Coalition fails to stay calm under pressure
WHAT happened to calm, methodical, no-surprises government? That’s what we were promised by Tony Abbott. The Coalition’s election victory was supposed to bring an end to the frenetic, often confused style of Labor’s six years in power.
But after just three months, the Abbott Government is itself looking rather ragged, with crisis rather than calm the order of the day.
Some of the alarums and excursions, as Shakespeare might have called them, have been unavoidable, of course.
The mid- year economic and fiscal outlook to be released next week is a case in point.
It will be so chockers with bad budgetary news at a time when consumer confidence is brittle that there is concern about the impact on preChristmas retail spending.
Treasurer Joe Hockey certainly doesn’t want to risk killing Christmas but he has no choice. The updated figures have to be made public.
Other problems, however, such as the politically stupid attempt to break a solemn election promise on school funding, should have been avoided.
And there is a third group of difficult issues that are not the Government’s fault but could have been handled a lot more tidily. The decision by General Motors to close its Holden manufacturing plants in Australia is one of these.
The Government gave the impression of failing to follow proper process. Cabinet divisions were exposed. And ministers left themselves open to the charge of pushing GMH out rather than encouraging it to stay.
The truth is that the new Cabinet initially paid considerable attention to proper process on the question of assistance for the car industry.
It set up a Productivity Commission inquiry designed to facilitate sensible, informed decision-making.
Things went awry when senior ministers learned from a US source that General Motors HQ in Detroit had already decided to stop making cars in Australia but was delaying an announcement.
That made the Productivity Commission inquiry pointless. ORE importantly, there was a growing conviction at the most senior levels of government that the company intended to use the Productivity Commission report as an excuse for its decision — a way of shifting blame.
So the orderly process went out the window. The information from Detroit was leaked, embarrassing Industry Minister Ian Macfarlane who, naively, thought there was still room for negotiation.
Abbott pre-empted the inquiry by announcing there would be no more money on the table for Holden and demanding the company clarify its intentions.
MAnd, when Holden’s local chief, Mike Devereux, insisted to the Productivity Commission that ‘‘ there’s been no decision made at this point’’, the Government reacted with open disbelief and turned its big guns on him. Hockey, in particular, applied pressure to force an admission.
The company, he told Parliament, should ‘‘come clean with the Australian people’’ and ‘‘be honest’’.
He goaded Holden: ‘‘Either you are here, or you’re not.’’
Politically the results were ugly. ‘‘ Hockey dares GM to leave’’, was the headline in one newspaper, above a report saying the Government had ‘‘effectively issued the company its marching orders’’.
The South Australian and Victorian governments were appalled. Industry sources complained that Holden was being ‘‘bullied’’ and ‘‘chased out of the country’’.
And Macfarlane appeared on television looking shellshocked, ineffectual and obviously out of the loop.
The Government got what it wanted. The company was forced to declare its hand — a shutdown by 2017. ‘‘We flushed them out,’’ says a minister.
But the Labor Party got something it wanted, too — a potent political weapon. Opposition leader Bill Shorten was able to portray the attacks on Holden as evidence of a government unsympathetic to the car industry and unwilling to try to save manufacturing jobs. In reality, Labor’s claims that GM in Detroit was prompted to pull the plug on Australia after Hockey’s parliamentary onslaught are ridiculous.
Big corporations do not make such multibilliondollar decisions overnight. This one was part of a strategy embarked on weeks ago involving the closure of unprofitable manufacturing operations in several countries.
Even had the Australian Government gone chasing after GM with a big cheque, it would have made no difference.
‘‘ To GM we’re just a pimple on a pumpkin,’’ a government source said. It’s true. Nothing would have saved Holden.
But the messy nature of the politics obscured all of that.
The government approach lacked elegance and clarity. Labor behaved as ruthlessly and as brutally as the Coalition did in opposition.
And what the voters saw was unlikely to convince them that much has changed so far in the way those who govern us do business.