Sharon Bird (Cunningham, Australian Labor Party, Shadow Minister for Vocational Education) Share this | Hansard source

I take this opportunity—as have many colleagues on this side of the House—to speak in opposition of the Automotive Transformation Scheme Amendment Bill 2014. I will look at some of the detail and explain why I am concerned enough to oppose the bill. I will also look at the context of some of the issues facing the automotive-manufacturing sector and manufacturing, more broadly, as a sector in our economy. I will focus on one of the aspects that I am most passionate about and engaged with, as the shadow minister: the skills-development issue.

The bill before us is intended to give effect to the Abbott government's $500 million cut to the Automotive Transformation Scheme over 2014-15 to 2017-18. That was announced as part of last year's MYEFO. The bill also has the effect of terminating the scheme on 1 January 2018, thereby cutting a further $400 million from the scheme, leaving no support for surviving components companies.

Labor opposes the bill. We believe that we need to fight to maintain Australian manufacturing capabilities and jobs—not pre-empt closure of this vital high-tech industry and risk early closure of firms, before 2017, by reducing funding. The scheme provides assistance in the form of co-investment to firms for the production of motor vehicles and engines and for investment in eligible research development of plant and equipment. This decision will put at risk 50,000 Australian men and women who have jobs directly in the car industry and the 200,000 workers who rely indirectly on the automotive-manufacturing industry for employment. It will also have a major impact on their families.

I have spoken in this place before of my own experiences, in my local area, with BlueScope restructuring and the effects that had on the supply chain in the area. We are also a major coal-mining industry. I come from a long line of coalminers and have seen the impact of retrenchment on families and the instability it creates in local communities, so we should be doing everything we can to protect these jobs. The scheme needs to be maintained to enable the government to work with industry, whilst it is in this transition, to rebuild jobs and maintain capabilities. Cutting this funding risks causing the early closure of motor-vehicle producers and hundreds of firms in the automotive supply chain, sending thousands of Australian jobs offshore.

In government, Labor's investments ensured that Australia maintained its automotive industry in the face of the global financial crisis, global industry restructuring and record-high Australian dollar. Labor's approach is based on co-investment in order to provide long-term certainty. It is not a hand-out. The industry only received support when it invested alongside the government. This support was critical in keeping the industry here and attracting new investments, models and capacity.

The Abbott government has demonstrated, through many decisions—but especially through this bill—that they do not care about workers affected by this downturn in the auto industry. They are cutting $900 million from the scheme, ultimately terminating it in 2018. It is part of a broader agenda to axe funding to programs that support workers in such industries. The manufacturing sector, including automotive, is worth fighting for. There has already been work done on how investment in strategies to transition the sector into sustainable long-term avenues can be achieved. One avenue is investment in upskilling the manufacturing workforce.

Recently a report was released on exactly this issue. I draw interested members' attention to a report of the Australian Workforce Productivity Agency: Manufacturing workforce study: skills to grow competitive, high-end manufacturing.In April this year, AWPA released this report on their investigation of the skills needed by the manufacturing industry, more generally, as it goes through this significant transition period. The manufacturing industry is Australia's fourth-largest employer. It has deep links with other sectors, particularly primary production, utilities, construction and services.

The manufacturing industry is a particularly important one in terms of the integration of innovation across all sectors. It is vital to economic activity in many regional areas. Manufacturing makes a disproportionately large contribution to exports and plays a critical role in the uptake and spread of innovation in our economy. As we well know, manufacturing has been in transition for decades, impacted by situations internationally and nationally—tariff cuts, industry restructuring, changing technologies, outsourcing of tasks to lower-cost economies and, more recently, the high Australian dollar and slower productivity growth in the economy. It is true that all these things created challenges and opportunities for our manufacturing sector. AWPA's report notes:

While transition is not new, it highlights the need for Australian manufacturing to focus on high-end innovative products where it has a competitive advantage. The future lies in us shifting from heavy industrial manufacturing to higher value added, technologically advanced production.

I would argue that the car-manufacturing industry sits perfectly within that frame.

In order for us to take advantage of these opportunities our workers will require a high level of skills, particularly the STEM skills—science, technology, engineering and maths. Improved leadership and management skills are necessary for businesses to increase productivity, innovate, adapt to changing business models and integrate into global supply chains.

AWPA made a number of recommendations. Firstly, it said, we need to focus on skills development. It indicated that the manufacturing industry's future lay in advanced and niche manufacturing. It recommended that industry work within Australian government manufacturing initiatives to identify linkages that promote industry-wide collaboration on skills and workforce development. The AWPA report recommended that continued government support be maintained for programs which assist businesses to develop and upskill their workforces, in particular, Enterprise Connect, Workplace English Language and Literacy program and the National Workforce Development Fund .

Sadly, the Abbott government totally ignored the AWPA recommendations and axed the very programs that AWPA recommended to upskill our workers to enable them to face workforce challenges in the future. The WELL program assisted businesses to train employees and to improve their English language, literacy and numeracy skills to help them improve their current and long-term future employment opportunities. The Australian Industry Group's report Getting it right: foundation skills for the workforce also highlighted the critical importance of language, literacy and numeracy. They were very supportive, I must say, of the program.

The National Workforce Development Fund program was part of the Labor government's Building Australia's Future Workforce package. This initiative was designed to link employers and industries to co-investment based funding for whole-of-workforce planning and development. In regard to the car industry I would refer members to two examples of where the National Workforce Development Fund was used very successfully in this way.

The Victorian Automobile Chamber of Commerce worked in conjunction with the Motor Trades Association Queensland and partnered with Kangan Institute to upskill and improve career pathways for 50 automotive technicians. VACC played an instrumental part in linking enterprises with the National Workforce Development Fund's training initiatives, and through its association with the MTAQ was able to assist with the provision of high-quality training for battery electric and hybrid electric vehicle skills.

Another example was the Nissan Aftersales Leadership Certification Program. This program, underpinned by the National Workforce Development Fund, took participants through a Certificate IV in Frontline Management. The program consisted of both on-the-job training and specifically designed modules of learning to enhance a candidate's ability to provide leadership and guidance in their particular role in the organisation. Both programs were well received by those businesses that were directly involved, by the industry organisations that worked to create them and by the participants. If people look at the department's website they will see some direct comment from workers who participated in that.

The second thing that the report said was that we need to position the workforce for adjustment and renewal. That particularly focused on developing the foundation skills but also getting in place some good and effective recognition of prior learning and accelerated training programs to help workers formalise the recognition of the skills they had developed. Again, it emphasised the importance of adapting those strategies for mature age workers, many of whom we see being impacted in the automotive industry.

Manufacturing should be promoted as a rewarding career. The AWPA report indicated that one of the main problems was a perception of manufacturing that was outdated and that it was important to actually have a conversation through industry groups, industry skills councils and trade unions all working together to promote the growing and positive opportunities in the manufacturing sector.

Finally, the report indicated that we needed to get seriously into the business of guaranteeing a supply of capable apprentices. They recommended that many of the programs that were sadly axed in the budget, such as Australian Apprenticeships Mentoring Program, the Australian Apprenticeships Access Program, the Accelerated Australian Apprenticeships Program and Apprenticeship to Business Owner were important to that task. Sadly, they have gone, too. In summary, the AWPA report into manufacturing recommended that this sort of investment would ensure that the workforce available would be positioned for a new and innovative sector in manufacturing more broadly but also obviously in the automotive area as well.

I would like to indicate, too, that one of the things that I do think was unfortunate for some of these industries in transition was the decision by the government to abolish local employment coordinators. In my own area, because of the BlueScope restructuring and its impact, we had one of these positions working closely with the companies and the affected workers to put in place some important programs that connected them with new opportunities but also put in place some training and support for supply chain providers to enable them to find some new markets. I think that was a short-sighted decision to remove those positions. They were very valuable.

Finally, I just wanted to make the point that I think that the decisions that the government made are short sighted. I think the automotive industry had the capacity, working in partnership with government, to have a strong future. I still think that that is a possibility, but this bill will not contribute to that outcome. The Abbott government established a $155 million Growth Fund designed, in their words:

… to generate the jobs of the future for employees and supply chain businesses in Victoria and South Australia affected by the closure of local automotive manufacturing operations.

I just want to highlight to the House that that fund included a $30 million skills and training program to assist automotive employees to have their skills recognised and also to provide them with training for new jobs while they were still employed. To date, we have not seen any information about how employees can access this program, what training options are being made available to them, whether they are able to have time at work to attend any training programs and whether they will be required to pay or for that training. There is much that needs to be clarified about the expenditure of that component of the package. It is important to provide that skilling and training opportunity to the workforce and I hope the government moves on that more quickly than they have done to date.

Sadly, they seem to be doing quite the opposite. The sector more broadly, and the workers in particular, as well as the regions and communities directly affected, deserve far better from their federal government than they are seeing at the moment. This bill is a bad decision and I am sad to be standing here but pleased to say I am going to oppose it.

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