Federal Government under pressure to throw $25 million lifeline to SPC Ardmona

FIRST it was Holden. Now it's SPC. The Abbott Government is under pressure to throw a $25 million lifeline to the struggling food processor.

LABOR is accusing the Federal Government of being un-Australian as it debates whether or not to help struggling food processor SPC Ardmona.

Cabinet is meeting in Canberra today for the first time this year and a request for assistance from the company, based in Shepparton, will be high on the agenda.

There appears to be a split over whether SPC should pocket $25 million from the Federal Government.

It's also asking for the same amount from the Victorian Government.

SPC wants assistance to upgrade its product development facilities, topped up by $150 million from parent company Coca-Cola Amatil.

Treasurer Joe Hockey has indicated he's not in favour of giving the handout.

He last night told the ABC that if the Coalition is asking voters to help the Government live within its means then corporate Australia must follow.

"The parent company of SPC Ardmona, Coca-Cola Amatil, which is an Australian company, in the first six months of this year had a profit of over $215 million - for six months - and yet there is a request for $50 million of taxpayers' money," he said.

"I think you can understand why we are being very cautious, very careful about handing out taxpayers' money to companies that are profitable, let alone companies that aren't profitable."

But Liberal MP Sharman Stone is at odds with Mr Hockey and other colleagues.

The member for the Victorian seat of Murray wants the Coalition to help the food processor, as her tweet below shows.

Today's Cabinet decision will decide if Australia is to continue to grow and process fruit, tomatoes and baked beans. Once gone, its gone.

— Sharman Stone MP (@SharmanStone) January 29, 2014

Dr Stone said the "measly" assistance package would help support an industry in which Australia has a great natural advantage and which employs a large number of people.

"We are a country with magnificent climate, great soils, great orchards - for a measly $25 million in support," Dr Stone told ABC radio.

"I just see this as a no-brainer."

Acting Opposition Leader Tanya Plibersek has urged the Government to act in the interests of SPC, to keep the last fresh fruit processing company in Australia, employing locals.

"I don't see anything more un-Australian than sending Australian jobs offshore," she told reporters in Canberra this morning.

Her comments come after Prime Minister Tony Abbott yesterday took a swipe at the ABC, suggesting the broadcaster takes "everyone's side but Australia's''.

Ms Plibersek used Holden's decision last month to cease production in Australia to claim the Coalition has no plan for jobs.

"The Government has already goaded Holden into leaving Australia," she said.

"They're now looking at trashing jobs in food processing, an area that will only grow as individual wealth in our region increases."

Independent Senator Nick Xenophon says the end of the line of SPC Ardmona would have flow-on effects for fruit growers in other states.

Senator Xenophon said the government should be using anti-dumping duties to create a level playing field for companies such as SPC Ardmona.

"The government needs to understand that free trade shouldn't be 'free for all' trade,'' Senator Xenophon said.

The Productivity Commission has rejected the use of further tariffs on imported fruit.

Senator Xenophon said that if SPC Ardmona closes there would be an influx of imported canned produce which would have an impact on the processed fruit sector across the country.

Victorian growers would also find themselves without a market, leading to a glut in supply and a drop in prices across the entire Murray Darling basin.

PM says his team has made a 'strong start'

Meanwhile, the PM rallied his Cabinet during its first sit down of the year, arguing the team has made a "strong start" since being elected.

"I think the public are giving us credit for having made a good start, even though we did inherit a mess," the Prime Minister told colleagues in Canberra.

Mr Abbott signalled out the Coalition's asylum seeker policy, saying no illegal boats have arrived on Australian shores in more than 40 days.

But he did admit 2014 would have its challenges.

"Obviously over the next year there is going to be a lot of noise, but we as a Government know what we're doing and we're going to get it done," he said.

Without making specific reference to the decision over SPC in his opening remarks, Mr Abbott did argue the Government will rein in spending.

"The public know that we have a plan to get the Budget back under control, because in the end governments - like households, like businesses - have got to live within their means," he stressed, accusing Labor of being "relentlessly negative".

With AAP