ED HUSIC, MINISTER FOR INDUSTRY AND SCIENCE: Hi, everyone. Thank you for joining us. This is a big day. It's a big day for Australian manufacturing, it's a big day for Australian jobs. It's a big day in fulfilling the Prime Minister's vision for a future made in Australia. We said this through the campaign and it was influenced by what we all experienced living through a once-in-a-generation pandemic which had massive impacts on our economy and had profound pressure on industry. We said we would learn the lessons and this is evidence that that is not just talk, that we will bring this into effect.  

When the Prime Minister made this commitment leading into the election, we said we would deliver it. Today is one step towards doing just that. It's part of our plan to ensure that we start dealing with some of the issues that come around our dependency on concentrated, broken supply chains. That supply side issue is driving a lot of problems that we've experienced in translating in inflationary terms and what we've seen with the rise in interest rates. The inability of the Coalition to deal with those supply side issues - the way that they had massive deficits, drove up debt and then put us on this trajectory. We've inherited that, we are forced to contend with it and the NRF is playing a role there.

And in terms of the $15 billion in growth capital that will be unlocked through the NRF - what we want to see in key priority areas: value add in resources, value add in agriculture, support in medical sciences, defence capability, energy in terms of low-emission or no-emission technology and the manufacturing of that on shore, and enabling capabilities, particularly around quantum, AI, robotics is what we need to drive future growth. Really important longer term to see our investment as a country step in when others may have vacated the field.  

And the Reconstruction Fund itself, again, is a co-investment fund. We want to work with superannuation. We're blessed with the fourth largest savings pool on the planet. We can work with superannuation, we can work with venture capital and private equity and increase the amount of capital that's available, particularly for SMEs when they want to grow. 

We also want to make sure that we support the growth of manufacturing in our regions. Currently 90,000 manufacturing firms in this nation, a third of which are outside our capital cities. Queensland boasts having more regional-based manufacturers than any other state in the country. We can all emulate that type of success and do more to diversify economic growth in our regions.  

But ultimately, this is about jobs, long term. A country that makes things makes great jobs. Manufacturing provides 900,000 jobs in this country and 85 per cent of them are full-time, secure jobs. Really important for a lot of people who feel a sense of pride about what they do and, ultimately, and I will end on this point, this is about backing Australian know how. This is not some one-off thrown off line. This is really important. Ideas that come from the factory floor, the lab bench, board rooms. They actually create firms. They generate jobs. And a lot of Australians are tired of hearing firms that have left our shores because they couldn't find the capital to back their ideas here but had willing investment partners overseas, or other willing governments prepared to back them. 

We can end that and we can support those great Australian ideas that translate into jobs and this is Labor backing in entrepreneurism, the growth of new firms, manufacturing jobs, and on this final point - I said the other one was my last one but I will make it this one - I suppose that isn't first time it's happened, right? 

The last thing is my profound disappointment at the Coalition. This is a Coalition, through Peter Dutton, that said it was the party of the working class and it wasn't there for manufacturing. You just can't say that. You cannot say you back blue collar workers but refuse to be there when they need your support and particularly in terms of manufacturing. 

We've worked with others in the Parliament and I continue to extend an offer to the Coalition. If they want to work with us on this, we'll work on it. This is a National Reconstruction Fund that we can all build as a nation-building moment in time and to make sure it's enduring requires all of the Parliament to step up and make sure this fund works.

  

JOURNALIST: Adam Bandt has said the Parliament has accepted the principle that coal and gas is different by accepting those amendments and that might have a bearing on negotiations for the Safeguard Bill; do you agree? 

ED HUSIC: I think there will be a lot said in respect of that amendment that they've moved, and I understand their motivation for moving it, and from day one when it emerged that this was the position of the Greens. We indicated to them that the NRF is about supporting manufacturing and not about a lot of what their concerns that they expressed. It wasn't about extraction of coal or gas and it wasn't about transmission of gas. This is about manufacturing. 

So if they wanted an amendment that specified and enshrined that, then all well and good and we've done that. And from our point of view, if you look in the priority areas, the value add in resources, if we can find ways instead of just mining stuff and shipping it overseas, if we can find the value add, particularly at this moment in time where the world is after our critical minerals and rare earths, then by all means we should have the means within us to value add there and transform them, for example, in energy storage systems, batteries that can be used by industry.  

So we think that it's a straightforward proposition. It's common sense, basically, endorsing what we think the fund would do. 

In reference to safeguards, I'll leave that in terms of my colleague and friend, Chris Bowen, to manage. We're not trying to cross streams here. We're dealing with these things in a very methodical manner but I think I'd be very careful about reading too much into what we believe is just a common sense proposition. 

JOURNALIST: You said before Christmas in a speech the global capital made these government investment funds, I guess, more necessary. Now with the advent of Biden's Inflation Reduction Act and a couple of billion dollars, we're seeing a flight of capital to the US for subsidy schemes like that, do you think this is now enough in the context of the sort of hoovering effect of the Inflation Reduction Act and other things in the US? 

ED HUSIC: To be frank with you, I was worried about that initially because it is a lot of money that they were putting on the table, the Biden Administration. But I think it's a matter of perspective and flipping it. In the talks I've had with the Biden Administration, I was there in late January, they recognise they can't do it all and that in terms of the value and supply chains other countries are going to need to lean in and contribute. 

They've got great interest in what we're doing around the Reconstruction Fund through to what the development of a national battery strategy to scale up, for instance, the development of onshore - manufacturing of onshore batteries. And so they also see this concept that they've advanced friend shoring, working with trusted partners, to meet some of the objectives of what they've got. 

We have a great entry point with the existence of a trade agreement with them, that ensures that they will recognise our contributions as part of that. 

If I may be direct with you, I think there's an opportunity to work with countries in the region that might not have a trade agreement with them, although I respect the fact that their law is structured in the way it is. But our friends in Indonesia, a massive market to our north, have expressed their willingness to work with us on some of these particularly low or zero emissions energy-generating technologies and the manufacture of them. I'd love us to find ways to work in closer with them and make that something that can tie into what the Biden Administration wants to do. 

But I actually think there's a lot more scope for us to do it. I don't think necessarily I wouldn't accept the proposition that we're outgunned financially because we always will be given the size of that market, right? But we are making a contribution. The Prime Minister's commitment to a future made in Australia and having the vehicle of the National Reconstruction Fund in large part, will deliver that is something that's been noticed by our allies and there's a door open for us to work with them on it.

  

JOURNALIST: What is the signal that this decision sends not only in your own portfolio but across policy about whether coal and gas will now be treated differently to other industry and decisions that are made into the future? 

ED HUSIC: I would recommend you take note of the Prime Minister's comments about the role for gas. There is an established role for gas and if I can say to you as an industry minister I know and the reason I fought so hard for some of the energy price relief was that industrial users make up half of domestic gas demand. The way that their operations rely upon gas as part of feedstock, not just about energy generation but feedstock as well. Gas has got a big role to play longer term. 

Now a lot of these firms that do currently use gas, they are looking at alternate forms of energy to support their operations. This is not just a “nice to have” and a statement that they throw out about net zero, they need to work on this. Their investors are expecting them to work on this. And if we can develop technology that can deliver new forms of energy to them that are cleaner and more efficient, and if the fund can establish the manufacturer of that through the NRF, this will be a good thing for the country and it also opens up an export opportunity as well. So, it's important in that. 

We also, within the fund, too, the other point I would make in response to your question, we are saying we want to have a value add in resources. We recognise and I certainly respect, that we've had these titans of the Australian economy - multigenerational titans in agriculture and resources. That's why we want to get more out of what we get from agriculture and resources and we've flagged that from day one in terms of our intention with the fund. So we do see a role to play but we've also got a role to find other ways to generate energy.  

JOURNALIST: Does concession on the coal and gas potentially disadvantage manufacturers who rely on coal and gas whether it's the resources or critical minerals in terms of some of those areas outlined in the NRF, particularly if they use that as part of their generation? 

ED HUSIC: Absolutely not. And the reason I say that with confidence to you is because if you look at the amendment itself, it talks a lot about transmission - extraction or transmission. The NRF is about manufacturing capability. So we want to be able to support manufacturers and a lot of manufacturers want access to growth capital at a time where the cost of capital has risen, where some have seen venture capital, for example, contract, and not be available. We can't afford to have the economy seize. I'm not saying it will seize but I'm talking rather colourfully - that one won't come back and bite me - but we can't afford people, businesses to not be able to have access to growth capital and we want to crowd in investment to make that a reality and that's what this will do. I think manufacturers, by and large, want the chance to be able to have the backing of their ideas and their intention for growth.

  

JOURNALIST: Just a clarification on what the Greens' amendment will mean. Will projects that want to manufacture blue hydrogen from coal and gas and feedstock and then decarbonising it but carbon capture technology. Will funding for those projects be precluded from the NRF now and I suppose as well more novel carbon capture and utilisation storage projects such as direct air capsule, would they be precluded? 

ED HUSIC: If I can come back and reinforce this point. This is about manufacturers who want to make energy, or equipment that is used for the generation of energy from new sources. It's not about someone going off the shelf and trying to install something that's already been developed and it's not supporting the purchase of that equipment. This is about building manufacturing capability that we know will drive longer term economic and commercial growth. So, it's not meant in that way. 

  

JOURNALIST: Minister, a lot of the projects are under the NRF are much longer term projects but the budget last year talked about revenue from this fund. How soon are you expecting to see revenue from the NRF and how much is there? 

ED HUSIC: Look, I'm one of the most impatient people in government. I'm very keen to get this thing up and running very quickly but I also know it's going to take some time to stand up those investments. I don't want that to be a long period of time. If I may pick up on a point that you've raised.  This is an independent board, guided by an investment mandate that's going to be backing firms that can deliver a rate of return to deliver back for the taxpayer. Importantly, if they do deliver, they're likely to deliver on the ground for the communities in which they're operating and we're very keen to make sure that happens as quickly as possible. 

JOURNALIST: How important will it be for Australia to plug the capability gap until we build our nuclear submarines?  And can the Government confirm it will be five Virginia-class subs from the US to help do that? 

ED HUSIC: I do admire the very deft way in which you've delivered that question to me, some of which I might flick to my colleague, the Deputy Prime Minister or Acting Prime Minister, I should say. So no career-limiting moves by me, if you don't mind.  

But on defence capability we have seen that the NRF can support, in particular, the evolution of important capabilities that will be expected by our strategic partners, notably around, for instance, quantum technologies. We're seeing growth in the number of quantum technology-related firms in this country. We don't want them to feel like the only way they will get capital is if they go to some other country to get that or have some other government back that. These are going to be important, not just from defence capability but the spill overs that will have great economic commercial benefit as well. So the more we develop onshore, the better for the rest of us longer term.

  

JOURNALIST: Minister, you've spoken about the prioritisation for some of the funds in the NRF - battery manufacture, clean energy generation as well. Obviously that could be enhanced by supply of critical minerals into the manufacturing. Could you just speak to how coordinated is the Government's policy at the moment in terms of the resources, the Department targeting specific deposits for development supply chain there. I mean, it seems that you need to do those two ends of the supply chain to meet up. What are you doing to make that happen? 

ED HUSIC: I think the Government is very focused on this across portfolios and the Prime Minister - a big deal to the Prime Minister. I mean the Prime Minister wanted this fund set up and you will quite often hear the Prime Minister talk about the lessons we learnt through the development of solar technology where a lot of the IP emerged onshore and then the manufacturing went somewhere else and we had to import at a higher price. He's thinking a lot around this on batteries. It's one of the reasons why he's very keen to set up that value-add sub-fund in the reconstruction fund of a billion dollars. 

And so we are very much across portfolios looking at how we can get the biggest bang for the buck, coordinate on that and drive longer term growth. The National Battery Strategy is under consultation right now. There are some great firms in Australia. We launched the consultation at Energy Renaissance in Tomago up in the Hunter and this is a firm that is looking to actually build, manufacture batteries onshore. They're not the only one. But they want to get the processing done. They want to see the processing done onshore because it speeds up production for them. So, the coordination that you're pointing to in your question is really important. 

  

JOURNALIST: Just back to defence briefly, a report in the Fin Review today has a feel that we will need a workforce more than 10,000 to build and maintain the submarines. What steps is the Government taking to ensure that we have that work force, to be able to handle the submarines? 

ED HUSIC: Again, if you don't mind, I might leave some of the specific elements of your question to Richard, to the Deputy PM, and he will, in no doubt, have responses to that. But the issue of skills that you point to, is a big one and I, on coming to Government, I thought that we had three forms of lead in our saddlebags.  

One was around supply chains, which we're slowly sorting through. The other was energy, which we've taken some strong action on and the other one is skills. And while we're developing a lot and we're investing a lot in the skilling up of Australians via vocational or university pathways, and in terms of some of the things you've highlighted in your question, university will be very important there, that's going to take some time. And so the reforms and the review into our migration system that Minister O'Neill has kicked off are going to be really important. We've tried to speed up access to skills from overseas. We are in a global contest for skills. We need to make sure Australia doesn't lag behind and I think there are ways longer term that we can get people in.  

And I just make this point, I would love every single job to be filled by a local but there will be times we need to bring people in, if it enriches our own skills base for industry. Again, it's about not being left behind. All the things that we are doing right now is making sure that we are not a laggard, that we're not following someone else's lead. I want us to have the ambition to lead ourselves but making sure we've got the talent available is really critical. The investments we are making now and the reforms we're making to the visa system are very important. 

JOURNALIST: Minister, you've previously talked about the potential linkage between this fund and the critical technologies required. Are you still confident that the scale of this fund is sufficient for Australia to compete in that space with quantum AI? And are there going to be any developments around specifically linking the priorities more to whatever comes out of that AUKUS pact as there's more detail around the non-submarine aspects of it?

ED HUSIC: I’m genuinely grateful for the question because now I can go to the Prime Minister and say I'm being questioned to get more money. So I'm more than happy to do that. But I think that look, in all seriousness, this is a very big fund. $15 billion is one of the greatest investments in manufacturing capabilities in living memory.  So it's a big start. Obviously, we want this fund to reflect the needs of the economy at different points in time. And there's a case to be made down the track, then let's look at it. But I think it is a big thing - this is a big investment in our industrial capability, and we'll want to get this fund up and running as soon as we can.  We want to get those investments made as soon as we can. And if we need to look at things down the track, we will remain open minded. 

JOURNALIST: Just in relation to multinationals. If the government is trying to get strategic capability onshore, will multinationals be able to access the fund in some way? I'm thinking about things like semiconductors. You can't just build a semiconductor industry here by throwing money at it. You would need to partner with someone. Is that a possibility?  That multinational companies will be able to access the fund either as loans or guarantees?

ED HUSIC: The Bill itself targets firms that are solely or mainly based in this country. And we've tried to prioritise Australian industry. If there's capability that we think is vital to the economy longer term we will always remain open minded as to how we can partner up with firms that want to bring capability onshore. But our priority with the National Reconstruction Fund is Australian manufacturing, supporting capability development and building sovereign capability.

The Green amendment would be fair, to summarise your response, that that amendment stops this fund doing what it was never going to do anyway. But if you wish to characterise it that way, I am not one to stop Phil Coorey.

JOURNALIST: How confident are you that there will be enough work for Australian industry, given the links that we've seen around the shape of all this and how disappointed are you by those links?

ED HUSIC: I would just say that again, at the appropriate point, the Deputy Prime Minister and Defence minister will make a more formal announcement about what we do, and I'll leave it at that.

But I also have another colleague of mine, Pat Conroy, who's very focused on defence industry issues. And again, I don't want to cut across their areas. 

JOURNALIST: The Greens have had a press conference today and said that they have managed to take this out of the government to get a win on coal and gas; are you disputing the characterisation of what's occurred?

ED HUSIC: I have come to appreciate in this place that people will characterise their points in the way that they want to, and I'm hardly one to stand in the way of that. But what I'm saying to you and what I've certainly expressed to the Greens and what I've said to the Parliament and publicly is manufacturing is an investment in manufacturing capability, and was never intended to do what was suggested.

But there were parties we wanted to work and engage constructively with, all parties on this, and they required that assurance as part of their process of agreeing to this Bill. And we're very grateful for the agreement of the Greens in this, and I am very grateful for the constructive way in which they and the crossbench worked. If they needed that assurance, then so be it.

But again, we were very clear in our mind about what this does. There might be other vehicles that support that kind of activity, notably NRF. It's up to them to make those calls, but certainly the NRF is about building manufacturing capability, not hang on saying sorry.

JOURNALIST: It's not a big win for the Greens if you just touch on that. And will this have any impact on the fossil fuel industry and investment into it?

ED HUSIC: Well, I think I've answered the first part of your question, and I think the other part in reference to the resources sector, I think we've been clear that we've highlighted it as a priority area. And the other point I'd make is I don't think by virtue of this decision, anything other than making it very clear, this is about supporting manufacturing.

That's what this fund is about. And we are just being very clear about that, not just to the Greens but to anyone else who's interested. 

JOURNALIST: When do you expect the money to start to flow? When would you reasonably expect the first of those funds to land in the bank accounts of manufacturers and who have you got in mind from both?

ED HUSIC: My notes here don't have a starting date. I’ve got a few things to get through first. Most notably, I need to obviously secure the support the Government needs to secure the support through the Senate. We're hoping to get that shortly. There's a Senate inquiry report to be brought down imminently. Then it needs to go to a vote and then we will be working very quickly to help shape this up and put this in place.

Obviously, as I've said, I'm very keen for this to happen as soon as humanly possible. But again, we don't want to rush and not get this right. We want to be able to make this an enduring, nation building moment. We want to get it right and not rush for its own sake.

JOURNALIST: Can you confirm that you've got the numbers in the Senate?

ED HUSIC: I remain quietly confident, but I don't want to pre-empt anything because I do have respect and I've taken the approach just from the get go. I understand people have different views on this and they'll put forward their points and we'll deal with them. Some we'll agree on, some we won't. I'm really stunned that the Coalition refuses to back blue-collar workers in manufacturing.

I've made a commitment in the Parliament. I'll make it to you all. I'm not here to crow about their change of mind. I just want the Parliament to be able to work together on something I think is enduring. The opportunity is there for them, but if they want to deal themselves out, then so be it. And if I may say to Jess, I'm not interested in just if the Coalition comes on board ignoring the rest.

I'm saying to you and I'm saying to everyone else, this is a chance for us to do something big, long term. This is a chance for us to get up off the mat. We are the lowest in manufacturing self-sufficiency in the OECD. That does have a jobs impact, has an impact on our sovereign capability. And it also sends a signal we don't value our knowhow.

We have a lot of smart people in this country. A lot of people that want to apply know-how to do the right thing for their communities, for their firms, for the broader economy. This fund is about that. This fund is about celebrating our ability as a people to get the job done and if people want to come on board, I'm all for that.

Thanks, everyone.