Annette Hurley (SA, Australian Labor Party) Share this | Hansard source

It gives me great pleasure to respond to the Governor-General’s speech in the address-in-reply debate, the first that I have taken part in where there is a Labor government in office. It was the focus in the speech on the future that particularly struck me. There was a focus on the future in both a social dimension and an economic dimension. I am very pleased that we now have a government which is looking to the future and which does in fact have a plan, and a plan on two fronts: to prepare for the future growth of Australia and to prepare for any future shocks to Australia’s economy. This mirrors a lot of what was done by the previous Labor governments under Hawke and Keating, where necessary restructuring and modernisation of the country took place in order to prepare the country for the future.

There were of course a number of social platforms in the speech, but today I specifically want to address some of the economic initiatives that it covered. I want to reiterate that they prepare us for future growth in Australia through innovation, productivity, research and development, and also prepare us for any future shocks to the economy, one of which we are only just beginning to feel, I suspect—that of inflation. But currently we are also feeling tremors through the world’s financial markets and it is difficult, I think, at this stage to tell how far those tremors will go.

In talking about the economy, I want to focus on the manufacturing sector, because it is of great importance to my state of South Australia and because, during the election campaign, the future Prime Minister, Kevin Rudd, expressed a great deal of support for the manufacturing industry in Australia—support that was expressed in emphatic terms that have not been heard from an Australian leader for some time and that was, fortunately, also backed up by comprehensive campaign commitments to ensure that the manufacturing sector does continue in Australia and can look forward to growth, change and development.

Before I address some of the promises within the campaign and then the measures that were addressed in the Governor-General’s speech, I would like to talk a bit about a particular example of manufacturing in South Australia. It was recently announced that Mitsubishi’s factory in Adelaide would in fact be closed—that the Mitsubishi company would no longer support vehicle manufacturing in Australia. That was indeed something that had been speculated about for some time and did not, in that sense, come as a shock to us in South Australia. Nevertheless, it was very bad news for the workers in that plant especially and for the economy of South Australia in general, although it was probably not as bad an economic shock as it might have been had it happened some time earlier.

For those who are not really aware of the development of the Mitsubishi factory, I can tell you that Mitsubishi’s Tonsley Park plant was opened in 1964 as the Australian manufacturing plant for Chrysler Australia. Chrysler then opened an engine manufacturing plant south of Adelaide in Lonsdale in 1968 to provide engines for the models being assembled at Tonsley Park. Then in 1980 the Tonsley Park plant was sold to Mitsubishi Motors Corporation and a new subsidiary, Mitshubishi Motors Australia Ltd, was formed to run the plant. At that time it produced the very popular Colt and Sigma range of vehicles, and they continued under the Mitsubishi range until the late 1980s, when production switched to the larger Magna and, later, Verada motor vehicles.

In the year 2000, Mitsubishi employed around 4,000 employees across the Lonsdale and Tonsley Park sites but by the early 2000s it was clear that the Magna/Verada line had aged considerably and approval for construction of a new vehicle was gained from Mitsubishi. A new car was engineered, and the Mitsubishi 380 was delivered to the market in 2005. In 2004, 670 workers at the Lonsdale engine plant and 350 at the Tonsley Park site were made redundant in response to a downturn in sales.

The car that arose out of the construction of the new vehicle, the Mitsubishi 380, did not achieve the success that was hoped for and has sold relatively poorly since its introduction in late 2005—down to as few as 50 cars a day. Finally, as I said, on 5 February this year it was announced that Mitsubishi would cease production of the 380 at Tonsley Park, effective at the end of this month. As a result, 930 direct jobs will be lost, and up to 2,000 jobs will be lost in industries supporting Mitsubishi’s manufacturing operations. Fortunately, the South Australian and federal governments have pledged $50 million towards retraining, Job Search and investment attraction.

I think one of the reasons that the unfortunate loss of the Mitsubishi plant is not as devastating as might be expected is that governments in South Australia and federally were acutely aware that there were a number of spin-off industries out of the motor manufacturing industry—a number of small to medium enterprises that relied on motor vehicle manufacturing in South Australia, in both the Mitsubishi and Holden plants. Fortunately a number of those smaller manufacturing industries have found other markets in other parts of the world and are successfully exporting to those markets. So although many people in those support industries will lose their jobs there will be some who will go on and continue to thrive.

I spoke at another time about the clusters project in northern Adelaide. That has been one of the reasons that some of these smaller plants have gone on to develop technologies that have enabled them to continue to manufacture well and innovatively, and to produce exports to the rest of the world. I am pleased to say that part of the Labor government’s plan is to assist that kind of manufacturing success story. As part of Labor’s $200 million Enterprise Connect initiative, $1.5 million has been committed to fund a Mapping the Connection project in the northern part of Adelaide. The idea is to examine the supply chain relationship between companies in northern Adelaide, as well as nationally and internationally, and then go on to develop strategies and programs to connect companies with one another and improve the supply chain opportunities.

That has already been successful, in a couple of instances, in a pilot project that was established in the northern suburbs. Those kinds of industry clusters have proved to be a magnet for direct foreign investment in Australia. An industry cluster has become a group of independent companies and associated institutions, including universities, that can both collaborate and compete. They do not necessarily need to be geographically concentrated but are linked by common technologies and skills, and some kind of governance or management arrangement is put in place.

That is one of the ways that the Labor government is looking to support innovation and exports in the manufacturing area. Another relatively small but significant program of the new Labor government will be retooling for climate change. There will be $75 million in grants which will particularly help small- to medium-sized companies meet the costs of such things as energy and water efficiency. This will be of great assistance to small to medium companies in the new era when companies need to be much more aware of environment change. Another program which will assist the northern suburbs is a $20 million grant to establish a manufacturing centre in Mawson Lakes in northern Adelaide. This is part of the larger manufacturing network program in which Labor will invest up to $100 million. This centre will work directly with manufacturing businesses to help them improve innovative capacity and will provide hands-on support for things such as benchmarking and managing the challenges of small business in that transitional growth period.

These are small but significant ways to allow businesses to cope with change in the manufacturing industry and to give them a bit of a lift-off to compete in a global market, which is becoming increasingly common. It is now becoming much more difficult to concentrate on just the domestic industry. Companies are beginning to understand that an export focus does assist them to grow and compete in today’s world. In the northern suburbs of Adelaide, an area where we are well poised to develop the kind of hub that will make an ideal manufacturing stronghold, we have widespread capabilities in ICT, defence, the automotive industry I have just discussed, electronics, mineral processing and food and wine. Many of those are growth areas and I expect, with a little bit of help, that those industries will grow and develop and will make the northern suburbs of Adelaide an even stronger manufacturing centre.

I briefly mentioned innovation and research and development, but that is not to say that I do not think that that is all important in developing an industry in Australia. I think we are beyond the phase when we can just stay with our current range of expertise. In fact, I think Australia, in its own borders, congratulates itself for its ability to innovate and develop good technologies and new processes that are practical and assist significant gains in the industry. But I think we have seen a slowdown in that in the past decade, because research and development was not a priority of the Howard government. It will be a great priority for the current government. The previous federal government cut the R&D tax concession, for example, from 150 per cent to 125 per cent. When you compare it to other areas, you see what a difference that kind of concession can make. The European benchmark is 150 per cent. In Malaysia, it is about 200 per cent. Across the European Union as a whole, there is also a 150 per cent R&D tax concession for science and innovation, as well as a €46 billion innovation and competitive program. Many of the major industrial companies around the world fund these kinds of programs. It is very important that the Rudd Labor government has adopted that with great enthusiasm and is determined to promote innovation and research and development.

We have the Minister for Innovation, Industry, Science and Research in the chamber at the moment. He has sent out the message, very loud and clear, that we, as a government, are wanting innovative research in all our tertiary institutions and that we expect much of that will feed back into our economy and businesses to enable Australia to once again position itself at the forefront of change and innovation and find itself new directions in the changing world. I am very excited about the direction that we are taking in industry, particularly, in my home state of South Australia. I commend the new government for the approach they have taken to that.

In the last few minutes that I have available I want to move slightly away from industry and talk about the changes to industrial relations that were mentioned in the Governor-General’s speech. It is a great relief for all of us in the Labor movement in Australia that we will see an end to Work Choices and the scrapping of that legislation and a relief to see the determination by our new Labor government to bring about changes to industrial relations legislation. Those of us who were out on the ground when campaigning hard all through last year heard story after story when we spoke to many people who were adversely affected by the Work Choices legislation. It was not just employees; it was also employers who had great difficulty coping with the red tape, the confusion and the conflict created by the Work Choices legislation. It was a divisive and difficult piece of legislation that did no good whatsoever for businesses and employees in Australia.

I am pleased that Prime Minister Kevin Rudd has moved as swiftly as he said he would before the election to change that Work Choices legislation. I, and many people I know, look forward to seeing a more just and fair industrial relations system developed as a result of that. Of course, most employers want the best for their employees, but the Work Choices legislation too often opened loopholes that many unscrupulous employers used to screw down workers’ rights, pay and conditions.

The most glaring example I had when I was campaigning was a man who went to work for a printer in the northern suburbs. He had worked for that printer for three months and the printer asked to take him on permanently. The man asked if he could vary his hours by 15 minutes, starting 15 minutes earlier and finishing 15 minutes earlier, in order to pick up his child from school. That was refused and the man was sacked. He was not only sacked but refused his last two weeks wages on the grounds that he had not given proper notice. That man went through the Work Choices system trying to find some redress and was given none until the intervention of my office. That is the kind of unfair practice that was promoted under the Work Choices legislation that I very much look forward to seeing changed under this new government. The opposition has indicated that it will support that legislation, and I look forward to seeing that facilitated through the parliament in the next few weeks.