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Tuesday, 8 November 2011
Page: 8600


Senator BIRMINGHAM (South Australia) (20:50): It is a pleasure to follow Senator Boswell in this debate on the second reading of the Steel Transformation Plan Bill 2011. He makes so many valid arguments about what the government are up to with this bill and about its potential impacts. It is nothing more than a tricky little tactic of the Labor government that they have brought this bill on separately from those which we voted on earlier today. We saw the government put through the parliament earlier today the Clean Energy Bill 2011 and 17 other bills related to the clean energy package. When they wanted to have committee consideration of the legislation, they thought it was perfectly reasonable to send the Steel Transformation Plan Bill off to the same joint select committee that considered the clean energy bills. They lumped them all in as one. They were happy to have the 19 bills considered together. Yet, for purely political purposes, they seek to have this bill considered separately from the other 18 clean energy bills. Why? Because they want to create some type of fake wedge so they can say, 'The opposition voted against support for the steel industry.'

That is what Senator Carr wants to go out there and do, and no doubt that is what he will do. But people will see through it. People will see through it because they will know, well and truly, that the only reason the government has proposed this in this way, in this place, at this time, the only reason the government has put the money on the table, the only reason we are voting on it on the same day as the carbon tax, is the carbon tax. This is all about the carbon tax. If you do not have the carbon tax, you do not need the compensation. That is not to say you do not need plans for the steel industry, Minister Carr; you absolutely need plans for the steel industry. But you have been dragged kicking and screaming into putting together this little piece of legislation to hand over a bit of money all because of the clean energy bills and all because of the carbon tax.

Senator Boswell: And Paul Howes.

Senator BIRMINGHAM: And, frankly, it is all because of Paul Howes, as Senator Boswell highlighted and as I will be turning to as well: 'Not one job!' But the minister has already failed that test, of course.

Senator Boswell: No, because Peter Beattie got a job.

Senator BIRMINGHAM: Peter Beattie did get a job, so there is one winner so far out of the Steel Transformation Plan Bill. But I thought Paul Howes was promising that not one job would be lost, and already we have seen the steel industry shed jobs since this plan was announced and even since this funding was announced. Let us understand that this plan and this funding are nothing more than a rotten little bandaid that will not last very long. It will apply some money for a period of time and so that will buy a little bit of peace for the government. That is all they are hoping for. They are hoping that this money will last past the next election, that it will ensure the steel industry in Australia survives past the next election, that they can keep Mr Howes and his cronies quiet past the next election, that it will actually achieve that much. That is all they are hoping for because, of course, the money will run out.

This is not some type of ongoing support to address the fundamental issues of the carbon tax, because the money from this runs out and the carbon tax, if Labor get their way, is here forever. It is here to stay. That is certainly what Prime Minister Gillard was saying today, that Labor stand by the carbon tax now, in five years, in 50 years, however long it takes—forever. So we know the government have the carbon tax here forever. We know the carbon tax is going to keep going up and up and up. The price of it keeps going up dramatically right through at least the modelled period to 2050, and it will go up beyond that, given the way the trajectories and the curves have indicated, at that time. This money will be flat out lasting for a couple of years, and then the steel industry are on their own again unless they manage to convince the government to fork out for another bailout plan. So this is little more than a bandaid. It is a bandaid measure that may last until the next election if Senator Carr is lucky. It may manage to hold things together for that long, but that is all that it is likely to achieve.

Senator Carr, you come in here and you try to talk about how it is a transformation—and you insert that grand word, 'transformation', into the title of this bill—but nobody is conned by that; nobody thinks that you are going to somehow, through this one bill and through this $300 million in spending, miraculously set the steel industry up for a bright future under the carbon tax, without some type of further assistance. So nobody is conned by that, and ultimately we will face a future in which governments will either have to fork out yet more money for the steel industry to prop it up under the carbon tax or, alternatively, see the steel industry die not the death of a thousand cuts but instead the death of one mighty sword blow to the neck in the name of the carbon tax.

The AWU state secretary in South Australia, Mr Wayne Hanson, had it right when he was talking about some of the major industrial towns in my home state. Take the words of Mr Hanson, when talking about Whyalla, the home of the OneSteel operations there, and Port Pirie, the home of the Nyrstar smelter there, and about what the impact of the carbon tax could be on those towns. What did Mr Hanson have to say about the potential impact of the carbon tax on the towns of Whyalla and Port Pirie in South Australia? He said this of those towns under the carbon tax:

'Goodbye. They will be off the map …'

That is what Mr Hanson thought the carbon tax would do. Why did he think that would be the case? Why did he think that the carbon tax would cause the towns of Whyalla and Port Pirie to be wiped off the map? He said:

It's ridiculous to consider (a carbon tax) when you don't have other countries that are prepared to adopt a common approach," he said. " … Should we be the trail-blazer?"

Mr Hanson seemed to really hit the nail on the head. Sadly, after he made these comments he went to ground very quickly. I can only assume that some of his friends in the labour movement suggested that such honesty was not encouraged in the labour movement and that such honesty in the public arena was not something that they wanted to hear from people like Mr Hanson, who might actually be exposing in some way the government's rotten plans that will destroy industries like the steel industry. Mr Hanson was not alone. It is little wonder that he thought that he could get away with such brazen honesty about the carbon tax and its impact on the steel industry. He made those comments on 19 April, when they were reported, and it was perfectly reasonable for him to think he could say that because a few days earlier, on 15 April, his national secretary had equally been out there being pretty bolshie about the impact of the carbon tax on the steel industry. That was none other than Mr Paul Howes, the same Mr Howes whom Senator Boswell mentioned before and whom we saw bobbing up on our television screens and coming to great national prominence on the night of the coup when Mr Kevin Rudd was rolled as Prime Minister of this country. Mr Howes bobbed up on Lateline and announced to the world that he was behind the change and that he was delivering the prime ministership to Julia Gillard, who was then, of course, the Deputy Prime Minister. Mr Howes, obviously a man of great influence in the Labor Party, had said on 15 April, as the national secretary of the Australian Workers Union, that he wanted to ensure that this carbon price will not cost a single job:

If one job is gone, our support is gone.

Senator Cash: That was Paul Howes?

Senator BIRMINGHAM: That was Paul Howes, Senator Cash; you are correct. It was the same Paul Howes who put Prime Minister Gillard in the Lodge—if Paul Howes is to be believed, anyway—who was laying down the law to Prime Minister Gillard: 'If you're going to go down the path of this carbon tax, if one job is gone, our support is gone.' They were the ominous words of the Australian Workers Union. Little wonder that Mr Hanson, the state secretary in South Australia, felt empowered—he felt liberated; he felt free—as a result of Mr Howes speaking so freely about the potential implications of the carbon tax. With the liberation, empowerment and freedom that Mr Howes gave to Mr Hanson, Mr Hanson went out there and indicated that he thought the carbon tax could wipe the towns of Whyalla and Port Pirie off the map.

Why? It is pretty simple when it comes to the steel industry. It is really very, very simple. The steel industry in Australia supports around 15,000 jobs or thereabouts. When it is making steel, more than 80 per cent of the emissions from steelmaking are released in the chemical reaction that produces iron. There is no technical alternative and, according to the steel industry, one is decades away. Let us dwell on that technical fact for just a moment: more than 80 per cent of the emissions from steelmaking are released in the chemical reaction that produces iron; there is no technological alternative to this and one is at least 20 years away, according to the steel industry. But hang on; I thought—let me just check on this, but I thought—this Steel Transformation Plan was only offering $300 million over the period of 2011-12 to 2016-17, according to the explanatory memoran­dum, and even then, when you look at the detail of the bill, that funding could all be committed far, far sooner than in that short window of time. So we have at least 20 years before the steel industry is going to find some way to mitigate, to overcome, the fact that, technologically, 80 per cent of its emissions are locked into the chemical reactions that take place when you make steel. Eighty per cent are locked in, and the industry faces 20 years before it thinks there might be a technological breakthrough, yet this government is offering a few pieces of silver for a few years. It is offering $300 million for just a few years. What happens after that, Senator Carr? What happens after that to Australia's steel industry? How do you expect this industry to remain competitive after that? Indeed, the Chairman of OneSteel, Mr Peter Smedley, said: 'There is no technology available today or in the foreseeable future for the company to be able to reduce its emissions. A carbon tax would merely be an additional cost.'

You might call this a transformation plan—and, Senator Carr, it might well be a transformation plan—if there were an alternative technology readily available in the next couple of years that the steel industry could pick up off the shelf out of Europe, Asia, the United States or some­where else and apply to their production practices in Australia. That might then transform the industry. It might transform their emissions profile. It might actually be part of a transformation plan. But, when that alternative technology is not available, this is nothing more than a bandaid. It is simply a bandaid. It is a handout given, as I said before, to keep the industry intact past the next election.

Do the industry welcome it? Of course they do. It is better than facing the carbon tax without this. But, from the coalition perspective, our position is crystal clear: the industry should not have to face the carbon tax and therefore should not have to have the compensation. If you want to provide funding for alternative purposes—to address the impacts the industry feel from the higher dollar or from the higher labour force costs that come from the industrial relations policies of this government; if you want to provide funding for other purposes—that is a separate debate.

But the government in every sense except the parliamentary votes has coupled this package with the carbon tax. It was only developed after the carbon tax was developed, in response to steel industry concerns. The legislation was only drafted and released with the final pieces of the carbon tax legislation. When the government wanted to have a committee of this parliament inquire into this legislation, it lumped it in with the carbon tax legislation. At every step of the way, this has been done in tandem, in lock step, with the carbon tax because that is what this proposal is all about. It is only out of a sheer political desire of the government to try to somehow wedge the opposition on this issue that it seeks a separate vote.

That is why we will not fall for such a blatant, stupid, political tactic. Our vote on this legislation will be the same as our vote on the carbon tax legislation because the two should have been voted on together. They should have been voted on as a package. Everyone in this chamber knows that. Everyone in this chamber knows that the two are in lock step and they should be voted on as a package. It is to the government's shame that they were not voted on as a package. And that is why the coalition will stick absolutely to the consistent position that we have taken throughout the debate today and over the last few days.

I did notice whilst in the chamber before that Senator Milne sought to move a second reading amendment to this legislation. Can I just reflect—because I had the opportunity to do so a couple of times during the debate on the carbon tax bills that were debated together, as against this carbon tax bill that is being debated separately—on how the tactics and approach of the Greens have changed in this place. Once upon a time, if the Greens wanted the government to consider a plan—be it for the Illawarra or elsewhere—as part of legislation, the Greens would propose detailed amendments to that legislation. They would take it into the committee stage and those amendments would be debated and would become part of the law if they were successful. Now, though, we see that, because the Greens dare not rock the boat with the government and the government dare not rock the boat with the Greens, the Greens have been pushed down to the stage and reduced to the point of simply doing second reading amendments to try to signal what they might like—to signal that they would like the government to take into account certain things in the proposal—rather than actually trying to put it in the legislation that the government should take into account certain things. This is what the Greens have been reduced to.

Of course, I can understand why the Greens might be a little timid about what they want to say in this regard, because we had the very embarrassing situation earlier this year where Senator Hanson-Young, from my home state, was quoted in an article headlined 'Steel town could thrive without steelworks, says Hanson-Young'. I tell you what: that was news to the people of Whyalla. They are very resilient people in Whyalla. They are very hardworking people. They are very decent people. They are people who try, of course, to generate a range of other industries and activities in their city. But OneSteel is directly responsible for the jobs of up to 4,000 people in this city of 22,000, and the very notion that Whyalla could thrive without the steelworks—thrive, no less—is, of course, just utter, utter madness.

My colleague Senator Colbeck, I think, highlighted just how much damage the carbon tax has done—in particular to BlueScope and OneSteel—in his contribu­tion. He demonstrated that more than 60 per cent of the market capitalisation of those companies has been wiped off the share market since the carbon tax was intro­duced—well above what has been felt anywhere else. That is because the share market knows that, for the long term, this Steel Transformation Plan does nothing. It is no more than a bandaid designed to see the government past the next election.