Terry Young (Longman, Liberal National Party) Share this | Link to this | Hansard source

In the time that I have this evening, I would like to make some remarks about the need to grow our manufacturing sector in Australia. I believe that, as a nation, we have navigated the COVID-19 crisis to date as well as any other country in the world. However, this situation has shone the light on issues that we, as a country, need to deal with. Though these are the same issues that many Australians understood before the virus hit, the COVID-19 situation has highlighted the importance of addressing these matters as we move forward.

One of the issues we need to prioritise is the lack of manufacturing in this country. Growing our manufacturing industries is a key priority of the Morrison government. Just last week, the government launched a new ad campaign to promote Australian-made, reminding Australian consumers of the value of buying home-grown products. This new campaign comes after the government invested $5 million earlier this year to expand the reach of the Australia-made logo. Our Manufacturing Modernisation Fund is now supporting around 200 projects around Australia worth approximately $215 million, with $48.3 million of federal investment. It is expected to create more than 2,600 jobs around Australia. Businesses are being backed to improve technologies and operations, upgrade equipment and upskill workers to boost competitiveness. Our $100 million Advanced Manufacturing Growth Fund is helping industries to fund advanced manufacturing techniques, allowing business to build long-term, sustainable growth.

Manufacturing provides jobs for almost one in 10 Australian workers, with more than 900,000 people employed in our manufacturing sector, the seventh-largest employment industry in Australia. Because of the value manufacturing provides for our Australian economy and the potential for employment, we need to focus on fixing some of the barriers the sector faces.

In my electorate of Longman, I've spoken to the small number of manufacturers we have left and the main common issue they all face is that they simply cannot compete with overseas companies on a financial level given our higher manufacturing costs. We must address this because Australia has always been able to compete on a quality level. We are well-known for producing some of the finest-quality goods in the world. The problem we face is the rising cost of living, which means people simply cannot afford to pay the higher prices that Australian-made goods often command. Before COVID-19, Australians were already grappling with the cost of living and COVID-19 has made this challenge even harder, but, if our nation is to survive and, indeed, thrive for future generations, we must give our Australian businesses a fair go.

There has been renewed community support for Australian products with a four-fold increase in applications and a doubling of new licences for the Australia-made logo. Now is the time to rally together and back our Australian manufacturers and the businesses in their supply chains. This means a renewed focus on addressing systemic issues and major barriers to Australian manufacturing. One major barrier that manufacturers face is the cost of energy. The government has recently taken steps to reduce the cost of energy and boost the development of new technologies. Through the recently released national Technology Investment Roadmap, the government is driving investment in low-emission technologies to strengthen our economy, create new jobs and support businesses. Australia has also secured gas supply out to 2023 and we've seen a drop in wholesale gas prices, which is great news for the manufacturing sector. The government's measures, which include the Australian Domestic Gas Security Mechanism and heads of agreement with LNG exporters, continue to be effective in boosting domestic gas supply and easing market pressures. Australia's gas and broader resources sectors have an increasingly important role to play in providing affordable and secure energy supply for our manufacturing sector.

We know that, since 2015, electricity generation in Australia from renewable sources has increased 54 per cent, with gas-fired generation growing six per cent from 2018 to 2019. I have had the pleasure of meeting with several alternative energy companies who will be able to complement the existing power-generating infrastructure we have with more inexpensive, environmentally-friendly options for commercial and industrial estates. We need to continue to take decisive action to develop technologies and secure affordable energy supply for Australian businesses, particularly when it comes to getting the state governments to play their part.

Another issue for businesses is keeping overheads and wage costs down. We want Australians to be employed and earning more, but, when I hear about Australian businesses that develop products locally and then go and produce them overseas where labour is cheaper, I think there must be a better way. What is the point of having the best conditions for workers in particular industries if the industry ceases to exist because the business can't afford to pay its workers? We must look at ways of reducing overall wage costs to businesses by greater efficiencies with high-tech automation and high-skilled workers, as well as potential changes to industrial relations practices that abolish high-cost, draconian stumbling blocks which cost businesses money and which were designed for a pre-2000 workplace rather than a 24/7 post-2000 globally competitive market, and replacing them with aspirational employee share schemes, where employees share in the profits of the business they work for. I would love to see more workers prosper when a business prospers.

Another suggestion is to have a different award for regional areas where the cost of housing and land is lower. This would also have the added benefit of decentralising and easing congestion in the major centres and bringing much-needed population growth and more economic prosperity to the regional areas. Why couldn't a resurrected Holden factory be located in Maryborough, the Kelvinator factory be located in Orange, or the KingGee factory be pumping out Aussie-made work wear in Mildura? Surely this must be better than a factory being set up in another country and employing no Australian workers.

We also know that overseas labour across various industries can often mean slavery practices. Australia has world-leading modern slavery laws that seek to stamp out illegal labour practices. We need to be creating jobs for Australians in Australia, where we know not only that we are buying a quality product but also that we are supporting fair and legal work practices. Our manufacturing exports are worth close to $55 billion in 2019, up nine per cent on 2018. We need to keep this trend going. The value of our manufacturing exports has also grown over the past decade to more than $120 billion in the last financial year. We know that exports are a big part of the equation to grow our manufacturing industries and create new jobs, particularly in small and medium businesses.

Government procurement is another barrier we need to overcome. The federal government changed procurement guidelines in 2017 for contracts worth over $4 million to ensure that officials examine and understand the wider benefit offered by alternative providers. We can improve access and platforms for local businesses to boost local procurement, especially given that more and more Australians are focusing on supporting their local community businesses during these challenging times. Manufacturing consists of many businesses and skilled jobs throughout the supply chain. We need to improve our local, state and national collaboration so that more and more Australian businesses get a chance.

We also need to ensure that the bureaucrats are briefed correctly before approving grants. A classic example of bureaucrat lunacy was shared with me by a local manufacturer of mower parts. This manufacturer proudly employs 116 full-time Australian workers. By his own admission he could move his factory offshore and manufacture goods at a much lower rate and increase his net profits, but he continues here out of patriotism and the enjoyment of employing fellow Australians. Someone decided to go into competition against him and applied for a grant to set up in competition to him. They duly received a grant to the tune of $380,000. They then used the funds to set up their factory in China to compete with this proud Australian business and, worse still, set their head office up in Singapore, which coincidentally has lower company tax rates. If they did this on their own dime, I wouldn't mind so much, but surely Australian taxpayers' money being used to fund businesses that compete against Australian businesses, employ overseas workers in overseas countries and pay less taxes overseas has got to be straight-out mental.

Lastly, we must look at the amount of red tape involved in running an efficient manufacturing business. There are simply too many levels of government, all with their hand out for a piece of the pie, cutting into profits and adding redundant layers of compliance and regulation. Manufacturing Australia has stated that a factory can be proposed, approved, built and operational in the United States in less time than it takes to jump through the very first approval hurdle in Australia. This isn't good enough. We must release the restraints on our manufacturing sector to make businesses more competitive. They should be competing on value, not cost. Making our Australian businesses more competitive and agile will strengthen our economic sovereignty and ensure greater efficiency.

We also need more national pride. Our approach isn't about nationalising the industry, as we are an open trading nation so that Australian manufacturers can access bigger markets, but we do need to shore up domestic capabilities and supply. We do this well in agriculture, resources and wine, but we need to do better in other industries such as the car and fashion industries. As a retailer of electrical appliances for over 20 years, I can say that in the 1980s it mattered to many people that the products they bought were made in this country. Sadly, when I exited that industry in the mid-2000s, very few asked or cared whether what they bought was made here. I would beseech all members of the public to seek out and, where possible, buy goods that were made and/or grown by Australian companies in Australia. This single act will help more than all the other strategies combined.

I can remember in the 1970s being driven by my dad in an EH Holden, coming home dressed in Stubbies shorts, washed in a Malleys washer and ironed with a Sunbeam iron, to mow the lawn with a Victa mower and then watch an AWA TV, drinking Caboolture milk and eating Arnott's biscuits while we cooked out on a Chef stove and a Sunbeam frypan with food that came from a Kelvinator fridge—all made in this great country. We need to get back to this.