This media release and key points were issued with the annual report series, Trade and Assistance Review 2003-04, on 22 December 2004.

Import tariffs, budgetary grants and tax concessions provided Australian industry with the equivalent of more than $11 billion in gross assistance last financial year, according to a Productivity Commission report.

Trade and Assistance Review 2003-04 provides the Commission‘s latest estimates of industry assistance provided by the Australian Government.

Most Australian industries have relatively low rates of assistance by historical standards, but pockets of high assistance remain.

The report shows that the manufacturing sector was the major recipient of assistance. Textiles, clothing and footwear and the automotive industries remain the most highly assisted manufacturing industry groupings, although the Government has announced continuing transition programs designed to move both sectors to lower levels of assistance.

The dairy industry received the highest rate of assistance in the agricultural sector, although its assistance has fallen significantly since dairy deregulation in 2000. Additional assistance has been announced recently for the sugar industry.

The report notes that particular forms of assistance, such as R&D subsidies, can deliver net community benefits if well designed. But it also indicates that industry assistance can entail significant costs to consumers, taxpayers and other industry — for example, tariffs on manufactured imports penalised businesses in the services sector by some $2.8 billion in total in 2003-04.