The trade union wants the State Treasury not to interfere in the financing of the industry

In short:

Divisions are growing over the government’s key Future Made in Australia bill, with one key union calling for Treasury control over the $22.7 billion plan to be curtailed.

AMWU Secretary Steve Murphy says the Treasury is not equipped to assess where public investment in net zero emissions industries should be placed.

What’s next?

Parliament will resume next Monday, with the government pushing for the bill to be passed in the Senate before the next elections.

An influential union wants the federal government to curtail Treasury’s role in the $22.7 billion Future Made in Australia industry plan, saying the department’s penchant for “market-based” solutions will hinder transformation.

The Australian Manufacturing Workers Union (AMWU), which is the dominant left-wing union and a source of talent for Labor in Parliament, wants a “tripartite” council to decide which sectors deserve taxpayer support.

Instead of Treasury officials examining the proposals, the analysis would be carried out by a group of policy experts, trade unionists and business representatives, supported by the Department of Industry.

The appeal exposes divisions over the government’s key Future Made in Australia bill, which is currently before the Senate and would give Treasury broad discretion over where support for industry should go.

The legislation includes safeguards for how taxpayer money is spent through the creation of so-called “sector plans” that Treasury would develop in areas where Australia has a natural competitive advantage.

The restrictions are designed to avoid wasteful public spending, but the AMWU-led groups say the Treasury’s role should be curtailed because it has “limited expertise” in industrial policy and has “historically favoured market-based solutions which are an obstacle to the coordinated efforts so urgently needed to transform these regions and our economy”.

Criticism of the AMWU has weight within the federal Labor Party. Pat Conroy, the recently promoted Cabinet Minister for Defence Industry, was the union’s national economist from 2004 to 2008, while Senate faction member Tim Ayres is a former leader of the union in New South Wales.

Senator Ayres was promoted in last week’s ministerial reshuffle, which included changing his title from Assistant Minister for Manufacturing to Assistant Minister for the Future of Made in Australia.

Tim Ayres, former Secretary of the AMWU in New South Wales, is currently Associate Minister for Future Made in Australia.(ABC Coffs Harbour: Ruby Cornish)

AMWU national secretary Steve Murphy said Future Made in Australia must focus on transforming the economy after more than four decades of market-oriented policies.

The End of “Dig and Ship”?

Australia needs to “become more than a quarry and a farm and a nice place to visit, which we have become because we have left it to private capital to shape what this country is,” Mr Murphy told the ABC.

“This is about moving Australia up the value chain and away from the concept of mining and shipping.

“We have nine of the ten components of a lithium battery, but if we leave it to the market, they will send (lithium) abroad and we will import batteries.”

Critics of the Future Made in Australia Act, including the Productivity Commission and key business groups, say it risks misallocating scarce taxpayer resources. The bill also fails to include “rides” for the government to withdraw support for failed investments.

Labour set out its plans in the May Budget, which are part of wider measures to boost investment in net-zero technologies and exports, including key minerals.

Trade union says production is a question of ‘how’, not ‘if’

However, Prime Minister Anthony Albanese also said the strategy was to build domestic capabilities in highly competitive global industries, including battery and solar panel manufacturing.

The AMWU says its 60,000 members are playing a key role in the transition to net zero emissions, including workers it represents in the existing coal and gas supply chain, as well as those who build and maintain electric vehicles, wind towers and solar panels.

In its letter to the Senate, the AMWU hails the government’s determination to “reindustrialise the Australian economy”, calling the Future Made in Australia Act “the most significant policy change in this area for a generation”.

The document says the plans represent a significant shift away from the “ineffective ‘dig and ship’ model that has characterised the Australian economy since the 2000s”.

“We welcome and share the Federal Government’s view that a coordinated, broad-based industrial policy, combined with strong working conditions, is the way to win the climate wars, provide security for working people and transform Australia into a net zero emissions nation in a way that is inclusive and inclusive of communities,” the letter reads.

“We are now moving from the question of ‘if we will’ do something to the question of ‘how we will’ do something in Australia.”