Victorian MP criticises free market purists over SPC assistance debate

Victorian Liberal MP Sharman Stone has spoken against economic dries in Cabinet opposed to SPC Ardmona’s request for $25 million co-investment from the federal government.

Stone told the The Australian Financial Review that the broader effects of government assistance needed to be considered, rather than free market “dogma”.

“There continue to be some [in the cabinet] who simply believe that any support for manufacturing somehow interferes with so-called free-market forces,” Stone, a PhD in economics, told the AFR.

“If there were free-market forces in Australia with market decisions being made with full information and completely unbridled competition, then SPC and companies like them would be able to bring cheap labour in from wherever,” she said.

“I’m hoping that the interests of the economy will be considered, not just dogma – that the facts are considered, not misinformation or misrepresentation.”

Prime minister Tony Abbott and treasurer Joe Hockey have signalled a hard line against government subsidies in the wake of December’s announcement that Holden would cease manufacturing in Australia in 2017.

In announcing assistance for Holden workers who would be made redundant, Abbott said “no country has ever subsidised its way to prosperity”.

Issues around Alcoa’s Port Henry smelter – which some believe could have its closure announced after a company review is delivered in March – as well as the Gove refinery (which will shut this year) and Qantas’s difficulties, are all expected to test the federal government’s free market credentials, especially with the budget projected to be well in deficit.

Stone’s Murray electorate contains the major operations of the processor.

She is concerned that if a requested $50 million in assistance ($25 million of which would be provided by the Victorian government) is not provided, SPC’s parent company will decide to close its operations.

“Things are very grim. I hope Coca-Cola Amatil’s shareholders are willing to hold out and give this company time,” she said.

“But I’m hopeful the right decision will be made by cabinet.”



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