Eric Abetz (Tasmania, Liberal Party, Shadow Minister for Employment and Workplace Relations) Share this | Link to this | Hansard source

The Steel Transformation Plan Bill 2011 represents the emergency surgery necessitated by an act of gross violence—in this case, economic violence perpetrated by the Green-ALP alliance. Very simply, but for the carbon tax we would not be needing this compensation package. It is a compensation package which will go nowhere near undoing the damage that has actually been occasioned by the announcement of the carbon tax. Hundreds of millions of dollars have been wiped off the share price. Some people might say, 'Why does that matter?' It matters because superannuation companies and other people have invested in those companies and, when their share value goes down, when their dividends go down, people in retirement, self-funded retirees and superannuants get a lower income. There are consequences for this sort of reckless activity.

Of course, the Steel Transformation Plan Bill is the last of the carbon tax package. The Labor Party deceptively sets it aside and suggests that it is unrelated, but of course the hapless Mr Combet was forced to admit, on 10 October 2011, that the so-called Steel Transformation Plan had been driven purely by the carbon tax when he said:

The negotiation of the Steel Transformation Plan did come out of the discussions we've had with the steel companies for months now over the carbon price issue.

So let's not have any more of this nonsense, this dissembling, this obfuscation, suggesting that this is about transforming the steel industry. The fact is that the steel industry was transformed before this bill was introduced. It was transformed in a negative way by the economic recklessness of this government. It was transformed by this government breaking a solemn election promise that there would be no carbon tax.

Indeed, I am reminded of a wonderful speech given by a fresh, new member of the House of Representatives. In her first speech she said—and let's guess who said this:

For far too long public debate in Australia has failed to nourish or inspire us.

She went on to say:

The end result of this political cycle is a weary people who no longer believe what politicians say and who think the politicians saying it do not ... believe it themselves.

Do you know who that was? None other than Ms Gillard herself in her very first speech. It seems that she has now morphed into that which she did not want to be. That begs another question: who is the real Julia? Is it the one who gave her first speech all that time ago? Is it the one who said 'no carbon tax' before the last election? Or is it the Ms Gillard who is now celebrating the passage of the carbon tax in direct breach of a solemn election promise? It is interesting, isn't it? Ms Gillard has morphed into that which she did not want to be.

The other thing about this steel transformation plan is that it was negotiated with two companies. How many other people and companies are involved in the steel industry in this nation? There are literally hundreds of small businesses involved in steel fabrication all over our country, many of them small family businesses. Will they receive a single cent of compensation? No, not a single cent. Why? This steel transformation bill is another insight into the way this hapless Green-Labor alliance does business. It is all about big government, big business and big unions. It is like their mining tax where they say, 'That's all resolved. We've negotiated it.' Well, they have, with three big mining companies—the three biggest—and do you know who they left out? Only the 2,997 other mining companies in Australia, but they all happen to be small businesses. So the Green-Labor alliance does not care about them. Similarly, in this so-called steel compensation package, who are they concerned about? Big business.

Labor say they are concerned for small business and that they are about trying to get more small businesses. I fear that unfortunately they are succeeding, not by growing small businesses but by collapsing big businesses into small businesses. That is not the way forward for our economy. To try to claim somehow that collapsing big business into small business is a good thing is another unfortunate insight into the way this government does business and seeks to run the economy.

When there are thousands of small businesses intricately involved with the steel sector, to provide compensation to only the two biggest companies is to sell short all those workers in all those small businesses. But what is the real reason? Chances are the vast majority of the workers in those small family businesses are not in a trade union, so why would you bother looking after them? Non-unionised workforces are not a concern. But, if you have a big unionised workforce that helps bankroll the trade union movement that helps bankroll this government, then you will use taxpayers' funds to compensate them, and all the others can go jump. This is similar to the three big mining companies with the mining tax. That is what this is all about: bankrolling those that bankroll the unions that in turn bankroll the Labor Party. That is where you get this vicious cycle.

I call on the genuine trade unionists in this country to stand up for their workers and say that enough is enough. Where are the Paul Howeses of this world? I remember the very strong stance that he took, 'If the carbon tax costs one Australian job, we will be opposing it.' We know it has cost more than one Australian job just from Coogee Chemicals alone. It has cost 150 jobs in that one project. We know it is costing many jobs at Kurri Kurri aluminium. We know that lots of jobs have been lost out of the steel sector courtesy of the carbon tax. Where is the hapless Mr Howes? Desperately seeking preselection to get into the parliament. He will rat on his workers and rat on the trade union movement because he wants a seat in the federal parliament, like so many other great champions of the workforce—people like Senator Doug Cameron, who shrunk the AMWU under his leadership. One can understand why—

Anne McEwen (SA, Australian Labor Party) Share this | Link to this | Hansard source

What has happened to the Liberal Party in Tasmania this week?

Eric Abetz (Tasmania, Liberal Party, Shadow Minister for Employment and Workplace Relations) Share this | Link to this | Hansard source

I thank Senator McEwen for that wonderful interjection. The evidence is overwhelmingly clear that the Liberal Party in Tasmania is growing. It is now the biggest party in Tasmania. It would win a state election in its own right. On the latest opinion polls it would win the seats of Braddon and Bass and chances are Lyons and Franklin and three Senate seats. Do you know why there has been this transformation, Senator McEwen? Because of your deceit to the electorate. The people of Tasmania know that every single Labor member and every single Labor senator was elected at the last election on the promise of no carbon tax. Members of the Labor Party have defied and betrayed the people who elected them. The people of Tasmania now trust that the Liberal Party has the integrity to stand by its election promises, unlike the Australian Labor Party.

That interjection from the hapless Government Whip highlights the difficulties that the Australian Labor Party are in. The coalition will continue to fight this carbon tax and its consequences all the way to the next election and, if the people of Australia give us the mandate, we will repeal it.

Doug Cameron (NSW, Australian Labor Party) Share this | Link to this | Hansard source

Nothing in that pretty hopeless contribution from Senator Abetz on the Steel Transformation Plan Bill 2011 surprised me. The contribution from Senator Abetz really did not deal with the issues facing the steel industry. Senator Abetz has never cared about the steel industry in his whole political career. Senator Abetz talked about genuine trade unionists standing up. I remind Senator Abetz that genuine trade unionists did stand up against the coalition and against Senator Abetz when he was the champion of Work Choices in the Senate, when his job was to argue that Work Choices was going to be of great benefit to working people in this country. Similar misrepresentations are now taking place when Senator Abetz is running the same nonsense about the sky falling in because the Labor government is taking steps to deal with carbon pollution and global warming.

Senator Abetz should be reminded that when the workers and good trade unionists did stand up they threw Senator Abetz and John Howard out on their ear. Clearly the position of the coalition is one that is false. It is a false concern that they are raising about manufacturing because in the 11½ years of the Howard government they were never concerned about manufacturing jobs. In terms of supposedly driving productivity in manufacturing they only raised Work Choices and trying to compete on low wages and low skills. That is the history of the coalition. Any steelworkers who are listening in know exactly where the coalition stand. They know exactly their position. Here we have the coalition running the argument that $300 million should not be allocated to help the steel industry through the difficulties it has with two main issues: (1) the global financial crisis, which the coalition fail to accept ever happened; and (2) the dollar being so strong that it is putting huge pressure on manufacturing companies around the country. And what is the coalition's answer to the strong dollar? Their answer is to give the mining companies back almost $11 billion—to give Gina Rinehart, Twiggy Forrest, Anglo-American, BHP and Rio Tinto $11 billion. That is their answer to the global financial crisis and the strength of the dollar. The strength of the dollar is the main issue that we are facing.

I suppose another problem that we face is the lack of skills across our industry base because of the complete ignorance of the Howard government in accepting and understanding that if you build your skills base you build the strength of the economy. They then fiddled the books in relation to skills and argued that if you were trained as a hamburger flipper at McDonald's you were then a skilled person who should be allocated as being trained against the traditional trades—an absolute nonsense.

Let us come back to the steel industry. I actually know something about the steel industry. I actually worked in the steel industry. I do not think there would be too many on the other side who have ever worked in the steel industry.

Senator Milne interjecting—

But I have worked in the steel industry. Senator Milne says 'ever worked', and I think that is right: some of them have never, ever worked in a real job. That is the position over there.

Opposition senators interjecting—

In they come, baying and moaning because the nerve has been touched. What would the lawyers on the other side know about workers in the steel industry? I know what it is like to work in the steel industry. I know what it is like to work in the manufacturing industry. I know what it is like to work in the power industry. I know what it is like to work in the shipbuilding industry. My background is as a fitter. I have been on the job and worked. I have not simply come here as the result of some preselection deal as a lawyer who has done nothing else but try to be an ambulance chaser for their whole life. So I actually know something about the manufacturing industry. I have never been an ambulance chaser like those on the other side. I have to say I am quite glad that I have no legal training. I am quite happy to say that I left school when I was 15 and have no formal qualification other than a City and Guilds trade certificate. But that does me against you lot over there. I must say the investment that has been made in the legal training for you lot over there has been misspent, because there is not a lot between the ears. A lot of you over there just fail to accept the absolute basics in this debate. The absolute basics are that our manufacturing is under pressure because of the success of our mining industry. The mining industry is driving the dollar up, and it is putting huge pressures on our steel industry.

How do we want to deal with it? We want to deal with it by increasing the skill base. We want to deal with it by promoting innovation. We want to deal with it by promoting best practice. We want to deal with it by making sure we have decent management training in this country, decent management systems in this country, managers who can actually compete internationally—something that in 11½ years the Liberals and the coalition failed to deal with. These are the issues for manufacturing in this country: dealing with the high dollar, innovating, building the skill base and making sure we have strong management skills within the industry.

We know what is around the corner with the coalition: they want to go back to Work Choices. They think that that is the best way to compete. They do not want to compete on best practice. They do not want to compete on quality. They do not want to compete on timely delivery. They do not want to compete on the skill base of the workforce. They just want to take away their penalty rates, take away their shift allowances and take away any condition we can have. They want to introduce what they describe as 'flexibility'. I say to every worker in this country: when you hear a coalition MP or senator talk about 'flexibility' you should immediately think about Work Choices, because 'flexibility' is code for the coalition's Work Choices. They said they could never speak the name Work Choices again, so what have they done? They have introduced the concept of 'flexibility'. So when you hear them talk about 'flexibility' it is flexibility to get rid of your penalty rates. The steel industry will compete through 'flexibility'.

You wait and hear it. It will be 'flexibility' to take away the penalty rates of steelworkers in this country, the 'flexibility' to take away their shift allowances, the 'flexibility' for the boss to tell them when they will start and when they will finish, the 'flexibility' for the boss to determine every move they make from when they go on the job until they leave the job. There will be no industrial democracy or rights on the job. It will be entirely managerial prerogative to determine whatever a worker does when they walk on the job. That is not an Australia that is a good Australia. That is an Australia that is the mindset of the coalition to rip away workers' rights and conditions. That is their only answer. 'Flexibility' means Work Choices. That is the clear position. What are we trying to do? We are trying to assist the steel industry, and the steel package we are putting up is completely separate from the package which was voted on historically here yesterday and which takes this country forward to do something about the environment and to reposition this country for the future. The steel bill is being put up separately as a special package to assist workers in an industry which is under huge pressure because of the global financial crisis and the strength of the dollar. It is what is described as the 'Dutch disease': the mining industry powers ahead, and the manufacturing industry ends up in difficulty. That has been well documented around the world. We have the Dutch disease at the moment. When you get a disease, what do you do? You exercise some care, exercise some support and assist the industry—and that is what we are doing. We want to help the fitters, the boilermakers, the welders and the steelworkers in the steel industry. We want management in the steel industry to lift their game: we want them to look at the research and development and the innovation that will drive the new technology and the new products to enable the industry to compete in an economy which is carbon constrained. That is the challenge for the steel industry, and we are putting up the finances to help them meet it.

But what do we get from the coalition? More negativity. I heard Senator Joyce's speech here yesterday. I do not think he mentioned the steel industry except in the first minute and in the last minute of a 20-minute speech—and it was an absolutely incoherent rant. Senator Joyce sees himself as one day being the Deputy Prime Minister of this country, who will be able to choose his portfolio. He will obviously say to Joe Hockey, 'Sorry, mate—you're never going to be the Treasurer; I'm going to be the Treasurer of this country.' Can you imagine giving the National Party the purse strings of this country? Can you imagine what a disaster that would be? We do not want to ever see Senator Joyce holding the purse strings of this country, and I know that there are some on the other side who are as horrified as I and we on this side are at that prospect.

What do we need to do? We need to build the capacity of our steel industry. We need the steel industry to be in a position where, through good work practices on the job, better management systems, higher skills, better quality products and more innovative products, they can take the opportunities that the legislation which went through this parliament yesterday offers industry in this country. If you look past all of the economic problems in Europe, one of the bright things there still is the renewables industry.

Senator Bernardi interjecting—

Senator Bernardi says 'what a dud'. But the renewables industry in Europe is employing tens of thousands of workers. It is at the forefront of building the latest technology in wind turbines, wave turbines, photovoltaics and tidal power. It is dealing with the issue of renewables technology and dealing with it effectively. In Spain there is 25 per cent unemployment at the moment, but not because—as Senator Back would have you believe—the renewable energy industry has created the problem for the economy. This is another example of the coalition's selective memory. They seem to forget that there was a global financial crisis and that we were lucky enough to get through it because there was a Labor Party in government who acted in a timely, targeted and temporary manner to make sure that we created jobs when all the while other countries around the world were losing jobs. When we are faced with a challenge we deal with it, and we dealt with the challenge that we faced in the global financial crisis. We are the envy of the world for our capacity to deal with these challenges. When we are faced with a challenge in the steel industry we will deal with it in the same way: we will look at it, and we will support the fitters, the boilermakers, the electricians and the steelworkers of Wollongong and Newcastle and elsewhere who need our support.

We are the party of working people in this country; you are the party of big business, and that is why you would hand back over $11 billion to Gina Rinehart, Clive Palmer and Twiggy Forrest—so that the donations keep pouring in to the Liberal Party from the big end of town. We know what it is all about, and you would do it at the expense of steelworkers in Wollongong and Newcastle. We will not do that. We are putting hundreds of millions of dollars separate from the climate change package in to assist steelworkers in this country and, as a former steelworker and as a former union official who looked after steelworkers, I cannot think of a better thing that government can do.

Cory Bernardi (SA, Liberal Party, Shadow Parliamentary Secretary Assisting the Leader of the Opposition) Share this | Link to this | Hansard source

You're a has-been. I think that's the best way to describe it.

Doug Cameron (NSW, Australian Labor Party) Share this | Link to this | Hansard source

I do not know what Senator Bernardi is going on about, calling people has-beens. That is all right. I am very happy to say that I have had a very good career as a trade union official and I come here to parliament with my experience as a trade union official to actually help workers. I do not know what Senator Bernardi comes here with other than probably favourable treatment in a private school and some degree that allowed him to go into a parliamentary office and suddenly he gets preselection and becomes, I bet you, a nonevent and a joke in parliament. You and Senator Joyce, Senator Bernardi, are a bit of a joke in parliament. You are pretty well seen to have no support. No wonder Malcolm Turnbull sacked you. No wonder Malcolm Turnbull had you well and truly under control.

Coming back again to the steel industry, we will make sure that the steel industry in Australia can actually compete and look at accessing some of the huge opportunities in relation to renewable energy. Look at Spain. Senator Back said that Spain was a basket case because of renewable energy. The only bright spot in the Spanish economy is the Spanish renewable industry. They are exporting $3 billion worth of goods every year. They are at the forefront of wind power and other renewable energy. Spain employs 40,000 people in renewable energy—40,000 jobs. The sector has 700 companies, 19 wind turbine manufacturers, 270 component manufacturers, 140 wind farm developers and 277 service providers. The opportunity we can have in Australia is about the steel industry accessing the capacity to build the wind turbines of the future and the steel towers that require hundreds of millions of tonnes of steel to be built so that renewable energy is there for the future. That is the challenge for the steel industry. I am sure the steel industry will take that challenge up. But let me tell who will not take that challenge up. That is the coalition, because they are Work Choices warriors and they have no other way. (Time expired)

Cory Bernardi (SA, Liberal Party, Shadow Parliamentary Secretary Assisting the Leader of the Opposition) Share this | Link to this | Hansard source

Before I address the specifics of the Steel Transformation Plan Bill I feel it is necessary to respond to some of the perfidious words of Senator Cameron. We have heard a monotone misleading of not only many aspects of this bill but the coalition's position on it. The first thing I would like to turn my head to is Senator's Cameron's claims that he was not the beneficiary of some preselection deal or some night of the long knives and that he was not an ambulance chaser. I suggest that Senator George Campbell, a former senator in this place, would say something different. Senator Cameron was the beneficiary of a plot against a sitting senator and was the beneficiary of a stitched-up preselection deal, which he now denies. So it is a bit rich for Senator Cameron to be saying that he is not the beneficiary and he is somehow authentic. He is so authentic as a defender of the workers that he voted for a carbon tax which this bill is directly related to. Once again, the perfidious words of Senator Cameron said it is not; it has nothing to do with it. But it does, and it was dealt with as part of the carbon tax package of bills through a Senate inquiry. So it is directly related to this bill.

Senator Cameron went on and said that manufacturing was under pressure because of the Australian dollar. That may indeed put additional pressures on the manufacturing industry in this country, but make no mistake: the people of Australia and the manufacturers of Australia know that the issue at stake here is the fact that this government is increasing the cost base for manufacturing by imposing a carbon tax. That is undeniable, it is indisputable, and that is why we are talking about an assistance package for parts of the steel industry. Senator Cameron also said there was a need for decent management, and I agree with him there. I think there is a need for decent management, particularly in the Labor government, because the Labor government have mismanaged every aspect of policy that they have introduced into this country.

Finally, in responding to Senator Cameron's comments, the politics of envy ooze out for everyone to see. For some reason he is claiming that because he did not go to a private school people who did are somehow terrible people or have had some privileged life. That is an insult to the many thousands of men and women who work very hard to send their children to private schools, and that includes a lot of parents who take on a second part-time job just to pay for that. The politics of envy do you no favours, Senator Cameron; nor do you for the workers of Australia when, as the supposed champion of the Left working class, you go into your caucus meeting and you roll over because you get defeated every single time.

Senator McEwen interjecting—

If you cannot advocate properly, do not advocate and do not pretend that you are. Having exposed Senator Cameron's talking points for what they are, just tired old Socialist doctrine, I turn my attention to the direction of this bill. The only reason this Steel Transformation Plan Bill is being introduced is to limit some of the damage caused to the steel industry by the imposition of Ms Gillard's carbon tax. This is a tax, of course, that was passed yesterday. It was the tax that was promised would never be introduced not only by the Prime Minister but also by Mr Swan. Fifteen of those on the government side of the chamber were elected at the last election promising not to have any carbon tax, and I notice that Senator McEwen has fallen silent after her earlier interjection. That is because she was elected at the last election as well—

Senator McEwen interjecting—

She was elected at the last election as well, promising there would be no carbon tax. Yet what did she do yesterday? She voted for it. The only person with any shred of decency on that side is Senator Conroy, who hates the carbon tax and refused to come in. Senator Feeney disappeared as well, as did Senator Arbib, who was indisposed overseas. They are the only people with honour.

This is the issue: we know this carbon tax is going to be a disaster for Australian industry, and this bill is a tacit admission of it. If there were not a carbon tax, there would not be a need for this kind of compensation in the first place. There would not be a need for $300 million to be doled out to two individual companies. And might I say that on 10 October 2011 Greg Combet, the Minister for Climate Change and Energy Efficiency, admitted that the establishment of the Steel Transformation Plan had been driven purely by the carbon tax when he said, 'The negotiation of the Steel Transformation Plan did come out of the discussions we've had with steel companies for months now over the carbon price issue.' The carbon price issue! What a way of describing exporting tens of thousands of jobs overseas, seeing industry flee overseas and seeing carbon dioxide emissions increase. But what really galls me about this is the fact that it is so selective. As this government always does, it plays favourites. It picks and chooses who it wants to be the winner, because under this plan there were only two Australian firms—albeit significant firms—that will qualify for assistance: BlueScope Steel and OneSteel. This is because the definition of 'eligible corporation' in clause 4 limits it to them.

This overlooks some key statistics that I think the Senate needs to be advised of. These two firms, I understand, employ somewhere between 15,000 and 17,000 employees, but every other steel business, including what are estimated to be the thousands of steel fabricators all over the country, many of them longstanding family businesses—people who have not had privileged backgrounds, who have worked and built their businesses from the ground up, and who should be admired by Senator Cameron and the people on the other side but instead are decried for making a success of their life—will not receive so much as a single cent of assistance under this legislation. I have to say that I am only estimating how many firms these are, because the Australian Bureau of Statistics has not kept the records for a number of years, but in 2006-07 there were around 91,000 total employees across the entire Australian steel industry chain. We have $300 million going out to two businesses that have about 15,000 to 17,000 employees, and we have nothing going to the other thousands of businesses, including the family-owned businesses, who are going to be equally affected by this carbon dioxide tax as it puts up the price of electricity and manufacturing—wages are going to rise, and all of these things. But there is nothing for them. If this does not smack of a government just trying to buy largesse and thinking, 'Well, we can placate these larger firms because they're the ones that will make the noise'—if it does not have the stench of a government that is desperate to quieten down any dissent—I do not know what does.

The frustrating thing also is that the government cannot even get its own lines right about how long this is going to take—how long this compensation package is going to be introduced over. Clause 12 of the Steel Transformation Plan Bill clearly states that the plan covers the four-year period from 2012-13 to 2015-16. But, of course, the government cannot even get its own lines right, because it makes it up on the run in general. On 12 July a joint media release was issued by Mr Combet, Sharon Bird and Stephen Jones, the member for Throsby, which stated:

… the Government will introduce a Steel Transformation Plan which will deliver assistance worth up to $300 million over five years—

not the four years that it says in the transformation bill but over five years—

to encourage investment and innovation in the Australian steel manufacturing industry.

They cannot even get the timing of it right. They have gone from four to five years. Mark Dreyfus, from the other house, said:

The Steel Transformation Plan will provide assistance of $300 million over five years.

I have trouble listening to or believing much of what Mr Dreyfus says, quite frankly, because I was on national TV with him once and caught him not telling the truth. I repeatedly pushed him and he kept saying yes, he had read a document which he clearly had not, and then he tried to misrepresent what was in the document. So there is a credibility issue there with Mr Dreyfus, but I think he is part of the ministry of this government. He said it was over five years as well, notwithstanding what the bill itself says. But the official websites of the Department of Innovation, Industry, Science and Research, who should be at the forefront of everything, and the Department of Climate Change and Energy Efficiency both state, 'The plan will operate over six years.' What is it—four, five or six years?

Might I suggest to you that the whole thing could be exhausted in two years, because there is a provision for as much as $164 million to be paid out in advance, before the carbon tax is even introduced. There is the one-off sweetener: 'There's your sweetener. Please don't complain. Have $164 million.' And then as much as $75 million can be paid out each financial year. That would give rise to $75 million being paid on 30 June of one financial year and another $75 million being paid on 1 July of the next financial year—the very next day. So, in effect, you have $164 million paid out up front and then you have $150 million paid out over two days. That is what is supposedly going to last four, five or six years. No-one is really sure, and no-one is sure what this government is actually doing.

But one thing that people can be absolutely sure about is the effect that this carbon tax has had on these two individual firms, notwithstanding the compensation that is being offered to them—this $300 million incentive. Immediately before this incentive was announced, the price of OneSteel shares was $2.03. Immediately following the announcement, the shares dropped to $1.93. That is a significant amount of shareholder wealth that has evaporated—somewhere to the tune of $133 million. What has happened since as more detail has emerged about this carbon dioxide tax that is going to disincentivise industry from remaining in Australia, limit growth of our industry, put the price of every consumer good up as a result of the electricity needed to produce it in this country and put pressure on employment and put pressure on domestic growth? What has happened since then? Quite frankly, it is all bad news for the shareholders of OneSteel, because their share price has dropped from $2.03 before this assistance package was announced to—at 8 September, when I have the most recent figures—96c. In the nine or so months from when the carbon pricing scheme was announced in February to 8 September, we have seen $2.5 billion wiped off shareholder value—$2,530 million. That is an extraordinary loss, and that is what this government calls innovation. That is what this government calls enterprise and growing Australia. But it is not just OneSteel; of course, BlueScope Steel has suffered as well. On 23 February, when the carbon tax was first mooted, it was at $2.20. By the time this compensation package was announced in July, the shares were down to $1.26. Today they are 74c; $2,662 million of shareholder wealth has disappeared, and we are expected to be convinced that this is innovation and somehow the shareholders will do better because there is going to be a $300 million payment to them over two years. This is an absolute folly. It is a joke, as are most of the government's policies in respect of supporting industry. When I first came into this place I once gave a speech saying that if we had Minister Carr running the manufacturing industry in this country the problem would be that we would ultimately see the decline of manufacturing. I stand by that because the proof is there. We are watching the diminishing of manufacturing in this country. We have seen Mitsubishi close on his watch. We have seen the motor vehicle industry under pressure on his watch. Now we are seeing the steel industry under pressure on his watch.

Of course, Senator Carr came in and gave me a huge spray. He did me the courtesy—I will pay this—of ringing up and saying that he was going to give me a spray in the parliament. But the proof will be in the pudding. We will see the decline of manufacturing in this country, and we are seeing it. And we are seeing a desperate government throwing taxpayer money where shareholder money should be. I mean, what sort of deal is it where you can destroy over $5 billion of shareholder investment and wealth, which is national wealth I have to tell you, and use the excuse that you are going to give us $300 million? It beggars belief. It does not pass the commonsense test.

These are the sorts of things that Australians are concerned about. We are worried about them because the compensation is dwarfed by the loss of shareholder values. It is not a good deal. The whole pretext that this is somehow going to drive renewable energy or that there is going to be some sort of benefit for us is simply not true. You cannot have renewable energy powering a steel furnace. I do not know anywhere in the world where it is done. Maybe it can be done here. I doubt it. We should learn from the experience of other nations. We should learn from their experience as to how they have generated jobs growth, not just in the mining industry—we are blessed with a great many resources in that respect—but in having a competitive manufacturing industry. And that means not imposing punitive taxes like a carbon dioxide tax across our entire economy at such a high level, which no other country in the world is doing.

Consider our competitor nations. Canada has entirely ruled out having any sort of carbon dioxide tax. They have just said, 'No, we are not going to do it. It is ridiculous. It is silly.' We have the European Union, which is probably as close to broke as it can get, where under the emissions trading scheme over there it has been estimated that over 90 per cent of the trades are actually fraudulent, pass-the-parcel trades, or rorts designed to get taxes out of it. My own research has indicated that there are huge concerns about the renewable energy industry in parts of Italy and Spain because it has been taken over by organised crime because they know that these subsidies are easily rortable. What we are seeing is a repeat of this sort of problem in this country. So devoid is this government of any new initiative that could possibly be called innovative or that could possibly reflect Australia's unique position in the world, they are just grabbing a hodgepodge of solutions from Europe. And Europe is not the best example, I have to tell you, of encouraging independence, thrift, enterprise and innovation.

We should instead be looking to our nearest neighbours and our major competitors in this respect—the people that we are trying to sell steel to, which is mostly Asia. We should be looking at what they are doing. Let me tell you this: yes, they have an investment in renewables in many instances and that is okay. We have some of that here too. But they are building plenty of coal fired power stations. They are not imposing economy-destroying carbon dioxide taxes because they know it is folly and will severely impact the national economy. Unless the rest of the world is following along it will make no difference whatsoever to the environment or to the climate. There are those of us, and I am one of them, who have some suspicion that even if the rest of the world did something it would make no difference to the climate. But that is not the point. Why would Australia go it alone in this process? A whole range of maxims will be trotted out about all the other countries that are doing this and how prosperous they are. Well, they are not prosperous. Spain is not prosperous. Italy is not prosperous. Greece is not prosperous. You have financial issues right throughout the European Union.

Ms Gillard held America up once and said, 'We should be modelling our economy on the Californian experience.' California has seen industry run over the borders into other states where they do not have these punitive green regimes. California is as close to broke as it gets. It needs to borrow money to pay its payroll. It is an absolute disgrace. And yet that is what Ms Gillard wants us to model our Australian economy on.

Well, I say, no, let's not do that. Let's not punish firms that want to invest and employ Australian workers. Let's not just mouth rhetoric about supporting Australian workers and yet try to shut them out. Let's not stand up and say, 'I have been a union boss so I know what is good for the workers.' Let me tell you: I have been an employer; I know what is good for the workers—a business that thrives and prospers. That is how they maintain their employment. Let me assure you of this: every decent employer in this country who has a decent employee will do whatever they possibly can to keep that employee happy because they want to keep them because they know they are an asset to the business. Every business owner that I know says they want a happy workforce. But there are problems when you have troglodytes like Senator Cameron and his ilk. Senator Cameron and his ilk see only the politics and the business of confrontation, where businesses need to be smashed in order to somehow protect workers. We saw it last week in the Senate inquiry when he was jumping up and down and trying to grandstand against Mr Joyce from Qantas. Shame on Senator Cameron and his ilk for doing that because Mr Joyce had to take a stand for his business, his shareholders and the Australian people. It is all right for Senator Cameron and others to criticise Qantas, whilst they are flying with them as often as they possibly can, but it just beggars belief. Hypocrisy writ large is so evident in this place. When people are standing up here saying that we do not care for the workers because we want to make sure there are prosperous, growing industries that we are not exporting overseas, because we oppose ridiculous policies that are not going to achieve the stated aims and are going to impose an impost on Australian thrift, entrepreneurship, enterprise and prosperity, we have every right to say this is wrong. We are not opposing the issue that Australian industry does occasionally need some support— (Time expired)

John Williams (NSW, National Party) Share this | Link to this | Hansard source

I rise to speak on the Steel Transformation Plan Bill 2011. The spending starts for the compensation for the carbon tax. There is no other reason this legislation is before the Senate. The government are well aware that the carbon tax passed through this place yesterday to the glee of many and the disappointment of others. They are well aware of the cost this carbon tax is going to have on our nation, including on the cost of doing business. I will say it again: if you strangle your business sector you strangle your economy. Business is where the nation's wealth is derived. Businesses employ people, those employed people pay tax and government, federal or state, gets the money to carry out their services, whether they be aged-care facilities or defence. It all comes from the business sector. The more we strangle our business sector here, especially those businesses that have to compete against competitors overseas where our exchange rate is damaging us, the cost of labour is far cheaper and the cost of energy is far cheaper because those countries have not decided to put a price on carbon and a cost on industries, the more we strangle our economy. Those businesses overseas do not face that; we do. Hence, that is why this legislation is before us.

I will turn to the cement industry. I am well aware that the cement industry is getting a 94.5 per cent discount on the carbon tax. I have raised this issue before in this chamber. We had 15 cement factories in Australia. One in Central Queensland closed up 18 months or so ago. A few months ago we heard the terrible announcement that Kandos was closing its factory, so we are almost back to 13. Kandos, I believe, employed 96 workers directly, and many of the truckies and the other businesses that survived and fed off the Kandos cement factory will feel that closure as well. In Australia we produce around 10 million tonnes of cement a year. When we produce a tonne of cement in Australia we produce 0.8 tonnes of CO2, that is around eight million tonnes of CO2 a year. China, that huge nation with its huge population, its huge growth of some nine per cent or 10 per cent a year and its exports growing enormously, produces in excess of one billion tonnes of cement a year. I said that we produce around 10 million tonnes a year; we actually import two million tonnes of cement as well. In China the average amount of CO2 produced in cement manufacturing is 1.1 tonnes of CO2 per tonne of cement. Comparing that to Australia: we produce 10 million tonnes of cement, with eight million tonnes of greenhouse gas, CO2, or whatever you want to call it. In China if you produce 10 million tonnes of cement you produce 11 million tonnes of CO2.

Here is the problem: if we shut down our industry in Australia, we will no doubt import from China our cement, those 10 million tonnes now being manufactured in Australia—of course, that production is on the slide as we have had one factory close and another announce its closure. We will see 11 million tonnes of CO2 produced in China, compared to the eight million tonnes that are produced in Australia. That is three million tonnes extra. I have said before that we do not have a tent over our nation. We are linked to the world in trade and in the atmosphere. Shutting down our industries and moving them overseas equals more CO2. If your goal is to reduce more CO2 that is simply not going to work.

The cement industry is going to receive a 94.5 per cent discount on the carbon tax. That will still cost the cement industry in Australia an extra $9 million. Industry cannot afford $9 million. I have met with the cement industry, I am sure people in the government have met with them, I am sure Senator Carr, the Minister for Innovation, Industry, Science and Research, has met with them. The cement industry cannot afford a tax of $9 million. Why? Mainly because of the exchange rate. I will take you back to why the Australian dollar is so strong. Look at the difference between our interest rate and those of most trading nations, those OECD nations, around the world. Most of their interest rates are almost at zero, while we have an official interest rate of 4.5 per cent. I welcomed the 0.25 per cent reduction on Melbourne Cup day. That was good news for battlers, for home loan borrowers, for small business and for farmers, although we have not seen any reduction in interest rates for small business or farmers yet. I have certainly been in touch with the four major banks to ask: 'What are you doing with your business loans?' We welcome the 0.25 per cent reduction from the Commonwealth and Westpac banks. It was only 0.2 per cent from the NAB, but that is still a reduction. Twelve months earlier when there was a rise of 0.25 per cent in interest rates, we saw the Commonwealth Bank raise its levels by 0.45 per cent and the NAB by 0.35 per cent. So we are getting some relief.

The interest rate differential is one of the reasons— it is not the sole reason—the Australian dollar is so strong. When people overseas are investing, are they going to invest and get 0.5 per cent or are they going to invest in Australia and get 4½ or five per cent? Sure there are exchange rate risks, and movements in exchange rates can turn everything pear shaped; I know that too well. However, this is a problem we are facing with industries. I will say it again: the cement industry—those 13 factories—cannot afford a $9 million tax if it is to survive. It cannot afford it. We will see more closures in this industry, just like in the steel industry.

We see that BlueScope and OneSteel are getting compensation through this legislation. My colleague Senator Bernardi highlighted the share market and what the carbon tax has cost those companies. This is where we have a serious problem with this whole plan: the cost of doing business. I know the majority of households are going to be compensated; there will be three million households that will not be compensated. That may cover some of their costs in increased electricity prices and in increased fuel prices, as electricity is used in much of the processing and delivery of fuel.

We now see that we are going to have under this proposal almost seven cents a litre on the road transport industry. Any truck with a tare weight of 4½ tonnes or more will face some $510 million of extra diesel tax. There was a 38 cents a litre excise on fuel. The coalition, driven by John Anderson, former Nationals leader and Deputy Prime Minister, brought in an 18½ cents a litre rebate for the transport industry. Consequently, they would pay just 19½ cents a litre, the road user fee, to contribute over the damage to the road. The government has already taken almost 3½c of that rebate off our truckies. On 1 July 2014, they plan to take almost another 7c off our transport industry. Where is the compensation for our transport industry? In regional Australia we need the trucks. Our rail system has been depleted. We should have invested in our rail system instead of pink batts and school buildings that are mainly the responsibility of state governments anyway. We could have put that money into the Brisbane to Melbourne train line, even up to Gladstone. We could have developed better infrastructure to make our country more productive and more competitive. But, no, we wasted so much of it.

Senators opposite have been laying very low on the diesel rebate, because, as I said yesterday across the chamber to Senator Sterle, there will not be a truckie vote for the Labor Party or the Greens come next election. You cannot put $510 million of extra cost on our truckies. I do not know if the transport industry would even make that much profit right across Australia. I do not know what the profits of Toll or Finemore or the smaller companies are, but I would doubt that they would make that much profit in total. I know that the transport industry is a tough industry with huge costs, and it has been since the seventies when I was driving in the transport industry. And we are going to put more costs onto our truckies. As I said, there will not be a truckie out there, especially an owner-driver, who will support the Greens or the Labor Party come next election, because they do not want that extra $510 million tax on their fuel.

Helen Polley (Tasmania, Australian Labor Party) Share this | Link to this | Hansard source

Is that from your crystal ball? Is that your prediction?

John Williams (NSW, National Party) Share this | Link to this | Hansard source

I will take that interjection. That is what is in the plan that the Multi-Party Climate Change Committee came up with. It will add a tax of almost seven cents a litre come 1 July 2014, and our truckies will have to pay that. I am sure you are familiar with it, Senator Polley. There is only one way we can prevent that tax being put on our truckies: have a change of government at the next election, because the coalition will not inflict that extra cost on our transport industry. All that would do is add to the cost of getting our exports from regional areas to the ports. Where I live, we do not have a train line. Everything comes into the town by road. Everything goes out by road.

The next point that I wish to talk about concerns our abattoirs. We are so grateful to have an abattoir in the town of Inverell that employs more than 600 people. It is worth a huge amount of money, not only through wages being spent in local businesses but also through the transport that brings the cattle to the abattoir and the refrigerated trucks that take the meat to the waterfront and to domestic consumers as well. Further, the fact that we have Bindaree Beef bidding in the stockyards each week puts a floor on the cattle price, which then feeds into the regional communities. That puts money into regions to keep their local economies viable. And we are going to impose a $1.74 million cost on this abattoir in the first year. That was the evidence that our Senate Select Committee on the Scrutiny of New Taxes heard at Tamworth: a $1.74 million cost. And yet their competitors in America will not have that cost.

They are striving to compete against America. The home of subsidies for farmers is either in Europe or America, and our industries have to compete against them. Those abattoirs in America, which are pursuing our markets in South Korea, Japan and many other countries, do not have those costs. If you remove the competitive edge of our trade-exposed industries you remove the jobs in those industries. That is what of great concern about this whole tax proposal.

It is through this place now. For that we can thank the betrayal of the Australian people by those opposite and those who were complicit in that betrayal—namely the member for New England, Mr Tony Windsor, and the member for Lyne, Mr Rob Oakeshott. They were complicit in the break of the promises made by and the breach of the words given by the Prime Minister and the Deputy Prime Minister, Treasurer Swan. Those two Independents played a major role in this. When it comes to seats in parliament, those seats do not belong to the politicians but belong to the people and the people will have their say come next election.

I want to talk now about the issue of certainty. The reason for the carbon tax was to bring certainty so that business could invest. And I welcome Senator Conroy to the chamber. We know that the carbon tax come 1 July next year will be $23. I was hoping Senator Conroy would stay for this speech, because I know what a great fan he is of this carbon tax. We have not seen him speak on it; we have not even seen him vote on it. He is like Senator Collins and Senator Feeney: they were absent with leave, because they did not want to be part of this whole debate yesterday.

Getting back to the idea of certainty, what will be the price of carbon in 2016 or 2017? Will it be $8 a tonne? Will the scheme have been shut down around the world, seeing that other nations are not taking up emissions trading schemes? Will it be $80 a tonne? We do not know what the price of carbon trading around the world will be in five years time. And that is supposed to deliver certainty? That is what is so uncertain about the whole policy: no-one knows what the price will be. It is a bit like asking what the Australian dollar will be trading at in five years time. You can have a guess. It will probably be somewhere between 40c and $1.40—a big range—but we do not know for sure. No-one knows for sure: it depends on the sentiment of the market, the buyers and sellers. What will be the price of carbon? We do not know. This is the certainty that was supposed to be delivered to Australian businesses and investors: we will not know what the price of carbon will be. That is why this whole scheme is so crazy.

The bill that we are debating is about the steel industry and compensation for only two companies. Where is the compensation for the states? Where is the compensation for the state of New South Wales? As people would be well aware, in New South Wales the coal fired generators are owned by the state. I still say that it was against the Constitution to introduce this tax, when section 114 clearly states:

... nor shall the Commonwealth impose any tax on property of any kind belonging to a State.

To me, that is black and white in the Constitution, but they will weasel their way around that, I imagine. I do hope the states take a challenge to the High Court on that very issue.

But when you consider companies like Macquarie Generation, owned by the New South Wales government, which produces 40 per cent of New South Wales' electricity, they are going to be up for about $550 million in carbon tax a year—their profit is gone! Their profit is currently $125 million, which goes to the state of New South Wales to help run our Police Force, our hospitals, our schools; and to build our roads and those other services that people depend on. But that money is going. So where is the compensation for New South Wales? Is it any wonder Mr O'Farrell, the Premier of New South Wales, announced an increase in royalties in the mining industry to make up for the money the state is going to lose? New South Wales this year has a budget deficit of $1 billion in their forecast, and then into the black at last. I know how tight it is for state governments—and for local governments—to run their budgets, to have enough money to deliver their services, to maintain their roads and everything else we insist on. But where is the compensation?

We have compensation for the steel industry, for two companies. What about the cement industry? What about the abattoirs? They would receive some $150 million over six years, but most abattoirs will not qualify for that anyway.

And where is the compensation for local government? If their landfills exceed the emissions of 25,000 tonnes, look at the cost to local government. Already, Tamworth Regional Council have announced an extra $300,000 for electricity. But in New South Wales we have rate-pegging, so they cannot increase the rates. They can increase the rates on their water and sewerage, and perhaps make a bit of a windfall there to compensate them, but it just means that people pay again. It is back to the people; it always comes back to the people to pay. The cost of living will go up—more than what the predictions say, I can assure you.

That is why this whole package has just been one big mess. You think you are going to reduce carbon dioxide. What are we on—386 parts per million? I would like to know what this carbon tax will do to the atmosphere. How many parts per million of CO2 will we have in the atmosphere in 10 years' time? We will have a lot more than 386 million. Just take China: they will produce 10.3 billion tonnes of CO2 this year. Under Australian Treasury's forecast—not opposition figures plucked out of the sky—China will produce 17.9 billion tonnes of CO2 by 2020. They will go up by 7,600 million tonnes a year. We are going to go up by 43 million tonnes. I wonder what the actual parts per million of CO2 will be by 2020? We are on roughly 386 million now. It is not going to be less than 386 million.

And the Greens are claiming now that it is carbon dioxide that has caused the cyclones and the floods. Well, there are going to be more later on—cyclones and floods have been around for thousands of years, just like climate change has. The climate has been changing for thousands and thousands of years—and will continue to change, regardless of what we do. But now, of course, here is a money-grab by the federal government with this carbon tax, handing out the gifts to try to keep industry alive. We have lost 105,000 jobs in manufacturing in the last three years. We will lose more.

But now, of course, some of the money might even be to pay for the advertising campaign coming up, which is going to convince everyone that the government has done the right thing, being led by the Greens and the Independents—that what the government has done is correct. It is crazy. If the government were to come up with a decent environmental policy I am sure it would be supported all around this chamber.

The biggest asset we have, and the greatest asset to nurture in this country, is our land, our soil, that grows our food—not only feeding millions of Australians but millions of people around the world. That is the greatest resource we need to look after. That is why our direct action policy is solely directed at incentives to the farmers, working with the farmers; not like the Kimberley Maxwell Yeadon stage of the early days of the Carr government. One of his staffers, by the way, was none other than Senator Penny Wong! That is where she learnt her hatred for those on the land: from the infamous Kimberley Maxwell Yeadon. Remember John Laws? He would be up him every day—Kimberley Maxwell Yeadon, the jumped-up shop steward. That is where this comes from: the Left of the Labor Party and the hatred for the man on the land and the families who work it. So now you understand why Senator Wong thinks like she does and where it comes from. This is a bad policy. If we win the next election, it is going.

Lisa Singh (Tasmania, Australian Labor Party) Share this | Link to this | Hansard source

After listening to Senator Williams' contribution to the second reading debate on this bill, the Steel Transformation Plan Bill 2011, there is no surprise that they will be voting against it because of course again, in their fine tradition, they have outlined how they are the party of 'no', they are the party that say no to everything, that run scare campaigns instead, that stick to a political kind of juggernaut situation of running scare campaigns and opposing everything rather than actually embracing what is good about the bill before them and the good that will come from it for the steel industry and the manufacturing industry.

I am pleased to speak to this bill, which does demonstrate very much the Labor government's commitment to the steel industry, just as Australia is shifting towards a new, innovative industry sector under the new carbon pricing mechanism agreed to by the Senate yesterday. While we are moving to protect steelworkers, and the steel industry, the coalition is mouthing platitudes and turning its back on that very industry. This steel transformation plan, and the carbon price, is giving manufacturing an opportunity to transform and adapt, through innovation, to meet the challenges of the future. It is very much a forward-looking plan: it is looking at the fact that we are transforming into a low-carbon economy future, into a clean energy future and preparing those parts of Australian industry, such as the steel industry and the manufacturing industry, for that transformation. Over something like $20 billion worth of potential support is going to be accessible to manufacturers to seize this very future that those opposition senators are just not willing to embrace and so they continue to live in denial as we move forward.

I think Senator Williams highlights again—similar to Senator Macdonald, whose contributions to both the second reading and the committee stages of the clean energy bills over the last week were absolutely appalling—that he does not accept the science. Similar to Senator Macdonald, Senator Williams spoke just now about his lack of understanding of the issue of climate change. What he raised was the fact that the climate changes. Well, lo and behold, so it does! And that there are floods. Yes, there are floods! And that there are storms and the like—yes, there are!

But why are we acting on climate change per se? Because science has provided us with input to show that some of that climate change is caused by human impact. It is of our own doing.

We have an opportunity to halt that and stop it from getting worse—and time is of the essence in that sense, as scientists have shown us—and actually start to try to save this planet and turn it around. For example, something like one trillion tonnes of carbon dioxide of human origin is in our atmosphere today, and we continue to contribute to it. The senator is right: China does contribute to it to a large extent, as does the United States and other parts of the world. Climate change has no boundaries; it goes beyond countries. But if we all as individual countries take the attitude, 'China is emitting X, Y and Z, so why should we do anything if they're not doing as much as we'd like them to do right here and right now,' then no-one would do anything, would they?

I would like you to go into a classroom and explain that logic to a grade 6 or a grade 9 class, who actually have an understanding about this. They are actually learning it in their school curriculum. They are not learning, 'Climate changes and that's just how it is, so let's do nothing.' They are learning that there is science that provides facts saying that the climate is changing from the human impact of emitting carbon dioxide into the atmosphere and it is causing detrimental effects on our planet. The result is that we need to do something about it. That is what yesterday's vote was all about. That is what it was about yesterday when you put your heads in the sand and voted against the clean energy bills.

John Williams (NSW, National Party) Share this | Link to this | Hansard source

It is you who betrayed Australia.

Lisa Singh (Tasmania, Australian Labor Party) Share this | Link to this | Hansard source

The only betrayal of Australia going on is from you, Senator Williams, and your opposition colleagues, for not supporting moving to a clean energy future, for not supporting action on climate change and for denying the science. You spoke recently on the fact that you do deny the science; you think we should do nothing because the climate changes. And if you do agree to do something it comes down to your Direct Action Plan, which is actually about taxing Australian households to give money to polluters. The irony is unbelievable.

The coalition is against a market driven approach. You come into the Senate and say: 'Oh, what's going to happen? We're not going to know what the price of carbon is going to be, because it's a market driven approach.' It is absolutely bizarre to have the coalition be against a market driven approach. Aren't you the party of the free market? Here you are against a market driven approach when it comes to putting a price on carbon. It is quite extraordinary.

The Steel Transformation Plan, which relates to the bill we are currently focused on, is just one part of the government's suite of policies supporting the steel industry and manufacturing in general. The coalition turns up at steel sites and cries crocodile tears and, at the same time, votes against $300 million worth of support for the steel industry. Again, it is complete hypocrisy.

The steel industry, as we know, is facing a number of challenges, including the high Australian dollar and higher input costs, separate from carbon pricing itself. We understand that the Steel Transformation Plan will encourage investment and innovation in the Australian steel manufacturing industry and will help the sector to transform into a more efficient and sustainable industry in a low-carbon economy. It builds on our existing collaboration, which the government has been supporting over several years now. For example, the CSIRO has been working with BlueScope Steel and OneSteel on the steel industry CO2 Breakthrough in Metal Production Program to increase energy efficiency and minimise costs by reducing emissions and waste, with a total investment to date of around $10 million. According to the worldsteel carbon dioxide breakthrough program, the technology resulting from the CSIRO's ISP is one of the few known technologies in the world with potential in the short term to reduce net carbon dioxide emissions by the steel industry by over 50 per cent at very minimal cost.

The University of Wollongong is another example. The CSIRO and ANSTO are individually represented on the Steel Industry Innovation Council. We know that the CAST Cooperative Research Centre, with government funding of $33.5 million, has been working with the Australian metal manufacturing sector to create business opportunities and improve processes to reduce costs and increase productivity. CAST partners include universities, business and industry players, including BlueScope Steel. These are all important transitional, researched and scientific good things that are happening in this space as we transform into a clean energy future. These are good things that the coalition senators refuse to listen to and take note of, because they are the party that just says no.

Another example is the Defence Materials Technology Centre, which has undertaken several research programs involving private industry—including BlueScope Steel, Bisalloy Steels and Thales Australia—with the University of Wollongong and government researchers. These programs are developing improved steel for armoured vehicles and better design and fabrication processes to reduce weight and cost. It is another innovative example of how innovation comes with the change to a low-carbon economy. That is the kind of business certainty that yesterday provides. Yesterday businesses were given some certainty, because now we know that we have a new market mechanism structure in place for their industry and for the investment and the innovation that comes with our transforming to a clean energy future. I think I have mentioned before in this place that I visited Alstom, an engineering factory in Tasmania, which was waiting to find out the outcome of yesterday's vote on the clean energy bills to give their business certainty so that they can continue to invest in Tasmania and the jobs that they provide in engineering support to our hydroelectricity scheme in Tasmania, as well as a number of other clients that they support in the clean energy sector in the rest of the country. All of these programs are developed to improve steel for armoured vehicles, as I said, and to improve outcomes that transition us into that clean energy future.

Aside from improving capabilities and protection available to Australian service personnel, research that has been undertaken also offers huge potential for civilian manufacturing applications and exports. This willingness of universities to support the communities that sustain them demonstrates the public-spirited nature of our public institutions, our universities. These contributions show again that the science and research sectors are a natural fit with industries and communities, with industries like the steel industry, and when they do work together, whether in good times or difficult times, our innovation system can very much capitalise on opportunity and minimise that adversity.

The $300 million Steel Transformation Plan is a special, appropriate scheme with assistance under the plan capped at $75 million per year. The Steel Transformation Plan will operate over six payment years from 2011-12 to 2016-17. There is no confusion about the term of assistance under the $300 million plan. As announced on 10 July this year, payments under the self-assessment component of that Steel Transformation Plan will be made six months in arrears and therefore the eligibility activity period will be a four-year period whereas the payment period will be a five-year period. As announced on 22 August, competitive assistance advances will also be available in the 2011-12 financial year. Accordingly, taking both these elements together, assistance under the Steel Transformation Plan is to be made available over those six payment years from 2011-12 to 2016-17.

On top of that, the government is also supporting the SMEs, the small and medium enterprises, through the clean technology programs which the coalition also oppose. For example, the new $200 million Clean Technology Food and Foundries Investment Program will provide grants worth up to $50 million over six years to the metal-forging and foundries industries. These grants will assist the industries to invest in energy efficient equipment and low-pollution technologies, processes and products. The government is also supporting these SMEs through tailored business management advisory services, through Enterprise Connect, for example, which the coalition is proposing to cut $100 million from.

Senator Nash interjecting—

The amount of negativity that comes from those senators opposite that continue to oppose everything leads to their putting their heads in the sand in not accepting that we have to take hold of the issues that climate change science provide to us and change our trajectory into a clean energy future.

Senator Nash interjecting—

Instead, it sends us back into the old dark ages—

Senator Nash interjecting—

Senator Nash, your opposition to the clean energy bills again highlights the fact that the opposition are focused on taking this nation into the dark ages, to the days when we did not believe scientists, when we certainly did not act on anything that science provided and when nothing really happened. It was a sad period in our history. We do not live in the dark ages anymore; we live in a time when we do embrace science and we do accept that we need to take hold of peer reviewed science. Unfortunately, those opposite continue to not support the science, although I tend to think that some of them do actually support the science and they are just playing politics on this issue. It suits them to try and be naysayers and be scaremongers and oppose everything because they see that that is perhaps their role rather than actually coming together and doing something for the benefit of all Australians, for our environment and for industries that need our support such as the steel industry. But, unfortunately, we will continue to see the naysaying opposition just oppose having Australia move into a clean energy future when so many other countries in the world have already embraced it and are embracing it. Why are they doing it? Why do we have these ongoing UN meetings to try and move this globe forward? We care about the future of this planet. We care about the fact that we need to do something to ensure that the human impact that we have on it is not going to be to its detriment—not just for us but for our children and for our children's children. That brings me back again to the bill and the fact that the bill focuses very much on steel transformation. It is a fact that steelmakers are very supportive of the Steel Transformation Plan. Australian steelmakers are facing considerable challenges from external factors other than the carbon price. I am sure that Senator Williams will acknowledge that. BlueScope has stated that it is restructuring its operations to improve its financial health in response to the global circumstances it faces, including the high Australian dollar, high raw material costs and intense import competition. They are realities that BlueScope Steel has to live with in the current global market. It is essential, therefore, that the steel manufacturing industry is supported during this period of transition, and that is exactly what the Steel Transformation Plan will provide: further support for Australian jobs and ensuring the future of the Australian steel industry. Labor senators on this side of the chamber very much support jobs. We are the party that very much supports working people. We support their rights and we support their jobs. Opposition senators have a long track record of not supporting jobs, ripping out workers' rights and ensuring that workers are not protected and not supported in any kind of transition to a clean energy future or a future where there is global uncertainty in the steel industry. We do not believe in leaving those workers in the lurch, and that is why we are supporting this bill.

Sue Boyce (Queensland, Liberal Party) Share this | Link to this | Hansard source

You have to love some of the Orwellian titles that the Labor government can dream up for its bills. There is the Steel Transformation Plan, which they would have us believe will somehow improve the steel industry in Australia. If passed, it is certainly going to transform the steel industry. It will transform it right out of Australia. That is what it will achieve. It will achieve the end of a steel industry in Australia. Certainly the players will stay, but the industry will not be based in Australia any longer.

I must address some of the bizarre claims made by Senator Singh and Senator Cameron about the Labor government's so-called concern for workers and workers' rights. The first thing a worker wants is a job. If you are destroying jobs at the rate that that is government currently is, you cannot be in the slightest interested in workers and workers' rights. It is a basic fact that without a job a worker is not a very well-resourced person. The Labor government apparently cannot seem to grasp this fact.

Let's just look at what has happened to manufacturing in Australia, particularly over the period when this government has been in power. Over the past decade and a half, the manufacturing sector in Australia has shrunk from 17 per cent of GDP to nine per cent of GDP. In the last four years alone, we have shed 136,000 jobs in manufacturing. That is how much this Labor government cares about workers—136,000 jobs gone in four years. What keeps workers in a viable and vital manufacturing industry is a government that cares about how that industry works and vaguely understands something about the industry that it is trying to control—that it is trying to assist and built. Certainly, absolutely nothing that Senator Cameron or Senator Singh can contribute will assist.

We have the bizarre situation of Senator Singh suggesting that we are opposing this bill out of some sort of spite. Well, no, we are opposing this bill because it is part of the government's carbon tax package and it should have been included with the carbon tax package. We are opposing this bill because, when we become the government, we will repeal the carbon tax and when we repeal the carbon tax there will be no need for a so-called Steel Transformation Plan. It was quite interesting to notice that Senator Singh mentioned all sorts of extremely good and useful research projects that are currently being conducted by universities, CRCs, the Defence Materials Technology Centre, and other groups related to the Steel Industry Innovation Council. Yes, there are some great research projects going on. There always have been some great research projects going on. These research projects are not reliant on the Steel Transformation Plan Bill being passed; they are happening right now. Industry has always been interested in being as efficient as possible, and this is particularly true of energy efficiency. Energy efficiency has been a key driver of most of the innovation that has happened in industries and most of the research that has been undertaken by industries, particularly smelting industries, over the last 20 years.

Once again we come back to another Orwellian little point about this bill: the Steel Transformation Plan Bill is allegedly about improving energy efficiency and reducing the carbon dioxide equivalent emissions of the industry, but nowhere in the legislation at all is there any requirement on the steel industry to reduce its emissions. They can get $300 million of assistance apparently without doing anything at all to reduce emissions. You would think there would be a KPI or two in the bill if the point of it is to reduce carbon dioxide emissions in manufacturing. You would think the bill would set out exactly what is expected here, but there is absolutely nothing to tell them what to do.

I would be very interested to hear some more of Senator Singh's views on some of the research that is being undertaken. It is just research. It will be industry itself and the practical and sensible people who will drive the real changes. They will make those changes because they are interested in efficiency and energy efficiency is a top priority for them.

Under the Steel Transformation Plan only two Australian firms will qualify. Only two companies are going to be transformed: BlueScope and OneSteel. We have a classic example of this government trying to negotiate with the big boys and leaving the small and medium enterprises entirely to their own devices, once again showing that this government is not interested in the slightest in the welfare of workers, because it is small and medium enterprises that provide the jobs of Australia.

There are thousands of steel fabricators all over Australia who will not get a single bit of assistance out of this legislation. They will face enormous increased costs and pressures under this legislation, despite the government saying the opposite. Energy costs will rise. Power costs will rise. Steel costs will rise. Cement costs will rise. The list goes on and on.

Given we have yet again the debacle of Minister Wong being unprepared to divulge the real basis for the modelling they undertook for the carbon tax, we have no idea what the real cost to the Australian people will be. No doubt in all of the multimillion-dollar ads the line about the very small increase that households and businesses will face will get used, but we know that is completely wrong because Treasury, no doubt under direction from the government, based their modelling on the fact that there would be an internationally agreed carbon scheme. That has not happened and is not likely to happen in the near future. It would be good if it did happen by 2020, but the odds of that happening are very low. So in those circumstances the costs in Australia are going to be higher and more prohibitive.

I interjected earlier—and I know I should not have, Madam Acting Deputy President—when Senator Singh was suggesting that all the smaller businesses would get government technical advice. Any business adviser acting in a non-conflicted way would have to tell any Australian manufacturer right now to move their business offshore. That is the only advice that any independent adviser could give an Australian manufacturing business. With this government's continued and increasing tax take no business could act in any other way. Any financial or business adviser who gave advice contrary to that would not be acting in the interests of that company. Small business will be devastated yet again by this government's actions.

We are opposing the Steel Transformation Plan because it is part of the carbon tax package. When we are in government this plan will not be necessary. There will be no need for a Steel Transformation Plan as compensation to the steel manufacturers, because they will not be subject to the carbon tax.

I would like to look at some of the costs that will go on smaller manufacturers and other businesses as a result. For individuals compensation cuts out at a maximum household income of $80,000 and for businesses compensation cuts out at a turnover of $2 million. The odds are that many small and medium manufacturers will not receive compensation at a business level nor at an individual level if they are successful enough to be able to pay themselves more than $80,000 a year. This government's current carbon tax plan will drive them into poverty. I suppose as their companies and households are driven down they should be grateful that they will be eligible for the compensation. I was chilled when I read a comment made by the Prime Minister in July this year. Speaking in Rockhampton on radio she said:

… small business will see some flow through in things like electricity prices …

What small businesses will be able to do is pass those costs on to consumers …

She needs to go in the same little 'we haven't got a clue how the real world operates' bag as Senator Cameron and Senator Singh. Is that really how they think business operates in Australia right now? You get a price increase if you are a manufacturer or retailer and pass it on to your customer? Do they honestly think that is how it works? If the complete and utter destruction of this economy under these know-nothings were not so frightening, it would be funny. But it is not funny. To claim that small businesses will be able to pass their costs onto consumers, as the Prime Minister has, reveals a complete lack of knowledge of what is happening in the real world. She would be very happy in the museum along with other dinosaurs like Senator Cameron and Senator Singh.

The price of electricity under the Labor-Greens coalition has gone up 10.7 per cent. Groceries have gone up 6.1 per cent. Petrol has gone up 11.3 per cent. You can partly include—I am not sure how you separate them—that 136,000 jobs have disappeared out of manufacturing in the past four years. In small business, 300,000 jobs have gone since Labor was elected. That is the sort of intelligent comment you get from the Prime Minister, who originally told us there would be no carbon tax, but now we have a carbon tax. She claims it will only affect 500 big polluters when we know it will affect every little corner of our economy and ultimately lead to the destruction of much of our economy.

There is decreasing room in Australia for successful manufacturing. I would have thought that someone like Senator Cameron would hang his head in shame at the fact that that is happening, but instead they are negotiating a little deal with BlueScope and OneSteel to hold onto some of their jobs. It was 'enough'. It was the fact that BlueScope announced that they were going to have to cut 1,000 jobs that finally got this government to wake up and notice that they were hurting industry in Australia and would go on hurting industry in Australia. But they did not wake up to try to stop the harm they were doing to industry; they just cobbled together the Steel Transformation Plan to try to protect it—presumably long enough for Senator Cameron to be out of the Senate so that he will not be held accountable when the thousands and thousands of jobs go when the real transformation happens.

I would like to make the point that climate change is real. Humans are contributing to climate change. We need to act. The coalition has a plan to act, including a direct action plan and a very significant investment in renewable energies, which continues on from the work that we have been doing in that area since 1996. That is the way to transform Australia's economy without destroying it. That is the way to keep jobs and industry in Australia. That is the way we can fix this without doing the damage that is going to be done to the economy by this government, which has not got a clue what it is up to.

I want to look at the Minerals Council modelling that was released the day before yesterday on the topic of how the carbon tax is going to affect the Australian economy. When you get rid of Treasury's fiction that it is sensible to base modelling on the fact that there will be a successful and well-functioning international carbon tax and emissions trading pricing scheme operating, the modelling shows that by 2020 the Australian economy will be a cumulative $180 billion poorer with a carbon tax than it would be without a carbon tax. It shows that by 2020 Australian wages will be 1.9 per cent lower with a carbon tax than without one. It shows that the price of a carbon tax in 2020 will not be $29 a tonne, as the Treasury fairytale would have you believe, but $43 a tonne because there simply will not be the opportunity there to buy permits from overseas to abate the costs of the emissions here.

Yes, the coalition absolutely opposes this piece of legislation. It will go the same way as the carbon tax when we are elected to government and can fulfil some real promises instead of promising one thing before an election, as the current Prime Minister did, and doing another thing straight after.

Nigel Scullion (NT, Country Liberal Party, Deputy Leader of the Nationals) Share this | Link to this | Hansard source

I rise today—again somewhat miffed by some of the contributions from those on the other side—with regard to the Steel Transformation Plan and the reasons for it to be put in place. Some of the contributions to the debate have indicated that this plan is part of an adjustment process and part of a very neatly put together taxation system when in reality it is a knee-jerk reaction. Straight away, immediately after the imposition of the carbon tax, they are out here with the bandaids. This plan is the very first bandaid—and it is a very large bandaid—to try to save the two biggest players in the very important steel industry. But once again they are only going to talk to the big players in this and through regulation say, 'The only ones who've got eligibility to this compensation package are the very largest.' This plan seems to be a rerun of the mining tax. They are only going to have a handful of players—only the very big players—in the room, and they will negotiate with them. They will take the pain away from those who have the greatest capacity to bear it.

It is good to see Senator Madigan in the room. I am not sure if Senator Madigan was around that table—I suspect that he was not—but he as a steel manufacturer must be bleeding at the gills at the thought that BlueScope and OneSteel are getting special assistance, whereas the manufacturing sector, which is very small in Senator Madigan's area but employs lots of people and is very important and provides the capacity for us to manufacture items, particularly in rural and regional Australia, which add a lot of value and a lot of independence will not receive any assistance. Sadly, Senator Madigan will not be in that. Senator Madigan, I am not sure if you are going to have a little wind turbine on your head or a special solar operated shirt as you weld your forge, but I wish you good luck with all of that, mate.

Senator Singh said some pretty interesting things during her contribution. She accused us in this place of taking a political position. I do not know about that—it seems pretty critical. She said that she could not understand why we were so negative about this tax. Senator Singh, I listened carefully to your maiden speech, and I think that you will make a very good contribution in this place. I know from the sorts of things you said that you must have good values, so I hope that you understand that we have taken our position on this because we gave our word to the Australian people that, if elected to government, we would not put a price on carbon: we would not introduce a CPRS and we would not introduce a carbon tax. That is what we said to the Australian people, and the Australian people thought when they went to an election that neither of the two principal organisations, the Australian Labor Party and the coalition, was going to impose a carbon tax. Senator Singh, the reason we have taken the position that we have on the carbon tax is that we have decided to honour our promise whereas you on the other side have decided to dishonour your promise in the worst possible way.

Then, Senator Singh, you accused us all of being climate deniers. I am not a climate change denier at all. I think a lot of the science is a bit confusing, but we will look at it on balance as we go along. We have certainly given the planet the benefit of the doubt, and we have agreed—as have the Australian Labor Party—that we will reduce our emissions by five per cent by 2020. The difference in our policies is that the direct action policy will, through a clearly audited arrangement and a clearly audited investment, be able to reduce our emissions by five per cent by 2020 whereas, if you look carefully at the plan and the modelling of those on the other side, you will find that they are falling short by 43 million tonnes. The Australian Labor Party are not reducing Australia's carbon footprint by five per cent by 2020—in fact, they are falling considerably short of that target. But it is okay; we are going to go and buy carbon credits on a market that does not exist and spend $3.5 billion every year until 2020—and that money would build an awful lot of schools and hospitals—rising eventually to $57 billion a year. So, in 2050, we will be sitting in this place saying, 'By the way, in the forward estimates there is one little line item—$150 billion that we are sending offshore.' That is the Australian Labor Party's plan. It is absolutely appalling, and it needs to be exposed for exactly what it is. It will do absolutely nothing to the climate, yet it is going to cost us that sort of money. This should not be seen in isolation; those billions and billions of dollars that we are sending off shore to buy a piece of paper so that the sea can be kept at the right level means that we are not going to be able to spend money on other things. The figures are absolutely terrifying.

Senator Singh said that businesses want certainty. They do want certainty, but I do not think they want the grim certainty of the financial future that this government has just provided them. If you went down to the company which Senator Singh referred to who manufacture steel for armoured vehicles and asked them, 'Would you have liked a carbon tax?' they would have said, 'Absolutely not.' There is no point putting your arm around the wounded soldier with a bullet hole in his leg and giving him your bandaid while saying, 'It will be okay; I'm going to help you get better,' when you were the one who shot him in the leg. It would be the height of hypocrisy for you to do that.

This steel plan is a short package of $300 million, and the question is: what is going to happen when it runs out? It is just going to delay the inevitable, which is that we are not going to be able to compete with imported products and that Australia, one of the world's great steel producers, will not even be independent. We know that the very next day after the government announced this $300 billion steel plan $300 million was wiped off the joint share packages of BlueScope and OneSteel. Of course, the steel plan now being brought in will do them no good at all—and, aside from that, the $300 million in the plan has come from Australian taxpayers, which means fewer schools and fewer hospitals. The people who own the shares are not companies; they are people. They are Australians, and the shares represent their superannuation, and $300 million of that has been wiped out.

They have already transformed the steel industry as part of their contagion of incompetence by ensuring that this small steel plan has already gone and had its effect—that is, it has had no net effect at all on looking after the steel industry, which is so important to manufacturing today. Senator Carr, on the other side, on his watch, has been responsible for over 105,000 jobs lost in the manufacturing sector, and I can tell you that what they do not really need now is a bullet wound in the head. It is not a wound; there is no bandaid that will fix this. It has been demonstrated, once again, that this carbon tax will be the end of another essential Australian industry. (Time expired)

Louise Pratt (WA, Australian Labor Party) Share this | Link to this | Hansard source

The time allotted for consideration of the remaining stages of this bill has expired. The question is that the amendment moved by Senator Milne be agreed to.

The Senate divided [11:34]

(The President—Senator Hogg)

Question negatived. Original question put:

That this bill be now read a second time.

The Senate divided. [11:42]

(The President—Senator Hogg)

Question agreed to.

Bill read a second time.