Jason Clare (Blaxland, Australian Labor Party, Shadow Minister for Communications) Share this | Link to this | Hansard source

The Export Finance and Insurance Corporation Amendment (Support for Commonwealth Entities) Bill 2016 proposes to do two things. The first part of the bill expands the functions of the Export Finance and Insurance Corporation, otherwise known as Efic, so that it can provide specialist financial advice to Commonwealth entities and companies. It is currently only allowed to provide these services to the Northern Australia Infrastructure Facility. Legislation to do that was passed last year. The opposition supports this amendment, which will, hopefully, lower government service delivery costs and enable other Commonwealth entities to access Efic's financial expertise.

The second amendment in this bill will allow Efic to provide loans to Australian companies to set up or expand operations overseas. In practical terms, it will allow a company to spend the loan overseas, rather than here in Australia. Currently, Efic is only able to provide guarantees to businesses that want to do this. The bill before us was examined by a Senate committee earlier this year. The committee received a number of submissions supporting this amendment. It is supported by industry groups like the Australian Advanced Manufacturing Council, the Advanced Manufacturing Growth Centre, the Export Council of Australia and the Australian Grape and Wine Authority on the basis that it will help Australian small and medium-sized businesses break into new markets. DFAT's submission also makes the point that this change to Efic's rules has the potential to reduce the administrative costs of funding applications by up to $12,000.

The Senate committee also received a number of submissions expressing some concern about the potential unintended consequences of this legislation. In particular, concern was raised about the potential impact it could have on Australian jobs. The Australia Institute and the Jubilee Australia's Resource Centre, in their joint submission, expressed concern that:

While the change to specifically recognise service exports may be desirable, the current proposed amendment seems to remove any focus on products that are produced in Australia. The effect of this could be the further offshoring of Australian manufacturing.

Their submission concludes that this:

…has the potential to reduce jobs that produce goods and services in Australia.

In addition to potentially offshoring Australian production, this change could move production into jurisdictions with lower environmental and labour standards. This reduces transparency and standards in supply chains.

The ACTU raised similar concerns in their submission to the inquiry. On page 3 of their submission, they say:

It is in the national interest that companies which receive government loans are required to use that money in a way which benefits Australian employment. The removal of these provisions will be yet another blow to the Australian manufacturing and services sectors. It could potentially lead to jobs being offshored.

The opposition supports what the government is trying to do with this bill. Australian businesses should be encouraged to become exporters and to look for opportunities overseas, but we also agree that we should avoid doing anything in this legislation that could lead to job losses in Australia.

To make sure that this does not happen, we are proposing to move three amendments to this bill when it is debated in the Senate. The first of those amendments will be to introduce an Australian jobs test. This test will require Efic to be satisfied before approval of a loan or a guarantee that would be spent overseas that the investment would lead to jobs growth in Australia. Efic already has a test that it applies. It is a test of no net job losses in Australia for all of the loans which are spent in Australia. We believe that there should be a higher standard for loans to companies when they want to spend those funds overseas.

The second amendment we will move will prevent companies from using a loan or a guarantee from Efic to, effectively, offshore Australian jobs. It will prevent a company from using a loan or a guarantee from Efic to set up something overseas that would, effectively, replace what the company currently does in Australia or what they contract another company in Australia to do for them. Let me give you a very practical example of what I mean and what this amendment is intended to ensure does not occur. A company uses an Efic loan to set up a call centre overseas and then shuts its call centre that does the same thing here in Australia. We do not think that taxpayers' money should be used to facilitate that. All that would be doing would be providing taxpayers money to offshore what are currently Australian jobs. I do not think anyone in this chamber or anyone listening to this debate would think that that is a good idea. I am sure it is not what the government is intending would happen with this legislation. This amendment would help to ensure that does not happen. Companies can use their own funds or they could get a loan from the bank if they want to offshore work that they currently do here in Australia—and they do do that, sometimes quite controversially. But our point is: taxpayers money should not be used to do that.

The third amendment that we will propose in the Senate deals with a situation that was highlighted in the media a few weeks ago. On 20 May, there was a story in The Guardian that said that Efic was considering a multi-million dollar loan to a company called Resource Generation Ltd—Resgen—to develop a coalmine in South Africa. The company is based in South Africa but is listed on the Australian stock exchange. It has no mining activities here in Australia. The coalmine that they are developing in South Africa is quite large. They have approval to extract 32 million tonnes of coal a year. It is the sort of project which could have an impact on the Australia coal industry. We asked some questions about this in estimates a couple of weeks ago and we were advised by Efic that they were not currently considering providing finance to this project but that it could currently be financed under their act.

It is correct to say that Efic can fund overseas resource projects, and they have done so in the past, under both coalition governments and Labor governments, but it is hard to see how this project could comply with the current part 1(3) of the Efic Act. This includes a requirement that loans can only be provided to companies for:

… any services in or in connection with the supply, installation, erection, operation, maintenance or repair of goods produced or manufactured wholly or substantially in Australia and exported from Australia …

The bill we are debating here today would remove that section of the act and therefore allow the whole loan to be spent overseas, making the financing of a project like this easier. In principle, we do not think it is a good use of taxpayers' money to give a company a loan that is spent overseas, to set up anything from a mine to a factory to any other business, if that is going to severely damage other businesses here in Australia and lead to the loss of jobs in Australia. It is not certain that a project like this would, but, in principle, we do not think it is a good idea to provide a loan to a company that is spent overseas that would severely damage other businesses here in Australia and lead to the loss of Australian jobs.

We are not opposed to what the government is trying to do with this bill, but, when an Efic loan is spent wholly overseas rather than here in Australia, we think a higher standard needs to apply. That is why we have proposed the Australian jobs test—our first amendment—that says that, when a company is getting a loan that is spent overseas, Efic needs to be satisfied that it will also create jobs here in Australia. That is why we have also proposed a second amendment, to prevent a loan like this facilitating the offshoring of work that is currently done here in Australia. And that is why we will also propose a third amendment in the Senate that would require Efic, when it provides a loan to a company that is going to be spent overseas, to be satisfied that the loan is not going to damage other businesses here in Australia and lead to job losses here at home.

The opposition supports efforts for businesses to expand overseas and enter new markets. We believe our amendments will help strengthen this bill and put Australian jobs first. I have been consulting with the minister about our amendments, and my office has been working with the minister's office. I think that consultation, that work, has been very constructive to date, and I thank him for his assistance with that consultation. Let me state on the record that I am happy to work with him and with Efic on our amendments over the winter break before they are considered by the Senate. The purpose of our proposed amendments is simple. We want to avoid any unintended consequences that come with this change to Efic's rules, and we want to make sure it creates more jobs here in Australia, not less—a very, very simple principle that I hope all members of the House and all members of the Senate can agree with. I look forward to those negotiations with the government in the coming weeks.

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

I rise to speak on the Export Finance and Insurance Corporation Amendment (Support for Commonwealth Entities) Bill 2016. This bill deals Efic, the Export Finance and Insurance Corporation. I can personally attest to the very good work that Efic do and the very important role that they play in our economy for small business. Before I came to this parliament, I worked as an export manager for my family's firm. My job was to travel overseas and put together bids for tenders for contracts. We were a small Australian company located in Chipping Norton, and we were competing against very large companies in the USA, Europe and the UK that were backed by public company finance. Often, putting together a specific package to supply goods or services—it was goods in our case—into a foreign market requires substantial finance.

Many small exporters face exactly the same circumstance we did back then. Having Efic in the marketplace enables a company to go to Efic and say: 'Hey, guess what: I have this export contract here to supply overseas. If I'm able to supply it I can create jobs in Australia. I can create real wealth for the country. The employees I employ will pay taxes. The money they will spend will help the local community. But I need some assistance to finance it to get the materials I need to produce those goods in my factory.' There are many circumstances where a bank would say they need extra equity, extra finance or extra security to be able to loan that money. But having Efic in the marketplace basically gives an option of lenders of last resort, for want of better words. Deputy Speaker, the mere fact that you are able to go to Efic because Efic exists enables your bank to give greater consideration to your application for that loan. In the past, the way it was structured was that Efic would provide a guarantee to your bank, and your bank would then be able to loan you the funds for you to get the materials you needed and to incur all the expenses you needed to fulfil that export contract. What we are now changing with this bill enables Efic to actually loan directly to that small business.

The other thing the Export Finance and Insurance Corporation does is enable you to insure the risk of non-payment. That is a real risk. My company was supplying places in Lebanon, Kuwait, Saudi Arabia and Jordan. Of course, the preference would always be to get a letter of credit, but a letter of credit is only as good as the bank that would issue it. In the Middle East there was always the risk on non-payment. But, Deputy Speaker, having Efic there gives you the ability to say: 'I'm prepared to take that contract, though there is a certain risk that I might not get paid.' Then you would price that risk into your pricing structure, quotation or tender and you were able to insure against this risk. This is a very important facility. It was important in the past and it will be even more important in the years to come.

If our country is to progress and if we are to continue—when I say 'we' I talk about the private sector economy—to create jobs, we must always remember that it is not government that creates jobs but the private sector. Those jobs come about by the production of goods and those companies having greater demand for their goods. If we are to continue to grow the economy like we need to, we need to get Australian businesses to be thinking about export markets as much as we possibly can. More than 98 per cent of the world's economy lies beyond our shores. It is important for the future prosperity of this nation that we have businesses considering what they can do to export their goods and services and have an important facility like Efic to back them up.

To do that, we must make sure we give Australian businesses at least a level playing field to compete on. If we expect Australian businesses to go and fight in international marketplaces and to win contracts, the very least we can do is give them some type of competitive level playing field. Some of the great risks we face are the policies we see from the other side of the chamber—from the Labor Party—that are simply putting Australian businesses at a competitive disadvantage and tilting the playing field in favour of foreign companies. Here are a few example: firstly, the rate of corporate tax Australian businesses must pay. We have seen over the years Paul Keating, very wisely, reduce the rate of company tax.

Tim Wilson (Goldstein, Liberal Party) Share this | Link to this | Hansard source

Hear, hear!

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

Correct. Hear, hear! And we give Paul Keating a 'Hear, hear!' for his understanding that if you lower the rate of corporate tax you encourage investment, you attract foreign capital, you grow the economy and, at the end of the day, government gets more resources and not less. Paul Keating understood that. Peter Costello understood that. The current treasurer, the member for Cook my good friend, Scott Morrison, understands that. In fact, I would say every member of the coalition understands that. If you can get that rate of corporate tax down it does not cost the economy money. It is not a giveaway to big business. It actually creates jobs, grows the economy and, ultimately, provides more resources for government to pay for—our schools, our hospitals, our roads, our kids with disabilities, our aged care—all the things that all of us want to see more resources put into. That is what we get.

The real threat to that is that Australian companies are paying 30 per cent currently—and we are reducing that; we have reduced that to 28½ per cent for very small businesses with turnover, not profit, of $2 million, which in many cases can be a single-man operation. A sole trader working under a company structure can have $2 million turnover. We have been able to bring that back to 28½ per cent, but we have the other side threatening to increase the rate of corporate tax for all companies back to 30 per cent. How are we expecting our Australian companies to compete on a level playing field if they are competing against a company from the UK that has a corporate tax rate of 20 per cent? How are we going to expect our Australian companies to compete against businesses from the United State if President Trump sticks with his promise and reduces the US corporate tax rate to 15 per cent? They are hamstrung. We are tying their hands and we are putting lead in the saddles of Australian companies, the very people that we expect to go out there in the international marketplace and win business for this nation.

Kevin Hogan (Page, National Party) Share this | Link to this | Hansard source

A point of order, Member for Shortland?

Pat Conroy (Shortland, Australian Labor Party) Share this | Link to this | Hansard source

The point of order is on relevance. There is no second reading amendment to this bill. This is about two narrow amendments to Efic.

Kevin Hogan (Page, National Party) Share this | Link to this | Hansard source

The member will be seated. The member for Hughes is in order.

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

It is quite disappointing to get that interjection from the member for Charlton. This is a debate on the Export Finance and Insurance Corporation Amendment (Support for Commonwealth Entities) Bill 2016 and the amendments to it. It is clear from the interjection by the member for Charlton that he has no understanding whatsoever of what is involved in the Export Finance and Insurance Corporation—what they do, their practices and their importance to the economy. To think that what I was talking about was not relevant shows the member for Charlton has no idea whatsoever what the Export Finance and Insurance Corporation do or their importance to the economy.

Sarah Henderson (Corangamite, Liberal Party) Share this | Link to this | Hansard source

The member for Shortland.

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

Yes, the member for Shortland. What I am talking about is the importance of the Export Finance and Insurance Corporation Act and why this is an important bill to give our businesses a fighting chance in international markets, something the Labor Party clearly do not have a clue about. What they do not understand is that if we are putting our businesses at a competitive advantage, it does not matter what we do as far as the Export Finance and Insurance Corporation goes. They will not have a fighting chance if we put them at a competitive disadvantage.

One of the main things is that rate of corporate tax. I know what it is like because, before I came to this place, I had to compete and put in tenders against American companies and companies from Europe and the UK. I tell you what, Deputy Speaker, luckily back then we had a similar rate of corporate tax, or Australia had a competitive advantage, because of men like Paul Keating and because of men like Peter Costello, who understood we had to have an internationally competitive rate of corporate rate. And, of course, the member for Cook understands that, as does the Prime Minister and everyone who sits on this side of the House. We understand the importance. I would hate to be a small business in the years to come that has to go out to those international marketplaces and put together a tender to produce goods in Australia, knowing that I was burdened by a 30 per cent corporate tax rate because of the Labor Party, yet I am competing against American companies that have a 15 per cent corporate tax rate or companies in the UK that have a 20 per cent corporate tax rate. How are we going to expect our businesses to get out there and win those international contracts?

The other area where this legislation, as good as it is, may come to nothing is with the cost of energy in this country. We can have all the policies that we want on building more wind turbines and subsidising solar panels but, at the end of the day, the cost of energy in this nation has to be internationally competitive if our exporters are to stand a fighting chance. The Labor Party wants to put lead in the saddles of our exporters. Over a decade ago, the cost of energy for Australian exporters in this country gave us a competitive advantage. That was what enabled Australians to get onto that international playing field and have the competitive advantage, knowing the cost of energy to produce goods in Australia was less than for our foreign competitors. But we surrendered that competitive advantage.

Already we see the cost of energy for business and consumers in this country double that of what it is in the United States. How do we expect our export industry to go and fight in international marketplaces with goods it has produced here in Australia if the electricity is double that for those same goods produced in the USA? Yet, we see the Labor Party not even recognising this is a problem, but wanting to make it worse by creating uncertainty in the marketplace with their claims for a 50 per cent renewable energy target. They want to put more unreliable, high-cost, intermittent power into the grid, force it into the grid and force it on those exporters, the very people that we rely on to create the wealth in this country. The Labor Party wants to handicap them. This is what we face. We need to get real in this parliament.

The world is a very, very competitive place. We have to do everything we can to at least give our exporters and our potential exporters a level playing field to compete on. This bill is important. It helps level that playing field. I would call on members of the opposition to have a rethink about all their policies that are putting Australian business at a competitive disadvantage.

Pat Conroy (Shortland, Australian Labor Party) Share this | Link to this | Hansard source

Unlike the previous speaker, the member for Hughes, I will actually talk about the bill we are debating in this place rather than delivering the fifth repeat of the speech he has given on five bills in the last few days. I think I could do a good impersonation of it; I have heard it enough. Unfortunately, the facts still do not support the member for Hughes's case—but I digress. It is my genuine pleasure to come to that dispatch box and talk about the Export Finance and Insurance Corporation Amendment (Support for Commonwealth Entities) Bill 2016. This legislation has two separate amendments that go to two separate issues. The first one is around empowering the Export Finance and Insurance Corporation, Efic, to provide its expertise to other organisations. It already provides its expertise to NAIF, and NAIF well and truly needs its expertise given the conflict of interest many of its directors have already. It will allow NAIF to provide that expertise to other agencies, and that is a good thing. Labor supports that, and I applaud the government for bringing the amendment to the parliament.

The second amendment is trickier. The second amendment allows Efic to provide loans to Australian companies to set up or expand operations overseas. Before I go into that specific debate I want to take a step back and talk about the noble work of the Export Finance and Insurance Corporation. It does good work in providing guarantees to Australian companies and providing loans, often concessional loans, to Australian companies that are trying to export overseas. When it was originally set up it was mainly aimed at manufacturers, and that is where it is currently predominantly being used. It has done some great work under governments of both persuasions.

I had a close connection with Efic when the last Labor government used an Efic facility to drive Australian content into the joint strike fighter, one of the largest procurements in the defence arena, not just in Australia but across the entire world. The Labor government established an Efic facility to drive Australians into the supply chain of the joint strike fighter through the primes, such as Lockheed Martin, BAE and Northrop Grumman. That is great. That is a classic example of how Efic works.

This amendment effectively allows Efic to provide loans to Australian companies to set up or expand operations overseas that do not lead to any local content in Australia. The minister used the examples of an Australian company setting up a call centre in the Philippines and an Australian fashion designer setting up a manufacturing facility in China. Both of those examples are two-edged swords to some extent. On the one hand, it may increase the viability of that business and mean that the fashion designer can keep producing great designs in Australia and add to the sustainability of their product and, in the call centre example, it may mean that that Australian company provides greater customer service and can expand in this country, but the concern of the Labor Party is, and has to be if we are going to honour the noble cause of the Labor Party, the impact of this amendment on Australian jobs.

I join the shadow minister for trade in his belief that the government does not intend for this to be the outcome. I could be generous in that assumption, but I do not think that it intends to have this loan facility enable Australian jobs to be offshored. But there is a danger in that because the only test that will be applied, in terms of the economic impact on Australia, is no net job losses. That sounds fine and dandy and that sounds like it means that there will not be job losses, but let me give you a scenario of where a truck could be driven through that hole.

If a company, Bank X, has two separate expansion plans and they access an Efic loan to set up a call centre in the Philippines, which is actually transferring a call centre that currently exists in Australia, they could satisfy the no net job losses by having another economic activity being established at that time or expanded at that time that produces roughly a similar amount of jobs. They could get an Efic loan to offshore Australian jobs as long as they were starting or expanding another economic activity at the same time. They would potentially satisfy that test, but we would have Australian taxpayer resources being used to offshore Australian jobs.

That is why the Australian Labor Party, the opposition, has a concern about the potential unintended consequences of the second amendment, especially when you look at the definition of 'Australian export trade'. 'Australian export trade', to qualify for the soft loan in these purposes, is defined as 'any transaction involving a benefit flowing directly or indirectly from overseas to a person carrying on a business or other activities in Australia'. So something as obscure as an indirect benefit to an Australian entity is enough to qualify for a loan. That is, I would submit, quite wishy-washy, and that is why the opposition is proposing three direct amendments that improve the bill, which on the whole is trying to add to the operational effectiveness of Efic.

The first one is around an Australian jobs test. The Australian jobs test that we would submit—and we will move an amendment along these lines in the Senate—is that the investment must lead to jobs growth in Australia. It cannot just result in no job losses; it must actually increase the number of jobs in this country. That is incredibly important. When I go back to my electorate of Shortland in the Lake Macquarie region on the Central Coast and I talk to people on low incomes who pay tax, they say to me that they do not mind paying tax as long as the money is used appropriately and effectively to advance our national interest.

Tim Wilson (Goldstein, Liberal Party) Share this | Link to this | Hansard source

That is why they vote Liberal.

Pat Conroy (Shortland, Australian Labor Party) Share this | Link to this | Hansard source

They do not vote Liberal in my area, mate. I do not think you would fit into Windale in my area, member for Goldstein, but I would love you to go up there and see what Australians are really facing. This is really important.

Tim Wilson (Goldstein, Liberal Party) Share this | Link to this | Hansard source

I would love to come up. I don’t like the snobbery coming from the other side.

Pat Conroy (Shortland, Australian Labor Party) Share this | Link to this | Hansard source

The snobbery is on your side, mate. I represent real Australia, not the wealthy parts of the country. The Australian jobs test means that taxpayers' money will only be used if the entity and Efic can demonstrate that it will increase the number of jobs in Australia. To me, that is a commonsense amendment that would improve the bill.

The second amendment goes to preventing companies using a loan to offshore Australian jobs, so that they cannot use a loan to replace what they currently do here or contract a third party to do here. That is very important in the example I highlighted earlier. Bank X cannot use an Efic loan to outsource a call centre that they have already established in this country and, importantly, given the complex web that corporations often use in terms of structuring businesses, they cannot use an Efic loan to offshore work they currently subcontract to an Australian based activity. That is very important, and, again, I would submit that is common sense.

The third amendment goes to dealing with a case that we saw recently: a South African coalmine, where Efic were actively considering providing a very generous loan to Resgen, a South African based coalmining company, to set up a coalmine in South Africa which would be the very significant size of Adani's Carmichael coalmine. To me, it is incredible that we would be considering using taxpayers' money to establish a mine in South Africa with some very vague assurances that some Australian mining supplier might benefit by supplying a bit of equipment to the mine at a time when global coal consumption is declining. So we have global coal consumption declining, we have Australian coal exports under pressure and the Australian government will be actively considering financing a direct competitor in South Africa. That is a huge concern. I am relieved that at estimates a few weeks ago, Efic stated that they would not be going ahead with that proposal. Hopefully they maintain that commitment and do not go ahead with that proposal. Our third amendment would prevent that. Our third amendment would prohibit Efic from providing a loan to an overseas based activity unless they can demonstrate that there will be no negative commercial impact to an Australian based activity. That is incredibly important.

Let me summarise. Labor's amendments are threefold. Firstly, it must grow jobs in Australia. Secondly, it must prevent a company offshoring existing Australian operations through the loan. And, thirdly, it must not lead to the establishment of an overseas based activity that will compete with an Australian inactivity. That is only fair and reasonable. This is not saying to Australian companies, 'You can't do any of those things.' They are in their rights to offshore jobs. We will object at times, as will other political parties in this place—no-one likes to see Australian jobs going offshore—but companies do have a right to establish operations around the globe, and good luck to them, but they should not be using taxpayers resources to do that. They should not be using taxpayers' resources to offshore jobs or set up activities overseas in direct competition with Australian operations.

That is the essence of Labor's amendments. They go to the nub of some of the concerns we have seen in some of the submissions to the Senate inquiry, particularly the submissions from the Australia Institute, the Australian Fair Trade Investment Network and the Australian Council of Trade Unions. It is really important to return to the true goal of Efic, which is to advance Australian commercial interests overseas. We have moved a long way from that—being purely related to Australian manufactured goods. I would like them to keep concentrating on that activity because Australian manufacturing needs all the help that it can get. I would urge Efic to keep concentrating on promoting Australian manufactured goods overseas, but we need to recognise that services are, increasingly, a dominant part of our economy. We need to make sure that we can assist Australian service operations to expand overseas, as long as it is not at the expense of existing operations in Australia.

I am going to use the time remaining to refute some of the ridiculous claims from the member for Hughes, since the Deputy Speaker is allowing a free-flowing debate—in his wisdom. Let me place on the record again that the member for Hughes occupies a parallel dimension where black is white and right is wrong. He keeps talking about expensive electricity in this country. He is absolutely right—wholesale energy prices—

Government members interjecting—

No. He is right on one thing. Even a broken clock is right twice a day, and this is one of your two, member for Hughes. He is absolutely right that wholesale energy prices have doubled in the last four years under his government. And why have they doubled? According to the Australian Energy Council—so the generators themselves, not the Labor Party or some mad conservation group—have identified the single most important driver of the doubling of wholesale energy prices. And it is uncertainty around climate change and energy policy. They have said that that uncertainty is equivalent to a $50 megawatt charge increase. So wholesale energy prices have increased from $60 a megawatt hour to about $130 a megawatt hour. Fifty dollars of that $60 to $70 increase is because of policy uncertainty, driven by the fossils in the Liberal party room, including the member for Hughes. It has been driven by the real minister for climate change and energy, the honourable member for Hughes. So that is the first issue that I have to rebut—what is driving wholesale energy prices.

Secondly, what is the salvation? We need more investment in the electricity sector. But I have news for the member for Hughes and all the dinosaurs in the Liberal party room. Unfortunately, it will not be coal-fired power stations unless they are massively subsidised. That is because of not environmental policies but base economics. The cost of building a brand-new coal-fired power station in this country is around $130 to $150 a megawatt hour. The cost of new renewables—

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

With storage.

Pat Conroy (Shortland, Australian Labor Party) Share this | Link to this | Hansard source

I am going to get to that, Sunshine.

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

And how much storage?

Pat Conroy (Shortland, Australian Labor Party) Share this | Link to this | Hansard source

ARENA, a government agency, estimates that you add $20 for adequate storage—$20 a megawatt for storage. So new wind power with adequate storage, according to the government's own figures, is $75 a megawatt hour. That is half the cost of new coal-fired power. Yet again it shows that the member for Hughes occupies a parallel dimension and needs to come back to reality if he is going to be part of a serious economic debate in this country.

In summary: let's get on with the job of reforming Efic so that we can support Australian businesses.

Tim Wilson (Goldstein, Liberal Party) Share this | Link to this | Hansard source

I rise to support this bill, the Export Finance and Insurance Corporation Amendment (Support for Commonwealth Entities) Bill 2016, and to support its objectives. As we have heard already from some of the other speakers, the Australian economy has been in transition. It is not a recent thing; it has been going on for a long period of time. Efic has played a very important part of helping Australian businesses grow their opportunities for creating jobs for every Australian and for improving and increasing the wealth of this country. For that, I think we have to be very thankful for the enduring contribution that every Australian business makes in employing people and employing the people in business who can grow the economy.

I want to start by saying that I do find the comments that were made by the previous speaker, the member for Shortland, quite offensive. The idea, he kept insisting, that he represented real Australians—and he made the allegation against the people of Goldstein that they are not—is just objectionable. Not only is it a patronising attitude towards other Australians, regardless of their circumstances, but the idea that people who are industrious, take responsibility for themselves, work hard and contribute to build the wealth of this country are not real Australians is outrageous. But that is, tragically, why the people of Goldstein, since Federation, have never voted for a representative from the Australian Labor Party, because there is no fundamental appreciation for the effort, work and responsibility that the people of Goldstein bring. They are the people who are industrious.

One of the things about our Goldstein community is that it actually has very little industry, but that does not mean that we are not deeply industrious people. We are entrepreneurial and take advantage of important measures, like Efic, that are there to support industry—traditionally manufacturing—to grow its export markets into the global economy but also, increasingly, in the services sector, which has been an important part of small business and entrepreneurs. That is why we support this piece of legislation: to broaden the opportunity that Efic can provide, to reflect the changing nature of the Australian economy and particularly to work with smaller businesses to make them medium businesses and larger businesses to travel them through their journey of growth so that they can continue to access finance to support their exports into the global economy.

Efic has always had a very important role as part of that discussion in building the future of this country since it has operated. The legislation has some minor amendments in comparison to the earlier versions, particularly around ensuring a shift away from just manufacturing towards eligible export transactions, particularly because then it will focus on services. It also has in it entrenching legislation of what is already Efic policy to include protection against job outsourcing, when Efic finances offshore investments by Australian firms. There will also be a requirement for Efic to charge fees when providing services to the northern Australia infrastructure fund or other government entities.

All of these things are very important. All of them make an enormous contribution to continuing to grow the Australian economy and to create opportunities. But one of the things I think is disturbing about what is being put forward by the opposition—and the previous speaker spoke about how they are seeking to move amendments in the Senate—is that it is simply for the purpose of virtue signalling. There is no substance. The scare campaign they are running around this piece of legislation is nothing short of absurd, but this is what happens when you have a political party that is irrelevant. They are still fighting like they won the last election, even though that is not the case. And what they seek to do, continuously, is find opportunities to drive wedges between the government, which is seeking to deliver for the Australian people, and all Australian people. What we see today is the driving of wedges by the Australian Labor Party, because they think it will achieve some sort of advantage.

I will say about the previous speaker that I very strongly welcome the reflection and focus on jobs, because their general objective since or during the election campaign has been to mock. The modern Labor Party mocks the objective of creating jobs and growth for the Australian economy. We are the only political party that seeks to represent all Australians and create opportunities for all Australians. We want to make sure that we do not engage in the class snobbery that we had from the previous speaker, who mocked people in communities who try to make this country a better place.

One of the things I also want to follow on from is the earlier comments by the member for Hughes. The member for Hughes showed how much he understands about what is necessary to create the opportunity so that people are able to be in a position to access Efic finance, to create the jobs and opportunities for Australians into the future. This measure is important, but it must sit as part of a suite of measures that reforms and contributes to the growing of the Australian economy.

We know full well that tax reform is a very important part of building this nation's future, where you have international competitiveness with not just capital but also labour. If people in a business and Australians want to compete on the global stage, Australians and their government need to back them. It cannot penalise them by making it even more difficult in a competitive global environment for them to secure employment, reward their labour and effort, and attract the investment needed to grow businesses in this nation. That is the point the member for Hughes was touching on.

We have a globally competitive tax environment for capital. It is only going to become more competitive over time. This is something that has been completed missed by the members opposite and many senators, and the cost of ignoring that important proposition is that it will harm the opportunity for job growth in this country. It will harm the very people they claim they represent and are standing up for.

If you want to create greater economic opportunities for all Australians, it has to be built on the fundamental structure of understanding that working people will put their endeavours where they can secure the best gains and invest their capital where they can secure the best gains. The opportunities for Australia to export goods and services to the world will come when we back them by minimising the regulation burdens and the tax burdens to build this country's future.

Kevin Hogan (Page, National Party) Share this | Link to this | Hansard source

Order! The debate is interrupted in accordance with standing order 43. The debate may be resumed at a later hour. The member for Goldstein will be given an opportunity at that time to finish his contribution.