In line with Labor's declaration that this election will be all about jobs, the Prime Minister has kicked off day one of the campaign announcing a $200-million plan to prop up the Australian car industry.
Last month, Labor announced it would tighten Fringe Benefits Tax rules around employer-provided cars - a move the car industry said would spell the end of the already ailing sector.
But Labor says the new funding announcement is not designed to make up for the FBT move.
Thea Cowie
Labor says the federal government should back the Australian car industry because this backs Australian jobs.
It says that's the logic behind its plan to insist that every Australian government department or agency vehicle is Australian-made.
The only exception would be if they cannot find a vehicle that is 'fit for purpose' among locally-manufactured cars.
The Prime Minister left it to his Industry Minister Kim Carr to announce the policy on the ABC.
Mr Carr says if the states and territory governments also commit to buying Australian only, locally-made car sales could increase by 18-thousand a year.
"We produce very good quality cars in this country and there's really no excuse for buying imported cars when you've got high quality Australian cars available. We want to ensure also support for our supply chain. There's about 200 companies involved in the Australian automotive industry. About 50,000 people directly employed, about 200,000 people indirectly employed."
Last month the government suffered a backlash from the car industry when it announced it would tighten Fringe Benefit Tax rules on employer-provided cars.
Under the proposed changes, drivers who buy a car using a salary sacrifice scheme would have to keep a detailed logbook outlining their personal and business vehicle use.
The Opposition says the best thing Labor could do for the industry is to scrap the FBT change, and stop propping the industry up with generous support programs.
Mr Abbott says Labor has been throwing taxpayer money around "like confetti".
"I want to say I have more respect for your money than to just write blank cheques to industries which - let's face it have been very good at using taxpayer money but haven't always been that good at maintaining production and jobs. The next point to make is that 200-million as conscience money for the $1.8-billion hit that they've just put on the industry it amounts to a bandaid on a bullet wound."
The Coalition has vowed to cut $500-million from the Automotive Transformation Scheme which under Labor is worth more than $2.5-billion over a decade.
It says it would still provide one-billion dollars to 2015, while a further one-billion dollars would be available from the start of 2016 to 2010.
The Coalition says it would also ensure support was more accountable, sustainable and better targeted than it is under Labor.
But Treasurer Chris Bowen says the two measures are not linked because Labor has been in talks with car makers for some time about a new industry assistance package.
The Australian Greens are backing Labor's Automotive Transformation Scheme but say the grants should be dependent on making electric cars.
The Greens want a national target for electric cars and direct financial assistance for developing high-tech and renewable technologies.
Greens MP Adam Bandt says funding needs to be better targeted.
"We've seen cash splashes before. The car companies take the money and then make people redundant shortly after. And we've also seen government handouts come without a requirement that Australian manufacturing comes to smart, clean manufacturing."
