House debates

Tuesday, 7 March 2023


National Reconstruction Fund Corporation Bill 2022; Second Reading

4:58 pm

Photo of Michael McCormackMichael McCormack (Riverina, National Party, Shadow Minister for International Development and the Pacific) Share this | | Hansard source

I'm glad the member for Moreton is in the House to listen to my contribution because, there's the bloke, there's the member who, on 1 November 2021, said:

My grandfather was a grader driver during the Great Depression. If a road hasn't had a grader on it since the Thirties why on earth would a responsible federal government make it a priority now while the population in the bush is decreasing?

No doubt your grandfather was a very good man, as you are, member for Moreton. I've been on trips with you. I have been on committee trips with you and I know you are a man of good heart and of good intention. When you wrote that tweet, you were wrong. I know the member for Forrest will back me up and the member for Herbert and anyone who's represented a regional electorate or peri-urban regional electorate will know that when you put bitumen on gravel, you add hope and prosperity to those regions, because it's the regions which are providing the food and fibre for all of Australia and many other countries besides. Indeed, it has a lot to do with the National Reconstruction Fund because, as Labor says, this will provide mostly jobs in the bush. I agree—that's what we want; that's what we need—but we're not going to get jobs in the bush when Labor come to this place and jack the energy prices up, sending them skyrocketing through the roof. We're not going to see manufacturers in regional Australia with the policies of those opposite, who have shown reckless abandon in the past when it comes to the regions.

This National Reconstruction Fund, I agree, was part of their policy platform prior to the election, and good on Labor for at least honouring one of the things that they said they were going to do. They didn't tell us that there was not going to be a $275 price cut in power bills. They didn't tell us that they were going to readjust people's superannuation or start to tinker with franking credits. Indeed, they did not tell us that, but they did tell us there was going to be a national reconstruction fund. This is the bill which puts that into the mechanics of the parliament. But is it good policy? Well, Labor comes to this argument, comes to this debate and comes to this motion making out as if there's been no construction happening in Australia at all, let alone in regional Australia, which actually showed the way during COVID. It was regional Australia.

Photo of Nola MarinoNola Marino (Forrest, Liberal Party, Shadow Assistant Minister for Education) Share this | | Hansard source

Hear, hear!

Photo of Michael McCormackMichael McCormack (Riverina, National Party, Shadow Minister for International Development and the Pacific) Share this | | Hansard source

I hear, 'Hear, hear!' behind me. I think that was the member for Forrest.

Photo of Nola MarinoNola Marino (Forrest, Liberal Party, Shadow Assistant Minister for Education) Share this | | Hansard source

Yes, it was.

Photo of Michael McCormackMichael McCormack (Riverina, National Party, Shadow Minister for International Development and the Pacific) Share this | | Hansard source

It was regional Australia that did this, no thanks to those opposite, who opposed everything that we were trying to do and everything that we did do during COVID. I constantly hear—and it drives me nuts—about this supposed trillion dollars worth of Liberal Party debt.

Photo of Nola MarinoNola Marino (Forrest, Liberal Party, Shadow Assistant Minister for Education) Share this | | Hansard source


Photo of Michael McCormackMichael McCormack (Riverina, National Party, Shadow Minister for International Development and the Pacific) Share this | | Hansard source

It absolutely is rubbish, Member for Forrest, because it's nowhere near a trillion dollars—but, then again, facts and figures were never a strong point of those opposite.

This bill ignores key economic issues. The key economic issue at the moment is cost of living. There's another really key economic issue, and that is rising energy prices. There is another really key economic issue, and that is labour market shortages. I was speaking to transport operator Peter Rodney, who runs a trucking company out of Wagga Wagga. He has 17 B-doubles backed up against his fence because he can't find drivers, yet what's Labor doing? What's Labor proposing to do? They're going to the states to jack up and whack up the price of fuel, with a 10 per cent price hike on our truckies, who led the way during COVID. They were the real heroes, aside from the nurses and the frontline medical professionals. They were the ones who carried the goods and the personal protection equipment. They are the lifeblood of our nation. No good gets delivered in Australia without a truckie—without someone who puts it on the back of their B-double or their little lorry. I know that's an old-fashioned word, but nothing gets delivered in Australia without the help, in some way, shape or form, of a truckie.

What we have at the moment is a Labor government wanting to increase the excise on fuel, and this is just a disgrace. It's a 10 per cent increase for our truckies. And it's not only that; they're also trying to force those family operators off the road by reckless policies pushing the envelope too far when it comes to climate, making sure that our truckies just don't have a hope for the future. The bill will make it even tougher for manufacturers, and it annoys me that Labor comes to this space and this argument saying there's been nothing done for manufacturers. The Modern Manufacturing Initiative was an absolute boon for regional Australia.

I know that, with the funding that we gave to businesses such as Flipscreen—with a $10 million grant to help this regional manufacturing hub create up to 147 full-time jobs during construction and up to 502 ongoing full-time jobs over the first five years of the project—the proponents there were absolutely delighted. The MMI was the centrepiece of the then coalition government's $1½ billion Modern Manufacturing Strategy, designed to position Australia as a globally recognised, high-quality and sustainable manufacturing nation. Indeed, it was doing the job. It wasn't, as Labor will, sending manufacturing jobs offshore because of sending industry offshore—that's because of high, reckless energy prices and high, reckless energy policies. That's what I really fear and worry about. Businesses will benefit from their own entrepreneurial endeavour. Yes, many require government help, and government help is always going to be there. I look at the Wagga Wagga meat processor, Teys, which has unveiled a $42 million waste energy hub plan that's going to reduce their—and these are their words are not mine—'skyrocketing' energy costs and protect 900 jobs. That is a good thing. They were worried about energy costs, I have to say, when we were in government, let alone what they must think now!

If you go right throughout my electorate you'll see manufacturers and businesses in regional Australia trying to operate in a market which is becoming harder and harder because of those opposite and their policies. The biggest factor—one of the greatest critical factors—is not just energy costs, as I said before, but it's finding the workers. The Regional Australia Institute identified 80,000 vacancies in regional Australia. The member for Page, no doubt, has any number of heavy industry, manufacturers and small, medium and large businesses in his electorate which just can't find hired help. There are signs in every window. If you go down the main street of any country town, city or regional centre then you'll see signs in shop windows which say, 'Apply within'. It's because there just aren't the people. It isn't just COVID, it's just very difficult.

But what are those opposite doing about it? They're proposing a lottery-type scheme in the Pacific which doesn't actually cut the mustard, I have to say, nor does the National Reconstruction Fund. Let's look at the critical issues first: labour shortages, rising energy prices and, basically, the cost of living. Let's let Labor address those issues in government before going down with this fanciful bill that they have before the House. Good luck with that! I know it was part of their election commitments, and let's wish them good luck with it. But, like everything that Labor does, tries or attempts, it will be a folly. It will be a folly, because, unfortunately, that's the Labor way.

5:07 pm

Photo of Graham PerrettGraham Perrett (Moreton, Australian Labor Party) Share this | | Hansard source

I rise to speak on the National Reconstruction Fund Corporation Bill 2022. I say that for the benefit of those listening, because the member for Riverina obviously brought in the wrong notes for the wrong speech for the wrong piece of government legislation. Unbelievably, he did stumble on the title for the legislation in the last 30 seconds of his speech but then quickly backed away from it!

The Australian Labor Party is committed to manufacturing. Manufacturing matters to the people of Australia. I know it does in my community of Moreton and especially to everyone in the mighty Australian Labor Party. Why does it matter? Because it's a driver for jobs. And I don't mean that unpaid-slavery-sort of work; I'm talking about meaningful, secure full-time jobs. For way too long, manufacturing was neglected by the former coalition government, which is perhaps why the member for Riverina, despite having a lunch break to work on his speech, did not actually address the issue of manufacturing and all that will flow from the National Reconstruction Fund.

Who can forget when the then treasurer Joe Hockey stood right at that dispatch box and dared Holden to pack up and leave Australia? I remember that. Nick Champion, one of my friends who got elected at the same time, would remember that. The first Holden rolled out in his electorate, and he saw Joe Hockey do that. And what did Holden do? They packed up and left Australia. How many jobs were lost, not just from the Holden plant but from all of those associated jobs? There were export jobs as well. Not only jobs in the manufacturing the cars but those associated manufacturers and suppliers who relied on Holden and the like. I'm sure all of my colleagues from South Australia know firsthand the devastation it had on local economies when those doors closed at Holden.

In Queensland, we have our own stories of how an LNP government failed to trust and support local manufacturing. I remember the disastrous decision by the Newman Liberal National Party government to order trains from overseas. No guesses for how things turned out when that genius let his ideology dictate policy. When the trains eventually arrived, not only did they not meet basic disability access requirements; they needed even more modifications, including air conditioning, ventilation, braking and sight lines for drivers. Thankfully, the great train-building community of Maryborough stepped up to the plate to rectify Mr Newman's defective trains. That was in an electorate that is not held by the federal Labor government, but still we invest in making trains. I note that the Prime Minister has been to that Maryborough train factory many times.

Thankfully, the Queensland state Labor government just a few weeks ago announced that Downer, in Maryborough, again will build a new fleet of trains. Queensland workers are building Queensland trains for Queenslanders. Can you imagine the positive economic impact this is having on the Maryborough community? I'm not sure that the local member for Wide Bay, Mr O'Brien, or Queensland senators Matt Canavan or James McGrath have ever visited Downer and Maryborough lately and seen what is happening there. They could be taken on a tour by the Prime Minister, he's visited that often. I have the mobile of the state Labor member for Maryborough, Bruce Saunders; I'm sure I could organise a visit for all of those gentlemen and he would be happy to take them on a tour.

It's regional communities, like Maryborough, like the one represented by the member for Riverina, that will really benefit from this National Reconstruction Fund. The $15 billion National Reconstruction Fund is the mechanism to support, diversify and transform Australia's industry and to create sustainable, well-paying jobs. Hopefully some of it will come to inner city seats like Moreton, but we know most of them will be in the regions, the areas represented by the Nationals.

The NRF will provide finance, including loans, guarantees and equity to drive investments in seven priority areas of the Australian economy. It will leverage our natural and competitive strengths and support the development of strategically important industries and shore up supply chains. The seven priority areas include value-adding resources, which means expanding Australians' mining science technology and ensuring a greater share of raw materials that have been extracted from the ground are then processed domestically—for example, the high-purity alumina from red mud in bauxite processing or lithium processing for batteries. This is to add as much value as possible here in Australia before we send those resources overseas. It includes value-adding in the agriculture, forestry and fisheries sectors, where we will unlock the potential and value-add to raw materials in things like food processing, textiles, clothing and footwear manufacturing. We know that we grow enough food and fibre for 75 million people in the world when we've got only 25 million here, so let's value-add all the way along and get those good jobs.

We'll develop capabilities in transport manufacturing and supply chains, including for the electric cars of the future, trains and shipbuilding. In medical science we will leverage Australia's world-leading research to provide essential supplies such as medical devices, personal protective excitement, medicines and vaccines. I know one of the advanced manufacturing plants in my electorate, Cook Medical, is where they tailor-make aortas. I have seen rooms full of, mainly, women sewing up the aortas that are going to be shipped off to Germany, California or wherever. It is unbelievable.

There are renewables and low emission technologies, the way of the future. we will pursue commercial opportunities, including for components for wind turbines, production of batteries and solar panels, new livestock feed to reduce methane, emissions, modernising steel and aluminium, hydrogen electrolysers, innovative package solutions that reduce waste and defence capability. We will maximise the sourcing of requirements from Australian suppliers employing Australian workers, whether that be technology, infrastructure or skills.

Lastly, enabling technologies will support those key enabling capabilities across engineering, data, science and software development, including the emerging areas, like artificial intelligence, robotics and quantum.

This is why the Albanese government's National Reconstruction Fund is so important to manufacturing in our nation. I'm disappointed those opposite have taken this as an opportunity to sledge rather than explore the future. They're happy to dredge up the past rather than look to the future. They're so scared of the future. We all saw during the pandemic how international supply chains could so easily result in major disruptions. It shone a light on how important manufacturing was to Australia. It demonstrated how vulnerable we are down under and how crucial it is to establish resilient and robust domestic production capacity—that little bit of economic nationalism.

The pandemic also reminded us of how innovative our local manufacturing can be and of the skills and production that is there that, sadly, the previous government failed to support and invest in. Before the pandemic, just five per cent of personal protective equipment, PPE, used in Australia was made in Australia. Put simply, we didn't have the manufacturing capacity to meet demand. But the Palaszczuk Labor government moved quickly at the time on this supply and production issue. They mobilised local manufacturing to deliver PPE and COVID-19 related equipment for frontline health and essential workers.

Our local manufacturing businesses quickly pivoted and stepped up to the challenge. I'll mention a few of my local businesses that did this. Belgotex at Acacia Ridge, one of Queensland's only textile manufacturers, purchased special looms, upskilled their workforce and commenced making special-gauge fabrics for local PPE production. The lightweight tight-weave fabric can be used to make medical scrubs, uniforms, hospital linen, sheeting, privacy screens, reusable face masks and gowns for frontline health workers. Imagine how many lives Belgotex at Acacia Ridge has saved in Queensland.

AnteoTech at Eight Mile Plains launched its 15-minute COVID-19 antigen rapid test platform, EuGeni. This project created five new, highly skilled jobs and protected 20 existing jobs.

EGR—a business that I drive past every day I go to work—a 46-year-old car accessories manufacturer at Salisbury, pivoted early in 2020 to produce protective face shields for frontline workers. EGR export bumper bars to Germany for German cars. They are very competitive, but they immediately changed. Their 800 staff were set up to mass produce the equipment at a rate of hundreds of thousands a day.

These are just a few of the local manufacturing businesses in my electorate, and there are many others, who pivoted when Australians needed them most. Sadly, the Morrison government didn't back in local businesses. In deciding to award contracts for PPE that could have been filled by local manufacturing businesses, they instead went offshore. Shame! As I said, a little bit of economic nationalism goes a long way in a crisis.

Being able to manufacture, innovate, build and create products right here in Australia is so important for our security and long-term prosperity. Australia is rich in valuable critical resources that the world wants and needs—resources we could rightly have expected would be used to build our manufacturing base to add value and create secure jobs right here in Australia, in our suburbs, in the bush and in our regional communities. But for decades we've mined those resources all too often and shipped them overseas, only for other countries to process, add value and then have us buy them at the local shop. We import them back at many times the price, sending the manufacturing industry and their profits and the thousands of jobs they create to other countries. If we mine it here, we should make it here, wherever possible.

Australian know-how, our scientists, our innovators and our capital are amongst the best in the world. Photovoltaic technology solar cells were invented here, but today 87 per cent of the world's cells are made in the one country, and in the next three years that number is expected to rise to 94 per cent. As the world urgently focuses on decarbonisation, the transition to renewables and low-emission technologies will play a vital role in delivering Australia's emissions reduction target of 43 per cent by 2030 and net zero emissions by 2050.

We're well placed to make the most of our technology and our skills. If we invent it here, we should make it here and monetise it here. We've seen what happens when Australia fails to back itself and when we fail to back our people—those people go overseas. We've seen that brain drain in the past. They take their experience, their know-how and their passion with them. We want Australians living overseas who have the skills and know-how to come home to good careers here. We recognise many of them left our shores seeking support and funding for their ideas.

Sadly, that girt-by-sea capital is a little too risk averse when it comes to backing in innovation. Too often, good ideas can't find support and funding and the right sort of helping hand at home. We want to empower the NRF to invest in Australians for Australia—Australian know-how, Australian ideas and Australian ingenuity. Both this bill and the investment mandate guiding investments will make sure the $15 billion fund drives Australia's natural inclination towards innovation.

The Department of Industry, Science and Resources has consulted widely both on the structure of the legislation and, most recently, on how the NRF will be implemented. Partnering and working with industry is vital, so co-investment plans will be developed with industry. These will outline investment opportunities in priority areas and actions for government and industry to build our industrial capabilities. The minister has said that plans are expected to be released by the end of this year.

Importantly, the NRF's investment decisions will be independent and at arm's length from government. We know the coalition aren't big fans of independent decision-making. For too long while they were in government, decisions were made in the interests of the coalition and their mates, not in the interests of Australia. Who can forget the stench of those colour coded spreadsheets and then the odour of mendacity associated with defending those dodgy, dubious, devious decisions—or a minister approving a grant to clay target shooting clubs that they were a member of? It was appalling behaviour and a clear demonstration of the coalition putting their interests or their mates' interests ahead of the Australian people, the Australian taxpayers.

Is there a flaw in the coalition's DNA? You don't have the answer to that, but I will take a closer look at the LNP-led Brisbane City Council, which failed to heed the mistakes of the Newman government and recently ordered their new bendy buses from overseas. At a time when we want to grow jobs and build industry skills and capacity onshore, Lord Mayor Schrinner decided to go offshore. Why not invest in local companies and create local jobs and even new and bigger industries right here in Australia?

Just two weeks ago I stopped to visit a local business, Bus Stop, which is located in Rocklea. It's a local family-operated business with more than 50 years experience in servicing and manufacturing buses. About three years ago they transitioned away from diesel to manufacturing and assembling electric coaches and buses for schools. Just imagine if the coalition had invested in and supported this wonderful local business by assisting in creating a vibrant and robust local bus manufacturing industry with jobs of the future, the way the Labor Palaszczuk is doing and the way the NRF will do.

What do the Liberals and Nationals have against workers in manufacturing? I shook my head in disbelief when I was listening to the opposition leader saying that the Liberals were the party of the Australian working class. That is such a joke! I'm not sure if politicians are eligible for the Logies, but the member for Dickson is surely a frontrunner already. Remember, this is the party that had the economic strategy of deliberately ensuring wages were kept low. We believe in investing in manufacturing.

5:22 pm

Photo of Nola MarinoNola Marino (Forrest, Liberal Party, Shadow Assistant Minister for Education) Share this | | Hansard source

O () (): I was a member of this parliament during the Rudd-Gillard-Rudd Labor years, and I learned very quickly how to recognise when the government became desperate when it was trying to force a bill through both houses of parliament. Extraordinary and extreme claims were made, and the desperation was palpable.

Disappointingly, that's what we saw recently from the Minister for Industry and Science when, in desperation to get Labor's rushed National Reconstruction Fund legislation through the parliament, he resorted to using our key defence pact AUKUS as a political pawn, a bargaining chip. In my view national security, and the role of AUKUS in our national security, should be above politics. Clearly for this Labor government, it is not; it was absolutely shameful. Even with what I've seen in previous Labor governments, this really surprised and profoundly disappointed me, particularly when the minister himself never mentioned the word 'AUKUS' once during the introduction of the bill. Obviously, it wasn't a priority at that stage; if it had been, the minister would have certainly made much of that in his introduction of the bill, but the minister didn't mention national security once. Not once! So I'm wondering how much of the initial $5 billion and overall $15 billion for the National Reconstruction Fund will actually be quarantined for defence on the back of the minister's comments. It's a very good question to ask. The minister has not provided any of this detail.

There are those of us who actually take national security very seriously and know that AUKUS was the work of the former coalition government. I am possibly the only daughter of a World War II war-widow in this place who understands how important national security is, what the cost is to Australian families, why we take it seriously and what was fought for.

AUKUS builds very strongly on our existing relationships with the United Kingdom and the United States. The reasons for this are clear, given how significantly the security challenges in the Indo-Pacific region have grown. AUKUS builds further on the three nations' longstanding and ongoing bilateral ties. For Australia, the first initiative under AUKUS was the eight nuclear powered submarines. There will be a concentration on cooperation around a range of existing and emerging security and defence capabilities designed to enhance joint capability and—the most important thing—interoperability. Speaking of interoperability, it is critical. I have seen firsthand through the Australian Defence Force Parliamentary Program just how much emphasis is placed on interoperability in any given theatre of operation.

For instance, RIMPAC, the world's largest international maritime exercise, in 2022 saw approximately 1,600 Australian Defence Force personnel join 26 international partners in exercises held across training areas in and around the Hawaiian islands and Southern California from 29 June to 4 August. The Rim of the Pacific Exercise is a biennial international military exercise hosted by the Commander, US Pacific Fleet. The ADF was really committed, and it was a substantial commitment, with the ships Canberra, Supply and Warramunga, the RAAF P-8A Poseidon aircraft, a submarine, mine warfare and clearance diving capabilities, and a joint landing force led by the 2nd Battalion, Royal Australian Regiment, accompanied by personnel and capabilities from across Australian Army units. RIMPAC, as we know, aims to be the premier joint combined maritime exercise and enables Australia to strengthen international partnerships, enhance that interoperability piece, and improve readiness for a wide range of potential operations—something that is becoming more and more critical in our regions.

The interoperability piece is critical. The original plans for AUKUS was to focus on cybercapabilities, artificial intelligence, quantum technologies and additional undersea capabilities. I was recently briefed on the cybercapabilities and issues both here in Canberra by our defence members and in Edinburgh. Given that AUKUS is a historic opportunity for the three nations, working with like-minded allies and partners, aimed at sharing our shared values and promoting security, it is very important. But this is a Labor government. During the Rudd-Gillard-Rudd years it never built one ship, and if the government were really serious about AUKUS in relation to this bill and anything else, it should be focused on energy security. After all, energy security is national security. Given those challenges in the Indo-Pacific, surely, energy security should be at the top of the government's priority list, even with this bill.

AEMO's recent 2022 electricity statement said there is an urgent need for additional dispatchable power and projects. As we know, gas continues to play a critical role, but there are questions around whether there will be shortages of gas and shortages of energy. Again, given Labor's very rushed energy price-cap legislation just before Christmas, putting price caps on energy, we know this will have an impact on gas exploration, extractions, plans, investment and future manufacturing. We know that the Victorian Labor government has demonised gas. Genuinely, Labor does not see gas as a critical and transitional energy—which it is. Labor's much-hyped plans for renewable generation transmission and storage are not delivering. I remember the minister for energy at the AFR energy and climate summit saying we will need to install 40 seven-megawatt wind turbines every month until 2030, more than 22,000 500-megawatt solar panels installed every day—that's 60 million by 2030—and 10,000 kilometres of transmission lines and corridors. If the decision is green hydrogen, I actually saw a map that showed that it would require 25 per cent of Australia's landmass, regional areas, to be covered by solar panels. Then there is the wind turbine issue as well. AEMO's latest report on the state of Australia's energy grid is a clear warning that the Labor government's energy policies are failing. The report shows Labor's rush to bring on the early closure of power stations and delays to the Kurri Kurri gas plant as key drivers of the deterioration in the grid stability since the coalition was in government. Under Labor, Australian households and businesses are not only being hit with higher energy prices but now they are being told to brace for potential blackouts as well.

As I said, energy security is national security. How on earth, as a nation, can we deal with national security challenges when we're facing in our own region a lack of reliable, affordable and dispatchable power? Even in Western Australia, which sits outside the national energy market, we're facing power shortages. The state government has plans to shut down all coal-fired power by 2029. Even the privately owned Blue Waters power station may close as well. Combined, this will take 1,440 megawatts of baseload power out of the system. Dr Steve Thomas, the shadow minister for energy, recently belled the cat when he said:

The current plan cannot be delivered by 2029, and it cannot supply the state's power needs.

He went on to say that the WA state Labor government has no plans for storage of renewables at night and that building battery storage to last overnight will cost at least $7 billion, twice the cost of the state government's entire transition plan budget. Steve Thomas also highlighted that in the transition process the WA state government will also have to change its ageing gas generation fleet from peaking stations to baseload, just try to keep the lights on. But the Labor state government doesn't have sufficient gas stations to deliver both baseload and peaking power.

In recent month we've seen 100,000 tonnes of coal imported from Newcastle in New South Wales to Collie—unprecedented. This is an up-to-date figure of $19.5 million in a WA taxpayer funded grant given to Collie coalminer Griffin Coal. Griffin supplies Blue Waters Power Station and South32's Worsley alumina refinery, and this is manufacturing of alumina from bauxite. The viability of Premier and Griffin are in the firing line through the state Labor government's decision to shut down all of those power stations by 2030 but without other sources of reliable, dispatchable and affordable power. I recently read that a former director of WA's state owned energy retailer Synergy said blackouts are inevitable in WA and the state's key energy grid is headed for disaster under the McGowan government's plans.

But we also know that under the NRF that the unions have plans to install union officials on the board—a bit like union controlled superannuation fund boards—and they plan to steer. That's what they said, that they plan to steer the NRF investments in a similar way to the union controlled super fund boards. We know that the unions are totally opposed to independent experienced directors on the NRF boards. And we know that Labor has backflipped on superannuation, on lower mortgages. The Prime Minister said 'life will be cheaper under me' on the $275 promise of reduced power prices, and there's every chance that the Labor government will roll over on union demands over time. Of course, we don't want to see this just become the next honey pot hive for Labor and its union bosses.

Australian people know they can't trust Labor when it comes to union control of the Labor government, whether it's the ABCC, through the CFMMEU, or the extreme changes to the industrial relations laws affecting small and medium businesses. For the first time, we have unions in small businesses, in our doors, through enterprise bargaining, through union demands to charge bargaining fees for non-union members. Of course it's reported that total union contributions—we can't be surprised—to Labor at state and federal levels rose from $13 million to about $16.7 million ahead of the 2022 election. I think the CFMMEU delivered about 25 per cent of all contributions to Labor, so it is no wonder that those decisions are made—

Photo of Kevin HoganKevin Hogan (Page, National Party, Shadow Minister for Trade and Tourism) Share this | | Hansard source

Paying the piper.

Photo of Nola MarinoNola Marino (Forrest, Liberal Party, Shadow Assistant Minister for Education) Share this | | Hansard source

Exactly. And now we know the way ahead. We had a very good meeting last night, with the Parliamentary Friends of Trucks, Trailers, Transport and Logistics, and we certainly heard from that industry about the issues they're facing. They are concerned for many reasons about the proposed increase in the fuel excise tax and what that will do to their businesses. There was one business that indicated the cost of their electricity, given they are in that space, has gone from over $400,000 to over $1 million. They are in the refrigerated space. Labor is looking to revive the Road Safety Remuneration Tribunal, which, as we know, will affect 35,000 small owner-operators in the trucking industry.

What we are facing as well is one of the world's highest carbon taxes, and we're waiting for Labor to backflip on legislated tax cuts ahead. I think that's something that none of us would be surprised to hear. So there are many reasons that I have concerns about this particular bill, but, I must admit, I was surprised and disappointed to hear the minister's reference to AUKUS in promoting this bill.

5:36 pm

Photo of Matt ThistlethwaiteMatt Thistlethwaite (Kingsford Smith, Australian Labor Party, Assistant Minister for Defence) Share this | | Hansard source

I'm obviously speaking in support of this very good bill, the National Reconstruction Fund Corporation Bill 2022. It's a major reform for Australia.

The previous speaker's presentation and speech had all the hallmarks of a classic Liberal speech: climate denialism and a bit of union bashing on the side. It had all of the hallmarks of a classic Liberal speech under the Dutton leadership. Of course, the opposition fails to recognise that this particular bill and policy was one of the features of the Albanese government's suite of policies that we took to the last election. We actually put this before the Australian people, and—guess what?—they voted for it. They voted for it in a big way because they do want to see a resurgence of manufacturing in Australia.

The Albanese Labor government was elected to deliver this $15 billion National Reconstruction Fund, and that is what we intend to do to keep faith with the electorate. This is a key election commitment that will diversify and transform Australia's manufacturing industry. During COVID, we saw the vulnerability of many sectors of our economy and, indeed, many communities because of supply chain shocks associated with COVID and a lack of access to shipping, to air freight and to other important markets that Australians had relied upon in the past. We know that Australia has the capacity—we had the capacity in the past, and we can reinstall that capacity—to be a leading, powerful nation when it comes to manufacturing. Manufacturing creates good full-time jobs that are high skilled and provide secure conditions of employment for workers.

As the Assistant Minister for Defence, I've been struck by, and tremendously respectful of, the capacities that are being delivered by Australian industry when it comes to Defence Force capability. Both large and small companies throughout the country, with their very skilled workforces, are playing a crucial role in ensuring that Australia's future economic prosperity and our national security are strong and that our sovereign capability and cutting-edge defence industry are underpinning our Defence Force.

After the pandemic, the supply chain constraints on our economy made a difference, and the government recognised the need to build a robust sovereign industrial base at a time of accelerating technological growth and acute competition for workforce skills. This reconstruction fund is the key to delivering on that endeavour. The fund includes defence capability as one of its focus areas, and it will complement the defence industry development strategy and seek to partner with the private sector to build defence capability and economic sovereignty.

Recently I was fortunate to visit RAAF Base Amberley in Queensland and see firsthand the partnership between Boeing Australia and the Royal Australian Air Force on technology involving uncrewed vehicles. The program is colloquially known as 'ghost bat'. These are high-tech, uncrewed vehicles manufactured here in Australia, in Melbourne, providing high-tech jobs for Australians, improving the capability of the Australian Defence Force, but, more importantly, providing export potential for Australia. A number of our allies are keenly interested in this technology and don't have similar technology in their industrial base. This is a great example of government being able to work with the private sector to leverage improved capability for our nation's defences, but, at the same time, invest in the high-tech industry and support the highly skilled jobs of the future. We have to build on that capability if we're going to embark on a deeper level of co-operation and integration between the Australian Defence Force, our allies and defence industry ecosystems. The government is committed to growing Australia's industrial base, to provide that game-changing capability that we're going to need into the future.

That is what the Defence Strategic Review is all about. It's also why the new government commissioned the defence industry development strategy, informed by the DSR, to articulate the strategic rationale and the national security imperative for a strong, resilient and integrated defence industrial base. The National Reconstruction Fund will help drive regional development and invest in our national sovereign capability, which will broaden and diversify Australia's economy in support of our national interest.

That diversification and that focus on broadening our national interest is focused on seven priority areas, value-adding in: resources; agriculture, forestry and fisheries; transport; medical science; renewables and low-emissions technologies; defence capability, or course; and enabling capabilities as well. These investments are about ensuring Australia's security into the future. We need to revitalise manufacturing after years of neglect under the former coalition government.

I've had the opportunity to make a couple of trips down to South Australia to see the burgeoning SME defence industry that is growing in Elizabeth and the former industrial manufacturing bases that were the powerhouses of manufacturing in Australia, particularly in the car components and car manufacturing industry. It's such a shame, when you visit the sites where those massive car manufacturing plants once dotted the main road that goes into Elizabeth, to see that many of them are now empty shells of what they previously were in the past. That is because the previous government didn't support automobile manufacturing in this country; they let it wither on the vine. That was a classic example of some of the lack of support that they gave to manufacturing. Their philosophy was simple: let the market rip, and the market will pick winners. Well, the market didn't work in that case. That is why governments of all persuasions throughout the world tend to ensure that they can support their manufacturing industries and boost the resilience of those industries, particularly in the wake of COVID, with the supply chain disruptions that we've had. The ironic thing is that the previous government was then throwing buckets of money at industry to try to reinstall some of that manufacturing capacity that we had in the past that had been lost because it was left to the market.

The new government takes a different approach. We have a strategic interest and a definitive aim of ensuring that we support manufacturing through a fund such as this. The fund will, of course, ensure there is a pool of $15 billion of investment funds that will be invested, and the returns will provide the basis for investments in industry. That will revitalise manufacturing in Australia after years of neglect under the former coalition government.

The NRF will provide finance, including loans, guarantees and equity to drive those investments in those seven priority areas of the Australian economy. It represents the Labor government having a plan to revitalise manufacturing in Australia—a plan to ensure that we're investing in strategic industries that provide the best opportunity for growth, for technological advancement and for high-skill jobs into the future. It's coupled with important policies such as our fee-free TAFE policy and our policy of boosting the number of university places that are accessible, particularly to students from low-socioeconomic backgrounds, because, if you invest in manufacturing, you're going to need the skills base to ensure that that manufacturing capacity can grow into the future.

We've got a suite of policies that are all aimed at ensuring that we're looking to the future, to technological advancement, to investment in hi-tech manufacturing and to growth of high-skill jobs that will improve the productivity of our nation and provide higher incomes for Australians. It's a deliberate strategy, and that's what the Australian people voted for. That's why it is bewildering that the opposition still have their heads in the sand and still think letting the market rip is the right strategy when it comes to investing in manufacturing. These leveraged Australian natural and competitive strengths will support the development of strategically important industries and, in due course, shore up supply chains as well. This includes NRF finance to grow advanced manufacturing and support businesses to innovate and move up the technological ladder.

We all know that Australia is rich with valuable critical resources—resources that many Australians rightfully expect would be utilised on home soil to build our industrial base, to add value and to create jobs here in Australia. For decades, we've mined those resources and shipped them overseas only for other nations and industries to process and add value to them. Then we import them back at many times the original price. Sending the manufacturing industry, their profits and thousands of jobs overseas makes no sense, but that's what was occurring under the previous government. Australia's know-how, our scientists and our innovators are some of the best in the world. We know we can process those resources that we mine here and that belong to the Australian people to add value, to create new industries and to create jobs in the process.

I think a classic example where Australia has led the world in technological advancement, in creating new industries, is in the solar and photovoltaic industry. I'm very proud to have the University of New South Wales in my electorate. That is where scientists such as Professor Martin Green were leading technologists in the development of solar cell panels and solar cell technology throughout the world. Basically, most of the solar cells that are produced throughout the world now have technology that was invented and commercialised at the University of New South Wales. That is something that we should be enormously proud of—I certainly am—as the representatives of that. We have the capacity to expand on that, to grow that and to ensure that we're creating jobs in that industry and nurturing it. That is exactly what this government is doing. I was very pleased to be able to go with the Minister for Climate Change and Energy, Chris Bowen, to the University of New South Wales, to provide them with a multimillion-dollar injection of funds through the Clean Energy Finance Corporation to ensure that we're leveraging the scientific development, innovation and work occurring at UNSW in the Centre for Advanced Photovoltaics and to ensure that they're developing the next generation of solar cells. We witnessed some of that innovation in practice, and they are the type of investments that governments should be making in cooperation with industry to leverage industrial capacity and manufacturing into the future and to create high-tech jobs.

The perfect example of how the world views the University of New South Wales was explained to me by a PhD student when I visited UNSW some years ago. I asked him what it was like to work at the University of New South Wales in their solar research facility, and the answer was a simple one but perfectly exemplified why we are so proud of UNSW. He said to me: 'If you want to work in space research, you want to work at NASA. If you want to work in solar research, you want to work at UNSW.' That perfectly explains the capability that the Albanese Labor government is trying to leverage with this National Reconstruction Fund.

5:50 pm

Photo of Sam BirrellSam Birrell (Nicholls, National Party) Share this | | Hansard source

From the outset, let me state that I believe in manufacturing, innovation, secure jobs and appropriate government policy to support businesses. The National Reconstruction Fund Corporation may be well intended, but it is the wrong model, poorly executed and even more poorly targeted. It falls well short of what is needed to support agriculture, manufacturing and transport logistics businesses in my electorate.

Why does this matter so much in Nicholls? Well, my electorate of Nicholls has a long and proud history of growing, manufacturing and moving products nationally and internationally. In competitive global markets, they have had to be nimble, innovative and cost conscious. At times, many of these businesses have had cause to seek government support for innovation, sometimes transformation, to support them to take risks that they otherwise might not take. Nicholls has, based on the 2021 census data: 2,291 agricultural businesses with annual gross production totalling $2.3 billion; 739 manufacturing businesses, including many large employers; and 1,260 transport and logistics businesses.

These industries are targets of the corporation this legislation will create, but the notions are vague and the models flawed. It is perhaps best described, and for those who remember this great moment in Australian history, as the 'Leyland P76 of industry and innovation policy'. The Leyland P76 was launched with great fanfare in the early seventies—there was a Labor government that was also launched with great fanfare in the early seventies. It was comfortable, it drove well and it stopped okay. You could even fit a 44-gallon drum in the boot, which was quite a selling point in those days. Initially, the public and the motoring reviewers were sold on it. It even won Wheels Car of the Year in 1973.

But reality soon set in, because people started to realise that the windows didn't seal and that, when it rained, water would pool at your feet. The exhaust could set fire to the carpet. Opening windows could cause the rear windshield to blow out completely. Interior fittings would come loose and rattle. The paint faded quickly, and the wheels literally fell off one vehicle. The Prime Minister at the time, Mr Whitlam, even referred to the P76 car as a dud eventually, and Bill Hayden called it a lemon. I think this legislation is both a dud and a lemon.

The P76 was a dud because Leyland was trying to reinvent the popular family sedans of the dominant players Ford and Holden, but Leyland failed on design, quality control and construction. The National Reconstruction Fund looks shiny and new on the showroom floor, and everyone's getting up on the other side and saying how great manufacturing is. We all agree manufacturing in Australia is great, but this policy won't stand up to a road test in the real world. It's poorly designed, and, while $15 billion is plenty of quantity, there is no quality.

The important thing to remember—and I saw this before I came into this place—is that there was no need to create a new model. The former coalition government had appropriate policy settings and funding pools in place to support our manufacturing, agricultural and transport sectors.

Photo of Anne AlyAnne Aly (Cowan, Australian Labor Party, Minister for Early Childhood Education) Share this | | Hansard source

Except you didn't.

Photo of Sam BirrellSam Birrell (Nicholls, National Party) Share this | | Hansard source

We absolutely did, and I saw it in my electorate. I'll give you a couple of examples. One is the Modern Manufacturing Initiative at HW Greenham & Sons. Greenham operates a meat processing facility in Tongala, in my electorate. Under the Modern Manufacturing Initiative, the coalition committed $10 million towards a $60 million project to expand the facility, increasing the production from 50 tonnes a day to 200 tonnes. Greenham can expand into premium beef and premium beef export markets. At the same time, it creates 240 jobs. Labor has ditched the Modern Manufacturing Initiative but the already committed Greenham grant survived, and I'm grateful it did. I was out there the other day looking at all the wonderful employment that's going on. I was looking at a company that got some government help to take a risk and is going to export fine northern Victorian and southern New South Wales meat products around the world. It's an example of investing in outcomes. The commitment by the government enabled a larger investment by business. A grant provided the certainty businesses crave.

Tom Maguire, the Group General Manager of HW Greenham & Sons, said this when the grant was confirmed:

It is very welcome news, we have a project that is going to create 240 jobs, and that funding was critical.

We have faced significant increases in costs since we started the project, and this will help us to overcome that and complete the project and start employing.

The coalition provided $2.5 billion to create the Modern Manufacturing Strategy. This support sought to bolster our sovereign manufacturing capability, and it empowered over 200 projects across Australia. We invested, we leveraged private investment and we got results.

The Modern Manufacturing Initiative backed businesses to expand, innovate and create jobs, and it did that by leveraging private capital. In contrast, the National Reconstruction Fund Corporation will use debt, guarantees and equity. I'm all for supporting industry innovation and advanced manufacturing, but loan schemes and government equity are less accessible than grants. Competitive grants, or targeted grants where they are justified, are a much better mechanism and fairer to the circumstances of individual businesses. There is a real risk that good manufacturers will be excluded because they can't meet the return on investment thresholds or can't complete a high-level business case in-house. There is a risk of crowding out, rather than leveraging, private investment. And there should be real concern about the bitter pill for family businesses in giving up equity in exchange for what is ultimately government support—support that could and should have been delivered as a grant by a government confident enough to back good projects.

Here's another example from my electorate. J Furphy & Sons not just is an industry-leading manufacturer; it also lays claim to being one of the oldest continuously operated family businesses in Australia—159 years in my electorate and still going strong. Furphy, for those of you who may be interested, is famous for its water carts. The description of something as a furphy—and I've heard a few furphies since I've been in this place, Mr Deputy Speaker—means it is a rumour or a falsity. Used unwisely in this place, a furphy could be ruled unparliamentary, but 'furphy' came from the gossip and rumours amongst our soldiers gathered around the water tank in World War I. So that's where the word 'furphy' comes from—from that fine Shepparton business.

Furphy Engineering is an innovator and now makes highly technical stainless steel tanks, such as storage tanks, processing tanks and pressure vessels for industry: milk, wine, beer—you name it. Furphy was supported in its modernisation by the former coalition government, whether it was solar panels on the roof or the $675,000 grant—a grant, not a loan—for a laser welding machine under the Goulburn Valley business innovation fund, part of the coalition's regional jobs and infrastructure program. Furphy are going right ahead with state-of-the-art laser welding as a result of the kit they've been able to buy with some government support. A grant enabled production of pillow plate heat exchange panels for existing and new applications, including value-added panels to help revolutionise solar thermal technology. It's a great example of the previous coalition government investing in practical outcomes when it came to energy transition.

This is a real-world example of what the Minister for Industry and Science in his second reading speech could only express in vague generalities. It was targeted, meaningful and productive investment. We on this side understand how to support our industries. Many on this side have lived experience. The best way this government can support industries is to create the right economic conditions for them to flourish. Instead, under Labor, we have soaring input costs, disrupted supply chains, critical labour market shortages, radical new industrial relations laws, rising interest rates, rampant inflation and, if the government gets its wish, rising wage costs for no additional productivity. That's no way for us to compete on the global stage. Without policies that create strong economic conditions, any government spending is in vain. The simple fact of the matter is that without addressing these key economic challenges, which are holding industry back—including those great industries in my electorate—government spending in this fashion will not achieve the outcomes we all want. I want a strong industry and innovation policy to support manufacturers. I have hundreds of manufacturers in my electorate who would embrace support from this government, but it must be the right support. Grants that provide confidence and leverage investment are the right mechanism. Loans and equity schemes with union strings attached are not. There is inappropriate ministerial discretion in this bill which allows the minister to appoint the chair and board members who will oversee the corporation and its funds. And a corporation with $15 billion in public funds will be a honey pot for union influence. Nobody should be shocked by the support for the governance arrangements for the corporation shown by the ACTU, the AWU and the AMWU.

Worst of all, the risk is that the corporation won't deliver outcomes. As the member for an electorate with a large agricultural and manufacturing base, including food manufacturing, I know how important it is to foster good outcomes. We need competitive industry, we need innovative industry and we need industry to have the confidence to invest in the future and create the jobs of the future. Above all, we need a government that understands what industry requires. I can't say this enough: I support the aims of the legislation, and I support our industries and the need to invest in sovereign capability. We need to continue to foster growth in high-skilled, well-paid jobs. We need an industry and innovation policy that is fit for this purpose, and not just a jalopy. Thank you.

6:01 pm

Photo of Susan TemplemanSusan Templeman (Macquarie, Australian Labor Party) Share this | | Hansard source

I rise to speak on the National Reconstruction Fund Corporation Bill 2022. It is extraordinary, standing in this chamber and hearing those opposite give a plethora of reasons for why they can't possibly support Australian jobs in manufacturing and expanding our manufacturing capacity. I appreciate that in the context of an election there's a whole lot of rhetoric that comes around, but I am staggered that those opposite can't see the difference that this can make for our ability as a country to make things here. It's a really simple proposition, and I would really urge those opposite to get on board and come on this journey with us, because our community deserves to have the confidence of all members of this House that we have the capacity to make things. I think what those opposite say really undermines the confidence of our manufacturing sector. But, more than anything, it talks it down, which is the last thing that we need.

We, as the Albanese government, were elected on a mandate to drive the transformation of Australian industry and to revive our ability to make world-class products. In my community, we are already doing that. People are surprised when I say that we make things in the Blue Mountains. We make them on a smaller scale; there are around 500 or so manufacturing jobs in the Blue Mountains. In the Hawkesbury, we have more than 2,000 people working in the manufacturing sector with more than 400 manufacturers. A lot of those are technicians and trade skills people, but there are all the other jobs that go around the work they do. They deserve to be trusted to expand and to do more here—not to be affected by international supply chains that hold up their work and their businesses.

This $15 billion National Reconstruction Fund, which I'm so pleased to be speaking on tonight, is one of the biggest government investments in manufacturing in living memory. This is big, and we do believe that it will drive economic development in the regions and, importantly for me, in the outer suburbs. I think one of the things that really struck me during the pandemic was the shock recognition by people that we don't make stuff here as much as we probably thought we did. There was the inability to get PPE and ventilators for our hospitals. It was things like that, which were actually life-and-death sorts of equipment, which made people suddenly realise through that terrible time that not only were supply chains under huge pressure but that we just simply could not do the stuff here that we needed to. I have to say—I've heard people opposite talk about it—that across my community this was a constant source of conversation during the pandemic. I know that this is a very widely supported initiative of our government.

One of the things that I particularly like about manufacturing is that it creates full-time and meaningful work. My memory tells me about 85 per cent of manufacturing jobs are permanent jobs—secure, permanent work. Knowing that they have ongoing, secure work transforms people's lives. There are a number of benefits that this legislation brings, which is why everyone in this place should be supporting it.

The way this will work is the National Reconstruction Fund is going to provide finance—and that includes loans, guarantees and equity— so that we can drive investments in seven priority areas, areas that we know are key for our economy. But we also know our natural strengths and the things that will help us in terms of global competition. This fund will support the development of these strategically important industries and shore up our supply chains. I think we need to keep in mind that that supply chain shock that we experienced has been one of the things that has been a contributor to inflation. It's led to the price rises. This is one factor we can do something about, not just in the short-term but over a long period of time, and take that out of our economic system.

We've identified seven priority areas. The first is value-add in resources. We know as a country we're great at digging things up and shipping it away and then letting other people do clever things and then we buy it back. But it makes sense to everyone I've spoken to to do more of that value-adding onshore in Australia. We can talk about it at a specific mineral level if we look at high purity alumina from red mud in bauxite processing, for instance, but let's go to something that we equally have a passion for and that is renewable energy and the things that we could do in terms of lithium processing for batteries. The value-adding in resources is a key area, as is value-adding in the agriculture, forestry and fisheries sectors, so that we can unlock potential and value-add to those raw materials.

I want to give you a great example of one of my businesses in the Hawkesbury that's already doing that and that's Kurrajong Kitchen and their world famous lavosh. They looked at it and said, 'We do not want to have Australians buying lavosh from offshore when we can make it here.' Karen and Ben Lebsanft have worked for years to build that business and to turn a product that they could easily have walked away from at various times and said, 'No, this is all a bit too hard,' but they saw the value in creating jobs in Hawkesbury, and, just as importantly, creating a really high-quality product. Food processing is one of the areas we know we can do more in.

Textiles, clothing and footwear manufacturing—and for me this feels a little bit like a full circle, because I was a young journalist in the 1980s when a previous Labor government was looking to make us more efficient and that was an area where changes had to happen. The consequence was that we lost a lot of that capacity. When you look at the ability to manufacture some of those PPE things that we needed the textiles industry and the footwear manufacturing sector were really key. We want to encourage people to look at that sector and see what they can do. We're prepared to do loans or guarantees or equity where people have a really viable idea around that.

Transport is another area. This one is also very close to my heart. Remember, the Blue Mountains is the place where the New South Wales government has bought trains from South Korea that do not fit the tracks. Instead of making them here, they bought trains from another country that literally don't fit the tracks of the Blue Mountains. It's not like they couldn't have worked out the measurements of the platforms, but as it is the platforms have to be shaved. They have to be reshaped. Tunnels have to be widened because of the New South Wales government going, 'We don't make things here.' It should never have been the case. When I looked at the platforms that needed to be changed and thought about the history that they have, I saw that in order to make these trains fit our railway tracks now you have to make adaptions to platforms that have been there for more than 100 years. The Leura Station was built in 1890 and Katoomba was built in 1874, yet no one thought to take the measurements and make sure that the trains fitted those tracks. That $2.3 billion that went offshore could have stayed onshore and provided long-term, secure, high-quality jobs, and they wouldn't have messed with our railway lines and our platforms. This is a classic example of how some misplaced idea that getting it offshore would be cheaper has led to all sorts of consequences. We can stop that from happening anywhere else. Transport is not just about trains and ship-building but also cars. I sat in this parliament when I heard the then government essentially dare the car-manufacturing sector to go offshore. The loss of that sector has had implications across innovation for a whole lot of parts of our manufacturing sector.

Transport was the third area we identified. The fourth is medical science. We know Australia's world-leading research to provide essential supplies such as medical devices, medicines and vaccines can be much better-leveraged than it is. In my community, we had one of the few manufacturers of rapid antigen tests—a scientific innovation—who saw the opportunity there because everyone so desperately needed COVID tests. They have now been able to expand what they do on the back of that. They were willing to take a risk, they were willing to pitch everything in and support the Australian community, and out of it they have now evolved. I look forward to seeing how they continue, and I hope they go from strength to strength. That's an example in the medical science area of things that our National Reconstruction Fund will be able to support.

The fifth area of seven is renewables and low-emission technologies. It does seem completely crazy that we created the photovoltaic technology which is used in virtually every solar cell that sits on peoples' roofs, yet you can't buy one that is made in Australia—they are all made overseas. Eighty-seven per cent of the world's cells are made in one country, and in the next three years the expectation is that will rise to 94 per cent. We need to reverse these trends that see great Australian ideas and innovation simply get shipped offshore.

The sixth area is defence capability, and that matters to the electorate of Macquarie because we are home to RAAF Base Richmond and a large defence industry sector. It provides long-term, good jobs, and it could be providing more, particularly as the needs of the RAAF change. That base may well at some stage in the future have more capacity for defence industries. It's a really key part of the local Hawkesbury economy, and we'll be looking to ensure that we completely secure defence industries there. We know that there are huge opportunities for that on the outskirts of Western Sydney. Under the National Reconstruction Fund, we'll be able to maximise the sourcing of requirements from Australian suppliers. We've got them employing Australian workers, whether it's in technology, infrastructure or skills—there's huge opportunity.

The last category that we want to see investment in is around the enabling capabilities. That means supporting the capabilities around engineering, data science, software development, artificial intelligence, robotics and quantum. When I've done technology visits overseas I've seen incredible things happening and asked, 'Why aren't we doing this in Australia?' It's because there has not been the support required to turn great ideas into great businesses.

As a co-investment fund, the NRF is going to draw in investment support from superannuation, venture capital and private equity sources. It is not just going to be government funds; it is partnering with all those sources of money to grow the taxpayer funded component of it. What's key too is that we have a model that we know works. Modelling it on the successful Clean Energy Finance Corporation means it is administered at arm's length to government by an independent board appointed jointly by the Minister for Industry and Science and the Minister for Finance. I've heard some members opposite talking about how wonderful competitive grants are. For things like this, you want it to be above politics. You actually want it to be done as part of an overarching strategy rather than who happens to write the best grant application, or who can have a word with a minister, which is not the way we are going to be approaching this. The government will provide guidance on expectations and policy priorities through a legislative instrument and an investment mandate, but the NRF will be administered at arm's length to the government. That is really key to its effectiveness.

The board will independently make investment decisions and manage its investment portfolio to achieve both the reconstruction fund's objectives and the positive portfolio rate of return. Free from political interference, there will not be a colour-coded spreadsheet in sight. That's what our community expects—good decisions made by the right people for the best interests of this nation.

6:16 pm

Photo of Andrew WallaceAndrew Wallace (Fisher, Liberal National Party) Share this | | Hansard source

I rise to speak on the National Reconstruction Fund Corporation Bill 2022 and, I have to say, I am somewhat bewildered. I have been really looking forward to speaking on this bill. This is one of those bills that I had a really good look at. I've been really excited to talk about it because it's very close to my heart. But I've been utterly bewildered, because families and their businesses across the country are contending with the most challenging cost-of-living crisis in a generation. I'm bewildered that we're discussing this bill while Australians are crying out for the federal government to do something, anything, to help them get through this cost-of-living crisis.

Inflation is at a historic high. Interest rates have climbed nine times since Labor took office but 10 out of the last 10 months. The price of doing business is soaring with each piece of red tape this government slaps on small and family business owners. The price of turning on the aircon, of filling up the car with fuel, of putting food on the table just continues to grow and grow and grow. You'd think that, instead of another bill throwing money at Labor union pay masters, they might consider introducing legislation to address the cost of living. The only thing the Australian people care about right now is how this government is going to reduce their costs and how Australians are going to be paying their bills. Rent, school fees, mobile phone and internet, Australians are struggling to make ends meet. It seems that everything is going up in cost and now, for many Australian families, there is a lot more month at the end of the money. That disparity is growing. It is getting worse under this Labor government's policies, and Labor just don't seem to care.

What should the bill do? This bill is Labor's signature manufacturing policy. They are going out to the electorate and saying, 'This is the bee's knees.' It is modelled on the Clean Energy Finance Corporation. The fund is designed to allow government to invest in initiatives which support their manufacturing priorities. These are not investments in grants; they are through government equity and loan schemes. This model means manufacturers may struggle to meet return on investment thresholds based on the government's arbitrary milestones. The federal government announced that the fund would be up and running by next financial year, but they refuse to commit to a launch date. Given their track record, not committing to a date is probably the safest option for them. However, last time they set up a fund like this, the Clean Energy Finance Corporation, it took 10 months before any money was invested.

Across industry, there is widespread concern that the delay in investment, increased red tape and time taken to get the model running effectively will mean lost years in manufacturing. It means private and personal investments might dry up. Anyone that has started a business—I probably shouldn't be looking over the other side when I say that—would know that dithering and delays such as these mean the difference between survival and closing up shop. What we are seeing across this country more and more as the cost of living really bites on small and medium sized businesses is, unfortunately, more and more businesses closing, particularly in the building industry where I come from.

What does this bill actually do? Well, it opens the door to unions yet again. I am gravely concerned about the potential for union interference in this fund. We already know what the unions want: they want board positions, they want power and they want money.

Government Members:

Government members interjecting

Photo of Andrew WallaceAndrew Wallace (Fisher, Liberal National Party) Share this | | Hansard source

Those opposite can laugh at that! They want an enterprise agreement with unions as a precondition to any application. Isn't it funny how, as soon as a member of the coalition mentions the word 'unions', they arc up on the other side? Isn't that funny? Under this scheme, the government wants a requirement that applicants commit to direct employment or, at least, direct employment conditions. Yet the Prime Minister still hasn't ruled out mandating union board members and union agreements as a condition of entry into the fund. He could easily do that; he could just rule it out and say, 'No, that's not what we're after.' This is mandated unionism enshrined in law for Australian manufacturers who just want the backing of their government. Compulsory unionism for start-ups and small businesses will rob them of their unique selling points—their ability to innovate, their agility, their capacity to pivot as the market and as technology requires it. Far from the objects and purposes of this act, it will have a crippling impact on manufacturing.

When we were in government, we outlined six core manufacturing priorities after significant consultation with industry, academia and across levels of government. These six areas were food and beverage, medical products, clean energy, critical minerals and resources, defence manufacturing, and space industry. We invested $1.5 billion into the landmark modern manufacturing strategy to cultivate manufacturing sectors in these six priority areas.

I've taken a personal interest in the defence manufacturing priority area as part of my commitment to back small businesses and local manufacturers on the Sunshine Coast. I think of the $47.4 million that the previous federal government invested to enable manufacturing generators for the ADF's protected mobility vehicles like the Bushmasters, which are now being used in active combat in Ukraine. I think of the Sunshine Coast's share of the $103 Advanced Defence Aerospace Manufacturing Network, with firms like HeliMods delivering the MQ-28 Ghost Bat, the first combat aircraft to be built in Australia in over 50 years, which I had the privilege of again seeing at Avalon just last week.

Photo of Andrew HastieAndrew Hastie (Canning, Liberal Party, Shadow Minister for Defence) Share this | | Hansard source

Good old Will Shrapnel!

Photo of Andrew WallaceAndrew Wallace (Fisher, Liberal National Party) Share this | | Hansard source

Indeed. Good old Will Shrapnel, indeed. I was incredibly disappointed to see the defence minister recently call into question the AUKUS alliance as if it were under threat if we didn't support his bill. Conflating our opposition to bad policy with a reversal of our long-held support of the AUKUS alliance and defence sector is utterly despicable. AUKUS would not have happened but for the former Prime Minister, the previous defence minister, Linda Reynolds, and the current opposition leader. It is absolutely shameful for this Labor government to suggest that we are somehow not locked in with AUKUS. It's also very disrespectful, considering the work that we did to get it up. Our defence and national security are not bargaining chips for Labor to gamble on its latest whim or novel policy. AUKUS is about our defence, security and economic strength. It was the coalition government that co-designed the alliance with our UK and US allies.

Labor continues to ride on the coat tails of our defence achievements, but AUKUS should be above politics. The government should be embarrassed by this appalling and desperate attempt to pass their flawed bill. Despite Labor's reckless politicisation of our defence and national security, our record unequivocally demonstrates the coalition's commitment to sovereign defence industry manufacturing: the coalition government's $270 billion decade-long sovereign capability program proves it. The very existence of the AUKUS alliance is proof, once again, of this commitment.

It's also why we put space industry at the core of our Modern Manufacturing Strategy. Australia should be at the forefront of science and advanced manufacturing, that's why we established the Australian Space Agency. Having a cutting-edge space industry is not just a matter of national pride; it's imperative that we operate in space for the defence of our nation. Space and cyber are domains in which we must be ahead of the game. Protecting Australia's interests in space means maintaining the security of our communications, financial, navigation and signals capabilities. Space affects almost every aspect of everyone's life in Australia. Many Australians would not even recognise the importance of this and, apparently, neither does this federal Labor government. While our competitors and our allies are investing heavily in the sector, Labor are ripping out incentives. Just think about this: in less than five years the US Space Force has amassed 16,000 military and civilian personnel, with an operational budget of $24½ billion. In contrast, the Australian Navy, now in its 122nd year, has 15,200 personnel. The RAAF, in which our Defence Space Command sits, is just 14,500 personnel—that's the entire RAAF.

We have a very long way to go, and we must. The Defence Space Command motto says it well, 'Space really is the ultimate high ground'. When in government, we did just that, investing in research, manufacturing, exports and missions. Labor appears to be dismantling our progress at every turn, and both industry and the community deserve to know why. In the seven key priority areas that Labor are talking about, they have very silently dropped space off—nothing to see here. It absolutely beggars belief that this government would drop this off in an increasingly contested environment—the most contested and geopolitically unstable period since the end of World War II, where space and cyber are going to be critical domains should conflict come our way. Yet, under this fund that the government is putting together, this reconstruction fund, they're not investing in space. It beggars belief!

In rushing this bill through, the Albanese government wants to offer $15 billion in taxpayer funds to a board picked by Labor to fund priorities set by Labor. They are leaving the task of determining manufacturing priorities to the minister. The potential for misuse is enormous, and I need not remind the House how out of whack Labor's priorities are. Instead of addressing energy security, they're funding climate warrior training programs. Instead of mental health support, they're spending $400 million a year of borrowed taxpayers' money on a housing policy experiment that may not result in the construction of one home. Borders are opening and the Navy is on alert. Regional GPs are closing. Businesses are shutting up shop. The construction sector is teetering on the edge of collapse. Mobile towers are going up across Labor held seats while regional Australia languishes once again at the hand of Labor's neglect. And those opposite have the gall to talk about integrity and transparency!

We know where Labor's priorities lie and we know what Labor do. It's kind of like a reverse Robin Hood. They rob hardworking families and their businesses to pay for union elites. They promise to fix the problem, but they want Australian taxpayers to foot the bill. Labor promises the world, but then they give you an atlas. Why do Australians always pay more under Labor?

I remind the government that they are just that: they are the government now; they are not an opposition in exile. They are not playing with union funds on the campaign trail. They are tasked with investing taxpayers' money to provide for them the best return. That means investing in priority economic areas which are clearly defined and based on reality, not on political whim. It means investing those funds with value for money and long-term success in mind. It means protecting funds from special interest groups, including political donor bodies such as the trade unions to which they are so beholden. It means keeping national security and defence beyond day-to-day politics.

It's time for Labor to get up, grow up and show up for the Australian people. No more politics. No more smoke and mirrors. It's time for real action and real outcomes for Australian families and their businesses.

6:31 pm

Photo of Zaneta MascarenhasZaneta Mascarenhas (Swan, Australian Labor Party) Share this | | Hansard source

What does the future of Australia look like under a Labor Albanese government? Jobs, jobs and jobs. And not just any job—good jobs, secure jobs, well-paid jobs, jobs that our kids can be proud of, jobs that will exist in the year 2100. Australia is rich in critical minerals and needs to build batteries, wind turbines and solar panels. We can rewire the nation so we can power Australia for the future. We can become a renewable energy superpower.

I thank the member for Fisher for pointing out the similarities that we have. The Clean Energy Finance Corporation, which the Labor Party put together and the coalition kept, was great policy. We took 10 months to get the architecture right, and we got it right. And have a look: the architecture is still in place; there are still companies that are using the Clean Energy Finance Corporation to fund projects and finance projects that we need right now.

In my first speech I spoke of my father, who, after 19 years of service at the nickel mine, was made redundant because the nickel price tanked. He was 56 years old at the time. He's a man from a generation of metalworkers who have less than 10 fingers—my dad has 9½. Losing his job hurt him far more than losing his finger did. In the climate space, we have the term 'stranded assets'. These are things that have been prematurely written off. My father felt like a stranded asset. He was someone who had more to give. From the age of 16, my dad was the breadwinner for his family. This was ingrained in him.

When we talk about markets, jobs and economic fluctuations, we cannot lose sight of the fact that what we're actually talking about is people and prosperity and homes and families—hopes and aspirations. A disruptive exit out of carbon-intensive industries will hurt people. So, yes, I want strong action on climate change, but I also want a just and orderly transition. Our carbon-intensive industries aren't something to be left to the market to sort out alone, nor are they things that can be switched off overnight. There needs to be a plan for transition that acknowledges that it's no longer business as usual for our large emitters whilst also ensuring that Australian workers have a place for them to work and for their children to work—obviously, when they're of working age—with jobs that are meaningful and jobs that are secure. That's why I support the National Reconstruction Fund.

The National Reconstruction Fund Corporation Bill 2022 will establish and fund a body that finances investments in seven priority areas across the Australian economy. That includes value-adding in the resource sector, something that's very important to Western Australia; value-adding in the agriculture, forestry and fisheries sector; expanding transport manufacturing capability, and here I'll point out that we now manufacture our own trains in WA; medical science; defence capabilities; and enabling capabilities such as data science and software development.

Finally, the things that I would like to focus on the most are renewables and low-emissions technology. For 12 years, I have spent my professional career working with some of Australia's biggest companies that emit large amounts of carbon dioxide into the atmosphere to help them transition to a low-emissions economy. During the time that I worked, what I saw was that there was nine years of delay and denial under the previous coalition government. However, in WA, there were parts of the private sector that were getting on with business and reducing emissions.

Despite this, we need the whole economy to transform, and we need to make sure that all workers are prepared for the transition to net zero emissions by 2050, and this requires a plan from government. Without a plan, we risk workers and communities, and they are at risk of being left behind. We risk more Australians in transitioning industries becoming stranded assets. Under the previous government, there were nine industry ministers in nine years. That's nine years without a plan. However, I would like to acknowledge the member for McPherson as a standout in her time as industry minister. She oversaw a remarkable turnaround in Australia's domestic capacity during the COVID-19 pandemic.

Harvard University's Center for International Development ranks economies according to diversity and complexity to assess their potential for growth. They placed Australia at 91 out of 133 in 2020. Our neighbours on that scale were Kenya and Namibia. In the last decade, we have slipped 21 places. When we put our all our economic eggs in one basket, we open ourselves up to risks. Simply put, the Australian economy needs to become more sophisticated. We need to diversify, and we need to be able to do advanced manufacturing. We need to be able to make it here and build it here.

As our economy transitions, there needs to be a safe and stable set of hands inspiring confidence among manufacturers to invest in capital to provide jobs for the future. A diversified industrial sector will insulate our economy against risks. The decade of delay, waste and indecision did not set up Australia well to enter this current chapter of Australia's history. A future economic vision for Australia is needed now more than ever. Capital markets are moving, and they are moving fast. Businesses and investors are turning away from fossil fuels. The market is shifting away to renewable and cleaner forms of energy, and the government must play a role to support this shift to ensure that our communities, industries and workers can be there to benefit from this change.

There is so much opportunity, and we need to realise this. We would be doing our communities a disservice if we didn't act and if we pretended that it was business as usual for the next 30 years. We would be setting up workers, towns and regional economies for failure. We're acting immediately on this challenge, because the days of delay and denial on clean energy have sent a chill through renewable energy manufacturers. This is why we have brought this bill before the House in the first eight months of our term.

The Albanese Labor government has a plan for Australia's economy. We're fixing the safeguard mechanism while rewiring the nation and increasing the amount of renewable energy into the grid. This backdrop to the decarbonising of the economy creates lower emissions electricity and cheaper electricity, and this will be a fantastic backdrop to the building of our manufacturing capability. We're going to build our capacity and confidence in the economy, and then walk with our workers and communities together in the transition process.

When Minister Husic launched our nation's first battery strategy, on the third of this month, he chose to do so at Energy Renaissance, an Australian lithium-ion battery technology manufacturing company at Tomago, in the Hunter Valley of New South Wales. It's a remarkable region with remarkable representatives such as the wonderful members for Hunter, Shortland, Paterson and Newcastle. It's a region that's a powerhouse of the Australian economy and one that has a proud history of building things for this country.

Our centres of manufacturing should not only be about making high-quality Australian products; they should also be places where new industries can flourish. Our battery strategy will be integral to helping Australia transition to a decarbonised economy, hit our ambitious targets, foster Australian innovation and support Australian industry. The strategy, in conjunction with the National Reconstruction Fund, will send a strong message to investors about Australia's industrial potential in battery manufacturing.

The National Reconstruction Fund has earmarked up to $3 billion of funding to support the Powering Australia plan. This will drive investment in areas such as clean energy component manufacturing and technologies, and improved energy efficiency. Australians invented photovoltaic technology, but today about 85 per cent of the world's cells are made in one country. Over the next three years, that will become 95 per cent. Australian manufacturers of hydrogen electrolysers, green metals, wind turbine components and, of course, batteries should take comfort in knowing that we want them to succeed here.

Australian innovation shouldn't mean that we're going to send that intellectual property overseas and offshore jobs. If we're talented enough to invent it here then we should be able to make it here. Governments can and should strategically and thoughtfully invest in industries for the future. Investing in manufacturing will be critical for Australia's economy to transition to net zero. It will also be critical for us to have sovereign manufacturing capacity in times of crisis. When the pandemic hit, there was one factory in Victoria producing face masks.

I want to echo the remarks of the member for Robertson, who recounted his experience with personal protective equipment availability during the early stages of the COVID pandemic and the risks to which that exposed our front-line workers. Global supply chain shocks such as COVID and the Russian invasion of Ukraine have tested our domestic energy markets, fertiliser stocks and, as mentioned, medicines and medical equipment. Developing our manufacturing capacity will expand our sovereign capacity. In these increasingly uncertain times, this must be a national priority. This bill puts forward a plan for sovereign capacity and the money we need to execute that plan.

Dr Jens Goennemann, from the Advanced Manufacturing Growth Centre, has observed that, if we understand manufacturing as a capability that permeates every industry, we can transform Australia from a lucky country to a smart country. Australia has demonstrated that it has the capacity to produce medical personal protective equipment. Adarsh, in Western Australia, was able to direct its manufacturing capabilities to produce 10,000 face shields for our front-line medical staff within the first four months of the pandemic hitting the WA shores. They could do this because they had pre-existing manufacturing capability. There has to be a base level of capacity for us to ramp up.

Ensuring the strong foundations of a manufacturing sector relies on an interconnected manufacturing ecosystem. One example is large car manufacturers in Adelaide and Melbourne. They created downstream demand for components such as windshields, cast metals and textiles. Then there was the creation of ventilators in Australia in the COVID-19 pandemic. That came through researchers working with manufacturers such as Ford and precision tool company ANCA to meet domestic needs and save lives.

The other example I'd like to highlight is in Western Australia, where trains are built on site in WA for WA railway lines. It was interesting to hear earlier about trains being built in New South Wales—$2 billion I think—and the trains could not fit the track. They had to change the platforms where they were being delivered.

By developing the capacity of one aspect of a sector, we're creating job for the future downstream and the ability to adapt when our nation faces times of crises. Conversely, if you shut down an industry, like the Liberals did to the car manufacturing sector, you send shockwaves through to small and medium businesses and suppliers.

I support this bill because I think the government can and should strategically and thoughtfully invest in industries for the future. This is what this bill does, and this is how we will create jobs. As our economy transitions away from emission-intensive industries, there needs to be a plan. We cannot leave the future of our workers and communities to chance. It was heartbreaking to see my father become a so-called 'stranded asset'. I don't want that for anyone, least of all the constituents of Swan.

6:46 pm

Photo of Garth HamiltonGarth Hamilton (Groom, Liberal National Party) Share this | | Hansard source

It's always a pleasure to talk on manufacturing in this place. I'm probably one of the few here who has stood, worked and maybe even sometimes sweated on a shop floor. I'm very happy to say I was the worst welder on that shop floor. I'm probably the best in this House, though. Times have changed.

To reflect on some of the comments in this conversation, watching that industry over a long time, most of my association was with the mining industry, but manufacturing played huge part in riding that great wave that happened in the early 2000s. The sad truth is that manufacturing in this country has been in a long decline, particularly as we've increased our engagement with Asia and we've seen the loss of those manufacturing jobs, over many governments. I don't think there's any evidence that really stands that it's one side or the other. That's been a long-term trend. So I always welcome a conversation about how we as Australians can return manufacturing back to these shores. As has been pointed out many times, and if the pandemic taught us anything, if there is one great thing we can take from it, it's the importance of self-reliance. If that's the great lesson we get out of it, that fantastic.

To speak on this particular bill, I think we should, as always, view it within the context of its times. Today we've just seen another interest rate rise. We're seeing in this period the steepest rate rises since the RBA became an independent institution. In the last three months of last year, we saw a slower economy than we expected. We're seeing confidence—not just consumer confidence, but business confidence—at a low. At the same time, we're seeing spending continue. So we're in a time of extreme turmoil, and today's Courier Mail relates the increase in costs for the average Queensland family over the last 12 months: they have risen by $1,150. Some of the comments in there were quite strong. You're seeing families make decisions about whether kids continue with swimming lessons, whether holidays are continued. We're in a period now where pressures are being felt, and they are being felt very strongly.

They are being felt in families as well as businesses. I'm very lucky in my patch to have quite a strong manufacturing sector. We support, obviously, our traditional agricultural industries but also the newer industries that have come to our region, particularly transport, and that will only increase as Inland Rail comes. As I'll get to, we are also getting more and more into defence. Every time I sit and talk with our manufacturing industries, be they large or small, they have two issues they'd like to see addressed. One is energy costs. Quite simply, for many of our manufacturers, this has become the driving cost in their decision making. The other is, of course, labour costs.

To look at this piece of legislation within the context of what's happening throughout the rest of the government's policies—Deputy Speaker Goodenough, you may enjoy this—I made a trip into the record books, looking at the impact of price caps historically. Obviously, this government has embarked on that pathway. I couldn't find the earliest possible example but there is a great one from 301 AD. I won't pretend to know this myself. It's under Diocletian 301 AD. They brought price caps in in ancient Rome because things were getting a bit too hot. Prices were too high, and wages weren't high enough. That particular piece of intervention went the way that, surprisingly, every other piece of price cap interventionist policy has gone; it failed, and failed terribly.

When I talk to my manufacturing sector and they raise the issue of energy costs, they look at what we know: when you have price caps, you have a restriction of supply; it follows. It will only ever drive up costs in the longer term. We have that sitting in front of people. Then there's labour costs and they are to be driven up. If we look at the IR legislation that went through the House and if we reflect on the comments from the Productivity Commission report, when you move people from individual agreements to enterprise-level agreements, you see a reduction in productivity. Understand what that loss of productivity means to a company that's already borderline, that's on the one hand weighing up energy costs and on the other hand looking at the impact of R legislation coming through. These are the things weighing on people's minds.

In that context, if we turn to the solution provided by this legislation, there appears to be more union power. If you want to assess a piece of legislation, a good way to do it is to see who it makes happy. Many of the previous speakers have spoken to the long list of demands that unions have made, licking their lips at the prospect of what the NRF opens up to them. When we see this sort of intervention, when we see unions wanting to force enterprise agreements as a precondition for application, that makes small manufacturers very scared. When we see calls for a third of board positions are to be hand-picked by the Council of Trade Unions, you start to get a feel that these decisions are not always going to be made in the best public interest, which of course, public investment should be.

I will speak to the two points that the government have often raised in this debate. One is that this is great for regional jobs. As someone who represents a regional area, Groome in the beautiful Darling Downs, I hear that a lot from Labor. It is always important, when we talk about jobs, to look at the record of the previous government, because our approach to jobs worked. We saw near-record-low unemployment. In regions like mine, we saw businesses pick up, thrive. We saw activity grow. Those jobs were available, which was fantastic for regions like ours. I meant that our kids, the younger generation, didn't have to go elsewhere, didn't have to leave the regions to find work. There were jobs, careers, lifestyles to be had at home. That's the record we delivered on.

I would turn also then to—this will tie in a little here—the other point that's made around defence and how important this is for Australia's national security. Leave alone the fact that this wasn't raised when the bill was brought forward. This is something that was found down the track as a very important part of it but not initially. I have to ask the question: How do you cut space industry out of your priorities when you are having a conversation about national defence given where the world is now and the threats of hypersonic missiles, just as one? It's almost implausible to think that you could have a serious conversation on defence while leaving out space industries. The previous government did not. Under the modern manufacturing scheme, I was proud to fight for trailblazer funding for UNSEQ, located in Toowoomba in my patch, that made them a leader of Australian universities in space research. It's extraordinary, and I'll tie that back in with a comment about regional jobs.

If you're looking for somewhere that has regional jobs, we're the largest privately funded inland city in Australia, apart from Canberra, and we had this huge investment. On top of the investment that we got from that Trailblazer funding, we've seen Boeing make a significant investment there. We've also seen Virgin Galactic make significant investments in our patch. It's extraordinary. Twenty years ago, you would never have thought this, but Toowoomba has become a hub for space research. It's not just big companies coming in; it's local companies joining in and finding their way into that. It's great to hear that local manufacturing firm JRS Manufacturing Group is moving out to the Wellcamp aerospace district and investing in new technology there.

When we talk about this great investment under the previous government's Modern Manufacturing Initiative, which did identify the space industry as being important to defence and which did spur regional jobs, we're not just talking about jobs in the defence industry or in manufacturing. What we're also talking about is everything that goes with that, be it not only the business support services or the logistic services but the education stream that goes with it. I was very happy to be at UniSQ with Vice-Chancellor Geraldine Mackenzie just recently, where we were looking at the future that's being laid out for the space engineering program that they are pioneering at their Toowoomba campus. The opportunities that this offers young people from Toowoomba and from the regions is an absolutely crucial part of our future.

We understand that when we talk about regional jobs, we're talking about new industries. When we talk about manufacturing, we're not talking about the sort of manufacturing that used to take place when Labor had people who worked in manufacturing. We're talking about modern manufacturing. We're talking about technologies just like this space engineering—the incredible work that's taking place out there. We're focused on that. We understand that's where new investment needs to go. So I point to the record of the previous government. We did understand that this was important. We did invest in the space industry, and we did provide local jobs.

The next point I'll make is that, whilst we talk often about the space industry as it relates to defence, the same research and the same industry in a region like mine drives our other key industries forward. Of course, great work has been done in the agtech space in recent years, where we've seen farms being run out of the palms of people's hands, with technology and information coming through. This is where investments in manufacturing, properly timed and properly focused—and with an eye to the future—don't just help out the one industry that they're focused on but have a broader impact. Why it was so important for the Modern Manufacturing Fund to focus on space was not just because of defence but because of everything else that came out with it, be it logistics or agriculture. Certainly, my region was very happy to play a part in that.

I'll reinforce my earlier comments. This piece of legislation is fighting against other pieces of legislation that are currently in play in the drive to bring manufacturing back to Australia. This is at a time when we're seeing price caps which will have a negative effect—and which have already had a negative effect on future investment, as the Senex case proved. They will have that negative effect on prices for up to two, three, five, 10 and 15 years down the track, because we will see a reduction in supply. This is fighting against that legislation at the same time as we're seeing legislation like Labor's IR bill, which is deliberately designed to move employees onto agreements that deliver lower productivity. Once again, we're seeing this legislation fighting against other legislation that is currently in play.

It baffles the mind that when you speak to the industry, when you speak about their concerns, their concerns are only too clear. When we speak to those in the manufacturing industry about their concerns, we understand their need for lower energy prices and for lower labour costs. But the solution provided is a mechanism for more power for unions in this space. I don't speak against unions on the basis that they are simply unions, I speak against any monopoly that tries to exert too much power—and I fear that's exactly what this legislation opens up the opportunity for. Small manufacturers, like HBS, where I first learnt to weld, would struggle under the increased union power that legislation like this would enable.

7:01 pm

Photo of Tracey RobertsTracey Roberts (Pearce, Australian Labor Party) Share this | | Hansard source

I rise to speak in proud support of the National Reconstruction Fund Corporation Bill 2022, a significant and important commitment made by the Albanese Labor government and a clear commitment to help the growth of industries in Australia.

The National Reconstruction Fund will be independent, and will work in the national interest. It will help rebuild our industries and capture strong opportunities for Australia. It is important to the nation's economy that we be a country that manufactures things again. The National Reconstruction Fund will absolutely help to achieve this. The Albanese Labor government has a plan, and part of that plan involves reviving Australian industry so that our industries can be a global leader in high-value manufacturing rather than sending things overseas, as the opposition has done in the past. The National Reconstruction Fund is about investment. It will be one of the biggest investments in Australian manufacturing capacity, and our manufacturing capacity is crucial to our nation's economy. This bill is about jobs and more jobs, and to keep those local is especially important in my electorate of Pearce in Western Australia, because it will provide opportunities for much-needed local jobs and help manufacturing businesses grow and prosper, and to become world leaders through innovation.

In Pearce, there are two industrial areas that help support and boost the state of Western Australia's economy and the nation's economy. One is the Wangara Industrial Area and the other is the newer Neerabup Industrial Area, which has so much potential. These two areas are the foundation of thousands of local jobs in the electorate of Pearce. Nine per cent of people in Pearce work in the manufacturing sector, compared to 6½ per cent across the state of Western Australia. The number of manufacturing businesses in my electorate is rising and, at last count, in 2022, were 762, up by 42 from the previous year. Manufacturing is the most productive industry within my electorate, generating $18,017 million in 2020-2021. Just imagine the potential to continue that growth, particularly in Neerabup. This site is primed to provide long-term economic growth opportunities, which will be achieved through the creation of local jobs for people in what is one of the largest and fastest-growing areas in Australia.

Let me share some detail in relation to Neerabup with you. The area provides manufacturing opportunities, economic growth opportunities and local employment opportunities. It is a parcel of approximately 1,000 hectares of land in the north-west metropolitan area of Perth. In coming years, the Neerabup industrial area is expected to become a large employment node in the electorate of Pearce, with connections to major freight links. The area is in the early stages of industrial growth, and is projected to be home to 20,000 jobs in the not-too-distant future. The development of this area is a strategic priority for the region and the electorate of Pearce.

Recognising the absolute importance of this industrial area, the Albanese Labor government committed $15 million in infrastructure funding to bolster it. This industrial area is just a few kilometres from transport links, which are vital for supporting businesses to deliver their goods when and where they are needed. It will benefit greatly from the Albanese government's $15 million investment in creating the dual carriageway on the local road, which is on Flynn Drive. This investment will mean significantly better access to and from the Neerabup industrial area by ensuring completion of the dual carriageway for the entire length of Flynn Drive.

I have been a strong advocate for funding and government support for projects, including this one, in the years prior to my election as the member for Pearce, in my previous role as the mayor of the City of Wanneroo, so I am very pleased that the Albanese Labor government is delivering this election commitment to the electorate. Appropriate investment in infrastructure is a key driver to attract businesses to industrial areas, so this project will be important for generating local job growth in my community. We have a large and fast-growing youth population. There are 56 local schools in the electorate, and I know how hard those schools work. I know the need for apprenticeships. I know the need for traineeships. I know the need for future growth in employment opportunities. I sit on eight of those school boards and I see, time after time, students trying to source opportunities for work experience, because there's not a great deal of opportunity in the local area. They have to travel far and wide for work experience, let alone for the opportunities for traineeships and apprenticeships. In this area, local employment opportunities will be very important.

The area is also planned to be the home of the Australian Automation and Robotics Precinct, which has a 51-hectare site and is set to generate up to 5,000 ongoing jobs in the growing fields of robotics, remote operations and automation, which used to be something futuristic, but now are something of the norm. These are all areas of innovation and are jobs of the future—and they are something that our youth are incredibly interested in. It will be used for testing, research and development, and training in autonomy and robotics. This precinct will deliver a long-term strategic employment cluster, and it's very exciting. It's one that will provide quality employment opportunities and attract talent from all over the world. The strategy of the Australian Automation and Robotics Precinct is to create and manage access to a globally linked and locally relevant test facility. This will include design co-labs, test laboratories and virtual laboratories. Precinct users and researchers will have the opportunity to accelerate technology and analytics testing and scaling.

As we elevate our national economic, environmental and social wellbeing, build our strategic industry capability and drive economic growth, we need to partner with industry and researchers. That is what the National Reconstruction Fund will do. It will be independently run, and its decisions will be made in the national interest. Investment will focus on seven priorities: renewables and low-emissions technologies; medical science; transport; value-adding in fisheries, forestry and agriculture; value-adding in the resources sector; defence capabilities; and technologies that support jobs in manufacturing.

The National Reconstruction Fund is a key commitment of the Albanese Labor government and will consult with industry to reveal market gaps and investment opportunities. The priority areas reflect current and emerging industry strengths that will help strengthen our capacity to respond to domestic challenges and also global opportunities. It is a significant step in rebuilding Australia's industrial capability and economy, so why would those opposite want to oppose it? It's because they don't have a plan, other than to be contrary and say no. They're the 'noalition', who left Australia with a trillion dollars of Liberal debt. On the other hand, we in the Albanese Labor government have a robust plan, and the National Reconstruction Fund is another step in creating secure, well-paying jobs for Australians.

Australia can be a country that manufactures things again, and we should. The pandemic emphasised the importance of having an advanced and agile manufacturing capability in order to be able to pivot to produce critical products to meet our nation's needs, especially at times when we need them the most. The National Reconstruction Fund will oversee one of the largest investments in our country's history—$15 billion. This will be invested in independently assessed projects that will diversify, support and transform Australia's industry and economy.

So, I repeat, why do those opposite say no to this vital investment in Australia's economy? Because they don't have a plan. Australian industry needs a government that recognises their contribution. Our future generations and babies that are being born deserve opportunity. Our communities want to know their government is supportive and loud about it, and is also backing that support with robust actions. We all know that actions speak louder than words. They want to know that their government is helping make the most of global opportunities.

It is time to stop the good ideas heading overseas due to lack of supportive capital. The Albanese Labor government knows the National Reconstruction Fund will help retain businesses and talent here on our shores, and to grow our economy and our nation. It will also help Australian industry capture new high-level market opportunities. The National Reconstruction Fund will help research and innovations move on the path towards commercialisation. The fund will help bolster national resilience and support well-paid, sustainable jobs of the future. Why would anybody say no to that?

The National Reconstruction Fund is about helping built and transform our industry capabilities in a strategic manner. That includes manufacturing. It is also about strengthening the nation's ability to harness technologies so that we can futureproof our prosperity and national wellbeing. The fund will allow the support of investment in medical manufacturing for things like vaccines and medical devices. Australia was once a leader in solar technology, and the independent National Reconstruction Fund will enable investment in solar and wind technologies, as well as the development of batteries to store renewable energy. This will be a win for our environment, which the Albanese Labor government values. The fund can accelerate our nation becoming a renewables super power. I have already talked about robotics and automation in Neerabup and the National Reconstruction Fund will build on our expertise in quantum technologies, robotics and artificial intelligence. We will partner with state and territory governments and industry to seek out investment opportunities within priority areas.

It is important to remind those opposite that the National Reconstruction Fund Corporation will be fiercely independent—an independent board making independent investment decisions is crucial to success. It will also be independent of political influence, the way it should be. There will be no sports rorts and colour-coded spreadsheets like we saw under the previous government. The Australian taxpayer expects—as they should—their tax dollars to be treated properly and respectfully, to be spent in the national interest rather than to suit political interests. Under the Albanese Labor government, that's what taxpayers will get with the National Reconstruction Fund.

Along with the Buy Australian Plan and Future Made in Australia Office, the National Reconstruction Fund ties in with the Albanese Labor government's plan for Australia to be strong and self-sufficient, and to have a renewed basis to sell to the world. I urge those opposite to walk with us and support the bill instead of making terrible decisions that do not support Australians or the future of Australia. I commend the National Reconstruction Fund Corporation Bill to the House.

7:14 pm

Photo of Scott BuchholzScott Buchholz (Wright, Liberal Party) Share this | | Hansard source

It's a privilege to be able to offer commentary in the debate on the National Reconstruction Fund Corporation Bill 2022. I want to acknowledge those contributions that have gone before the House as the debate comes to a close for the evening.

Listening to debate from both sides of the House, it is right to acknowledge that this was a fundamental that was taken to the election and that Labor definitely have the right to bring this piece of legislation to the table. However, in doing so, they have claimed some falsities. It behoves us, as an opposition, to prosecute a case against the falsehoods that are being debated as, time after time, members of the government roll up with their speaking notes and, one after another, deliver exactly the same message.

That this piece of legislation will miraculously fix our international supply chain issues here in Australia, as it's claimed, is not true. It just will not do that. I come from 25 years in transport and logistics—domestic, intrastate and international. I can tell you, Mr Deputy Speaker, with my hand on my heart that this bill is not the panacea—the fix for all the international supply chain failings that have hampered us—that Labor claim it to be. We've heard the argument rolled out time after time that there was a failure in PPE equipment, personal protective equipment, during COVID, but not one of those on the other side has complimented our Australian manufacturing sector. Not one of them has complimented those who were able to move nimbly and dexterously to change up their business models. The Australian manufacturing sector is alive and well, and it is my intention tonight, in the time afforded me, to prosecute the case for how amazing our Australian manufacturing sector is.

We've been told that there are going to be a plethora of jobs in the regions as a result of this fund, but there've been no figures brought forth on that. We were told by the Prime Minister this afternoon, at the dispatch box when he made his contribution, that a $15 billion off-budget investment would create zero inflationary pressures in the country—zero to none. He actually went on to cite the RBA governor's comments to say that the inflationary pressures we are dealing with at the moment have all come from Ukraine—it's the Ukraine conflict; it's not government spending. There is $46 billion of off-budget investment coming through government. Mr Deputy Speaker, I'll just take you back to the UK parliament when they had a new Prime Minister who said she was going to go and borrow a heap of money. She didn't last very long. The markets rejected it. The markets collapsed, and quite rightly. They should have. Those opposite have spoken about making Australia a great manufacturing country again. I say, 'Well done and strength to the arm of our Australian manufacturing sector today.' They do an amazing job.

As I mentioned, our job is to prosecute a case against the untruths that are coming. We are debating this bill today, of all days, when the RBA has delivered yet another rate increase. Here we have, metaphorically, the Reserve Bank governor putting both feet on the brake of the economy by raising interest rates for an unprecedented 10th consecutive time—nine rate rises under this government, one previously. He has two feet on the brake, and the Labor Party, directly in contrast, are bringing into the parliament another $15 billion worth of accelerated spending. The reason I speak against this bill tonight is not just through the prism of manufacturing but through the prism of pure economics.

The RBA governor has been forced to put up interest rates 10 consecutive times. It's a blunt instrument that he has. It is the determination of this place that we set the terms of reference for the RBA, and we ask them to keep the inflation rate at between two and three per cent. If we really wanted to help them, we would slow that spending down, and the IMF have made some comments about that which I will share with you. Please be mindful that the RBA governor has one blunt instrument, interest rates. He has two feet—the governor speaks collectively for the board—on the brakes in trying to slow the economy down, but the Australian Labor Party needs to take its feet off the accelerator. That's because of the unintentional consequences through this bill, which puts a noose around every mortgage holder in my electorate, in the great state of Queensland, and in the country of Australia as interest rates are forced up. Even though during the campaign this government said they were going to make mortgages cheaper, but since this government came to power, if you have a $700,000 loan with a bank your mortgage payments are $1,700 more expensive as a result of leaving these guys in charge.

Don't just take my economic credentials for it. The IMF, the International Monetary Fund, have made comment specifically about this program and their heightened concerns about the spending by this government in light of what the Reserve Bank is trying to do by dampening interest rates. Section 16 of the IMF press release says:

Strong aggregate demand and the tight labor market warrant continued focus on fiscal consolidation in the near term.

Saving of expected revenue overperformance—

And this is the piece I want you to listen to—

and judicious implementation of spending programs, notably infrastructure investment, would help in containing demand pressures and inflation.

So they're saying, 'Be careful! Be careful with programs like that.'

They continue:

Implementation of below-the-line activity through newly created investment vehicles (National Reconstruction Fund, Rewiring the Nation, and Housing Australia Future Fund) should be … should be avoided. Cost-of-living support in light of high energy prices should be targeted, aimed at protecting vulnerable households and small viable firms.

These comments aren't being delivered by Liberal Party hacks. This is the International Monetary Fund raising concerns about the very issues that I raised earlier in my speech. But time after time we have those opposite coming into the House and saying that we're fearmongering and carrying on, as they preached from their speech tonight. Open your eyes: this is a concern. Open your eyes!

We have an amazing manufacturing sector and, as the former assistant roads and freight minister for this country, I'll say how proud I am of companies just in that portfolio alone, like one by the name of Paccar, situated in Bayswater in Victoria. Most Australians don't know about this company, which manufactures Kenworth trucks. They've got about 147 engineers on site. They manufacture from chassis rails to the entire production of Kenworth trucks here in Australia. Mack-Volvo do exactly the same thing in Queensland at Rocklea. So do not say that manufacturing is dead and that this single piece of legislation is going to reinvigorate the manufacturing sector, because it's just not true. Can I tell you how much government subsidies these two great Australian businesses get from government? One of the CEOs once said to me, proudly: 'We do not take a cent of government funding. We raise our own capital internationally or through our parent companies, and we are proud of it'. I said to them, 'You should be proud of it, because there's a long list of skeletons in the manufacturing cemetery of those that have relied on government subsidies as a result of doing deals with the Australian union moment.'

Volvo, Mack, Kenworth and DAF are manufacturing and assembling right here in Australia. They're speccing these trucks up for Australian conditions. And then the value chain to that—the mufflers, the exhausts, the brakes and the motors—is all prepared here in Australia. Some of the componentry comes from other than Australia. In fact, one of the choke points when it comes to manufacturing and getting trucks off the assembly line—they can probably do, collectively, around 30 to 40 trucks a day between those two businesses here in Australia—was out of Taiwan. It was the superchip conductors. This bill will do nothing to affect the supply chain pressures on superchip conductors out of Taiwan, because we do not have the technological capabilities to compete. As geopolitical threats exist, what we could do is partner with those Taiwanese companies and bring them to Australia so that we've got first access to them.

I stand here proud of the Australian manufacturing sector. Those on the other side mentioned that wide consultation was conducted and that there's wide-ranging support for this bill. When I go through and have a look at some of the non-government stakeholders who were consulted, there's the Australian Council of Superannuation Investors. I'm not too sure what they manufacture. But I've spoken to manufacturers, and after I tell you who they consulted with I'm going to share with you what the manufacturers really want. They also—surprise, surprise—consulted with the Australian Council of Trade Unions. What do they manufacture? The Australian Investment Council, Industry Super Australia and the Law Council of Australia are some, to name a few.

When I talk to the manufacturers here in Australia that are employing Australians, producing products that we use every day and putting food on our tables, they say they want cheap, reliable energy. They're not getting that from the other side. They're saying they want a reliable workforce that's globally competitive. It's not forthcoming. Australia needs bipartisan support on programs like this. We need cheaper power. We need reliable power. We need affordable wages.

The consultation process was short of concerning. I came from a financial background before the transport sector, so I'll ask a question of the Australian government. Let's put this to the test. If this was a corporation and there was an opportunity to invest money in it, how many of those on the other side would mortgage their homes and invest their money, as we on this side do when we go and start up businesses, borrow money from the banks, take a risk and employ Australians? Most of us on this side are small business operators. I currently have a mortgage over my house. If I fail in my business operations, the bank will take that house. How many of those on the other side would take that risk and invest in this program? How many? That should be the litmus test.

Have another look at your speaking notes and have a look at Labor's track record. Have a look at how much was raised when Labor brought the mining tax into this House, which was going to deliver rivers of gold. There was to be $350 million raised in the first year, but what ultimately happened over the forward estimates was that they went and spent the money that it was supposed to raise and Australia was left with a debt. Remember when Labor told us: 'There will be no carbon tax under the government I lead'? You can't trust Labor. They've said that this bill will address the international supply chain pressures. Believe me, it will not. They may endeavour to achieve that, but I can assure you it will not.

There are a number of irresponsibilities, and the last one is that the bill is fiscally irresponsible, delivering funding well in excess of the coalition's Modern Manufacturing Strategy, which was about $1.3 billion. This is an additional $5 billion for appropriations, plus a $10 billion investment, but the government's not going to tell you when it's going to be invested. The clanger is: 'We're going to create a committee, but we're not going to tell you who's going to be on it when the time is right.' You can't trust Labor.

Debate interrupted.