Rob Mitchell (McEwen, Australian Labor Party) Share this | Hansard source

I rise to support the honourable member for Brand's very-well-worded and intelligent amendment to the Export Market Development Grants Legislation Amendment Bill 2020. We are not opposing the bill, because we understand the enormous benefits the Export Market Development Grants scheme has brought to Australian small and medium enterprises over many years. The EMDG Act establishes a grant program for Australian small and medium enterprises for reimbursements of up to 50 per cent of their export related marketing expenses. This, on the surface, is a great policy and, like most policy initiatives over the last few decades, it was introduced by the Whitlam government, in 1974. Its purpose was to encourage small businesses to expand their export markets and for Australia to diversify its economic reliance. Over time, however, the EDMG Act has not functioned in the best way it could for our exporters.

The Howard government slapped a spending cap of $150 million on the EMDG in 1997, and since then the funding has not really increased in real terms. Because of the confusing administration, the level of reimbursement each SME receives is uncertain and varies from year to year, dependent on the demand on the scheme and the size of the appropriation. Currently, some exporters are being forced to wait up to two years to receive reimbursements, with the level of funding unknown until after the completion of their promotional activities. We want our exporter-operators operating with as much certainty as possible, not hedging their bets based on what they think they might or might not get from this government.

The bill implements the recommendations of the Fisher review to streamline the act and to cut down bureaucracy. It will change the reimbursement scheme to an upfront grants scheme, which will provide certainty for exporters. The grants will also be capped for export-ready SMEs with an annual turnover of less than $20 million, down from the previous $50 million. That's because the review found that to many big exporters these grants were seen as nice to have rather than actually acting as an incentive to diversify their exports.

So Labor will be supporting the bill, but we urge the government to actively enter discussions with the Export Consultants Association and take on their advice about any amendments to the act. While we will be supporting the bill, we are horrified by this government's indifference to any export market that doesn't involve digging things out of the ground. That accounts for the vast majority of SMEs, who are trying to make a go of it in complex exports—exports like manufacturing, which has all but died under this government's watch and has contributed to our decline in our world rankings.

Diversifying our exports means higher wages and more jobs for Australians, and in the midst of the Morrison recession, the worst this country has seen since the Great Depression, you would think it would be a top priority for a government, yet small and medium enterprises account for just 14 per cent of Australia's exports. If we look at that in comparison with G7 countries, we see they account for 25 per cent of exports and the European Union average is around 35 per cent. By lifting our SME exports to 25 per cent of our overall exports, Australia would increase its GDP by an estimated $36 billion. At a time when this government is slashing JobKeeper and saying there isn't enough money in the budget to help young families with child care, you'd think that $36 billion would be an enticing number. Then again, this is the government which has squandered billions of dollars on waste, rorts and favours for Liberal mates, so it isn't surprising that the PM is more interested in bringing a lump of coal into parliament than he is in supporting industries that can save the Australian economy.

Because of the government's inaction over the last eight years, our exports have been become unusually dependent on China, so this government should be doing all it can to promote diverse export markets, but it's not. Take, for example, Australia's languishing trade and investment relationship with India. Two years ago a landmark report on India found that no single market over the next 20 years would offer Australia more growth opportunity, but so far this government has done next to nothing in its response to the report's 90 recommendations. Instead the PM held a virtual summit with Prime Minister Modi with practically no attention given to the trade and economic relationship. It's hardly shocking, then, that India's share of Australia's export has dropped below two per cent, the lowest since 2003. In a growing market Australia is getting less and less of a share because this government is asleep at the wheel when it comes to supporting small and medium enterprises and exports.

Our SME exporters have learnt the hard way that the government really cares more about short-term bucks they can get from mining rather than the long-term stability we can achieve by diversifying exports. That's why Labor has publicly called on the government to address Australia's lack of export complexity. A recent Harvard study of economic complexity ranked Australia 93rd in the world for complexity of its exports, lagging behind great and powerful nations such as Kazakhstan, Uganda and Senegal. Such a narrow export base means Australia is uniquely dependent on a small number of trade investment markets, which obviously increases Australia's risk in a deteriorating global economic environment. The government claims to care about national security above all else, but if this were really the case Australian businesses would not currently be feeling the pain of geopolitical tensions. That they are is due to the mismanagement of the current Prime Minister.

Despite these warnings, Australia, under Prime Minister Scott Morrison, is more dependent than ever on China for its exports and jobs. In fact, we depend on the Chinese market more than any other country in the world. A British research institute recently determined that among the Five Eyes countries, comprising Australia, the US, the UK, Canada and New Zealand, Australia is the most dependent on the import of Chinese goods, particularly strategic goods, ranging from medical equipment and pharmaceutical goods to processed aluminium and steel. These are things that can and should be made here. We're a country that should be able to invent things, make things, sell things and export things. We have the know-how. We have the intelligence. We just don't have a government that's actually committed to driving and building this.

The government has had over seven years to figure it out, yet it still hasn't delivered a plan to support our exporters, to save Australian jobs or to diversify our economy. Australian exporters are suffering and Australian jobs are on the line because our exports are forced to be too reliant on a single market. I find this particularly worrying, because Chinese demand for our commodities is forecast to plateau in coming decades, and we've seen recently the issues in relation to exports. Whether it be live fresh rock lobster—our wild catch lobster, which is the best in the world—or other commodities such as barley, they are all at pains, while this government walks around, puffs its chest up and says how good it is. In the meantime, our exporters, our farmers and Australian workers are suffering.

With all these exposed sectors, such as our meat exporters and winemakers, it becomes painfully clear that China, for reasons which are vague and unclear, is willing to limit imports from us. But what is definitely clear is that the government has been asleep at the wheel and is failing Australian workers and businesses badly. We cannot change our reliance on China overnight, but the government seems to believe it is up to the Australian companies to go and open new markets. It's obvious from our history that nothing will happen unless the government takes the lead, but it will take a little more follow-through than a couple of press conferences called by the Prime Minister. We have a vast network of trade embassies right around the world that can deliver work and help bring in extra markets, more job opportunities for Australian workers and more opportunity for Australian exporters, but we've got to have the government driving these things. There's no point sitting on your hands and saying, 'It's not our fault. It's all their fault.' No, it's not. It's actually the government's fault, and the government should be held to account for doing this and causing the issues that we're seeing today for our small and medium enterprises.

It's not just China that we're dependent on. Australia currently holds 28 days worth of fuel imports. Now, this is well below the 90-day minimum requirement under international agreements. Even though the hapless Minister for Energy and Emissions Reduction signed an agreement with the US to hold fuel reserves, let's be clear: we're going to get fuel reserves, but we're going to leave them in the US rather than onshore. So, if anything happens and we have any incidents that stop fuel from being transported, we'll be left with nothing. This is the joy that we have when we listen to Minister Taylor. Seriously, he turns anything he touches into absolute problems, each and every time. Whether it's false emails with the City of Sydney or his energy policy, you can be sure that whatever happens with Minister Taylor is going to end up being a mess.

We need to ensure that this fuel is delivered onshore. It should be sitting here. We should have our refineries working. We should have jobs in this country. We should have the fuel supply that our people rely on here onshore, because we don't actually have the capacity to refine it. We saw the member for Brand talking very strong about the refinery in her electorate that's being shut down. Where's the government on that? It's nowhere to be seen. That is an absolute failure. Really, the core business of the Australian government is firstly to protect our citizens.

The government has abandoned self-sufficiency in favour of foreign reliance. As I said, we used to be a country that invented things, built things and sold things. But, under this government's watch, the manufacturing sector has collapsed. Through past jobs, I know the importance of access to Australia's high-quality exports. The rock lobster fishery in Victoria and South Australia is the cleanest and greatest in the world, yet it's being held up and those products are not getting overseas. Sure, it's good for Australian consumers because it means a price drop, but it's not good for those who have invested millions of dollars in an industry and the many jobs that it brings.

Industries like that have been abandoned by this government, because this Prime Minister is all about a photo op but never a follow-up. If it was up to Labor we would be working hard with exporters to be build relationships and secure the markets that Australian jobs depend on. Diversifying export markets is more than a photo op and a free trade signing ceremony. We've seen with the free trade agreement with China just how well that's working at the moment! Labor would work with other allied and aligned countries who also face the challenge of a more assertive China, not alienating ourselves from our Pacific neighbours like this government is doing.

While we will support the passage of this bill, we say to the government that more must be done to improve SME exports. We are lagging on the world stage when we should be out in front. I say to the Prime Minister if he ever took the time to listen to anyone but himself that if he expects the support of exporting businesses then he has to do more to protect them from the geopolitical tensions, which they are now exposed to courtesy of the failure of this government.

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