Nick Champion (Wakefield, Australian Labor Party, Shadow Assistant Minister for Manufacturing and Science) Share this | Link to this | Hansard source

My great fear is that, despite the government's assertions about shipbuilding in South Australia, we are slowly sleepwalking into a shipbuilding skill shortage. Now, the minister, Christopher Pyne, says that 'the valley of death is over'—I'm quoting him here from his press release of 12 October last year:

The valley of death is over and we are now seeing a upturn of employment in naval shipbuilding in our state that will only continue to increase as these new projects gain momentum.

This is despite the most recent announcement that another 90 jobs will go at the government-owned ASC. That is a very concerning thing. Behind all of those redundancy announcements made by ASC—there are something like 1,000 jobs gone in the last few years as a result of this government's decision—and despite Minister Pyne's assertion that employment will be going up and that we are through the valley of death, we find jobs continually shed at ASC.

And these are real people—people like my mate Daniel, who's an electrician who just took a redundancy at ASC. He said to me: 'I knew it was coming. I thought I would take one now.' He is not the first electrician I have known who's taken a redundancy. I know Andy, who also took a redundancy a year before and has been in and out of different employment as an electrician since. Now, behind their very human stories—and they are capable people, so they will do other things—there's a decline in shipbuilding skills in South Australia. This is very, very serious. I have here a graph. This is out of the ANAO report. You can see the graph there. It starts off high and goes down low, and then it's projected to go back up again.

John McVeigh (Groom, Liberal Party) Share this | Link to this | Hansard source

Order!

Nick Champion (Wakefield, Australian Labor Party, Shadow Assistant Minister for Manufacturing and Science) Share this | Link to this | Hansard source

I know you're going to say I can't use props, but it's a very important graph and I'm only illustrating to those who might be watching that they should go and have a look at that report by the Auditor-General and the ANAO, because it makes a number of important points about the government's Naval Shipbuilding Plan.

The plan itself is very important. Presumably I can refer to the Naval Shipbuilding Plan. But on page 64 of that it says 'why it is critical to manage this workforce growth.' It makes the point that one of the things that bedevilled both the air warfare destroys and the Collins-class constructions was not inefficiencies in terms of people not doing their jobs; it was the growth of that workforce and the acquisition of skilled workers. That just doesn't happen overnight, and that's what the report makes clear. That is an economic risk to those projects, and presumably it will be an economic risk to future projects.

Interestingly enough, on page 68 of that report it talks about the rehiring of former naval shipbuilding workers. There's an interesting point in there where it says:

However, the longer these workers are out of shipbuilding jobs, the greater the chance they will find attractive work in another industry or exit the labour force. Mature age workers could potentially fill vital foreman and middle manager roles, or supervise the training of the future generation of naval shipbuilding workers.

It also goes on to talk about recruiting people from the oil and gas industry and from the automotive manufacturing industry. But the government's done absolutely nothing about either of those things, and it's still letting people go at the ASC. This is a critical economic risk to shipbuilding in South Australia. If you don't believe me, have a look at page 29 of the ANAO report:

Has defence determined its workforce requirements?

There is a box that says:

Defence has not determined industry workforce requirements for naval construction programs.

The report goes on to say:

The assumptions of Defence’s current workforce planning activities are not based on a cost-benefit analysis. In particular, whether maintaining the shipbuilding workforce between the Hobart Class Destroyer and follow-on surface-ship builds is the most cost-effective way of establishing the naval shipbuilding enterprise.

Think about that. What that's saying is that this government did not look—did not look!—at the cost of redundancies at ASC or at the cost of dispersing the shipbuilding workforce at ASC versus holding it there and having those workers continue to be employed. They could have trained another generation of shipbuilding workers and they could have trained apprentices. ASC could have been the host employer to build and maintain that shipbuilding workforce. I put to you the cost of making these workers redundant and the cost of those redundancies: the cost of having someone to manage the redundancies, the cost of the redundancy itself, the economic cost to that worker, the cost to the community and then the cost you have to contemplate of going out there to find that electrician, to find that rigger, to find that welder. That's a cost too. So, we're dispersing the workforce, as this graph shows, completely destroying it, running it down to zero, and then we're going to run it back up again—running it down at great cost, running it up at great cost. This is this government's magnificent achievement: the destruction of one workforce and the creation of another, at great economic cost and without a cost-benefit analysis.

What they have done is set up a Naval Shipbuilding College. We will hear all about that, this Naval Shipbuilding College. In the mind's eye, you can imagine people training in rooms and the like. But that's not what this Naval Shipbuilding College does. What it actually does is broker, apparently, between private industry, who have to be the host employers to these apprentices, and all the other providers who are currently there at the moment—providers like PEER, which is the group trainer for electricians in South Australia. Why do we need this middleman? The price of this college has blown out from $25 million to $62 million; the cost has blown out by 2.5 times already—to perform a function that I'm a bit curious about why we need it. Why do we need this $62 million middleman?

Here's the rub. I know employers of welders. I know welding shops who look down the track. They have their own apprentices, they do their own workforce training, they are industrious employers and they are profitable employers. They don't need help from government, truth be known. They can go out there and make a profit without us. But here's the thing. They're terrified that one day soon, when the frigates kick off, we are going to see a wage spiral. This has happened before, whenever there is demand for skilled workers. We know these workers. You can't produce them overnight. It's four years to produce an electrician, plus another year to get them really up to scratch in shipbuilding. These are not the sorts of skills that you can acquire overnight. It's the same thing for a welder and the same thing for a rigger. For white-collar workers it's even worse. For engineers, you do a three-year degree and then it is three years, really, getting your head around shipbuilding. So, these are workers that cannot be produced overnight. We have welding shops in my electorate that are terrified of losing their welders to the shipyards in three or four years time. And they're expected to do this government's job; they're expected to take on extra apprentices, perhaps to get the shipbuilding college to be the broker between them and the group trainers.

This is a ridiculous situation for us to be in: the destruction of one workforce—the redundancies and the pain and suffering that goes with that—and, on the other hand, we face a skill shortage in the shipbuilding industry in South Australia in the future. This is what this government is going to bequeath to us. This is the cost of having three different prime ministers, I've forgotten how many defence ministers, at least two defence industry ministers now and this revolving door through the ministry. This is the cost of it. This is the price that the workers of South Australia will pay, and this is the price that these projects might well pay in the future. And what will the government—the future opposition—say then? They'll say, 'It's all the workers' fault,' just like they've done previously.

Julian Leeser (Berowra, Liberal Party) Share this | Link to this | Hansard source

Today I rise to speak on immigration. Immigration isn't an end in and of itself, but it's a policy tool that we use to build our nation. My friend, the former Prime Minister Tony Abbott, said that Australia is a country with an Indigenous heritage, a British foundation and a multicultural character, and I think he well sums up the nature of the country. Convicts, soldier, administrators, free settlors and all those who came after carved out of the harsh Australian environment the most successful democracy and most successful country on earth. More than seven million people have immigrated to Australia since the Second World War. Migrants have made a huge contribution to this country, one which we should take real pride in celebrating. Each new citizen adds their distinctive story to the broader Australian story.

It's with some considerable pride as a Liberal that I recall that it was the government of Harold Holt, the minister Sir Hubert Opperman and his departmental secretary, Sir Peter Haydon, who dismantled the White Australia policy at a time when the Labor Party was led by Arthur Calwell, whose response was the famous 'Two Wongs don't make a White.' The people who migrate to Australia ultimately help determine what sort of a country Australia will be in the future. Immigrants help fill skill shortages in our economy. They bring new ideas and new ways of doing things. They strengthen Australia's international reach and provide us with connections to markets in other countries. Migration helps broaden the tax base and allows to us pay for the ageing population and the services we need. A larger economy also helps attract and maintain businesses in Australia, giving them access to a larger domestic market.

Deloitte Access Economics estimates that the contribution of the 2014-15 migration cohort alone over 50 years will be in the order of $9.7 billion. With little to lose and so much to gain, migrants bring to our country an entrepreneurial spirit, such that one in three businesses in Australia have been started by migrants and those businesses employ 1.4 million people. We can all think of major success stories, from Sir Frank Lowy, who founded a small deli in Blacktown, with his friend and fellow immigrant John Saunders, which went on to become the global behemoth Westfield, to Shemara Wikramanayake, who at the end of next month will become the new CEO of Macquarie Bank. New migrants have helped us to create new industries. The international education industry was in its infancy over 30 years ago, and yet today education is our third-largest export industry, bringing $30 billion in revenue to Australia every year.

Australia is a nation of immigrants: 49 per cent of us were either born overseas or have one or more parent born overseas. Despite these strengths, immigration as a policy can only succeed while it retains public support. Three things weaken that public support, and I want to talk about them today. The first of those things is when we fail to control our borders. Australia and America are both immigrant societies, but the ethos around immigration is different in both countries. Australia has never been the country of Emma Lazarus, whose famous poem adorns the plinth on which the Statue of Liberty stands:

… Give me your tired, your poor,

Your huddled masses yearning to breathe free,

The wretched refuse of your teeming shore.

Send these, the homeless, tempest-tossed to me …

Part of Australia's success as a country is that we've always been selective about our immigration program. Public support for immigration has been built on the notion that, in John Howard's famous words, 'We will decide who comes to this country and the manner in which they come.' Under Labor, 50,000 people sought to come to Australia in 800 boats, providing a sense that we, as a sovereign nation, had lost control of our own borders, weakening public support not just for the humanitarian intake but for the migration program in general. It took our now Prime Minister, Scott Morrison, and Operation Sovereign Borders to restore border integrity and public confidence in the immigration program so it could be expanded both on a humanitarian and an economic basis.

The second factor that weakens public support for immigration is the question of whether people coming to Australia will fit in. Do they share our values? Can they get along in our society? Have we given them the tools to make a success economically and socially in our country? Unfortunately, there are a million people in this country who have little or no English, and some of them have been here for more than 20 years. This means that such people are socially isolated in our communities, and their opportunities to integrate within society and to join the economy are much more limited than those who have English as a language. This is why our government has repeatedly sought to ensure that new migrants have the best chance of succeeding. I note the work the government has done to bolster English and refocus the Adult Migrant English Program, which this year is celebrating its 70th birthday. We've also strengthened the Australian citizenship test to prioritise integration and Australian values, to ensure people coming here accept the values of our country. Australian citizenship is and has always been a privilege, and should be treated accordingly.

The third major concern in relation to immigration is that it leads to more congested cities. I understand the problem of congested cities. In Sydney, we're still suffering from Bob Carr's appalling period of office as New South Wales Premier, including the time when he said, 'Sydney's full,' and stopped spending any money on infrastructure. Today, our government, working with the New South Wales coalition government, is taking up the infrastructure backlog, which was 16 years in the making. I know people are feeling the pinch and I know these projects can't come on quickly enough, but these projects take time. Not only do we have to build infrastructure of the future, but we're also still catching up on the Carr-Iemma-Rees-Keneally created backlog. Major infrastructure takes many years to come online, from inception to delivery. Some projects take up to 20 years to deliver. The Carr era means that New South Wales is only now starting to move ahead. The population pressures that we feel in our cities are built by Labor's poor planning.

In my own electorate, on bad days it can take more than an hour to travel the six kilometres from Hornsby to Pennant Hills. The appalling state of Pennant Hills Road means that people take rat runs and clog them up too. Bad traffic congestion means people are spending more time in their cars and less time at home with their families. That's why our government is delivering NorthConnex, which will take 5,000 trucks every single day off the worst road in Australia, Pennant Hills Road, bypassing 21 sets of traffic lights and even at the quietest times save drivers up to 15 minutes in their travel. This $3 billion project will transform Berowra and boost the national and New South Wales economies. This project is part of our government's $75 billion infrastructure investment across Australia. I also hear complaints in my area about the New Line Road, and I understand the need for action on this road as well in order for people to travel from the rapidly transforming rural areas in my area, and in neighbouring electorates, to reach major motorways that take them to the CBD, Macquarie Park or south-western Sydney.

The issue of congestion isn't just one for my electorate, but affects all of the city. Today, travelling in peak times in my city takes 65 per cent longer than the same journey does off-peak. Part of the reason for this is the lift in the immigration rate that occurred under Kevin Rudd in his quest to create a bigger Australia. Rudd lifted the total population growth rate from 220,000 to 375,000. In 2002, the Intergenerational report said that Australia would increase its population by 2½ million over the next 15 years. Well 15 years later, the population has actually grown by five million. To solve these congestion issues, we obviously need to think about faster infrastructure construction and a more even distribution of migrants than simply to Sydney and Melbourne, and I applaud Minister Tudge for his recent speech about looking at encouraging people to go to other states and to rural areas.

There are some in our community who call to stop immigration. I think this would have unforeseen consequences in our country. Since coming to government, we've created over a million jobs. Last year, we created over 1,000 jobs every single day. We have an unemployment rate of five per cent. In the old days, they used to describe that as full employment. There are many businesses in my electorate who can't get the skilled worker they're looking for. If we stop migration, then we put the growth of the economy at risk—and that ultimately risks our national prosperity, because these businesses won't be able to expand and do the things that they need to do without the workers that they need to do them. It was the Howard government who first recognised the importance of matching our workforce pipeline, through skilled migration, with new jobs coming online. John Howard's policies led to an historic first. For the first time in history 50 per cent of migrants were skilled migrants. Fast forward to last year's program and about 70 per cent of permanent migrants were in the skilled stream.

One of the reasons we need to have more skilled migrants is Labor's failed education policies. Time and again Labor tinkered with the education system, leading to students graduating from courses with skills and qualifications unrelated to the types of jobs needed to advance this nation. Labor meddled with the vocational education system, allowing dodgy providers to rip off unknowing students. Under Labor's scheme, unethical training providers were able to target the vulnerable or unsuitable, who were signed up to training courses they had no chance of completing. Quite often students had no capacity, yet were offered inducements to complete these courses. Some students didn't even know they were signing up to courses. All of this indicates that we need to have a properly focused migration policy. We need to ensure that we are building public confidence in all three of those aspects. We need to ensure that we are providing the skills for our country's prosperity into the future.