Page 1082 - Week 05 - Tuesday, 29 May 2007

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in direct competition with the private sector, especially when the competitors are often skilled and well-established providers in this area of activity.

I do not quote myself to say “I told you so” to the government, although that would perhaps be justified, but to reiterate the warning that I first delivered 2½ years ago and that is that governments should not involve themselves in private industry and business activities. This is for two reasons. Firstly, as I suggested in 2004, they are poorly equipped to compete with established private enterprises. Private vehicle leasing companies operate in a highly competitive industry and have done so for a long period of time. If they are unsuccessful they fold and are replaced by competitors who can achieve success.

The second reason that governments should not involve themselves in private business activities is that when public money is involved a higher threshold of responsibility exists. What well may be a sensible expenditure for a private company to make becomes difficult for a government-owned entity to justify. The expenditure of public money requires a tangible benefit for the people of Canberra, and the fact that no dividend was declared or paid in the last financial year by Rhodium suggests this benefit has not been produced.

I am conscious of my role as chair of the public accounts committee, which is currently conducting an inquiry into Rhodium Asset Solutions, so I will not detail the litany of examples that serve to demonstrate my point that government should not be involved in enterprise best left to the private sector. Suffice to say that the operation of Rhodium Asset Solutions has not produced a tangible benefit for the people of Canberra.

In relation to the sale of Rhodium, I will touch on a point that has received some coverage in the media: the need to, as far as possible, support the local motor trading industry. Rhodium have carried out a policy of, where possible, purchasing their fleet locally. I understand that over 3,000 of Rhodium’s fleet of some 4,000 vehicles were purchased locally. This is a big chunk of the ACT motor sales market and, if possible, the company that purchases Rhodium should be encouraged to continue supporting the local market by purchasing their vehicles from ACT dealers. Whilst it may be impossible to make this a condition on the sale agreement, I urge the ACT government, as I have done publicly since September of last year, to make a concerted effort to encourage potential purchasers to continue to support the local motor trading industry.

The local industry competes with much bigger markets in Sydney and Melbourne and it is important that the ACT government recognises the contributions of these businesses to the local economy and, if possible, that it facilitates or encourages support for them by the private entity that ends up purchasing Rhodium.

The opposition supports the government’s motion, as I have said above, and looks forward to the sale of Rhodium and to the end of government involvement in an area that is very much best left to private enterprise.

DR FOSKEY (Molonglo) (12.07): I am going to oppose this motion—not that my opposition is going to have any impact on its traverse through this house. I want to


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