Patrick Gorman (Perth, Australian Labor Party, Shadow Assistant Minister for Western Australia) Share this | Hansard source

[by video link] This Industry Research and Development Amendment (Industry Innovation and Science Australia) Bill 2021 will put the word 'industry' back into Innovation and Science Australia. It is a renaming bill. It is not particularly exciting but it is this government's priority. It means that Industry Innovation and Science Australia will join a long list of famous name changes. The Quarrymen became the Beatles. Robert Zimmerman became Bob Dylan. Reginald White became Elton John. Prince became an unpronounceable symbol. The Cockroaches became The Wiggles and then they became woke, and now Innovation and Science Australia will become Industry Innovation and Science Australia. I'm looking forward to the first album! But unfortunately this bill does little else. It's typical of this government—a failure to give Australian industry and manufacturing the support they need. It's another bill where we see a lot of talk but very little action.

The opportunities that come from greater investment in innovation and industry, in more Australian manufacturing, are obvious. But, unfortunately, when it comes to this government you always have to spell out the obvious, and what is obvious is that you can't be a nation-building government unless you look at the success of previous nation-building governments: the Whitlam government—sewerage through the suburbs of Western Sydney; the Hawke and Keating government—reforming our industry so that you can have a proper open economy where Australian manufacturing can be part of that global economy; and the Ruddock and Gillard governments, who did, unlike the government that followed them, support the Australian automotive manufacturing industry.

I believe that Australia needs to be a country that makes things again. Growth in manufacturing will benefit all Australians. It's one of Australia's most evenly distributed industries, accounting for almost seven per cent of jobs in every state. Every state has a manufacturing industry base that employs hundreds of thousands of people across our country. When we look at what we want to achieve when it comes to diversification of our international trade, we know that most international trade is manufacturing related. Manufactured products accounted for over 70 per cent of global merchandise trade in 2018. The manufacturing trade is worth some US$14 trillion.

Manufacturing is the missing piece of the Australian economy. We are No. 1 when it comes to the export of iron ore; we're No. 2 when it comes to aluminium ores, zinc and lead; No. 3 when it comes to exporting copper, in terms of value; and we have four of the top seven universities internationally for mining engineering. Manufacturing is that missing middle bit. We lead the world in producing the inputs that go into manufactured resources. We lead the world when it comes to educating people on how to deal with those resources. But we are so far behind when it comes to using the resources that we mine, many of which are mined in the great state of Western Australia. So we need a federal government that has a comprehensive plan. The world wants to invest in Australia: in 2020, foreign investment in Australia was some $3,990 billion, a $97 billion increase on the year before.

What do we need from the federal government? We need a federal government that properly invests at scale in Australia. With just seven per cent, manufacturing accounts for a smaller share of national employment in Australia than it does in any other OECD economy. What we've seen since the turn of the century is that manufacturing has lost close to 200,000 jobs in Australia. A study from Harvard University and their Growth Lab ranked the most complex economies in the world. On that complexity scale, Australia ranked 93rd, just above Pakistan and behind Morocco, Uganda and Senegal. Since 2000, we've fallen 29 places. We are going backwards at a very, very rapid rate. When it comes to manufacturing self-sufficiency, Australia ranks last among OECD nations. Our imports of all manufactures are about three times bigger than our exports. We had a manufacturing trade deficit of over $180 billion in 2019.

That's where we are right now. Despite this, Australia's manufacturers are ready. They make a disproportionately high contribution to national trade performance. We saw that manufactured product accounted for some $95 billion in export sales in 2019, and we know that if we get manufacturing right for the future that's what's going to give young Australians the job opportunities they want. Despite the talk we have from the Treasurer and others about how great the job market is, we know that it's young people who are not going to have those high-paid jobs if we don't take action, if we don't invest in the sorts of new industries and new opportunities that give young people the secure, good-quality jobs that they so much deserve.

When it comes to how we make sure we create those opportunities, we start with the 900,000 Australians working in manufacturing, but it's an ageing industry. The average age of Australians working in the manufacturing industry is 42, two years older than the average Australian worker; 45 per cent of Australian manufacturing workers are over the age of 45; and 20 per cent are over the age of 55. We know that, as we see in some of the industries in the care economy, we're going to have massive deficits through not having enough skilled workers just to keep things as they are, let alone to grow these industries for the future. Again, they are good-quality jobs: 85 per cent of jobs in manufacturing are full time, and people who work in manufacturing earn seven per cent more than average earnings. More manufacturing in Australia means higher quality, better paying jobs in Australia and more opportunities for young Australians.

When it comes to the outcomes of increasing our manufacturing investment, most countries consume as much manufacturing as they produce, but Australia doesn't—that is, we have a deficit of what we manufacture. The Australia Institute estimates that if we increased our manufacturing to the global standards we'd have $180 billion a year more in new manufacturing output, $80 billion a year in new manufacturing added-value growth and some 400,000 new, direct jobs in manufacturing. This is the opportunity that's in front of us. It's not going to happen by renaming a department; it's not going to happen just by hope or leaving it entirely to the free market. We know that the countries that have high-quality manufacturing, innovation and industry sectors are the ones where the government works hand in hand with industry.

When it comes to Labor's plans, when it comes to the alternatives where it's a bit more than just renaming a piece of legislation or renaming a department, Labor has a clear plan to support industry: a national reconstruction fund. The fund will make sure we rebuild Australia after COVID. It is a plan for the future. It will create a $15 billion capital pool that has the potential to unlock $30 billion or more in investment. It will leverage private contributions and make sure businesses are eligible for loans, equity core investments or guarantees for projects. And what do those projects need to do? They need to deliver strong, good-quality jobs for Australians.

We know that, while we might have low unemployment rates, around two million people are looking for more work. These are the underemployed Australians, who do not have the level of income or the job security from the work they are currently doing that they would like to see in the workplace right now. Manufacturing is so important for that. Government needs to play an active role. We have just been through the biggest economic shock in a century. It's time the government played an active role, just as we did after World War II and, indeed, just as the Rudd and Gillard governments did as we responded to the global financial crisis. Get in there, lend a helping hand and make sure that we build something that lasts for the future. That's the Labor way. A Labor government will partner with businesses to create well-paid, secure jobs. The national reconstruction fund could be the difference between job-creating projects happening or not. If we have a choice between creating jobs for people, getting more people into high-paid, secure jobs or not, we should always lean on the side of taking action.

I speak here from Western Australia—from the cave. Western Australia does have an economic success story. We have good news to share with the nation. Thanks to the ability to keep COVID out of resources and mining, and the energy industry that's been able to continue and stay strong despite what we've seen happen with mining projects and resources projects across the world, which really have suffered during COVID, the Western Australian economy contributes well and above our 10 per cent of population. That's well known to people here in WA. We contribute 16 per cent of Australia's GDP. WA's gross state product is 54 per cent higher than Australia's average state GDP but just four per cent comes from manufacturing. There is so much more potential here. Leveraging the skills, leveraging the investment and leveraging the trade relationships that our mining and resources industry has and turning that into that advanced, elaborately transformed manufacture means that we have more industry for the future. What we know—and we know it here in Western Australia more than elsewhere—is that commodity prices fluctuate, but the ability to retain value, making sure that you support industry, and transform it into a world-leading product that other countries and other businesses want to buy is where economic success lies.

There are also opportunities when it comes to manufacturing and industry with the resources sector. It's projected that this year Australia's resource and energy exports will be some $300 billion—our largest export industry—but mostly shipped overseas for processing. It's projected that lithium exports will increase fivefold between now and 2025. But we're not doing the processing of lithium or any of the value adding here—another missed opportunity where we could use those great Australian scientists, engineers and chemical engineers to make sure that we are investing in ourselves and capturing more of that value here.

The other opportunity, of course, is in renewables and hydrogen. Currently, some 95 per cent of the world's hydrogen production is not renewable hydrogen. The opportunity for Australia to be a renewable hydrogen powerhouse of the world is one that should not be missed. We will always be a net energy exporter. Let's make sure that we're exporting the energy of the future and planning for that now. The Clean Energy Finance Corporation estimates that by 2050 the global revenue from hydrogen could be some US$2.5 trillion per year, and it's up to all of us in this parliament to make sure that we are investing to make sure that we are able to capture as much of that value chain as possible in the years ahead.

I would also like to note that there are a lot of people who've put good, carefully thought-through ideas to the government about how you can do more about investing in WA jobs and in manufacturing here and across the country. I would particularly like to note the work of the Australian Manufacturing Workers Union, who have consistently put out plans for jobs and plans to revive Australian manufacturing. I remember when Treasurer Hockey dared GM-Holden to leave Australia, and indeed they did. When you send a message like that to global manufacturers, they pick up on those signals. But, despite these really heartbreaking pieces of feedback that people in the manufacturing industry have had from this government at times, the Australian Manufacturing Workers Union continues to put forward plans for WA jobs and to revive manufacturing in this country.

We've seen an amazing success story in the work that's been done out at Bellevue, which I was fortunate enough to visit with the member for Ballarat a few months ago and where we're now making Western Australia's trains here in Western Australia again. We're not having to rely on purchasing them from overseas, which I know has been an absolute disaster in other states, where they have trains that haven't been the right shape or the right size for their platforms or their tunnels. What we have is about 200 Western Australians working here, making train cars that Western Australians are going to ride on. There's really exciting hope. I would encourage the minister who's sitting at the table to make sure that we continue to talk to the resources sector and the mining sector about how we make sure that we get more of that Australian manufacturing into our mining industry. We know that there's thousands and thousands of kilometres of train track. There are thousands of cars that are moving ore and other things across this state and across our country. The more those are made by Australians in Australia, the better, and the more we can again capture value for manufacturing here in Australia.

I will just finish by saying there's one other thing that we should be manufacturing here in Australia. The legislation I wish we were debating would be about how we get mRNA manufacturing happening here in Australia. Currently we have the ability to manufacture one great vaccine, the AstraZeneca vaccine, but it's not building that capacity for the future. Getting into the mRNA business is the future, and this government needs to get onto it today. (Time expired)

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