28.5.13 Australian Jobs Bill 2013

Mr HAWKE (Mitchell) (18:42): The
member for Corangamite is precisely wrong in his interpretation of what we will
do if we are elected in relation to this bill, the Australian Jobs Bill 2013,
and manufacturing in Australia. We have indicated that we will immediately
repeal the carbon tax. I note that the member for Corangamite will be very
concerned about the impact of the carbon tax on Australian business.

You certainly do not help Australian workers and Australian
jobs by passing a bill called the Australian Jobs Bill, although we know that
this government has some sort of fetish for Orwellian titles of its bills. It
thinks that by calling it the Australian Jobs Bill that, somehow, this will
create jobs in Australia. The coalition of course rejects such a proposal. In
fact, when you look through this legislation it really gives you the sense that
we are having a bill for a bill's sake—and certainly we have Bill at the table
at the moment, so maybe we are having a bill for a Bill's sake. But we have
grave concerns about this bill, which proposes meaningless changes to the
Australian Industry Participation plan.

Mr Shorten: Deputy Speaker Cheeseman, I rise on a point of order. I would ask that the
member for—I don't know—parental leave to, at least, refer to me by my correct
title.

The DEPUTY SPEAKER ( Mr
Cheeseman ): I do remind the
parliament that it is appropriate that all parliamentarians refer to one another
by their titles.

Mr HAWKE: Thank you, Deputy Speaker. I want to thank the minister. Perhaps, Mr Deputy
Speaker, you could draw his attention to the same standing order in the light of
the fact he did not refer to me by my title.

The DEPUTY SPEAKER:
Indeed.

Mr HAWKE: That was brilliantly done, again, Minister. I would be the member for
Mitchell and you would be the minister. That would be the correct way to handle
that point of order. Moving on to the substance of what we are here to deal with
today, the Australian Industry Participation system, which the government is
proposing to amend and also to make some revisions to the system implemented by
the Howard government.

The coalition have no problem with the Australian Industry
Participation scheme but the government is yet to convince or provide any set of
compelling arguments—we certainly did not hear compelling arguments from the
member for Corangamite—about why this bill should be revised. In fact, there is
no part of industry in Australia today or any of the sectors that we have
consulted with that is calling for a new, heavy-handed regulator to help them
create jobs. So while the objective of an Australian Industry Participation
scheme is to assist in the local sourcing of products, there is nobody saying to
government and there is nobody saying to the opposition, 'What we need to buy
more Australian products and employ more people in Australia is a new regulator,
a regulator with new powers, a heavy-handed regulator.' Yet in this bill we see
the proposal for the establishment of an IPA because a new bureaucracy,
according to the government, will help us source more products locally. That
seems to be their thinking in relation to a lot of things: a new regulator, a
new committee, a new government approach will somehow produce a better benefit
for the sector. Given the fact that this scheme has been in operation since
2001, if there was a body of argument that said we need a new regulator, it
would be well-established in public argument and public policy. That argument
has not been made and we have not heard any arguments in relation to this bill
discussion today.

I think it is objectionable that this proposal of the
government should seek to embed public servants into private companies'
workforces to shape and perhaps even dictate their purchasing decisions. We
heard from the member for Corangamite that perhaps they could help with
procurement. I do not believe that government employees or government appointed
people into this scheme will help with private sector procurement. The coalition
takes a different approach, that it is an anathema to the operation of a vibrant
private sector to have such people embedded into companies by government,
especially for the success of a modern economy.

When you look around at different reactions in the Senate
inquiry and certainly to the exposure draft that was released, and it does not
matter where you look, you can see the in comments on the draft legislation from
Australian Petroleum Production and Exploration Association, who say:

APPEA considers that the proposed
legislative approach is unlikely to significantly increase opportunities beyond
those created by the extensive efforts already employed by the oil and gas
industry to provide full, fair and reasonable opportunity to local
suppliers.

We have many other comments from many
industries—the big miners, BHP Billiton, Rio Tinto and Xstrata, civil
contractors, the South Australian Chambers of Mines and Energy, the Queensland
Resources Council, the Minerals Council of Australia, New South Wales Minerals
Council, the Department of Commerce Western Australia and the Industry
Capability Network—all of whom are not expressing any support for such new
proposals from government, in fact highlighting that there is a lack of clarity
in the legislation around the items such as the proposed trigger date at which
the production of an Australian industry participation project becomes
mandatory. That is a legitimate concern. Again, we are adding to this idea of
sovereign risk in Australia with these sorts of bills that float around
proposing to do something for Australian industry but again adding to the red
tape and regulatory burden that companies have to face in making decisions about
whether they are going to invest and whether they are going to employ.

One of the concerns I have in particular is that by passing
this bill we would be adding to that regulatory burden, we would be adding to
that concept of sovereign risk and we would not be doing anything to enhance the
ability of industry to make good-quality decisions in relation to their own
businesses at the moment. In this climate is this sort of approach needed? No
case has been made about this particular bill. We are very concerned at the
approach of the government.

Mr Shorten: Are you talking about Tony's parental leave?

The DEPUTY SPEAKER:
Order! The member will be heard in silence.

Mr HAWKE: Thank you, Mr Deputy Speaker. I would hate to call the minister out. In
relation to this bill, whenever you look at the cost-benefit analysis the
government goes through in relation to the cost of new legislation, once again
we find evidence of mendacious activity from the government. It is not clear
exactly what cost this would be in terms of the new regulator and it is not
clear where the money is coming from. In relation to what we can tell, we have a
stated figure that the changes will be accompanied by spending of around $98.2
million over the next five years. I want to note that this expenditure is
supposedly offset by cuts of $1 billion overall to the R&D tax incentive
that do not appear to have been appropriately modelled and have certainly never
been publicly clarified or justified. So, again, whenever we see new legislation
presented with heavy-handed regulation, overregulation, we do not really even
have an understanding of how much it will cost, or a rigorous cost-benefit
analysis. Why is a rigorous cost-benefit analysis important in relation to new
legislation? There is a good 280 billion reasons why a cost-benefit analysis
matters in terms of public debt, net debt, and perhaps some $300 billion of
reasons very shortly in terms of gross debt, why we need cost-benefit analysis,
why we need to look at what is the actual benefit of this new regulator and
legislation versus the cost that it will have to government.

When you consider the response of stakeholders, including small
to medium enterprises, industry associations and indeed all of the major
industry sectors, you can see that there is a grave level of concern about the
way this bill would operate. Ideas which could be seen to be reasonable, and
indeed the reduction of the capex of $500 million or more for AIP projects,
could be seen to be a good thing. However, I want to note the dissenting report
by coalition senators, who raise an excellent argument in relation to the
proposed reduction of capex—that is, that there could be a range of problems. In
particular, the Chamber of Commerce and Industry WA provided a calculation that
said that the changes would mean that the share of affected projects would rise
from six per cent to around 26.2 per cent. That is by anybody's benchmark a
dramatic increase. That sort of dramatic increase is something that ought to be
considered quite carefully before we proceed with something like this and would
have a lot of effects in terms of cost and assessments and the involvement of
government in so many other projects. It is something which again does not
appear to be desirable.

While the coalition is certainly supportive of the scheme
introduced by the Howard government in 2001, the core purpose—to give Australian
firms increased opportunity to secure work on major local projects—is a worthy
one. When you look at the actual provisions of this bill, however, and you
examine what the government is proposing, it has not been demonstrated, and it
is not obvious, how this particular bill—with its Orwellian title, the
Australian Jobs Bill—will in fact achieve that objective. And I take with grave
concern the concerns of industry and other serious players in this sector
suggesting that, in many ways, the increased regulatory burden and the new
regulator may indeed achieve much of the opposite or add to the sovereign risk
of doing business in Australia.

So, with those features in the forefront of our minds, I would
advocate opposing this bill. I know the coalition is opposing this bill. We are
looking for something more meaningful from the government than a new,
heavy-handed regulator and a series of changes which are uncosted and really
have no substantive backing from the sector involved.