said Carr, according to The Weekly Times Now.
“The Government needs to understand that once capabilities such as these are lost, they are lost forever.