Sophie Mirabella (Indi, Liberal Party, Shadow Minister for Innovation, Industry and Science) Share this | Hansard source

I rise to speak on the so-called Australian Jobs Bill 2013. In doing so I wish to express my frustration with not only the content of the bill but the government's lack of accountability in explaining and justifying the reasons for its introduction and its apparent determination to yet again push through legislation that will increase regulatory and compliance costs for Australian businesses.

Given that it has misled the Australian people hundreds and hundreds of times, it is difficult to take almost anything that this government says at face value. But it is even harder to find reason to support one of its bills when there is so little clarification around even the very basic details in the legislation—the precise reasons for the change and exactly how those changes will be financed.

Prior to February this year, I cannot recall in my time as a shadow minister ever having been refused a briefing by the government. In February was when my office asked Minister Combet's office if I could receive a briefing from the government following the release of the so-called Industry Innovation Statement—otherwise described as a 'jobs plan', another Orwellian phrase—of which these changes form a part. That request was pointedly refused.

One of a number of reasons why I sought that briefing was to try and obtain more detail about the changes to which this bill potentially would give effect. Such conduct points not only to a disturbing lack of accountability on the part of the minister but also to a complete arrogant disregard for accepted protocol, good governance and accountability—especially when a staff member in the minister's office tells a staff member in mine that the basic reason for the refusal is that I apparently had the temerity, the gall, the nerve, to make some public criticisms of a number of elements of the government's policies in this area. 'How dare I criticise the government or question its policies' was effectively what was being said at a time when former members of the frontbench of this government had not only disputed and questioned policies that their own government and party had pursued but also condemned this opposition, whose job it is to question, to query, to sift through new policy and funding announcements with a fine-tooth comb. All we were told was, 'No, you can't do that. How dare you criticise us!' No wonder the business community are sick to death of the veiled and sometimes overt bullying that they get from this government when they dare to do what any good corporate citizen should do and contribute to public debate. If they dare disagree with this government, watch out! This attitude has unfortunately become its trademark as a government. Remember what was once said by them, that they wanted to let the sunshine in—from a government that proclaimed it was supposedly going to be the most open, transparent and accountable in Australian history. I suppose the kindest reflection you could make is that they have become very transparent in their actions and their motives, but regrettably far from the way that they originally meant.

Not the least of the problems with this bill is how its changes are being financed. The government has said that it is funding its various changes in the industry statement, some of which are subject to this bill, by making another deep cut to the R&D tax incentives system. It said comically that its last round of changes was revenue neutral. Now it asserts that the cut this time amounts to around $1 billion. Not only is there absolutely no evidence anywhere on the public record that verifies that that figure can be correct, but it represents quite a difference from the figures that were calculated by the government's own Business Tax Working Group when it was modelling the same numbers last year. It is also at odds with the nature of those previous changes the government made to the R&D tax breaks system from 2011. That set of changes was specifically designed to reduce the claims on the system by the largest investors in innovative R&D activity in Australia and pointers to the fact can be found numerous times in Labor's legislation and its own words, not to mention in the words of the Greens as well, albeit that those words of the Greens proved that they have plainly never had a clue about the sort of damage they were agreeing to inflict on the system when they foolishly passed Labor's 2011 changes.

So it would be very instructive to know, from the minister and from others on the Labor benches during this debate, on what basis the $1 billion has been calculated. One would have to assume that figures for the old R&D tax concession have been used to underpin that calculation, in which case the savings would almost certainly have been overestimated. I would also add that the government first cited the $1 billion in February, long before most claimants had calculated all of their R&D spending for the first year of the new system and at which time the government still could not have been anywhere near sure of the full impact their changes have inflicted on large R&D spending businesses. In other words, there is absolutely no reason to be anything other than deeply suspicious and cynical about the claim that the savings they are supposedly making by decimating R&D incentives, for the second time in this government's history, have been accurately calculated. If I am wrong about this then the next Labor speaker in this debate should immediately point out why and how and give financial details to back up their argument.

The government has also publicly tried to create the pretext that its industry statement somehow represents an injection of $1 billion in new funding in the Industry portfolio. But anyone who takes anything more than a cursory look at their summary figures knows that cannot be true. Instead it seems to incorporate around $600 million worth of cuts. Of course, all of that is bad enough in itself, but that is even before we get to the specifics of the Australian Jobs Bill itself.

To put it very simply, the coalition's view has always been that there are a number of obvious benefits to the nation in encouraging greater use of local firms' capabilities in major public and private sector projects. That obviously stands on its own merits as a beneficial thing for our economy, and that is, after all, why the Howard government was the architect of the Australian Industry Participation scheme in 2001. We have always been very open to the idea of making or helping make incremental changes to the system that are likely to increase and improve its effectiveness.

I have also long said publicly that I am not at all averse to the idea of making changes to EPBS arrangements either, as long as they are constructive and will genuinely benefit Australian industry. If there are widespread demonstrable benefits that will be created by changing the arrangements around things like the capital expenditure threshold at which the production of Australian Industry Participation Plans becomes necessary, or even the trigger dates, then we are not inclined to object to those things out of hand at all.

But the bill that is now before us honours none of those goals. Unfortunately, if it is passed, it will diminish rather than improve the operation of the system, not least because there is not a clearly defined need for the establishment of yet another bureaucracy to administer the AIP system. After more than 21,000 new regulations under Labor, surely the government are not serious about setting up this agency, which they are calling the Australian Industry Participation Authority, to create even stricter rules, more extensive compliance requirements and stiffer penalties. Do we really seriously need another bureaucracy to do the job that the existing bureaucracy should be quite capable of administering in the first place, let alone in an area of policy like this one, where the best results are generally going to be achieved through more sensible encouragement rather than coercion?

There is also more confusion and ambiguity than there is practicality in the approach to the concept of the trigger date. Not only is it problematic in itself that there are a plethora of definitions in the bill of what a trigger date can be, but that in turn leads to further questions as to whether it will be conceivable that a meaningful procurement plan can genuinely be drafted in a number of these situations. The problem is exacerbated even further, as the Business Council of Australia notes, because of the requirement in the bill that project proponents must provide a draft AIPP to the authority 90 days before even the earliest of all the possible trigger dates on the list. Undoubtedly, another consequence of passing this bill would be a substantial upsurge in the number of AIPPs that need to be generated. It stands to reason that, if you widen the range of projects to which the system applies and increase the number of businesses which need to participate in the system, particularly by lowering the capital expenditure threshold, then reporting and compliance requirements are inevitably going to rise significantly.

In the course of drafting and promoting the industry statement, the government has also, sadly, found little time to acknowledge the reality that most firms in the resources sector are genuinely keen to partner with smaller local firms. It is not a matter of bringing out a big stick that represents the answer here; it is finding practical ways of capitalising upon the reality that most local resource companies genuinely would welcome closer interaction with Australian suppliers.

And of course it is completely unacceptable that any government should think it appropriate to legislate, as this bill does, to seek to embed public servants into private companies' workforces in order to wield influence over their purchasing decisions. This is anathema to a modern industrialised economy.

Time will probably not permit me to focus on a number of other potential problems with the bill or indeed the industry statement more generally, so let me defer instead to some comments made by a number of stakeholders in order to present a more general encapsulation of the impact that this bill would have if it were passed. The Queensland Resources Council said:

We … strongly disagree with the mechanisms proposed in the policy … We would urge government to pursue a far less costly, and more effective way of achieving these policy objectives.

They also said:

… this type of intervention is unnecessary, and indeed deeply patronising to the sector—

that is, the resources sector. The Australian Petroleum Production and Exploration Association said that, without significant further attention to a range of issues, the government's approach 'will not have any significant impact on increased local content outcomes' and:

…compliance costs will increase, again, … without commensurate additional benefit to Australian industry.

The Australian Mines and Metals Association said that the government's proposal 'does not contain rigorous cost benefit analysis' and:

It does not provide adequate justification for the increase in costs.

It also said that the bill would 'comprise a heavy-handed and undue intervention by government', would not address concerns with 'reduced labour productivity and increased cost' and 'may exacerbate them'. The Business Council of Australia said:

It added:

CCI of Western Australia said:

… the Bill should not proceed in its current form. The Government has not presented a persuasive case for a legislated instrument on local industry participation. Instead, the Federal Government should acknowledge that there are already a number of policies in place to address local industry participation, that local content penetration in major projects is significant, and looks to ways of coordinating these efforts more effectively as a means of promoting full, fair and reasonable opportunity for local suppliers.

As an excellent encapsulation of the excessive regulatory impact the bill will have, Xstrata Coal said:

… the proposed … bill … only adds to the regulatory red-tape and cost of projects which are becoming increasingly marginal as a result of Australia’s high cost structure, regulatory burden, tax regime and currency exchange rate.

The reality is that the government's industry statement is a misnomer. The government has done almost nothing of substance for Australian industry in its time in office, and that remains the case now. It does not have a jobs plan, as it came keeps claiming. In fact, it would be far more accurate to dub it a retrenchment plan. Over 5½ years, the government has never taken any action to seriously help arrest the mass decline in manufacturing jobs in Australia. It only ever seems to succeed in accelerating it. It has presided over the worst rate of manufacturing job losses in Australia's history, with more than 140,000 gone in net terms and one disappearing, on average, every 19 minutes—which contrasts very, very sharply with the record of the Howard government, when we had well over one million manufacturing jobs and losses of only between 6,000 and 7,000 over that whole period of 11½ years.

So, whenever this government talks about manufacturing and wanting Australia to be the country that makes things, it is all a farce, it is all a con, it is all a try-on—just as some of the members on the other side have realised. A job they thought they would have for life in a so-called safe seat is now under threat because this government has trashed the Labor brand and has betrayed the manufacturing workers it has continually said it supports. And what do we find? We find backbenchers on the other side saying anything—

Mr Champion interjecting—

they think will carry them through the next election—

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