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Wednesday, 9 November 2011
Page: 8635

Senator BERNARDI (South Australia) (10:01): Before I address the specifics of the Steel Transformation Plan Bill I feel it is necessary to respond to some of the perfidious words of Senator Cameron. We have heard a monotone misleading of not only many aspects of this bill but the coalition's position on it. The first thing I would like to turn my head to is Senator's Cameron's claims that he was not the beneficiary of some preselection deal or some night of the long knives and that he was not an ambulance chaser. I suggest that Senator George Campbell, a former senator in this place, would say something different. Senator Cameron was the beneficiary of a plot against a sitting senator and was the beneficiary of a stitched-up preselection deal, which he now denies. So it is a bit rich for Senator Cameron to be saying that he is not the beneficiary and he is somehow authentic. He is so authentic as a defender of the workers that he voted for a carbon tax which this bill is directly related to. Once again, the perfidious words of Senator Cameron said it is not; it has nothing to do with it. But it does, and it was dealt with as part of the carbon tax package of bills through a Senate inquiry. So it is directly related to this bill.

Senator Cameron went on and said that manufacturing was under pressure because of the Australian dollar. That may indeed put additional pressures on the manufacturing industry in this country, but make no mistake: the people of Australia and the manufacturers of Australia know that the issue at stake here is the fact that this government is increasing the cost base for manufacturing by imposing a carbon tax. That is undeniable, it is indisputable, and that is why we are talking about an assistance package for parts of the steel industry. Senator Cameron also said there was a need for decent management, and I agree with him there. I think there is a need for decent management, particularly in the Labor government, because the Labor government have mismanaged every aspect of policy that they have introduced into this country.

Finally, in responding to Senator Cameron's comments, the politics of envy ooze out for everyone to see. For some reason he is claiming that because he did not go to a private school people who did are somehow terrible people or have had some privileged life. That is an insult to the many thousands of men and women who work very hard to send their children to private schools, and that includes a lot of parents who take on a second part-time job just to pay for that. The politics of envy do you no favours, Senator Cameron; nor do you for the workers of Australia when, as the supposed champion of the Left working class, you go into your caucus meeting and you roll over because you get defeated every single time.

Senator McEwen interjecting

Senator BERNARDI: If you cannot advocate properly, do not advocate and do not pretend that you are. Having exposed Senator Cameron's talking points for what they are, just tired old Socialist doctrine, I turn my attention to the direction of this bill. The only reason this Steel Transformation Plan Bill is being introduced is to limit some of the damage caused to the steel industry by the imposition of Ms Gillard's carbon tax. This is a tax, of course, that was passed yesterday. It was the tax that was promised would never be introduced not only by the Prime Minister but also by Mr Swan. Fifteen of those on the government side of the chamber were elected at the last election promising not to have any carbon tax, and I notice that Senator McEwen has fallen silent after her earlier interjection. That is because she was elected at the last election as well—

Senator McEwen interjecting

Senator BERNARDI: She was elected at the last election as well, promising there would be no carbon tax. Yet what did she do yesterday? She voted for it. The only person with any shred of decency on that side is Senator Conroy, who hates the carbon tax and refused to come in. Senator Feeney disappeared as well, as did Senator Arbib, who was indisposed overseas. They are the only people with honour.

This is the issue: we know this carbon tax is going to be a disaster for Australian industry, and this bill is a tacit admission of it. If there were not a carbon tax, there would not be a need for this kind of compensation in the first place. There would not be a need for $300 million to be doled out to two individual companies. And might I say that on 10 October 2011 Greg Combet, the Minister for Climate Change and Energy Efficiency, admitted that the establishment of the Steel Transformation Plan had been driven purely by the carbon tax when he said, 'The negotiation of the Steel Transformation Plan did come out of the discussions we've had with steel companies for months now over the carbon price issue.' The carbon price issue! What a way of describing exporting tens of thousands of jobs overseas, seeing industry flee overseas and seeing carbon dioxide emissions increase. But what really galls me about this is the fact that it is so selective. As this government always does, it plays favourites. It picks and chooses who it wants to be the winner, because under this plan there were only two Australian firms—albeit significant firms—that will qualify for assistance: BlueScope Steel and OneSteel. This is because the definition of 'eligible corporation' in clause 4 limits it to them.

This overlooks some key statistics that I think the Senate needs to be advised of. These two firms, I understand, employ somewhere between 15,000 and 17,000 employees, but every other steel business, including what are estimated to be the thousands of steel fabricators all over the country, many of them longstanding family businesses—people who have not had privileged backgrounds, who have worked and built their businesses from the ground up, and who should be admired by Senator Cameron and the people on the other side but instead are decried for making a success of their life—will not receive so much as a single cent of assistance under this legislation. I have to say that I am only estimating how many firms these are, because the Australian Bureau of Statistics has not kept the records for a number of years, but in 2006-07 there were around 91,000 total employees across the entire Australian steel industry chain. We have $300 million going out to two businesses that have about 15,000 to 17,000 employees, and we have nothing going to the other thousands of businesses, including the family-owned businesses, who are going to be equally affected by this carbon dioxide tax as it puts up the price of electricity and manufacturing—wages are going to rise, and all of these things. But there is nothing for them. If this does not smack of a government just trying to buy largesse and thinking, 'Well, we can placate these larger firms because they're the ones that will make the noise'—if it does not have the stench of a government that is desperate to quieten down any dissent—I do not know what does.

The frustrating thing also is that the government cannot even get its own lines right about how long this is going to take—how long this compensation package is going to be introduced over. Clause 12 of the Steel Transformation Plan Bill clearly states that the plan covers the four-year period from 2012-13 to 2015-16. But, of course, the government cannot even get its own lines right, because it makes it up on the run in general. On 12 July a joint media release was issued by Mr Combet, Sharon Bird and Stephen Jones, the member for Throsby, which stated:

… the Government will introduce a Steel Transformation Plan which will deliver assistance worth up to $300 million over five years—

not the four years that it says in the transformation bill but over five years—

to encourage investment and innovation in the Australian steel manufacturing industry.

They cannot even get the timing of it right. They have gone from four to five years. Mark Dreyfus, from the other house, said:

The Steel Transformation Plan will provide assistance of $300 million over five years.

I have trouble listening to or believing much of what Mr Dreyfus says, quite frankly, because I was on national TV with him once and caught him not telling the truth. I repeatedly pushed him and he kept saying yes, he had read a document which he clearly had not, and then he tried to misrepresent what was in the document. So there is a credibility issue there with Mr Dreyfus, but I think he is part of the ministry of this government. He said it was over five years as well, notwithstanding what the bill itself says. But the official websites of the Department of Innovation, Industry, Science and Research, who should be at the forefront of everything, and the Department of Climate Change and Energy Efficiency both state, 'The plan will operate over six years.' What is it—four, five or six years?

Might I suggest to you that the whole thing could be exhausted in two years, because there is a provision for as much as $164 million to be paid out in advance, before the carbon tax is even introduced. There is the one-off sweetener: 'There's your sweetener. Please don't complain. Have $164 million.' And then as much as $75 million can be paid out each financial year. That would give rise to $75 million being paid on 30 June of one financial year and another $75 million being paid on 1 July of the next financial year—the very next day. So, in effect, you have $164 million paid out up front and then you have $150 million paid out over two days. That is what is supposedly going to last four, five or six years. No-one is really sure, and no-one is sure what this government is actually doing.

But one thing that people can be absolutely sure about is the effect that this carbon tax has had on these two individual firms, notwithstanding the compensation that is being offered to them—this $300 million incentive. Immediately before this incentive was announced, the price of OneSteel shares was $2.03. Immediately following the announcement, the shares dropped to $1.93. That is a significant amount of shareholder wealth that has evaporated—somewhere to the tune of $133 million. What has happened since as more detail has emerged about this carbon dioxide tax that is going to disincentivise industry from remaining in Australia, limit growth of our industry, put the price of every consumer good up as a result of the electricity needed to produce it in this country and put pressure on employment and put pressure on domestic growth? What has happened since then? Quite frankly, it is all bad news for the shareholders of OneSteel, because their share price has dropped from $2.03 before this assistance package was announced to—at 8 September, when I have the most recent figures—96c. In the nine or so months from when the carbon pricing scheme was announced in February to 8 September, we have seen $2.5 billion wiped off shareholder value—$2,530 million. That is an extraordinary loss, and that is what this government calls innovation. That is what this government calls enterprise and growing Australia. But it is not just OneSteel; of course, BlueScope Steel has suffered as well. On 23 February, when the carbon tax was first mooted, it was at $2.20. By the time this compensation package was announced in July, the shares were down to $1.26. Today they are 74c; $2,662 million of shareholder wealth has disappeared, and we are expected to be convinced that this is innovation and somehow the shareholders will do better because there is going to be a $300 million payment to them over two years. This is an absolute folly. It is a joke, as are most of the government's policies in respect of supporting industry. When I first came into this place I once gave a speech saying that if we had Minister Carr running the manufacturing industry in this country the problem would be that we would ultimately see the decline of manufacturing. I stand by that because the proof is there. We are watching the diminishing of manufacturing in this country. We have seen Mitsubishi close on his watch. We have seen the motor vehicle industry under pressure on his watch. Now we are seeing the steel industry under pressure on his watch.

Of course, Senator Carr came in and gave me a huge spray. He did me the courtesy—I will pay this—of ringing up and saying that he was going to give me a spray in the parliament. But the proof will be in the pudding. We will see the decline of manufacturing in this country, and we are seeing it. And we are seeing a desperate government throwing taxpayer money where shareholder money should be. I mean, what sort of deal is it where you can destroy over $5 billion of shareholder investment and wealth, which is national wealth I have to tell you, and use the excuse that you are going to give us $300 million? It beggars belief. It does not pass the commonsense test.

These are the sorts of things that Australians are concerned about. We are worried about them because the compensa¬≠tion is dwarfed by the loss of shareholder values. It is not a good deal. The whole pretext that this is somehow going to drive renewable energy or that there is going to be some sort of benefit for us is simply not true. You cannot have renewable energy powering a steel furnace. I do not know anywhere in the world where it is done. Maybe it can be done here. I doubt it. We should learn from the experience of other nations. We should learn from their experience as to how they have generated jobs growth, not just in the mining industry—we are blessed with a great many resources in that respect—but in having a competitive manufacturing industry. And that means not imposing punitive taxes like a carbon dioxide tax across our entire economy at such a high level, which no other country in the world is doing.

Consider our competitor nations. Canada has entirely ruled out having any sort of carbon dioxide tax. They have just said, 'No, we are not going to do it. It is ridiculous. It is silly.' We have the European Union, which is probably as close to broke as it can get, where under the emissions trading scheme over there it has been estimated that over 90 per cent of the trades are actually fraudulent, pass-the-parcel trades, or rorts designed to get taxes out of it. My own research has indicated that there are huge concerns about the renewable energy industry in parts of Italy and Spain because it has been taken over by organised crime because they know that these subsidies are easily rortable. What we are seeing is a repeat of this sort of problem in this country. So devoid is this government of any new initiative that could possibly be called innovative or that could possibly reflect Australia's unique position in the world, they are just grabbing a hodgepodge of solutions from Europe. And Europe is not the best example, I have to tell you, of encouraging independence, thrift, enterprise and innovation.

We should instead be looking to our nearest neighbours and our major competitors in this respect—the people that we are trying to sell steel to, which is mostly Asia. We should be looking at what they are doing. Let me tell you this: yes, they have an investment in renewables in many instances and that is okay. We have some of that here too. But they are building plenty of coal fired power stations. They are not imposing economy-destroying carbon dioxide taxes because they know it is folly and will severely impact the national economy. Unless the rest of the world is following along it will make no difference whatsoever to the environment or to the climate. There are those of us, and I am one of them, who have some suspicion that even if the rest of the world did something it would make no difference to the climate. But that is not the point. Why would Australia go it alone in this process? A whole range of maxims will be trotted out about all the other countries that are doing this and how prosperous they are. Well, they are not prosperous. Spain is not prosperous. Italy is not prosperous. Greece is not prosperous. You have financial issues right throughout the European Union.

Ms Gillard held America up once and said, 'We should be modelling our economy on the Californian experience.' California has seen industry run over the borders into other states where they do not have these punitive green regimes. California is as close to broke as it gets. It needs to borrow money to pay its payroll. It is an absolute disgrace. And yet that is what Ms Gillard wants us to model our Australian economy on.

Well, I say, no, let's not do that. Let's not punish firms that want to invest and employ Australian workers. Let's not just mouth rhetoric about supporting Australian workers and yet try to shut them out. Let's not stand up and say, 'I have been a union boss so I know what is good for the workers.' Let me tell you: I have been an employer; I know what is good for the workers—a business that thrives and prospers. That is how they maintain their employment. Let me assure you of this: every decent employer in this country who has a decent employee will do whatever they possibly can to keep that employee happy because they want to keep them because they know they are an asset to the business. Every business owner that I know says they want a happy workforce. But there are problems when you have troglodytes like Senator Cameron and his ilk. Senator Cameron and his ilk see only the politics and the business of confrontation, where businesses need to be smashed in order to somehow protect workers. We saw it last week in the Senate inquiry when he was jumping up and down and trying to grandstand against Mr Joyce from Qantas. Shame on Senator Cameron and his ilk for doing that because Mr Joyce had to take a stand for his business, his shareholders and the Australian people. It is all right for Senator Cameron and others to criticise Qantas, whilst they are flying with them as often as they possibly can, but it just beggars belief. Hypocrisy writ large is so evident in this place. When people are standing up here saying that we do not care for the workers because we want to make sure there are prosperous, growing industries that we are not exporting overseas, because we oppose ridiculous policies that are not going to achieve the stated aims and are going to impose an impost on Australian thrift, entrepreneurship, enterprise and prosperity, we have every right to say this is wrong. We are not opposing the issue that Australian industry does occasionally need some support— (Time expired)