The National Party has announced it will reduce the number of long-term beneficiaries by 30 per cent in five years. Ambitious stuff, but notably absent from the government’s Better Public Services programme is a commitment to ignore industry requests for state lifelines that may arise. If social welfare is unsustainable, then so is propping up failing corporations.

The result of doling out money for nothing to beneficiaries and corporations is the same – it might stem the immediate cash flow problem but it is not a sustainable solution. Furthermore, long-term assistance breeds dependency, whether it is individuals or corporations.

A striking example of the failure of corporate ‘assistance’ is the Australian car-manufacturing industry, which has been in decline for many years. Australian car manufacturers cannot compete with the likes of Japanese, Korean or Chinese automakers. So should government intervene and rescue the sinking ship? Well, the Australian federal government did just that but ignored the hole in the hull, hoping instead that bailing out water would keep the industry afloat.

Every year since 2001, the Australian federal government has injected $500 million into Australia’s ailing car-manufacturing industry. Assistance was to cease in 2015 but has been extended to 2020. So what exactly has $6 billion of taxpayer funds got the people of Australia?

Precious little. In 2008, Mitsubishi closed its last Australian plant; on 25 July, Cockerill Maintenance & Ingénierie Industrial announced the closure of two Melbourne factories, leaving 119 parts workers jobless; and despite a March deal totalling $53 million, Ford announced in mid-July plans to lay off 440 employees at two of its plants.

RMIT University economics professor Sinclair Davidson summed it up best, saying Australia should not have a car industry, at least not one that is dependent on corporate welfare. No corporation should expect or depend on bail-outs – let them sink or swim as others do in the market.

This side of the ditch offers its own examples of corporate ‘welfare’ failure. The National-led government gave a handsome loan to MediaWorks, while Labour introduced an ill-conceived film tax credit scheme. At least the coffee shops of Wellington are kept well frequented with film stars.

It is clear that government handouts, whether to individuals or industries, do not work. But will government ever learn the lesson? It remains to be seen.