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Tuesday, 19 March 2013
Page: 2585

Mrs MIRABELLA (Indi) (15:17): I rise on this very important issue: the adverse impacts that the carbon tax is having on jobs and manufacturing. What compounds the damage that the carbon tax has caused to Australian jobs is the fact that the government has ignored warnings. Last year in February we had the CEO of Penrice Soda say:

The carbon tax, if it is implemented the way it is intended to be, could be the death knell for a lot of Australian industry … From this year Penrice will pay $8m in carbon tax. Adelaide Brighton $80m, one of our big clients. The timing of it is excruciatingly poor.

But this government did not listen.

The government did not listen to the very basic logic. And the logic is this: if you impose a tax on Australian energy intended to increase the price of energy, to increase the price of electricity, it makes conducting business in Australia more expensive. That means running hospitals becomes more expensive. It means manufacturing operations are more expensive. And why? Let us remember why.

The purpose of this tax was not to reduce emissions. It was not for some environmental benefit because, as we know, when Australian businesses go offshore, we are exporting our emissions offshore to nations that do not have the same clean, green production processes and regulations we do. What happens is: they will make the same things we used to make but create more emissions in the process, so it is a lose-lose.

We know from the government's own modelling that the carbon tax is intended to cut production in key areas. We see that their own modelling shows that aluminium production is supposed to fall by 61.7 per cent, and that alumina production is supposed to fall by 44.1 per cent and iron and steel production by over 21 per cent.

What that is telling you is that, with the fall in production, necessarily there is a fall in jobs in those industries that are directly affected by the carbon tax, because, in the manufacturing sector, those businesses that compete with imports are put at a competitive disadvantage. It is a very simple thing to understand. When you put the cost up of making something in Australia and an import comes in that competes with an Australian-made product, that import, which obviously does not have a carbon tax imposed upon it, is even cheaper than it would have been.

Now let us take our exports, because manufacturing contributes to 29 per cent of our exports. Our exports in manufacturing are also put at a competitive disadvantage when they are competing with goods overseas that do not have the high costs of production that we have.

The government are in pure denial. They are in pure denial because there is the lack of maturity to make a very simple statement: 'We got it wrong.' The Prime Minister is not big enough to say she got it wrong in choosing the Greens over Australian workers; she got it wrong in caving in, showing poor judgment. It was not very tough then, was it? No woman of iron then, no tough cookie then, in standing up to the Greens. She could have thrown the Greens a bit of a carrot; they would have still supported her. But, no. The Prime Minister, in what will arguably—and there is a lot of competition for this—go down as her worst judgment call ever, chose the Greens and this ridiculous, job-destroying policy over Australian workers. For what? Not to reduce emissions but to desperately try to cling on to power.

Over this year alone, let's look at some of those businesses. In March, CSR announced the loss of 150 jobs at Ingleburn, with its managing director later confirming that the carbon tax had added around $500,000 to annual costs at the Ingleburn facility. In February, Amcor announced that over 300 jobs were lost across the country, many in Brisbane and also in the Prime Minister's own electorate. What did the company say at the time? It cited significant cost increases, and it included energy as one of a series of factors that had a significant impact on its ability to remain competitive. That is what it is about. The Prime Minister may think that costs in relation to a business operation is a boring topic, but it is a basic fact that, if a business cannot keep its costs under control, it will not remain competitive. It is not a charity; it must make a profit in order to employ people, and in the manufacturing sector we are seeing that this is becoming more and more difficult.

There are significant international challenges. We know that there are challenges, but why on earth, in that environment, would any government ignore the challenges and sometimes use them as a crutch to absolve themselves of their poor policy, their job destroying policy? And there is the economic sabotage of the carbon tax at a time when we can least afford it. Often you get the response from the minister or the minister's spokesman. It is interesting that, in the areas of industry policy and manufacturing policy, when things get a bit too tough, ministers are too afraid to front up to the media to pursue their argument. Instead, they send out a spokesman. One of the things they invariably rely on is the high Australian dollar. That is their crutch. It is not the carbon tax. In fact, there is the perverse Orwellian language, as if the carbon tax is great. Well, if it is so great, they should have put it at a higher rate and it would have created more jobs. But they know in their heart of hearts that that is absolutely absurd. So when they rely on the high dollar, not only are they not being totally up-front with Australian workers but they are insulting the businesses that are trying to remain competitive and continue to employ Australians.

Rob Sindel, CSR's managing director, said only the other day that it is 'just too easy for people to say it's just the Australian dollar'. CSR is a company that has experienced job losses recently. What we see is continued evidence from business and industry groups when they tell the government about the cost of making things in Australia: the barrier to investment and growth is increasing costs, and energy costs, important input costs, are an increasing barrier to that growth and investment.

Greg Evans from the Australian Chamber of Commerce and Industry said:

The lack of pricing power and inability to pass on cost increases, such as the effect of the carbon tax, has dented small business profits and its ability to employ and expand.

But, of course, the Prime Minister and the minister for industry are totally and utterly deaf to that, because to accept that would mean accepting responsibility—a very grown-up thing—which, unfortunately for this nation and the workers of this nation, this government is incapable of doing.

We have seen a record number of companies go into liquidation. We saw reports in the media on Monday about over 10½ thousand companies. The government just brushed that aside. In relation to that, insolvency practitioners have said that the carbon tax for many of those companies was the last straw. We heard that it was like pulling a leg from under a chair. What do the government do in response? They say, 'You're all pretending, because, really, the number of jobs has gone up.'

The other week the government quoted some figures from the ABS. According to media reports, the ABS briefed the government on labour force gains for February 2013 and warned them. This is according to media reports. It will be very interesting to see what happens with the update on job figures next month. They were briefed that the figures would be overstated, most likely by a factor of two. Of course, this did not stop the Treasurer and the Prime Minister boasting about all the jobs, even though it was reported that they had been briefed that the figures would be overstated. So the Labor Party should stop the spin and tell the truth, because out there—not just in the suburbs of Western Sydney but in the regional towns and centres of this country, in the manufacturing centres of our capital cities—people are seeing Australian jobs disappear. For every large listed company that has its job losses reported in the newspapers, there are dozens of small and medium-sized businesses whose job losses go unreported, but the impacts are felt just as deeply in the families that lose their livelihood. Why? Only because the government are incapable of owning up to the fact that the greatest economic sabotage inflicted on the Australian economy was the carbon tax.

We even see the impact of the carbon tax on the auto sector. The Labor Party likes to pretend to promise the industry the earth, the moon and the stars.

Mr Champion: We know what you'll do with the auto sector. There won't be an auto sector.

Mrs MIRABELLA: There is a lot of delicacy and sensitivity on the other side, because at the last election they promised the industry whatever they needed to get over the line, and what did we see after the election? Not only did the Prime Minister break her promise not to introduce a carbon tax but she imposed $460 million in increased costs on Australian manufacturing.

They also broke $1.4 billion worth of their promises to the auto sector. So, the Labor Party is saying: 'We will tell you whatever you want to hear. We will promise you anything you want up until the election, and afterwards we will do the exact opposite.' So much of the discussion about the auto sector is around the components sector. We have heard the chief executive of the Federation of Automotive Products Manufacturers say:

We are going to be impacted by a carbon tax, and our competitors (overseas) won't.

And in a very challenging environment, this government is saying, 'That's too bad.'

We even see, in the case of the large companies that were awarded compensation and in the words of Graham Cray of BlueScope, that any compensation is like a bandaid over a bullet wound—because, let's face it, you can never totally compensate for the damage you have caused. At least the so-called compensation was admission of the damage the carbon tax would cause. But even these large companies need to make decisions for when the so-called compensation runs out. Companies do not make decisions for a three-year period; they look to the long term, particularly when they are looking at significant investments. But what about all those businesses that do not even get the pretense of a look-in with compensation? They are left there to accept the additional burden.

You will have the Labor Party tell you, 'But we've given all this free money to households so they can afford the increased energy costs.' But they ignore—and the reality is—that so many of the products made in Australia are being replaced by cheaper imports that are given a head start because they do not have the additional electricity and energy charges imposed upon them, because they come from countries, unlike Australia, that do not subject their manufacturers to the world's largest carbon tax.

The reality is that there is great concern about job security in this country, particularly across the manufacturing sector, where 109,000 jobs have been lost since this party came to power. They can get up here and come to the dispatch box and pretend that the reality is something else. But workers out there, and their families, know the damage that is being done, because they are losing their jobs and their friends are losing their jobs. Manufacturers have come together in a new organisation called Manufacturing Australia to ensure that their voice is heard, because they want to continue to have viable businesses and they want to continue to have a viable future. And there is every reason that we can have that viable future. The simple first step is to remove damaging government policies like the carbon tax that are intended to slug and slow down the production of our manufacturing sector.