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ENSURING AUSTRALIA HAS INDUSTRIAL RESILIENCE NEEDS TO BE ENSHRINED IN LAW

20 April 2022

Independent Senator for South Australia Rex Patrick will present a proposal for an Industry (Resilience and National Security) Bill to representatives from Australian Industry in Adelaide today.

“COVID-19 has shown Australia to be far too vulnerable to unplanned events such as pandemics, major catastrophes or international conflict,” said Senator Patrick. “Australia can no longer take overseas supply chains for granted. We must be able to withstand and bounce back from international events which interfere with critical industries and their supply chains."

“The Morrison Government has still not responded properly on industry resilience and national security in the wake of the pandemic and Labor has not addressed the issue either.”

Senator Patrick is committed to introducing an Industry (Resilience and National Security) Bill into the next parliament, if re-elected. The Bill will place a requirement on the Government of the day to map out and publish critical industry capabilities and then proceed to ensure those capabilities are properly supported through positive policy settings, Government procurement and investment.

“The requirement to do this will not be spelt out as policy, which can change or easily be ignored by officials, as we’ve seen happen over and over again. Rather it will be enshrined in Australian law,” Senator Patrick said. 

"This will involve the setting up an Australian Industry Capability Commission empowered to participate in and assess tender evaluations when critical industry capabilities are involved, audit Government procurements and report publicly on compliance with promised Australian industry participation commitments from successful tenderers."

"My legislation will set up a criteria for rating onshore industry."

"Being an Australian will require much more than having an ABN. Ownership, control where intellectual property is domiciled and whether work is actually carried out in Australia will be among the factors that will determine a company’s onshore rating."

"The Morrison Government has unfortunately provided a textbook on how not to support and boost Australian manufacturing."

“In the wake of the pandemic the Government set up a National COVID-19 Coordination Commission (NCCC) to plan Australia’s recovery in the post-COVID-19 world. The Commission, headed by hand picked gas executives, unsurprisingly came up with a plan for taxpayers to fund commercial gas exploration and production."

“The whole thing was a waste, unless you were a gas company shareholder.”

The outcome of the NCCC work contrasts strongly with an executive order issued by President Biden on 25 January 2021 which stated, “The United States Government should, whenever possible, procure goods, products, materials, and services from sources that will help American businesses compete in strategic industries and help America’s workers thrive.”

When I asked Finance Minister Simon Birmingham about whether Australia would be taking a similar approach he responded “I’m happy to take on notice any analysis which would be informed by the trade law branch of DFAT, really, in terms of the nature of the executive order, its application and its consistency with the Australia-US FTA obligations and commitments and US commitments more generally have been made.”

“It's a very disturbing situation when Government puts trade law consideration ahead of national resilience and security,” Senator Patrick said. “I fully support fair trade, but not when it puts our own country’s resilience at risk.”

Subsequent to President Biden’s initial executive order order, the US has further strengthened its approach by introducing domestic content requirements and price referencing for critical domestic good in Government procurements.

Senator Patrick will be putting his proposal to industry members and has undertaken to work with them to ensure passage of his proposed Bill through the 47th Parliament.

“I’m not a rookie Senator, I know what it will take to get this important national resilience and security initiative through the 47th Parliament."

"It's critically important we arrest the decline in industrial capability and capacity in Australia and build strong foundations for our security."