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Thursday, 25 August 1994
Page: 314

Senator SPINDLER —I give notice that, on the next day of sitting, I shall move:

  That the Senate—

  (a)notes the article by Mr Peter Roberts in the Australian Financial Review on 24 August 1994 which calls for an abandonment of the Government's economic rationalist position of `hostile rejection of intervention of any kind' in industry policy;

  (b)supports the call for a developmental industry policy based on a national vision of a desired industry future, and explicit sectoral and regional development strategies;

  (c)rejects the static model, comparative advantage and tenets of neoclassical economics, and instead recognises the validity of Professor Paul Romer's `new growth theory' which identifies innovation as the basis for economic growth;

  (d)notes further that the `new growth' model recognises that industries, particularly high-tech industries and those which involve high levels of research and development, generate `knowledge multipliers' which drive growth in other sectors;

  (e)accepts that this analysis means that the market, left to itself, will under-invest in these growth-generating industries and that strategic government intervention is absolutely essential to achieve best outcomes; and

  (f)calls on the Government to wake up to modern economic theory and start to fill the vacuum that it calls its industry policy with some `pro-active' intervention.