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

I rise to speak about the importance of investing in our manufacturing industry as we emerge into a post COVID-19 world. Government policy needs to adapt if we're going to take advantage of opportunities presented to us. For the first time in 29 years, Australia is in a recession. This is not a landmark to take lightly. The health, social and economic circumstances of this pandemic will be felt for years to come in my home state, which is already experiencing the economic effects of the downturn. Our industries have been devastated by the effects of social isolation—in particular, retailers, restaurants, cafes, pubs, clubs and small businesses across many industries—and they're still hurting. Some organisations and businesses will not survive.

Nearly 30,000 Tasmanians are unemployed or underemployed. These figures are devastating to the individuals and to their families. There are some 34,392 people on JobSeeker in my home state. Unemployment hasn't reached this level in Tasmania since the 1970s. Then there are the youth unemployment figures of above 15 per cent, and expected to go above 20 per cent by Christmas. Tasmania's overall youth unemployment rate is 15.1 per cent. This figure is distressing to many young Tasmanians, who are concerned they may not be able get employment in our state either now or into the future. Our slogan during the pandemic, and post this pandemic, should be: let us leave no Australian worker behind. No Australian should be forgotten or neglected.

While the question of how did we get here is relatively straightforward, COVID-19 and the lack of this Liberal government's planning for the future is leaving Australians wanting. The solutions to how we get out of this economic mess are harder to produce. However, there is at least one solution that is tried and true and perfectly rational: revive Australia's manufacturing now. The contribution of Australian manufacturing to national GDP has slumped from 30 per cent in the 1960s to a mere 5.7 per cent in 2018. We have the lowest level of manufacturing self-sufficiency compared with other developed nations, a statistic no government of any persuasion should be proud of. To add insult to injury, Australian Industry Group's latest Australian Performance of Manufacturing Index indicates that manufacturing has deteriorated to its worst level since the GFC. Sales, production and employment have reported record monthly declines in the index's 28-year history, indicating an industry in need of resuscitation.

Ironically, COVID-19, although it is a tragedy, could potentially lead an Australian manufacturing renaissance. There are a few reasons why COVID-19 may lead to this. Firstly, as almost all Australian supply chains depend on imports, this pandemic serves as a fantastic learning opportunity to expose the dangers of over-reliance on global supply chains. It is without a doubt that Australian-made goods are just as good as any imported supplies or even better. The main reason for outsourcing our supply chain has been, primarily, the lower cost. However, running an economy in the eye of a pandemic storm has shown that the guarantee of undisturbed supply from Australian suppliers is increasingly persuasive within the industry groups. If Australia is to cut itself off from the rest of the world, partially or absolutely, can we still rely on our pre-COVID supply chains to the same degree? I say we can't.

Secondly, it can create jobs to address Australia's staggering unemployment rate. Under the Liberals' watch, the Australian unemployment rate has skyrocketed to 7.5 per cent, the highest level seen in 22 years. This is also not taking into account that so many Australians and Tasmanians are reliant on the JobKeeper payment. To get Australians back into jobs, these jobs need to be created from somewhere. We need a jobs plan. The federal government, state governments and businesses should all, collectively, be seeking to reset supply chains to source from local manufacturers, to a partial extent if not completely. If this concerted effort was put into this policy, there would be a tremendous opportunity to create jobs, very well-paid jobs, that would see more Australians back in work. Already the COVID-19 taskforce has earmarked approximately 500,000 new jobs that can be created in advanced manufacturing if the right policy settings are applied.

Thirdly, having a supply chain reset to prioritise Australia will result in greater economic and political sovereignty. China is Australia's largest trade partner. Although international trade offers more benefits than drawbacks, Australia needs to get the balance right. In May, the Chinese government raised new trade barriers against Australia. They have done this again to a third Australian export, and they are also signalling that Beijing may be looking to diversify its import of iron ore. This is a result of a diplomatic rift stemming from the Australian government's call for an independent inquiry into the origins of COVID-19. With the Chinese government increasingly willing to flex its economic muscles against Australians who won't fall in line, Australia needs to achieve greater independence and flexibility on the global stage.

Fourthly, a revived manufacturing sector can and will drive our economic transformation post-COVID-19. With the Australian dollar weak, there is a real window of opportunity to seize advantage of that to foray into advanced manufacturing exports. Developed countries like Germany, Japan and South Korea all have world-leading advanced manufacturing export industries, with Germany and Japan accounting for $740 billion each and South Korea accounting for $417 billion in total output in 2019. In comparison, Australia's total manufacturing output in 2019 was only $79 billion. We need to rebalance that.

With borders remaining shut for the foreseeable future, Australia's reliance on tourism and international education will not be sufficient to buttress the economy. We need to revive manufacturing as a matter of necessity. My home state of Tasmania can lead this charge. Economist Saul Eslake has earmarked the potential for northern Tasmania through advanced manufacturing and renewable energy. The opportunity to expand manufacturing products interstate and internationally will allow Tasmania to diversify its economic pot, leading to greater resilience and prosperity for all Tasmanians. Projects such as the renewable hydrogen production facility proposed for Bell Bay could become an internationally competitive hydrogen-exporting hub. This project would be a major employer, and the flow-on effects to other service providers would be fantastic for our economy.

We have already displayed the resilience of our manufacturing sector during this extraordinary crisis. Tasmanian companies, like Incat and Definium Technologies, have shown they are up to adapting to the COVID challenges. They have illustrated ingenuity and capacity to innovate. Hobart based Incat has a global reputation and a track record of building fast, industry-leading and advanced-technology notable ships. Tesla has linked with Incat, with Incat's technological prowess potentially being sought to build rocket launching pads for American companies. Incat has also been tipped to play a role in building the new Spirit of Tasmania ships. Definium was recently engaged by Victorian company Gekko to manufacture ventilator control systems. These Tasmanian businesses illustrate the capacity of home-grown companies to innovate and exploit opportunities interstate and internationally. We should be so proud, because these particular companies demonstrate that we can lead Australia and explore new opportunities both nationally and internationally.

We have to do this together, and the message is that we cannot leave anyone behind. We have to ensure that there are opportunities in our home state of Tasmania for our young people. We do not want to see, when the borders reopen, a brain drain from our state. That's the last thing that we need. Manufacturing is an essential part of every country's economy. We have to invest and we have to innovate, and the federal government should be doing whatever they can to support this new development in manufacturing in this country. (Time expired)