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Wednesday, 24 October 2018
Page: 11030


Mr CHAMPION (Wakefield) (10:23): On 12 October 2017 the then Minister for Defence Industry, Christopher Pyne, said:

The valley of death is over and we are now seeing a upturn of employment in naval shipbuilding in our state that will only continue to increase as these new projects gain momentum.

On page 30 of the ANAO report of this year there is a graph. That graph shows the valley of death. It shows how employment goes up and up and up during the Labor years and then slowly goes down and down and down until it hits the valley of death, and then it goes up again.

The DEPUTY SPEAKER ( Mr Hogan ): The member for Wakefield won't use props.

Mr CHAMPION: I knew the Deputy Speaker was going to say, 'You can't use props,' but this is an important graph, because it puts the lie to the minister's statements made last year. The fact is the minister and the parliament know, because of the ANAO report, about the terrible economic cost that is going to go on not just to individual workers who are being made redundant as we speak—I know workers who have been made redundant as we speak—but to the nation. This is a cost to future shipbuilding projects.

The ANAO report, on page 29, says:

Defence has not determined industry workforce requirements for the naval construction programs.

It goes on to say:

The assumptions of Defence's current workforce planning activities are not based on a cost-benefit analysis. In particular, whether maintaining the shipbuilding workforce between the Hobart Class Destroyer and follow-on surface-ship builds is the most cost-effective way of establishing the naval shipbuilding enterprise.

What that tells us is that the terrible cost of redundancies is not just going to be borne by workers; it's going to be borne by the shipbuilding industry. We're going to make all of these workers redundant, we're going to pay them redundancies, they're going to go out to the private sector and get other jobs, and then we're going to have to rehire those workers, if we're lucky. If we're unlucky, they'll go off to other industries and we'll never see them again.

The destruction of one skilled workforce and the creation of the other is going to cost this nation hugely. It's going to cost us in lost productivity in future naval shipbuilding projects. This government is slowly walking South Australia's shipbuilding industry into a skills shortage, and that skills shortage will cost the nation. It will cost us in future productivity losses. It will cost us in future productivity costs. It will be a terrible blight not just on those individual workers who have lost their jobs but on the state of South Australia. This is something that the government should not be crowing about. They should be hanging their heads in shame because it's going to cost the country. Making these workers redundant—unnecessarily, in my opinion—is going to cost this country dearly.