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Thursday, 25 March 2021
Page: 99


Mr BRENDAN O'CONNOR (Gorton) (12:20): While there are so many things I'd like to respond to in relation to the appropriation bills—there are so many things that are deficient insofar as the government's performance with respect to a whole series of issues in and outside of my portfolio—the one thing I'd like to touch upon, which was just mentioned is, the absolute disregard for the importance of maintaining the efficacy and equity in the largest employment subsidy program we have seen.

It's true to say that the government finally got around to introducing JobKeeper. But when I asked the Prime Minister in question time whether they would have a wage subsidy his answer was that there was no need. Fortunately they reconvened the parliament and introduced JobKeeper. But we did not expect, many months on, to see that program—billions of taxpayers' money—being used to enrich the very, very rich friends of the government. We did not expect to see corporate executive bonuses being paid in companies that were in receipt of JobKeeper. Quite frankly, that is outrageous, and it is incumbent on those companies to do what other good companies have done and pay back taxpayers' money to the Commonwealth rather than game the system so that they can pay bonuses to corporate executives. That was not the intention of the wage subsidy. The wage subsidy was to look after workers and to look after businesses that were struggling as a result of the restrictions imposed upon them quite rightly for health reasons. Therefore, we need to see those companies do the right thing and pay back that money. As the Labor leader said recently, this government is weak on the strong and strong on the weak. We only need to compare the government's approach to JobKeeper being used for bonuses by companies in this country with the way in which they went about robodebt, where they attacked the vulnerable and threatened them with jail, many times completely erroneously. They have never really apologised for that absolutely outrageous behaviour by the federal government. We want to see better from the government in relation to dealing with people who are seeking to game the system in order to use and misuse taxpayers' money. That needs to be done as a matter of urgency.

In relation to my own portfolio, I have to say that it is replete with problems, mistakes and dereliction by this government. We have seen blowouts in contracts. We have seen blowouts in expenditure. We have seen a failure to ensure that our defence industries are getting sufficient parts of the largest contract that the Commonwealth has entered into in our history. For example, we have a situation where this government went to the last election promising that the Future Submarine Program would have 60 per cent local content. From that commitment it's fair to assume that local businesses, small, medium and large, would have felt that they would have had a great chance of securing a lot of business out of the biggest contract the Commonwealth has entered into in relation to this matter. Nearly $90 billion will be spent.

But what we found after the election was there were no enforceable provisions in the contracts to compel the government to ensure that the prime contractor, Naval Group, provided that work to local businesses in this country. So we have a promise by the government, an announcement by the government, but no delivery—an announcement before the election, an undertaking to the Australian people; and yet after the election we find there is no enforceable provision inside that contract to compel Naval Group to provide work and business to our defence industry.

What we have now seen, as a result of that deficiency, is them seeking to retrofit the contract. What they have suggested is that they have secured that commitment now. But what we saw, what was revealed in Senate estimates yesterday, was that the government has, firstly, despite its promises, not seen the provisions of the contract that have been inserted, apparently, into that contract. What was revealed at Senate estimates yesterday is that not one minister has actually seen the words that were apparently included to ensure that local businesses secured sufficient work and were able to grow as a result of that. Nothing has been forthcoming. There is no accountability, no transparency, and now we find that not one minister—not the Minister for Defence, not the Minister for Defence Industry, not the acting defence minister—has actually seen the words that were apparently added to that contract.

Why should we believe this government when it comes to this matter, given the failures we have seen in the past? Why should defence industry in this country invest in this area without it being fully transparent that there is sufficient work for them? It's incumbent on the government to explain exactly what is happening with respect to this contract. Not only has nobody in the cabinet seen the words that are supposed to be now included in this contract with the very, very large French prime contractor; but also there is no way of us understanding whether that content, even if it is in the contract, will secure the commitment of at least 60 per cent for local businesses. The problem we have with that is that that promise is hollow if we're not sure about the terms of that contract.

There is no accountability, no transparency, no confidence in the government in relation to this matter. That is a real, real problem. We don't know if Australian industry content is on the right trajectory until the third or fourth submarine due in the mid-2030s. So we will not even know, unless there's more accountability by this government, for 15 years. It will take us 15 years to be assured of whether that's a commitment. That is not sufficient. You cannot rely on that as a result of the government's very hollow promise.

The problem with the government is it made commitments even though it didn't secure the provisions. There's been no focus by the government on its job. These matters should have been resolved, determined, at the beginning. When you enter into a contract they should be secured, and it should be fully understood so that the defence industry know that they will be part of the supply chain and part of this contract in a proper way. But that hasn't been done, and this attempt to fit it retrospectively is very, very dodgy. It's very, very unclear and, indeed, we don't know the details.

For example, apparently there are penalties if Naval Group do not provide local content as agreed; but we don't know the quantum of the penalties. So we don't know whether the prime contractor will say, 'We'll just build the penalties into the costs and not provide that local content.' If the penalties are not high enough to ensure that Naval Group provide local businesses the work, then why will they necessarily engage with local businesses?

If the penalties are negligible and not going to deter them from acting in contravention of the terms of the contract, then how can we be assured that local businesses will be in receipt of that work? Well, we cannot be assured, and the government have not given us any reason to believe that they have fixed this problem.

We have a Minister for Defence who, of course, is absent, and that's for medical reasons. We have rumours abounding that the defence minister is about to lose her job to the Minister for Home Affairs. We have an acting defence minister who has not understood or fully followed the current problems. We have a government that are completely unable to focus on the biggest expenditure, when it comes to contracts, in this nation's history. They must do better. They must make sure that businesses in this country are provided sufficient work out of the billions of dollars of taxpayers' money that are building our defence assets and our defence capability. If that does not happen, then we will not see businesses grow, we will not see sovereign capability enhanced and we will not see sufficient jobs for workers in this country. It will come down to just the abject failure of this government to do what it promised to do before the last election and continues to promise, without any confidence by anyone that it has done what it promised.

The DEPUTY SPEAKER ( Ms Vamvakinou ): The original question was that this bill be now read a second time. To this the honourable member for Kingsford Smith has moved as an amendment that all words after 'That' be omitted with a view to substituting other words. The question now is that the words proposed to be omitted stand part of the question.

Question agreed to.

Original question agreed to.

Bill read a second time.

Ordered that this bill be reported to the House without amendment.