Kim Carr (Victoria, Australian Labor Party, Shadow Minister Assisting the Leader for Science) Share this | Hansard source

I indicate the chamber that, while we would all have to acknowledge that the crisis in the Australian steel industry has been caused by a glut of cheap imported steel, there have been numerous calls in public for Australian governments to mandate targets for the use of Australian steel. The usual proposition is for a 90 per cent mandate, which this amendment also puts forward. Labor's position is that we do not mandate the content; we mandate the standards. This is a very substantial difference. I think the one-size-fits-all approach that is being advocated in some quarters will not do the job, will not meet the needs of Australian industry. For instance, there are many gauges of steel that we do not have produced in this country anymore. In many defence contracts we will be required to. So there are some questions that have arisen in terms of the practicalities.

More particularly, I think on the issues of international trade and industry policy there needs to be a much more careful and nuanced argument so that the policy positions, which I think many in this chamber, particularly on this side, support will not be the subject of challenge and frustration by our competitors. I disagree with the minister to this extent. We do know that our international competitors are only too happy to use measures like this when it comes to their country. Try pulling this sort of free trade approach in the United States. I am not talking about under the new administration; I am talking about under the current administration. There are a whole series of legislative measures. In China there are a whole series of legislative measures in place which frustrate our capacity. Just recently BlueScope has been hit with savage penalties in the United States under their dumping regime, which is much more coercive and much more brutal than anything we would ever propose. We seem to maintain in this country a set of standards for us which of course are not applied by our competitors around the world. We do this in the name of free trade. I take the view that we can ensure that we preserve Australian industry capabilities and be consistent with our trade obligations if we use our heads. This is what I am concerned about with this measure. That is why I say that the position of the Australian Labor Party is that we mandate Australian standards. That insures, as we have seen in practical terms, that we can deliver.

In South Australia the Industry Participation Advocate of the Department of State Development, Mr Ian Nightingale, works across all sections of manufacturing industry. He has highlighted his role in terms of being a steel industry advocate in that state, which has seen his capacity to monitor the level of local products used and the jobs created in public projects, which are evaluated in terms of the economic benefit to the state. He has helped negotiate contracts to preserve the supply chain. For instance, the Auburn project allowed particularly the use of steel from OneSteel in Whyalla, which was then sent to Victoria to convert it to reinforced steel, and then sent back to South Australia to use on the project. We saw here that the capacity to coordinate and facilitate major projects was done in a much more flexible and effective means, supporting Australian industry, than we have seen in many other circumstances.

The evidence presented to the Senate inquiry on these matters highlighted that the contracts for state government public sector procurement, other than for building and construction, have seen an increase in local content of 40 per cent—that is, from 51 to 91 per cent. What we have seen in those circumstances is the work of ensuring the application of standards. I acknowledge that continuing work needs to be done.

Similarly, in Victoria the state Labor government is pursuing policies consistent with our trade obligations, in particular on the question of small and medium-sized enterprise arrangements within those agreements, to ensure that the rail crossings project is able to use local steel and to secure contracts with local steel fabricators to an extent unforeseen in recent times.

So it is possible to actually pursue industry policies consistent with our trade obligations which preserve industry capabilities and Australian jobs. Of course, it was a policy that this party, the Australian Labor Party, highlighted within government, and we have now announced a six-point plan that would see those provisions strengthened. The Buy Australian at Home and Abroad program would be strengthened under a Labor government. The industry supplier advocates would be strengthened under a Labor government. We would ensure that we have the capability to assist our supply chain companies to get contracts and keep contracts, but to do it on a competitive basis consistent with our trade obligations. We would ensure that we are able to use Australian product to build Australian capabilities and preserve Australian jobs without having to mandate it in the way that is proposed in this measure, and the Labor Party will not be supporting it.