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Thursday, 29 May 1997
Page: 4446

Mr CREAN(3.05 p.m.) —Mr Speaker, the first question that has to be asked is: where is the Minister for Industry, Science and Tourism (Mr Moore)? This was the discussion gagged yesterday because the Prime Minister (Mr Howard) has been hiding from the people of Newcastle. He has told us today that he is finally going to Newcastle, but in a month's time after his overseas trip. We know what is on in England in the last two weeks of June! It is the test match. We have got the industry minister at the casino when he should have been addressing the workers of Newcastle, and the Prime Minister at Lords because he is not prepared to go there.

This is a government that has gagged any sensible debate and has hidden from the people of Newcastle because it has none of their interests at heart. Where is the minister for industry? He was in the House before. He knew this matter was coming on. Is there a new game opening at the casino? Is this where he has gone? Maybe it is the late lunch, but he is certainly taking no account of his responsibility.

I also want to know why, in terms of the response to this debate—we will be interested to see when the member for Hawker gets up, and presumably the member for Paterson (Mr Bob Baldwin) is going to be following—

Mr HAWKER —Mr Speaker, if I could rise on a point of order, my seat is Wannon.

Mr CREAN —It is the only time you have had a chance to speak in the place. I presume the member for Paterson will be up in this place too. Why? Because Paterson was held by the Liberal Party by 600 votes. And there are more than 800 Newcastle families working in the steelworks who live in that electorate—yet this is a government that has hidden from and washed its hands of the people.

The fact is that the terms of reference that were given to the member for Wannon (Mr Hawker) actually require him to come back with recommendations on a national steel plan. Why then has the government not sought to engage BHP in the discussion to try and get them to change their callous decision to close Newcastle steelworks, to get them involved in the exercise of being part of that steel plan?

There is one point that is very important to understand. A nation without a steel industry is a nation without a manufacturing industry. It is also a nation without a defence industry.  Without the steel industry of this country we lose thousands of jobs and we lose export opportunity. It defies logic that a nation like ours, with natural resources in iron ore and coal, with leading infrastructure, leading technology and a massive improvement in labour productivity, cannot see itself developing an expanded steel making industry. It would not have happened under Labor.

The Prime Minister has taunted us on the basis of saying, `Don't hold that hope out for the workers of Newcastle.' But let me just say this: BHP presented Labor with this same proposition back in 1983—the threat to close Newcastle, the threat to also close Whyalla and even the threat to close Port Kembla. Labor stepped in, as it promised to do during the election campaign, and said it would have a plan within 100 days and that plan was implemented. That plan saw massive investment in the steel industry by BHP. It saw a restructuring package for the steel affected centres of this country. It saw the introduction of a steel bounty. But, more importantly, it took this nation from being a net importer of steel to a net exporter. Steel exports over the 13 years of Labor's plan have trebled. Those steel exports are now the largest manufacturing export of this country and they account for 60 per cent of the world's steel. But the decision announced by BHP some four weeks ago sees them reducing their commitment to the export of steel.

The Prime Minister wants to talk in this place about how this steel plan of Labor's failed. The trebling of exports—some failure! What we had was BHP, as recently as 1995, recommitting itself to steel making in Newcastle; recommitting itself to keep the blast furnace technology going to the year 2002 and then to invest in the new technology—the electric arc furnace. There was a commitment to keep steel making going in Newcastle, not 13 years ago but two years ago. The only thing that has changed since that commitment by BHP is the change of government.

This Howard government has sat limply by and let BHP make a unilateral decision without any commitment in terms of dividend and repayment to this nation. The reality is that when you engage BHP, they will respond. Labor proved that in 1983 and Labor kept that engagement going throughout its 13 years in government. Who has dropped off the engagement? The Howard government. Why can't the Howard government pick up the phone to John Prescott and say, `Let's have a look at the analysis by which you have made your decision to exit steel making in Newcastle. Let's have a talk about it'?

That fact of the matter is this: BHP are still going to invest in steel. In fact, they have even invested in an electric arc furnace. But do you know where that investment is? It is in the US. Newcastle's electric arc furnace has gone to the US. Why has it gone to the US? Because Ohio has offered them free land, a new road, and a five-year tax break. And we hear the government say, `Oh, this is a commercial decision.' Some commerciality! The reality is that BHP is going where it is wanted and the signal in this country is that this government does not want a steel making industry. It is appalling that they should take such a stance. The fact of the matter is that BHP made that commitment and we would have kept them honouring it.

I heard the other day not only the Prime Minister but also the Minister for Foreign Affairs (Mr Downer) crowing about this new Chinese investment in Western Australia in iron production—the direct reduction method for iron billets to be developed in Western Australia. If this comes to fruition, this could make feed stock for steel making commercially viable in this country. But what will happen if we do not have steel making? If we do not have the electric arc furnace or the newer technology to convert it, where does it go? Why isn't the government thinking of the strategic link? Why does the government just want this place to be a quarry or an iron exporter? The fact of the matter is: if they develop a strategy that takes those billets at commercially competitive rates and brings them across to the electric arc furnace at Newcastle and then converts the technology developed by Australian investment into a new technology that can cast the metal into strip, we would have a leading edge opportunity to not just be value adding our resource but to be exporting to the world.

But what will happen if the government stands idly by? We will be exporting pig-iron again. It will be the only thing that this Prime Minister has in common with his former idol, Bob Menzies. We will have Pig-Iron John. The only relationship between any policy approach in his prime ministership and that of the person he idolises is to ship our resource out as pig-iron—back to the 1940s. And he wants to get up here and pretend that what we are talking about is going backwards in terms of policy making. How backward can you look? This is the approach that happens when a government has its hands off the lever, when the government does not believe that there is a role for government in industry policy—in striking the approach for the strategic direction, in looking for the opportunities and for making the most of them.

Many of us on this side of the House have been to Newcastle since the announced closure by BHP. What we have tried to do is to develop a cohesive approach forward—one that does not just relate to Newcastle, but one that commits this nation to not only retain steel making but also expand the opportunities. What we have talked about in terms of a response to the BHP closure is a two-pronged approach. It is essentially that there needs to be a steel plan developed for this nation with particular emphasis on retaining steel making in Newcastle. Also, there should be a strategy to develop the diversity of the economy in the Hunter region.

One of those opportunities for that diversity has again been nobbled by this government, and that is the decision to invest in the Hunter in the Redbank power station. That project cannot go ahead because this government has abolished the infrastructure bonds which were essential to the funding of that program. They go around making all these promises about how it still might be able to go ahead, but they will not lift a finger to help. Here is a specific example of where economic diversity in the Hunter region can be not only started but also built upon.

I turn to the elements of the steel plan. We as a nation do not want to become just a quarry and a nation that exports its job opportunities. We want to look sensibly at the means by which we limit the extent to which we simply export iron ore. We want to encourage value adding. We want to attract the investment in the new technologies that directly reduce the iron ore into feed stock for steel making. We want to encourage investment in the new technology that makes the steel. We want to invest in the new technology that turns it into strip and makes it available for our other manufacturing industries such as cars and whitegoods. I was at Fisher and Paykel, a whitegoods manufacturer, the other day. They get their industrial steel from Japan. They would dearly love to buy it from BHP.

I simply make this point: a nation like ours that cannot put those sorts of things together is not trying. It will not happen without leadership. It is not going to happen on its own. What we want to do is not just concentrate on steel. The environmental pressures on this nation, as well as the international demands, are going to increasingly see requirements for lighter weight metals: the aluminiums and the magnesiums. Again, we have the deposits and the technology, and within the steel making centres we have the skills and the commitment to productivity improvements. The challenge for this nation is to develop a strategy that brings it together and gets us into metal fabrication, not just for supplying our own needs but for exporting. We have the technology. We know we can do it with the mini-mills. But it cannot be done without the leadership and commitment from government to encourage the private sector into looking strategically forward.

The fact of the matter is that industry all around this nation is calling out for a vision for industry policy from this government. It wants to be part of the equation. But what sort of a signal is it when the best the Prime Minister can say when BHP is closed is, `I wish they had rung me earlier, I am really sorry that they did not ring me.' It is absolutely pathetic. Quite frankly, all he has to do to demonstrate some sort of leadership—and there has been none of it demonstrated in this House over this sitting week—is to make a commitment to the people of Newcastle, the Hunter and the steel towns around this nation that he is about developing a strategy to secure their future.

BHP's decision will not impact totally for two years. There will be an election before that time and we will be running this campaign constantly and persistently. We believe that this nation does need a steel industry, because that supports the manufacturing and defence industry. But we believe government has to take a role in facilitating the development of that plan, looking at why BHP is prepared to invest overseas and not here; why, when we have invested $130 million in their new project M technology for directly producing strip metal, they are not prepared to apply it in this country. It is ridiculous that we make that sort of investment only to see the technology go overseas because we have run down our capacity as a steel making nation. This nation has invested in the steel industry, it has invested in BHP, and there is an entitlement to expect a dividend. That is only going to occur if leadership is shown by the government, and that is what we are looking for. (Time expired)