Sophie Mirabella (Indi, Liberal Party, Shadow Minister for Innovation, Industry and Science) Share this | Link to this | Hansard source

I rise to speak on the so-called Australian Jobs Bill 2013. In doing so I wish to express my frustration with not only the content of the bill but the government's lack of accountability in explaining and justifying the reasons for its introduction and its apparent determination to yet again push through legislation that will increase regulatory and compliance costs for Australian businesses.

Given that it has misled the Australian people hundreds and hundreds of times, it is difficult to take almost anything that this government says at face value. But it is even harder to find reason to support one of its bills when there is so little clarification around even the very basic details in the legislation—the precise reasons for the change and exactly how those changes will be financed.

Prior to February this year, I cannot recall in my time as a shadow minister ever having been refused a briefing by the government. In February was when my office asked Minister Combet's office if I could receive a briefing from the government following the release of the so-called Industry Innovation Statement—otherwise described as a 'jobs plan', another Orwellian phrase—of which these changes form a part. That request was pointedly refused.

One of a number of reasons why I sought that briefing was to try and obtain more detail about the changes to which this bill potentially would give effect. Such conduct points not only to a disturbing lack of accountability on the part of the minister but also to a complete arrogant disregard for accepted protocol, good governance and accountability—especially when a staff member in the minister's office tells a staff member in mine that the basic reason for the refusal is that I apparently had the temerity, the gall, the nerve, to make some public criticisms of a number of elements of the government's policies in this area. 'How dare I criticise the government or question its policies' was effectively what was being said at a time when former members of the frontbench of this government had not only disputed and questioned policies that their own government and party had pursued but also condemned this opposition, whose job it is to question, to query, to sift through new policy and funding announcements with a fine-tooth comb. All we were told was, 'No, you can't do that. How dare you criticise us!' No wonder the business community are sick to death of the veiled and sometimes overt bullying that they get from this government when they dare to do what any good corporate citizen should do and contribute to public debate. If they dare disagree with this government, watch out! This attitude has unfortunately become its trademark as a government. Remember what was once said by them, that they wanted to let the sunshine in—from a government that proclaimed it was supposedly going to be the most open, transparent and accountable in Australian history. I suppose the kindest reflection you could make is that they have become very transparent in their actions and their motives, but regrettably far from the way that they originally meant.

Not the least of the problems with this bill is how its changes are being financed. The government has said that it is funding its various changes in the industry statement, some of which are subject to this bill, by making another deep cut to the R&D tax incentives system. It said comically that its last round of changes was revenue neutral. Now it asserts that the cut this time amounts to around $1 billion. Not only is there absolutely no evidence anywhere on the public record that verifies that that figure can be correct, but it represents quite a difference from the figures that were calculated by the government's own Business Tax Working Group when it was modelling the same numbers last year. It is also at odds with the nature of those previous changes the government made to the R&D tax breaks system from 2011. That set of changes was specifically designed to reduce the claims on the system by the largest investors in innovative R&D activity in Australia and pointers to the fact can be found numerous times in Labor's legislation and its own words, not to mention in the words of the Greens as well, albeit that those words of the Greens proved that they have plainly never had a clue about the sort of damage they were agreeing to inflict on the system when they foolishly passed Labor's 2011 changes.

So it would be very instructive to know, from the minister and from others on the Labor benches during this debate, on what basis the $1 billion has been calculated. One would have to assume that figures for the old R&D tax concession have been used to underpin that calculation, in which case the savings would almost certainly have been overestimated. I would also add that the government first cited the $1 billion in February, long before most claimants had calculated all of their R&D spending for the first year of the new system and at which time the government still could not have been anywhere near sure of the full impact their changes have inflicted on large R&D spending businesses. In other words, there is absolutely no reason to be anything other than deeply suspicious and cynical about the claim that the savings they are supposedly making by decimating R&D incentives, for the second time in this government's history, have been accurately calculated. If I am wrong about this then the next Labor speaker in this debate should immediately point out why and how and give financial details to back up their argument.

The government has also publicly tried to create the pretext that its industry statement somehow represents an injection of $1 billion in new funding in the Industry portfolio. But anyone who takes anything more than a cursory look at their summary figures knows that cannot be true. Instead it seems to incorporate around $600 million worth of cuts. Of course, all of that is bad enough in itself, but that is even before we get to the specifics of the Australian Jobs Bill itself.

To put it very simply, the coalition's view has always been that there are a number of obvious benefits to the nation in encouraging greater use of local firms' capabilities in major public and private sector projects. That obviously stands on its own merits as a beneficial thing for our economy, and that is, after all, why the Howard government was the architect of the Australian Industry Participation scheme in 2001. We have always been very open to the idea of making or helping make incremental changes to the system that are likely to increase and improve its effectiveness.

I have also long said publicly that I am not at all averse to the idea of making changes to EPBS arrangements either, as long as they are constructive and will genuinely benefit Australian industry. If there are widespread demonstrable benefits that will be created by changing the arrangements around things like the capital expenditure threshold at which the production of Australian Industry Participation Plans becomes necessary, or even the trigger dates, then we are not inclined to object to those things out of hand at all.

But the bill that is now before us honours none of those goals. Unfortunately, if it is passed, it will diminish rather than improve the operation of the system, not least because there is not a clearly defined need for the establishment of yet another bureaucracy to administer the AIP system. After more than 21,000 new regulations under Labor, surely the government are not serious about setting up this agency, which they are calling the Australian Industry Participation Authority, to create even stricter rules, more extensive compliance requirements and stiffer penalties. Do we really seriously need another bureaucracy to do the job that the existing bureaucracy should be quite capable of administering in the first place, let alone in an area of policy like this one, where the best results are generally going to be achieved through more sensible encouragement rather than coercion?

There is also more confusion and ambiguity than there is practicality in the approach to the concept of the trigger date. Not only is it problematic in itself that there are a plethora of definitions in the bill of what a trigger date can be, but that in turn leads to further questions as to whether it will be conceivable that a meaningful procurement plan can genuinely be drafted in a number of these situations. The problem is exacerbated even further, as the Business Council of Australia notes, because of the requirement in the bill that project proponents must provide a draft AIPP to the authority 90 days before even the earliest of all the possible trigger dates on the list. Undoubtedly, another consequence of passing this bill would be a substantial upsurge in the number of AIPPs that need to be generated. It stands to reason that, if you widen the range of projects to which the system applies and increase the number of businesses which need to participate in the system, particularly by lowering the capital expenditure threshold, then reporting and compliance requirements are inevitably going to rise significantly.

In the course of drafting and promoting the industry statement, the government has also, sadly, found little time to acknowledge the reality that most firms in the resources sector are genuinely keen to partner with smaller local firms. It is not a matter of bringing out a big stick that represents the answer here; it is finding practical ways of capitalising upon the reality that most local resource companies genuinely would welcome closer interaction with Australian suppliers.

And of course it is completely unacceptable that any government should think it appropriate to legislate, as this bill does, to seek to embed public servants into private companies' workforces in order to wield influence over their purchasing decisions. This is anathema to a modern industrialised economy.

Time will probably not permit me to focus on a number of other potential problems with the bill or indeed the industry statement more generally, so let me defer instead to some comments made by a number of stakeholders in order to present a more general encapsulation of the impact that this bill would have if it were passed. The Queensland Resources Council said:

We … strongly disagree with the mechanisms proposed in the policy … We would urge government to pursue a far less costly, and more effective way of achieving these policy objectives.

They also said:

… this type of intervention is unnecessary, and indeed deeply patronising to the sector—

that is, the resources sector. The Australian Petroleum Production and Exploration Association said that, without significant further attention to a range of issues, the government's approach 'will not have any significant impact on increased local content outcomes' and:

…compliance costs will increase, again, … without commensurate additional benefit to Australian industry.

The Australian Mines and Metals Association said that the government's proposal 'does not contain rigorous cost benefit analysis' and:

It does not provide adequate justification for the increase in costs.

It also said that the bill would 'comprise a heavy-handed and undue intervention by government', would not address concerns with 'reduced labour productivity and increased cost' and 'may exacerbate them'. The Business Council of Australia said:

It added:

CCI of Western Australia said:

… the Bill should not proceed in its current form. The Government has not presented a persuasive case for a legislated instrument on local industry participation. Instead, the Federal Government should acknowledge that there are already a number of policies in place to address local industry participation, that local content penetration in major projects is significant, and looks to ways of coordinating these efforts more effectively as a means of promoting full, fair and reasonable opportunity for local suppliers.

As an excellent encapsulation of the excessive regulatory impact the bill will have, Xstrata Coal said:

… the proposed … bill … only adds to the regulatory red-tape and cost of projects which are becoming increasingly marginal as a result of Australia’s high cost structure, regulatory burden, tax regime and currency exchange rate.

The reality is that the government's industry statement is a misnomer. The government has done almost nothing of substance for Australian industry in its time in office, and that remains the case now. It does not have a jobs plan, as it came keeps claiming. In fact, it would be far more accurate to dub it a retrenchment plan. Over 5½ years, the government has never taken any action to seriously help arrest the mass decline in manufacturing jobs in Australia. It only ever seems to succeed in accelerating it. It has presided over the worst rate of manufacturing job losses in Australia's history, with more than 140,000 gone in net terms and one disappearing, on average, every 19 minutes—which contrasts very, very sharply with the record of the Howard government, when we had well over one million manufacturing jobs and losses of only between 6,000 and 7,000 over that whole period of 11½ years.

So, whenever this government talks about manufacturing and wanting Australia to be the country that makes things, it is all a farce, it is all a con, it is all a try-on—just as some of the members on the other side have realised. A job they thought they would have for life in a so-called safe seat is now under threat because this government has trashed the Labor brand and has betrayed the manufacturing workers it has continually said it supports. And what do we find? We find backbenchers on the other side saying anything—

Mr Champion interjecting—

they think will carry them through the next election—

Nick Champion (Wakefield, Australian Labor Party) Share this | Link to this | Hansard source

I said that in 2010. You have a very short memory.

John Murphy (Reid, Australian Labor Party) Share this | Link to this | Hansard source

Order! The member for Wakefield should familiarise himself with standing order 65(b).

Sophie Mirabella (Indi, Liberal Party, Shadow Minister for Innovation, Industry and Science) Share this | Link to this | Hansard source

And I can understand why some members on the other side are very sensitive—but, colleague, you should have acted earlier with the Labor caucus to ensure that this government did not inflict the single greatest act of self-harm on the Australian economy, particularly on manufacturing, with the world's biggest carbon tax.

Nick Champion (Wakefield, Australian Labor Party) Share this | Link to this | Hansard source

I'm not sensitive. What nonsense! The dollar. It's the dollar.

John Murphy (Reid, Australian Labor Party) Share this | Link to this | Hansard source

Order! The member for Wakefield should familiarise himself with standing order 65(b). The member for Indi has the call.

Sophie Mirabella (Indi, Liberal Party, Shadow Minister for Innovation, Industry and Science) Share this | Link to this | Hansard source

Thank you, Mr Deputy Speaker. Give the member for Wakefield some leniency in this matter. I can understand he is under extraordinary stress. Why wouldn't you be when you think you have got a seat for life and then your Prime Minister trashes the Labor brand and you see thousands of manufacturing jobs disappear around the country and in your own state? Of course you would be beside yourself. Of course you would sit there interjecting when someone tries to point out the facts of what has happened under this government.

When this government leaves office, it will leave behind an atrocious situation in the sector for its successor to have to try and fix. Sadly, this government has no vision and no clear or sensible priorities. All it has is an insatiable desire to spend and to delay the difficult decisions. It has an incapacity to make the hard decisions. In fact, the only thing it truly knows how to do in the industry and innovation portfolio is to mislead, spin, increase bureaucracy and suffocate Australian businesses with ever more insidious regulatory requirements and costs and the world's biggest carbon tax. This government has a tin ear.

Australian businesses, Australian manufacturers, deserve so much more. To that end, the coalition is disappointed but not surprised that the government is introducing this bill and again ignoring common sense and sound and sensible advice from the business community in the process. The government is very good at cute and clever Orwellian language, but the Australian people have heard enough and they have seen through the veneer of this government. There is nothing there but spin. There is nothing there but sheer desperation to survive.

This Prime Minister has sold out working people to appease the Greens. Her judgement was so poor that she thought she needed to sell out working people and Australian families—sell out working people who work in manufacturing, sell out Australian families by increasing their cost of living with a carbon tax—because she thought that was what she needed to do to get the Greens' support. I do not know which will go down in history as the worse political judgement—her decision to betray the Australian people with the carbon tax or her decision to announce an election date so early that it has put a hold on businesses for the months until 14 September. This is a bad bill. This is bad for jobs. This is bad for Australian competitiveness. We will not be supporting this bill.

Darren Cheeseman (Corangamite, Australian Labor Party) Share this | Link to this | Hansard source

It is my pleasure tonight to rise to speak on the Australian Jobs Bill 2013. This bill will help support and create Australian jobs in manufacturing for the next decade plus. We all know that manufacturing has been doing it particularly tough, principally because of the high Australian dollar and the difficult trading and retail conditions that have come in the aftermath of the global financial crisis. But we do have hope in the manufacturing sector, and this bill is a significant part of that.

There are very significant projects happening right now in Australia, principally in the mining states. The Australian Jobs Bill will require that major projects submit a specific plan that will ensure Australian businesses have full, fair and reasonable access to bid for jobs and opportunities. I think that is the Australian way. The bill will require all major projects that have capital expenditure of $500 million or more to develop an Australian industry participation plan. The Australian industry participation plan will be prepared at an early stage of a project's approval, to enable Australian industry to participate in the design and, importantly, the development of the project. This will increase the chances of Australian companies in securing work opportunities that come from those projects, and it will enable Australian industry to participate in and to influence the tender specifications of these very large projects. I think, and the government believes, that it is important to enable Australian industry to participate in these large projects.

The whole process will be managed by the Australian Industry Participation Authority. The authority will evaluate and approve Australian Industry Participation Plans and publish those plans in summary to enable those companies to have full access. The authority will also take responsibility for delivering and supporting arrangements to help Australian businesses to develop the capabilities and the connections that they need to take advantage of and capture those opportunities within those very large projects which are not exclusively but principally within the mining sector. The authority will have the opportunity to coordinate in these important areas and will also take a significant role in the Buy Australian at Home and Abroad initiative, with relevant expertise and assistance provided by AusIndustry and, importantly, Enterprise Connect.

The authority will be a one-stop shop for Australian firms seeking to build their capabilities so that they can link into these new business opportunities. For projects of $2 billion or more they will have an embedded Australian industry opportunity officer in those projects to enable procurement teams to help promote Australian firms into the global supply chain. The bill will also give workers in the manufacturing industry hope. These very large projects will enable Australian industry to directly participate, and pre-existing arrangements and employment with those Australian companies will provide those workers that opportunity to work directly in partnership in accessing these particular projects.

It is estimated that these changes that the Labor government is pursuing will create up to $6.4 billion worth of economic activity for firms in this nation. I come from the very proud manufacturing town Geelong, and this will provide opportunities for Geelong fabricators and Geelong industry to participate in these very large, globally significant projects.

Further to these reforms Labor will also introduce much stronger rules with respect to dumping. Dumping of products can undercut local manufacturers and in some cases deny them the opportunity to be able to compete in the type of manufacturing they do. A new antidumping commission is being created to investigate complaints of dumping which is injuring local industry and costing local jobs right throughout the nation. We will invest $24.4 million to increase our investigative capability with respect to this, almost doubling the number of investigators available to stop the insidious activity of dumping in Australia. Having more investigators out there will send a very strong message to foreign firms that any dumping will be cracked down upon immediately. It also sends the message to investors in the industry that Customs will investigate their concerns immediately and be empowered to take action to stop dumping behaviour.

As part of the Australian jobs announcement Labor will also commit to establishing 10 industry innovation precincts. This will be a significant additional investment in manufacturing. In my community in the Geelong region we have incredible research capacity. We have a very strong university in Deakin University, which has been at the forefront of linking our major employers within the Australian economy, particularly those in the manufacturing sector, to expertise from universities. These 10 industry innovation precincts, which will be located around Australia, will add significantly to the partnership led by industry and universities.

Deakin University is working, as we speak, with a consortium and will be making an application to the Commonwealth in due course. I have spoken at length with senior people at Deakin University, and I look forward to doing my piece as a local member, along with the member for Corio, to advocate that one of these potential innovation precincts be located within our region. I think we have a very strong case to make. We have the expertise in the region at play and of course Geelong is a passionate and proud manufacturing community.

We will certainly do everything we can to take full advantage of these innovation precincts to enable us to harness the best and the brightest minds, from academia, universities, CSIRO and, importantly, partner them with, and led by, the private sector. This will ensure that we can use the full grunt that comes from Australian universities to innovate our manufacturing sector and to develop new opportunities for Australian companies to develop product that is ready for the marketplace, that is innovative and that is high-tech. That is certainly the path that we as a Commonwealth government wish to go down and it is certainly a path we have gone down in the Geelong community. There is no doubt that this bill provides a very strong way forward.

Last week we had some terrible news: the decision of Ford to cease production of Ford motor cars from October 2016. Geelong has had a long, strong and proud association with the Ford Motor Company that goes back to about 1925. Our region is a strong region. We are proud manufacturers, but we know that as community leaders we have a lot of work to do in Geelong to build new opportunities for people. I believe that the Australian Industry Participation plan, which stems from the Australian Jobs Bill, is the way forward and will provide us those opportunities into the future.

We also need to carefully note some of the policy positions that the coalition have adopted, particularly with respect to manufacturing. We know that, if they are elected to government in September, they will immediately rip $500 million out of the New Car Plan. They have further plans to rip a $1.5 billion out of the New Car Plan but they are not, at this stage, admitting to that upfront. The reality is that, if the coalition are elected, the car industry will have no choice but to leave Australia, creating a crisis for some 200,000 workers in the auto sector across this nation. We are certainly making very plain to the Australian community the stark choices, particularly with respect to the auto sector, that people will have come September this year.

As I have indicated, Geelong had some very confronting news last week with respect to the Ford decision. But we have a plan to help support the Geelong community and the workers at Ford and, indeed, those workers at Broadmeadows. We have a funded plan to help support the supply chain which of course has companies scattered right throughout Victoria, South Australia and New South Wales.

It is Labor that supports manufacturing, it is Labor that supports manufacturing communities and it is Labor that will stand up for manufacturing workers across this nation, whereas Tony Abbott, if he is elected as Prime Minister, will not stand up for those workers and those communities. In fact, he will put some very significant cuts in place that will have severe consequences for the manufacturing capabilities of this nation.

In conclusion, I certainly recognise the importance of this particular bill, the Australian Jobs Bill, and I commend the passing of this legislation to parliament, to enable us to move forward as a nation and to help strengthen manufacturing opportunities in this country not only for those companies but also in recognition that Australian industry works in partnership with its workers and unions. This legislation will provide every opportunity for our industry to move forward with a strong, comprehensive plan around supporting Australian jobs. I commend these measures to the House.

Alex Hawke (Mitchell, Liberal Party) Share this | Link to this | Hansard source

The member for Corangamite is precisely wrong in his interpretation of what we will do if we are elected in relation to this bill, the Australian Jobs Bill 2013, and manufacturing in Australia. We have indicated that we will immediately repeal the carbon tax. I note that the member for Corangamite will be very concerned about the impact of the carbon tax on Australian business.

You certainly do not help Australian workers and Australian jobs by passing a bill called the Australian Jobs Bill, although we know that this government has some sort of fetish for Orwellian titles of its bills. It thinks that by calling it the Australian Jobs Bill that, somehow, this will create jobs in Australia. The coalition of course rejects such a proposal. In fact, when you look through this legislation it really gives you the sense that we are having a bill for a bill's sake—and certainly we have Bill at the table at the moment, so maybe we are having a bill for a Bill's sake. But we have grave concerns about this bill, which proposes meaningless changes to the Australian Industry Participation plan.

Bill Shorten (Maribyrnong, Australian Labor Party, Minister for Financial Services and Superannuation) Share this | Link to this | Hansard source

Deputy Speaker Cheeseman, I rise on a point of order. I would ask that the member for—I don't know—parental leave to, at least, refer to me by my correct title.

Darren Cheeseman (Corangamite, Australian Labor Party) Share this | Link to this | Hansard source

I do remind the parliament that it is appropriate that all parliamentarians refer to one another by their titles.

Alex Hawke (Mitchell, Liberal Party) Share this | Link to this | Hansard source

Thank you, Deputy Speaker. I want to thank the minister. Perhaps, Mr Deputy Speaker, you could draw his attention to the same standing order in the light of the fact he did not refer to me by my title.

Darren Cheeseman (Corangamite, Australian Labor Party) Share this | Link to this | Hansard source

Indeed.

Alex Hawke (Mitchell, Liberal Party) Share this | Link to this | Hansard source

That was brilliantly done, again, Minister. I would be the member for Mitchell and you would be the minister. That would be the correct way to handle that point of order. Moving on to the substance of what we are here to deal with today, the Australian Industry Participation system, which the government is proposing to amend and also to make some revisions to the system implemented by the Howard government.

The coalition have no problem with the Australian Industry Participation scheme but the government is yet to convince or provide any set of compelling arguments—we certainly did not hear compelling arguments from the member for Corangamite—about why this bill should be revised. In fact, there is no part of industry in Australia today or any of the sectors that we have consulted with that is calling for a new, heavy-handed regulator to help them create jobs. So while the objective of an Australian Industry Participation scheme is to assist in the local sourcing of products, there is nobody saying to government and there is nobody saying to the opposition, 'What we need to buy more Australian products and employ more people in Australia is a new regulator, a regulator with new powers, a heavy-handed regulator.' Yet in this bill we see the proposal for the establishment of an IPA because a new bureaucracy, according to the government, will help us source more products locally. That seems to be their thinking in relation to a lot of things: a new regulator, a new committee, a new government approach will somehow produce a better benefit for the sector. Given the fact that this scheme has been in operation since 2001, if there was a body of argument that said we need a new regulator, it would be well-established in public argument and public policy. That argument has not been made and we have not heard any arguments in relation to this bill discussion today.

I think it is objectionable that this proposal of the government should seek to embed public servants into private companies' workforces to shape and perhaps even dictate their purchasing decisions. We heard from the member for Corangamite that perhaps they could help with procurement. I do not believe that government employees or government appointed people into this scheme will help with private sector procurement. The coalition takes a different approach, that it is an anathema to the operation of a vibrant private sector to have such people embedded into companies by government, especially for the success of a modern economy.

When you look around at different reactions in the Senate inquiry and certainly to the exposure draft that was released, and it does not matter where you look, you can see the in comments on the draft legislation from Australian Petroleum Production and Exploration Association, who say:

APPEA considers that the proposed legislative approach is unlikely to significantly increase opportunities beyond those created by the extensive efforts already employed by the oil and gas industry to provide full, fair and reasonable opportunity to local suppliers.

We have many other comments from many industries—the big miners, BHP Billiton, Rio Tinto and Xstrata, civil contractors, the South Australian Chambers of Mines and Energy, the Queensland Resources Council, the Minerals Council of Australia, New South Wales Minerals Council, the Department of Commerce Western Australia and the Industry Capability Network—all of whom are not expressing any support for such new proposals from government, in fact highlighting that there is a lack of clarity in the legislation around the items such as the proposed trigger date at which the production of an Australian industry participation project becomes mandatory. That is a legitimate concern. Again, we are adding to this idea of sovereign risk in Australia with these sorts of bills that float around proposing to do something for Australian industry but again adding to the red tape and regulatory burden that companies have to face in making decisions about whether they are going to invest and whether they are going to employ.

One of the concerns I have in particular is that by passing this bill we would be adding to that regulatory burden, we would be adding to that concept of sovereign risk and we would not be doing anything to enhance the ability of industry to make good-quality decisions in relation to their own businesses at the moment. In this climate is this sort of approach needed? No case has been made about this particular bill. We are very concerned at the approach of the government.

Bill Shorten (Maribyrnong, Australian Labor Party, Minister for Financial Services and Superannuation) Share this | Link to this | Hansard source

Are you talking about Tony's parental leave?

Darren Cheeseman (Corangamite, Australian Labor Party) Share this | Link to this | Hansard source

Order! The member will be heard in silence.

Alex Hawke (Mitchell, Liberal Party) Share this | Link to this | Hansard source

Thank you, Mr Deputy Speaker. I would hate to call the minister out. In relation to this bill, whenever you look at the cost-benefit analysis the government goes through in relation to the cost of new legislation, once again we find evidence of mendacious activity from the government. It is not clear exactly what cost this would be in terms of the new regulator and it is not clear where the money is coming from. In relation to what we can tell, we have a stated figure that the changes will be accompanied by spending of around $98.2 million over the next five years. I want to note that this expenditure is supposedly offset by cuts of $1 billion overall to the R&D tax incentive that do not appear to have been appropriately modelled and have certainly never been publicly clarified or justified. So, again, whenever we see new legislation presented with heavy-handed regulation, overregulation, we do not really even have an understanding of how much it will cost, or a rigorous cost-benefit analysis. Why is a rigorous cost-benefit analysis important in relation to new legislation? There is a good 280 billion reasons why a cost-benefit analysis matters in terms of public debt, net debt, and perhaps some $300 billion of reasons very shortly in terms of gross debt, why we need cost-benefit analysis, why we need to look at what is the actual benefit of this new regulator and legislation versus the cost that it will have to government.

When you consider the response of stakeholders, including small to medium enterprises, industry associations and indeed all of the major industry sectors, you can see that there is a grave level of concern about the way this bill would operate. Ideas which could be seen to be reasonable, and indeed the reduction of the capex of $500 million or more for AIP projects, could be seen to be a good thing. However, I want to note the dissenting report by coalition senators, who raise an excellent argument in relation to the proposed reduction of capex—that is, that there could be a range of problems. In particular, the Chamber of Commerce and Industry WA provided a calculation that said that the changes would mean that the share of affected projects would rise from six per cent to around 26.2 per cent. That is by anybody's benchmark a dramatic increase. That sort of dramatic increase is something that ought to be considered quite carefully before we proceed with something like this and would have a lot of effects in terms of cost and assessments and the involvement of government in so many other projects. It is something which again does not appear to be desirable.

While the coalition is certainly supportive of the scheme introduced by the Howard government in 2001, the core purpose—to give Australian firms increased opportunity to secure work on major local projects—is a worthy one. When you look at the actual provisions of this bill, however, and you examine what the government is proposing, it has not been demonstrated, and it is not obvious, how this particular bill—with its Orwellian title, the Australian Jobs Bill—will in fact achieve that objective. And I take with grave concern the concerns of industry and other serious players in this sector suggesting that, in many ways, the increased regulatory burden and the new regulator may indeed achieve much of the opposite or add to the sovereign risk of doing business in Australia.

So, with those features in the forefront of our minds, I would advocate opposing this bill. I know the coalition is opposing this bill. We are looking for something more meaningful from the government than a new, heavy-handed regulator and a series of changes which are uncosted and really have no substantive backing from the sector involved.

Amanda Rishworth (Kingston, Australian Labor Party, Parliamentary Secretary for Disabilities and Carers) Share this | Link to this | Hansard source

I am very pleased to be speaking on the Australian Jobs Bill 2013, because I believe in actually boosting our manufacturing sector. I am disappointed to hear tonight that the opposition has decided not to support this bill; however, I am not surprised. I heard you, Mr Deputy Speaker Cheeseman, talk about the car industry. The opposition has shown very clearly where their true colours lie when it comes to the car industry, and that is: not to support the car industry and not to ensure that we keep innovating in the car industry. So it is not surprising that the opposition has decided not to support what I think is a very important bill.

It is an important bill but it is the government that has decided to put jobs first, and this has been something that we have done since the day we came to government. Our focus has constantly been on jobs, and it is good to have the Minister for Employment and Workplace Relations—otherwise known as the minister for jobs—here at the table. He worked, as did the rest of the government, to support jobs through the global financial crisis. That was a very, very difficult period. But this government took action to ensure that there continued to be economic growth and that people continued to be in jobs, and that is why we have seen, under this term of the Labor government, over 900,000 jobs created. That is a significant number when, in many other nations around the world, jobs are in decline. They cannot boast such job creation.

However, we have to recognise that part of the success has led to significant challenges for the manufacturing industry. In particular, the high Australian dollar and greater international competition have put pressure on the industry. So we need to make sure that there is continuing support for manufacturing in this country. This is very important, considering the challenges and how important this is to our next stage of job creation.

The manufacturing sector employs nearly 1,000,000 Australians across the country, and one in 10 of those employees live in my electorate of Kingston. Their message to me is loud and clear: they expect their government to stand up for jobs and stand up for opportunities for them, and this bill before the House today does exactly that. In the past we have seen Australian companies working on major projects and they have demonstrated that they can successfully compete against global competitors to win work in supplying goods and services. Often it is the innovation that Australian companies can show and the excellent services that they can provide that put them ahead of the pack when it comes to actually winning in open tenders. Unfortunately, though, we need to ensure that we are giving those companies an opportunity to compete for this work and, through the Australian Jobs Bill, the government will be supporting the creation and retention of Australian jobs by requiring Australian Industry Participation Plans for major projects, and this will ensure that Australian businesses have full, fair and reasonable opportunities to bid for key goods and services. This approach will assist Australian industry to gain a foothold in major projects by encouraging them to innovate and develop competitive capabilities to take advantage of investment opportunities.

What this actually means for Australian industry is quite significant, and it is disappointing that the member for Mitchell was criticising this legislation and saying it would amount to nothing when what we have seen through the modelling is that Australian industry could receive an additional $1.6 billion to $6.4 billion worth of work. I do not know about the member for Mitchell, but to me that is significant work. Many companies around Australia could benefit, and many workers could find meaningful and interesting employment in that. So I think this is a really important part of the bill, and it makes sure that there is an opportunity for businesses, with their innovation and their great products and services, to actually gain a foothold.

But it is simply not enough to have rules requiring organisations to have Australian Industry Participation Plans if there is no-one to oversee them. For this reason, the Australian Jobs Bill will create a new entity known as the Australian Industry Participation Authority, whose duty it will be to administer the AIP Plans and make sure that the AIP Plans are compliant and administered and that there will also be consequences for non-compliant plans. The authority will act as an independent entity from the government and ensure that Australian firms are offered every opportunity to grow and prosper. But it will also directly advise the minister on the Australian Industry Participation Plans and issues around those, and will administer programs aimed at improving the capacity of Australian firms to win work on major projects.

At no stage—and I think this is a myth sometimes peddled by those opposed to this legislation—will the Australian Industry Participation Authority ever force an organisation to use one supplier over another. What this bill really aims to do is to create a fairer playing field, to increase the opportunities for Australian firms to win work on major projects, and not—and I make this very clear—to require that Australian firms must be used but to really ensure that they do get a look in. But I have to say that this is one part of a very important package that the Labor government has put forward. In fact, it is a $1 billion package because we recognise the importance of the manufacturing sector, the importance of jobs that go along with that, the importance of the workers and also of the companies in the area of manufacturing.

So the plan was launched on 17 February. It has three objectives at its heart. First is backing Australian firms to win more work at home, and this has been a critical part of the Australian Jobs Plan. The second is supporting the Australian industry to increase exports and win business abroad. That is really important; we have always been a big exporting nation and we need to ensure that industry, and especially our manufacturing industry, gets the opportunity to export overseas. I have a number of manufacturers in my electorate that really have taken the opportunity to innovate. They have, at times, had assistance to export overseas from this federal Labor government that has resulted in an increase in some of these companies from a few employees to just under 100 employees. So we can really help industry win those export opportunities. Thirdly, helping Australians in small and medium businesses to grow also creates new jobs. I think this is incredibly important.

The plan is about what we can do right now to get more work for Australian factories, workshops, offices, construction sites, services and businesses. We have put the money on the table: $1 billion into the productivity, prosperity and jobs of the 21st century. As I said, it is very, very disappointing that the opposition have said they will oppose this part—obviously, we are not sure which parts. They have also been on record saying that they will oppose the industry precincts, which are another part of this package—a very innovative way to bring industry together and build capacity. They have said that is the 'old' way to do business, but I see in my electorate the collaboration that goes on with a range of different industries and that is really one of the ways for the future.

Through our plan, we will see our nation's research efforts translate into better economic outcomes by promoting collaboration between business and research institutes through a major new network of industry innovation precincts. We will also see small- to medium-size businesses and start-up companies be provided with expanded business assistance and better access to finance through measures to further stimulate Australia's venture capital. These are incredibly important measures; this is an incredibly important package. I believe this will really improve the manufacturing sector as we go forward.

As I mentioned earlier, in my electorate of Kingston, one in every 10 workers are employed in the manufacturing sector. We have been through a transition in our local area as well—it was incredibly disappointing when in 2008 Mitsubishi announced it would close its doors at the Tonsley Park site, and this had also occurred at the engine site, which had been in Lonsdale—this actually took interventionist federal and state Labor governments, working to retrain workers who lost their jobs and also supporting the creation of new jobs through co-investment with industry as part of the SA Innovation and Investment Fund. I have been able to visit a number of recipients that have received grants as part of this fund, and seen how they are thriving. In fact, the minister at the table, Minister Bird, visited one of those sites—Redarc Electronics—which has a very exciting model. They do sales, investment and research and development on site, as well as the manufacturing. But they are also participating with another site in working to educate their workers and helping with literacy and numeracy as well. That is just one of a number of very successful businesses that transformed as a result of the Mitsubishi closure.

Another very important part of the Mitsubishi story, though, is that the South Australian government had the foresight to buy this site—to buy the old site at Tonsley. Now, they are working to reactivate this site as an employment hub, focusing on high-value, advanced manufacturing that integrates industry, education, research and affordable living options, as well as community facilities.

This is a very important site because it not only has a connection to public transport that is going to be upgraded as a result of the most recent federal budget but it is also connected to Flinders University, and a TAFE is being constructed on the site. So we see that real connection now with translating research. Not only is Flinders University across the road; there will be buildings on that site as well that start to connect that. I see a real opportunity there at Tonsley. There is a lot of commercial interest in Tonsley as well, and a lot of discussion about the type of place it is going to be.

It will become an integral manufacturing hub and, while it was disappointing to see the exit of Mitsubishi for so many, it is great to see that this industrial area will be transformed to create the jobs of the future. This story is really important. We need to continue to seek out those types of stories, support those types of stories right through Australia and ensure that we are doing everything we can to support innovation right around this country.

As I said at the beginning of this speech, it is disappointing that the Liberal Party and the National Party have chosen to put their heads in the sand when it comes to supporting manufacturing. It is disappointing because when I am out there talking with people they do want to ensure that local companies are getting a bite at the cherry when it comes to work that is here in Australia. They also want to know that their government is supporting and promoting their manufacturing and services overseas and that they have increased opportunities. Importantly, they want to know that their government is supporting venture capital research and development, and stimulating the research sector. These are all very important parts of this bill and the package, and I commend the bill to the House.

Craig Kelly (Hughes, Liberal Party) Share this | Link to this | Hansard source

I rise to speak on this rather Orwellian named bill: the Australian Jobs Bill 2013. I would like to comment on a few of the statements made by the member for Kingston—that this government is somehow supporting the Australian manufacturing. This government, that the member for Kingston is a member of, supports smashing Australian industry with the world's largest carbon tax. The member for Kingston cannot come into this parliament, stand at the dispatch box and claim the wonderful things her government is doing to support manufacturing while at the same time belting them with the world's largest carbon tax.

On the Australian Jobs Bill, the member for Kingston also mentioned all the wonderful jobs that this Labor government has created. Firstly, governments do not create jobs; it is the private sector entrepreneurs who create jobs in our economy. Also, if we have a close look at the ABS statistics for jobs, there are currently, as at April 2013, 682,900 Australians on the unemployment lines. An extra 211,000 people have been added to the unemployment lines since this government came to office, an increase of 45 per cent. We can fill two Melbourne Cricket Grounds or two Sydney Football Stadiums and still have people left over. That is the number of people who have been added to the unemployment lines of this country since this Labor government took office.

We hear that this government has created close to 900,000 jobs—it is actually 885,000. Again, these jobs were not created by government unless they were blow-outs in public servants; they were created by the private sector. What is not said is that, in the time this government has been in office, we have seen our Australian population increase by 1,858,000—close to two million people more live in Australia now than when this government came to office. If the government were doing a good job, we would expect to see 65 per cent or more of those people being employed. Let me go through those numbers again. Some 1.85 million people have been added to the Australian population but we have had an increase in employment of only 885,000. That is less than 50 per cent. We are going backwards as fast as we can.

Of course, those are the official ABS statistics. We also have the Roy Morgan figures. They do a slightly different measure of unemployment. For March 2013 Roy Morgan estimated there were 1.37 million Australians unemployed, or 10.8 per cent of the workforce, and a further 936,000 Australians underemployed. We know the definition of 'employed' counts those who have worked for one hour a week. So we should add the number of people underemployed—that is, people working part time and looking for more work. According to the Roy Morgan figures, there are an additional 936,000 people underemployed. Roy Morgan notes:

… what should concern the Government is that a large 2.305 million Australians (18.2% of the workforce) were unemployed or under-employed in March …

So we really do have to look at what we can do to ensure we see the growth and protection of Australian jobs, but this bill does not do it.

This bill bizarrely creates Australian industry opportunity officers. These bureaucrats will be embedded into private companies to second-guess their purchasing decisions. This is something you would expect of a mad socialist plan. This is something we saw in old Soviet Russia, where the government would appoint a bureaucrat to second-guess a private company's decision. We can just see the government thinking this up. They dreamed: 'If only we can get a government bureaucrat in every business. The government knows best. We can plan exactly the way it will work.' This is simply a mad decision. It creates red tape. It does the exact opposite of what businesses need to create jobs in our society and our economy.

Let us look at a few comments. Minerals Council of Australia Chief Executive, Mitch Hooke, said this proposal was simply unnecessary. He said:

The proposal to embed public servants inside companies is both unnecessary, unwarranted and inefficient.

Australian mining companies use more than 80 per cent local goods and services.

We are already buying Australian when it makes good business sense to do so.

If we are going to make sure that Australian companies buy Australian goods, we do not need new bureaucracy, we do not need government bureaucrats meddling in private businesses; what we need is to reduce business red tape and get their taxes down, especially their carbon tax. Some Australian businesses are becoming uncompetitive simply because this government has hit them with the world's largest carbon tax. When an Australian company is quoting to provide goods and services to a large new project and it is competing with someone from overseas, the Australian business employing Australian workers is penalised by this government in having to pay the carbon tax but the overseas company simply does not pay it. We have a government placing our own businesses here in Australia at a competitive disadvantage. You guys just do not get it. You do not understand or realise the damage that you are doing.

But of course, this gets worse. We know that at 1 July this year the carbon tax will increase. Elsewhere around the world we have seen a collapse in the EU carbon price and we have seen energy prices in the US fall, and we in Australia are putting our carbon tax up. This is complete insanity. This is going to cost Australian jobs, like we have been seeing over the past weeks and months.

Let us not forget the Treasurer's promise from last budget that the economy would create 500,000 new jobs this financial year. There are only two months left. So far there have only been 123,000 jobs created in the economy despite the population increasing by over 600,000 people. So with two months left, the Treasurer is 75 per cent short of that target. You do not have to be a rocket scientist to work out why. It is simply because the same government, the same Treasurer, has put Australian industry at a competitive disadvantage with the carbon tax. So is it any wonder we have this big increase in our population but only a very small increase in our employment numbers?

And as I said, the carbon tax does get worse. We know that it goes up. Not only that, what we do have and what there has not been any commentary in the media about, is that this government plans to extend the carbon tax to our trucking industry from 1 July 2014. This would effectively increase the tax on diesel fuel by 7c a litre. And that is just in 2014. So every time every small business truck owner goes out there to fill his truck to deliver goods anywhere in Australia, starting in 2014 if this government is re-elected, they are going to be paying an extra 7c a litre for their diesel fuel. Again, this policy is complete insanity. It is the exact opposite of sanity and it will kill jobs.

Take a few examples. If an Australian business is manufacturing in Melbourne and has to shift goods by road to Northern Queensland, they will pay the increase in the carbon tax through diesel fuel. Similarly, a business in Western Sydney in my electorate of Hughes might be manufacturing or quoting for a job for a mining project in Perth. Those goods must be transported across Australia, again incurring the increase in the carbon tax on diesel fuel.

But if I am a manufacturer overseas, I can ship my goods into the Port of Perth or the Port of Brisbane or the Port of Melbourne, reducing the road transport cost and the distance in Australia, thereby avoiding the tax. Again, it is the carbon tax and these other taxes that are putting Australian industry at a competitive disadvantage and costing Australian jobs.

We have seen some bad bills come from this government, but the ideology behind this bill that wants to put a government bureaucrat into private businesses to second-guess their purchasing decisions just shows that this government has completely lost the plot. They have no idea and they are unfit for office. That is why the coalition opposes this bill. If the coalition is successful at the next election, we will deliver tax cuts without a carbon tax. We will take the pressure off business. We will try to ensure that Australian business can compete on a level playing field. That is what will create Australian jobs. That is what creates the incentive for people to employ. This is just another bad bill from a bad government in its dying days. Therefore the coalition has no alternative than to oppose this bill.

Stephen Jones (Throsby, Australian Labor Party) Share this | Link to this | Hansard source

I am pleased to be speaking on a bill about Australian jobs. The Labor government supports the Australian Jobs Bill 2013. It is good Labor legislation. I follow the member for Hughes who opposes the bill, because that is what the coalition does—they say no. In his 15-minute dissertation on all things except the matter before the House, we never heard one skerrick on policy about what the coalition would do if they were to sit on this side of the House and deal with the challenges that are currently confronting the manufacturing industry in this country. There is a very simple reason for that: they do not have a policy except to say no.

I am pleased to speak about this bill today because it demonstrates the importance that Labor attaches to the manufacturing industry.    As members of parliament—and I see the member for Cunningham in the chamber as well—the member for Cunningham and I represent the areas of Illawarra, and in my case the Southern Highlands as well, and the manufacturing industry is very important. Still over one in 10 jobs in our electorates comes from manufacturing. Manufacturing is critically important. From anywhere in the Illawarra you can see the Port Kembla steelworks, an iconic part of the Illawarra landscape. The blast furnace and smoke stacks are an ever-present part on our horizon. Manufacturing is critical as an employer but also critical in terms of generating wealth and economic opportunities within the region.

The distortion to Australia's economy that is being driven by not only the mining boom but also the historically high Australian dollar is creating inequality and not just between industry sectors. It is also exacerbating inequality even within states and between regions and their capital cities. What might be a boon to one part of the economy is a burden in another, because their export-exposed industries are labouring under the pressures created by the high Australian dollar. All bubbles burst, and when the mining bubble bursts it could leave behind a very altered landscape. If we do nothing we will sacrifice the manufacturing capabilities of this country, which have been built up over many generations.

I believe, and I know the member for Cunningham believes, that manufacturing matters. Manufacturing is critical not only to our economy but also to the sort of country that we want live in. This is because, quite simply, a country that makes stuff knows stuff. The engineering know-how that accompanies a manufacturing industry creates a culture and knowledge within a town and within a society which I believe is critical to the future of this country. It is not only critical to our economy but it is critical to the sort of country we want to live in.

Manufacturing and the engineering trades create the ecosystems of knowledge that are critical to being a clever country. The skills and know-how involved take generations to develop. This can only be done by being involved in all elements of the production process. I want to ensure that through legislation and policies such as this we have a manufacturing industry, manufacturing and engineering know-how and skills in this country for many decades to come. Manufacturing invests in the equipment and technology. It drives innovations and capabilities which we need to maintain our productivity and our economic capacity. While manufacturing makes up only about 8.3 people cent of all employment across the nation and about 8.6 per cent of gross domestic product, it contributes to more than 25 per cent of all business investment in research and development. Put simply, the manufacturing sector is boxing well above its weight when it comes to investing in our future know-how and our technological capacity.

Australia's mining boom of the past decade should be a bonanza for Australian manufacturing and for steel production in particular, but it has not been. When coupled with the high Australian dollar we are seeing less work going into the fabrication shops and the manufactured product that is being used in these mining developments. The Australian Steel Institute has estimated that Australian steel is only getting around 10 to 12 per cent of the share of the local business being done in our major resource projects, despite steel fabrication factories having capacity to at least double their current output.

We know there are a number of reasons behind this, including as I have said the high Australian dollar but also because we are not a part of established global supply chains and because of tendering arrangements for large projects. This is something that the member for Hughes in his 15-minute tirade failed to focus upon. He fails to understand how work is done in large mining developments, these large resource projects and other large developments around the country. These businesses are often multinational companies who come to this country. We welcome their investment but they bring with them established global supply chains, the same contractors and suppliers they use when they do a development in Indonesia or Brazil or in China or in India. They use the same established supply chains, often derived from the same designs and the same specifications that they use in each of those different countries.

That is why the centrepiece for A Plan for Australian Jobs is a detailed and fully funded policy which contains long-term reforms to ensure Australian industry gets a slice of the pie. The policy will ensure that Australians continue to have high-skilled, well-paid jobs in competitive industries that will be the backbone of the modern broad based economy. Today's legislation will bring in new laws which will help Australian businesses gain access to major investment projects. By being required to complete Australian Industry Participation Plans, every large investment project worth $500 million or more must show that they will provide opportunities to local businesses, ensuring that Australian industry is able to grow and generate jobs through these projects.

Industry Participation Plans require projects to open up their supply chains so that Australian industry has a fair go at gaining work. Industry Participation Plans will mean that projects cannot simply import supply chains from overseas or lock local suppliers out by using exotic standards. In my own electorate I have heard examples of how fabricators have been invited to a tender for large projects that could have made the difference between them staying open or closing the doors. They receive an invitation to tender on the Friday which closes on the Monday. Quite clearly that is not a bona fide invitation to tender. It is quite clearly just a ruse, if you like, to be able to demonstrate to somebody that they are attempting to give local industry a go at winning the tenders. This is not good enough. These are not the sort of arrangements that we want to see in place to create a level playing field. Projects need to get to know Australian industry and provide every opportunity to Australian businesses to gain the work.

I have given lots of examples in the House before where this has not occurred, where specifications and designs within the plans for a project have almost mandated that overseas products or overseas companies win that work because they are designed in a way which excludes local businesses from properly tendering. This is the sort of thing that we are focused on. It is too late once the designs are done. It is too late once the specifications are put in place. It is also too late once the invitations to tender are gone. We want to be there on the ground at the very get-go to ensure that we are not locked out, that we develop those relationships and are integrated into those supply chains.

Analysis conducted by the government indicates that as a result of broadening industry participation requirements under the jobs bill Australian industry could see an additional $1.6 billion to $6.4 billion worth of extra work. This could be keeping fabrication shops around my electorate and right around the country busy with work. It would lead to the employment of new apprentices and the retention of existing staff. That is why manufacturing matters to the government and it is why the Gillard government is investing billions of dollars to support and grow new jobs. In the current budget environment a billion dollars is a major investment but A Plan for Australian Jobs has three core strategies: backing Australian firms to win more work at home, supporting Australian industry to increase exports and win businesses abroad, and helping Australian small and medium businesses grow and create new jobs. Put simply, we are looking after the jobs of today while planning and investing in the jobs of the future.

The package builds on the support we have already delivered since coming into office, including measures such as the $300 million Steel Transformation Plan. I never heard the member for Hughes mention the Steel Transformation Plan. I can tell you, Mr Deputy Speaker Adams, and the minister at the table, the member for Cunningham, can tell you—she and I worked very hard on pulling together the Steel Transformation Plan—it delivered much-needed relief to the steelmakers, including Arrium and BlueScope, both of whom have businesses in our electorates. The Steel Transformation Plan is the difference between BlueScope being open today and it being closed before Christmas last year. It is as simple as that.

Sharon Bird (Cunningham, Australian Labor Party, Minister for Higher Education and Skills) Share this | Link to this | Hansard source

Did he support it?

Stephen Jones (Throsby, Australian Labor Party) Share this | Link to this | Hansard source

And the member for Cunningham reminds me: probably the reason why the member for Hughes, who has employees within his electorate who work at BlueScope, never mentioned it in a debate around the future of manufacturing and the future of Australian jobs is because when he had the opportunity to come into this House and cast a vote in support of local manufacturing jobs, he voted against it. He had the opportunity to put his hand in the air, to stand with those on the government side of the House and say, 'We vote for BlueScope, we vote for the Steel Transformation Plan, we vote for keeping the steelworks open in the Illawarra,' but he declined to do so. He voted against it, and that should be known. It is a matter to his eternal shame in this place.

It is not just that plan. The $5.4 billion New Car Plan is providing the automotive manufacturing sector the certainty it needs to attract long-term investment to 2020. I never heard mention of that in any of the earlier speeches either, which is a tragedy because we have seen in recent days the difficulties that that sector is going through in Australia. Of particular importance is the announcement by Ford that it intends to close down its domestic production facilities in Victoria by 2016. Well, that story will be repeated in two other car production plants—in both Toyota and in Holden—if the coalition wins at the September election because their policy is to halve the amount of assistance and co-investment that the government puts into the car industry right from the get-go.

It is something the Leader of the Opposition does not tell the manufacturing industry workers when he dons a hardhat and a yellow vest and does doorstops in manufacturing shops around the country. He keeps it secret from them, the fact they voted against the steel industry transformation plan. He keeps it secret from them that the coalition wants to rip millions of dollars' worth of assistance for research and development out of the car industry. And there is no secret there are no other policies in the coalition policy drawer when it comes to manufacturing.

The $1.2 billion Clean Technology Program is critical to helping businesses transform the way they do their work, ensuring they can invest in clean energy processes, reduce their electricity bills and reduce their power usage as well. It is $1.2 billion for a co-investment program—also on the chop if the coalition wins. There are businesses around the country that are developing new programs, that are putting in bids for grants right now that must be wondering about the uncertainty that will be visited upon them if there is a change of policy following a change of government.

There is a lot in the package. It is not, as previous speakers have attempted to characterise this—laughable in their simplicity—a means of just placing somebody inside a mining company. And if that was the only thing that was contained in the policy, what a difference that would make. What a difference that would make to ensure that local manufacturers and local businesses got a fair shake when it came to tendering for these projects, multi-billion dollar projects. Local businesses get a feed out of some this work that is going on; it will keep those businesses open. If that was all it was, that would be good enough. But we are going far beyond that in this far-reaching project.

I would ask those on the other side of the House to rethink their plan to say no, to rethink their plan to reject this bill. There is a lot in it for workers in my electorate. There is a lot in it for businesses around the country. And there is a lot in it for manufacturing around the country. For those reasons, I commend the bill to the House.

Jane Prentice (Ryan, Liberal Party) Share this | Link to this | Hansard source

I rise to speak on the Australian Jobs Bill 2013. Today's bill is yet another example of this Labor government's interventionist approach to industry policy. It says it is part of its plan to support and create jobs, but realistically the primary consequences of this bill are to install further bureaucratic oversight of private operators within our economy. This bill contains too many impractical and unreasonable measures; it is symptomatic of the government's command-and-control approach to industry and we should therefore oppose the bill.

The passage of today's bill would result in changes to the Australian Industry Participation system. The AIP system was introduced by the Howard government in 2001. Its core purpose is to give Australian firms increased opportunity to secure work on major local projects. Currently, companies seeking customs duty concessions under the Enhanced Project By-law Scheme and entities tendering for Commonwealth government procurements worth $20 million or more need to produce Australian Industry Participation plans. Through these plans, companies show how they will provide local firms with optimal opportunities to tender for and perform some of the work on their project. The system has generally worked very effectively, and has been accompanied by a number of complementary changes at state level. As its architect, the coalition is a supporter of the system and we would therefore support sensible refinements to the system if they are likely to enhance its operation.

The government claims its aim is to make changes to the system which will potentially increase the number of Australian suppliers for major local projects. The bill and the accompanying material show little regard for the historical evolution of the AIP system or for the progress that had already been made over many years of increasing local industry participation on major projects. Further, there is little evidence that this bill is based on a rigorous cost-benefit analysis.

As the Business Council of Australia noted in its submission to the exposure draft for this bill:

The Bill does not pass the test of good legislation—the problem is poorly defined, the costs and risks of the Bill are understated and the costs and benefits of sensible, alternative policy options have not been properly assessed.

This is not rational policy. The changes have not arisen in response to an identified need in industry. It is merely an attempt to justify the Labor government's Industry and Innovation Statement of 17 February 2013, where they proposed a number of changes that will supposedly 'strengthen the capacity of Australian firms to win more work on major projects'.

It is all very well for this Labor government to pay lip service to supporting Australian jobs. However, we must look at the detail of this bill. Some of the changes include: the establishment of a new Australian Industry Participation Authority to supposedly 'raise the profile of these activities, coordinate opportunities arising from AIP Plans (AIPPs) and help business gain access to opportunities'; the requirement of AIPPs to be generated for all projects with a capital expenditure of $500 million or more; the revision of EPBS for projects worth $2 billion or more by requiring 'Australian Industry Opportunity Officers' to be embedded in the procurement teams of individual companies. These proposals amount to a new bureaucracy, more red tape and more bureaucrats. They claim that in some way it is a measure to improve Australian industry rather than admit it is just one more way they can increase the intrusion of government into industry.

I also remain concerned about the lack of clarity in the legislation around the proposed 'trigger date' at which the production of an AIPP in the conception and/or planning phases of a project becomes mandatory. Further, there will likely be a substantial rise in the number of AIPPs that need to be produced. There will also, no doubt, be an increase in reporting and compliance requirements as a result of any lowering of the capital expenditure threshold. These revisions are heavy-handed, misguided, and will collectively compromise the operation of the Australian Industry Participation system.

It is the coalition's view that a number of the changes in this bill will weaken rather than improve the system and are an anathema to the operation of a vibrant private sector and a successful modern economy. Against this background, it is unsurprising that almost all of the submissions provided to the Senate Economics Legislation Committee raised multiple and significant concerns about the content of the exposure draft. Stakeholders within industry have already expressed their opposition to the changes in the Australian Jobs Bill 2013. Xstrata Coal, in its submission on the exposure draft, said the bill:

... only adds to the regulatory red-tape and cost of projects which are becoming increasingly marginal as a result of Australia's high cost structure, regulatory burden, tax regime and currency exchange rate.

The Business Council of Australia went further, stating that it:

... establishes a worrying new precedent for government intervention ... This will add to Australia's reputation as a costly and unpredictable place to invest in major capital projects. The introduction of a new regulator to oversee project procurement risks creating an antagonistic instead of a cooperative and constructive relationship with business.

The Australian Petroleum Production and Exploration Association in its submission to the Senate Standing Committee on Economics, said:

Overall, APPEA does not believe that a case has been made to justify the imposition of a complex and potentially time consuming regulatory process.

They noted that this bill will:

… increase complexity, uncertainty and the cost of compliance.

I absolutely agree with these sentiments.

Finally, the government has stated that these changes will be accompanied by spending of $98.2 million over the next five years. This expenditure is supposedly being offset by cuts which total over $1 billion to the research and development tax incentives, which does not appear to have been appropriately modelled and publicly clarified or justified.

However, there can be a role for government as a facilitator to support Australian industry and jobs. For example, the Export Market Development Grants have been very successful in assisting our small and medium-sized exporters engage in international markets to export Australian products and to grow the Australian economy. These grants are not about having government bureaucrats embedded in export companies telling them what or to whom they can export. However, instead of supporting this successful industry policy, this Labor government recently cut $25 million dollars for no rational reason except to cover up their $192 billion in accumulated government debt.

This bill is a complete anathema to the idea of free enterprise. It is not about supporting industry or supporting the Australian economy; it is about expanding the power of government and creating yet another new layer of bureaucracy. Embedding public servants in companies, no matter how big or small, belongs in the works of an Orwellian novel, not in the pages of Commonwealth legislation. I therefore oppose this bill.

Bob Katter (Kennedy, Independent) Share this | Link to this | Hansard source

I have great respect for the previous member of parliament but, with all due respect, I was reading statements by Senator Madigan yesterday and I most certainly shared the sentiments of a person who was very angry because he saw the coalface—he saw the reality of this place. The previous speaker clearly has never talked to a truck driver, because every truck driver in my area screams and complains that there is no work for them, because of all the big contractors from down south. All the big contractors from down south now complain that they are not getting any work because of the big contractors from overseas. They are not getting any work either. In Western Australia they tell me that a whole mining processing plant will come in from overseas and be loaded and taken on a semi and it is all bolted together. The steel comes from overseas. The work is done overseas. All we get is laying a concrete foundation, and that will be, typically, contractors coming in bringing in 457 workers or whatever to do the work and then flying back out again, leaving no benefit behind for our communities in Australia, whether it is the bloke that owns the truck or whether it is the small contractors and loaders.

Quite frankly, if we were building the Snowy Mountains scheme now, Thiess Brothers would not get a contract. Les Thiess and his seven or eight brothers who worked in the firm with him would not get a contract. In those days we put immense pressure upon government corporations to employ Australians and he was able to get a small contract, and when the tendering was highly competitive he ended up with all of the contracts. Dillingham and Utah were both sidelined. Over 40 per cent of the entire building of the Snowy was done by Thiess contractors and only 20 per cent by Dillingham, Utah and all of the other mostly foreign corporations. When there was a prejudice working to give Australians a fair go, not only did they get a fair go but they were so good that they made sure the others were gone. That was the history of the Snowy.

The previous speaker's husband belonged to a government in which all road construction was done with local owner-drivers. That was the policy of the Queensland government. In that period some 10,000 kilometres of roads were built or sealed in Queensland, all with owner-drivers. This is from a government that was spending $3,000 million—which, in today's money, would be about $6,000 million—a year. The current Queensland government and this one are spending $45,000 million a year and there are no jobs for local truckies at all—and they are not putting down much bitumen at all. In fact, it is quite fascinating to figure out what the hell they are spending the money on. Whatever else may have been said about the government of those days in Queensland, no-one would ever question the economic effectiveness and the great economic success story that was Queensland in the 1970s and 1980s.

The previous speaker said that this proposal is a complete anathema to free trade, and she is dead right—it is. We have a saying in my party that 'free market' means big foreign monopolistic corporations are free to mark up to whatever level they please. That is what 'free market' means as far as we are concerned—free to mark up to whatever price you feel like.

It is very seldom and rare for me to give any praise to either side of this parliament but in this case, with this bill, at least the Australians will be able to have a go. I have a constant and continuous complaint that we did not even know there were any tenders being called for the job. We did not even know that. I think Leighton is a very excellent company. I have had very good experience with them. They are very good Australians. But, at the end of the day, the three Leighton companies are all foreign owned. We will often get three tenders on a job and they will be from the three Leighton companies that are owned by Leighton Holdings in Australia. So whilst I do not in any way denigrate these people—I think that they have done an excellent job—by the same token, the tendering process is not really a tendering process at all. All the jobs have been stitched up and all the tendering has been done long before the action comes down.

I quoted in my book a New Guinea example. Bechtel was contracted to build the Ok Tedi pipeline for $82 million—I think that was the figure, if my memory serves me correctly—and Curtain Brothers came along and said they could do it for $17 million. The American who was in charge of Ok Tedi said, 'Do you know Curtain?' and I said, 'Yes, I do.' He said, 'Not only did I stupidly give him the contract, because I did not think he could do it, when Bechtel had bid $82 million and this bloke was effectively bidding $20 million to do the same job, but he came in six months ahead of schedule and so we made a huge amount of extra money.' In that case the decision was taken by a big American mining company—I think it was American but it was foreign anyway—to do a deal with a big American contracting construction company and no Australian was allowed to go in. But, when the Australian beat his way through the door, he did it for a quarter of the price that the big international corporation had tendered for and came in six months ahead of schedule, which enabled them to make an extra $60 million of profit that year. I am going from memory in that case, but you would have to be blind and deaf not to know that Australian companies are just not getting a look in.

All of the great, giant mining companies of Australia, with the exception of Andrew Forrest, are all foreign owned. There are only front men or front women for foreign corporations. Those that purport to be Australian are just fronts for foreign corporations. They have their contacts overseas and they just simply bring the overseas operators in and do the whole lot. The head of one of the biggest mining companies in Australia—and I will not mention his name—said that in Africa they ring up the Chinese and a huge construction crew comes in and six months later they fly out—you have got a mine and camp living conditions and a town built and away they would go. That is what is going to happen in Australia. That might be all very wonderful for the mining company but it sure ain't very wonderful for Australia. We are being bypassed all the time.

I would say that in most of the little midwest towns in north Queensland, where I come from, they would have had 10 contracted truck drivers. I doubt that I could count 10 in the whole of the midwestern gulf country now, because all of the work is going to big corporations and the locals get no look-in at all. That is on a local scale, a regional scale if you like, but on a national scale it is happening in exactly the same way—the Australians are not getting a look-in at all. If you tell me that this is going to solve the problem, no, it does not. But at least it gives an Australian company and an Australian contractor or subcontractor the right to put his name forward. In 'realityland' this gives the opportunity to someone like me to put up a hell of a stink to ensure that the contractors and subcontractors get a look-in at construction sites.

I quote the case of Adani. It seems to me they are building a two-kilometre airstrip. Some of my First Australian friends said when negotiating native title, 'Why do you need a two-kilometre airstrip?' They said, 'We get big planes coming in from overseas flying in workers.' 'But you said, when Mr Katter attacked you in the paper, that you weren't flying in workers from overseas.' The bloke concerned said there was a thundering silence for two minutes and then they started on another subject. They are going to fly workers in from overseas, thanks to the initiatives taken by the current federal government. Congratulations, you have given to foreigners hundreds of thousands of jobs that should have gone to Australians. You call yourself the Labor Party, but Ben Chifley would turn in his grave and have convulsions if he saw a Labor government flying 100,000 workers in from overseas.

When you walk out of the parliament through the door behind the chair, you see a big picture of Charlie McDonald, the first member of parliament for Kennedy, the seat that I represent. Those men fought and died—literally died with three people shot dead at the picket line at Dagworth Station, where Waltzing Matilda was written a couple of weeks later—for pay and conditions. And when they won those conditions they saw the big corporates of the day simply bringing people in from overseas to work the mines and the cane fields. The entire executive of the AWU in Queensland was jailed for three years with hard labour for having a strike. After all those fights we saw all those conditions being taken away from us. Of the first seven speeches by Charlie McDonald in this place, six were about people coming in from overseas to take jobs away from us.

The root cause of this is that the six great mining companies in Australia were allowed to be sold to foreigners. They were all owned by Australians and now they are all owned by foreigners. If that is a step forward then I think there is a most peculiar value system in this parliament. If it is a sign of free markets then you can stick your free markets up your jumper. I would like to see Australia owned by Australians. If that sounds a bit xenophobic, as TheAustralian newspaper described those attitudes and values, those were the attitudes and values of Essington Lewis and John Corbould who created the Mount Isa Mine and BHP. They created the Australian steel industry and these great structures in Australia. These mines and structures have been sold to foreigners by the greatest group of grubby worms, the slithering suits of Sydney. They have made fortunes selling the country. A lot of the mining magnates of Australia have made fortunes by simply selling their country to foreigners. There is a name for that.

Here today we are moving the Australian Industry Participation Plan. Far be it for me to say anything good about this government, but there is a tiny bit of light, of opportunity, that will be provided to my contractors, the people that I grew up with, went to school with and who are my friends. They have no work, because the contractors are coming in either from down south in the big cities or from overseas. This will provide us with at least the opportunity to put in a bid. All we are asking for is the right to put in a bid. I do not know how many times people have come up to me and said: 'Bobby, we didn't even get the opportunity to put in a bid. It was all over, red rover. The first we knew about it was all the trucks coming in from outside, all the semis, all the D9s, all the scrapers, all the construction crews.' In my little home town of Cloncurry, a First Australian who had a very successful engineering operation told me the five engineering operations in Cloncurry had all gone. They have been taken over by contractors coming in with 457 workers, so there is no benefit for my little home town of Cloncurry. Once upon a time we rejoiced that a mine was opening up in our area. Now it is really a taxing of our infrastructure. (Time expired)

Yvette D'Ath (Petrie, Australian Labor Party, Parliamentary Secretary for Climate Change and Energy Efficiency) Share this | Link to this | Hansard source

It is my pleasure to sum up the debate on the Australian Jobs Bill 2013. The Gillard government has a strong commitment to supporting and creating Australian jobs, and to support the future of our businesses and industries. There is no doubt that parts of the economy are under pressure from fundamental changes in the global economy since the global financial crisis. The government's industry and innovation statement, A Plan for Australian Jobs, is a detailed and fully funded response to these pressures, containing long-term systemic changes to ensure we can increase prosperity, broaden our economic base and compete in an increasingly competitive world. The important issues for manufacturing to innovate and to improve productivity are equally important for businesses and jobs across our entire economy. After detailed consultations with industry and workers, the Gillard government firmly believes that higher priority should be given to identifying and taking advantage of untapped opportunities for Australian businesses to participate in major projects.

This bill supports the creation and retention of Australian jobs by requiring Australian Industry Participation Plans, or AIP Plans, for major projects which will ensure that Australian businesses have full, fair and reasonable opportunity to win work and provide key goods and services. Under this bill, any domestic project worth $500 million or more must demonstrate how it will provide opportunities to local businesses through an Australian Industry Participation plan. This requirement will effectively unlock the international supply chains used by major projects and provide the opportunity Australian businesses need to demonstrate their capability and professionalism and to win work not just domestically but also all over the world.

The bill also creates a new Australian Industry Participation Authority to administer these changes, as well as related programs to build capability and capacity within local business and to link them with new business opportunities. Through consultations and consideration in the Senate Economics Legislation Committee we know there is strong stakeholder support for the measures included in this bill. Australian industry knows it is the right thing to do. Australian workers know it is the right thing to do. There is one overriding objective in all of this: the Gillard government's strong commitment to supporting and creating Australian jobs. I thank members for their support in passing this bill and I urge our colleagues in the other place to pass this bill into law without delay.

Dick Adams (Lyons, Australian Labor Party) Share this | Link to this | Hansard source

The question is the bill be read a second time.