Melissa Parke (Fremantle, Australian Labor Party) Share this | Link to this | Hansard source

I want to take this opportunity to speak about the understandable concern among Australian manufacturers and workers, and in the wider community, about the poor and declining local content component of major mining and petroleum projects.

This is a matter of importance in Western Australia, where it goes to the heart of the disconnect between the booming resources sector and other parts of the economy. And it is a matter of importance in my electorate of Fremantle, where manufacturing businesses in areas like the Australian Marine Complex are not sharing in the work that should logically flow from the scale of investment we are seeing.

It defies common sense that there are not greater benefits for Australian manufacturing and for Australian workers as a result of the massive investment that is occurring in resources projects. I am contacted regularly by business owners and by workers who cannot understand how 80 or 90 per cent of the fabrication involved in certain resources projects is taken offshore. At a time when steel-manufacturing workshops are running well below capacity, the newspaper headlines about the boom make bitter reading, and the television ads about the commitment of mining companies to local economies make for bitter viewing.

In recent years the Australian manufacturing industry has come under threat from offshore competitors that undercut Australian companies, often through lower standards of safety, poorer conditions of employment and lower production quality.

It is one thing to say that Australian industry must be internationally competitive, which is a project that Labor governments have successfully pursued over the last quarter century, but it is something else altogether when that so-called competition occurs in the absence of a level playing field.

And so the Prime Minister has been right to say that the Australian manufacturing industry deserves action now, and that is why this government has been right to act and to make federal grants of more than $20 million contingent on the provision of plans to maximise opportunities for Australian business.

This builds on other government programs that are designed to support a strong and sustainable manufacturing industry. As an example, when BlueScope Steel announced plans to close its doors the government was on the ground with $130 million in assistance, including $100 million from our $300 million Steel Transformation Plan, the first industry support program of its kind in almost 30 years.

I would also observe that, in my electorate of Fremantle, Austal Ships is benefiting from a $350 million government contract to build and service eight Cape Class patrol boats. The construction of these vessels will create new jobs and training opportunities for the young people of Fremantle and WA. What is more, the project will dovetail well with the new Maritime Trades Training Centre at South Fremantle High School, funded by this government.

These concrete and positive actions are in stark contrast to the approach taken by the current WA government, which appears to spend most of its time keeping the red carpet neat and tidy for huge mining companies and little time being concerned about small and medium sized Western Australian businesses.

In 2010 the local industry participation in West Australian mining and offshore petroleum and gas projects averaged only 53 per cent, down from a peak of 72 per cent. This disturbing trend needs to be reversed if we are to ensure job security for the tens of thousands of Australians employed in the manufacturing industry.

By 2013 business investment in the resources sector in Western Australia is expected to reach $62 billion, representing a significant opportunity to underwrite new jobs in a range of sectors. In my electorate of Fremantle there remains comparatively high youth unemployment in the south and south-east despite the resources boom. That is why the government has funded a historic jobs and training package, and that is why we have put in place the requirement of local participation plans. I also note that the West Australian Labor opposition recently tabled the Skilled Local Jobs Act, under which skilled work agreements were proposed to facilitate strong local content growth.

The federal Labor government has put in place measures that require project developers to publish extensive details of opportunities available to Australian business if they want the five per cent tariff exemption on imports for major projects. However, the WA Premier, Mr Barnett, is on record as saying legislation is not the answer. I wonder what he thinks the answer is. What is the WA government doing to ensure that the economic opportunities of a historic resources boom are spread widely, fairly and for the long-term structural benefit of the state and national economies?

Graham Perrett (Moreton, Australian Labor Party) Share this | Link to this | Hansard source

Nothing!

Melissa Parke (Fremantle, Australian Labor Party) Share this | Link to this | Hansard source

I thank the member for Moreton for his contribution. As the representative of a Western Australian electorate, and an electorate with an established manufacturing, shipbuilding and fabrication industry profile, I know how important it is that we continue to work towards greater involvement of local businesses, especially manufacturing, in mining development projects. The federal Labor government regards a strong Australian manufacturing sector as an essential part of a sustainable, diverse and innovative economy, and an essential focus of jobs training and employment opportunities. We will continue to support a stronger manufacturing sector and a sustainable, diversified economy through our Clean Energy Future package, through our Defence procurement processes, through our Steel Transformation Plan and local content procurement policies, and through the implementation of the mining resources rent tax.