Anthony Albanese betraying Bob Hawke reforms with Future Made in Australia, says John Howard

John Howard has intervened in the national debate to warn the Made in Australia agenda could unleash ‘harmful consequences’ and represents a new form of protectionism.

Former prime minister John Howard in his Sydney office. Picture: Jane Dempster

John Howard has intervened in the national debate to warn that Anthony Albanese’s Future Made in Australia policy is a retrograde “new protectionism” that constitutes a betrayal of the major reforms carried by the Hawke and Keating governments.

Mr Howard said that, while Bob Hawke – whom he described as the nation’s best Labor prime minister – had “embraced reality on many economic issues”, this was “something which has totally eluded the Member for Grayndler”.

The former Liberal prime minister turned Mr Albanese’s own words against him, declaring that “Bob Hawke knew that the world was round. The present Prime Minister is a flat-earther with the best of them”.

Mr Albanese last week dismissed critics of his Made in Australia agenda – including inaugural Productivity Commission chair Gary Banks – as “flat-earthers”. The Prime Minister accused them of a failure to grasp the new wave of competition between rich nations racing to secure supply chains and capitalise on the global green ­energy transformation.

“This isn’t the old protectionism. This is about how Australia supports industries which will be able to stand on their own two feet,” Mr Albanese said.

But, in an opinion piece for The Australian, Mr Howard forcefully rejected the government’s defence of its new policy and suggested it would lead to “harmful consequences”. He also labelled Mr Albanese’s attack on Professor Banks as “gratuitous and dishonest”.

“The Future Made in Australia industry policy announced by Anthony Albanese last week is of a piece with the so-called new protectionism fiercely derided by Bob Hawke more than 30 years ago,” Mr Howard said.

“Our current Prime Minister wants us to believe that subsidies and incentives for certain enterprises are a world away from tariff protection and will be totally free of harmful consequences.

“That argument has not ­impressed Gary Banks and other economic commentators. Nor would it have impressed Bob Hawke in the early 1990s.”

Mr Howard warned the government was failing to take the hard decisions to lift productivity by slashing red tape or increasing flexibility in the workplace relations system. He also warned the government had misinterpreted Joe Biden’s Inflation Reduction Act, which offers a suite of tax credits, subsidies and grants for businesses involved in the clean energy transition.

“The Prime Minister and his Treasurer have claimed that their new policy is all about building foundations. If they were serious about stronger foundations, they would reform and not further tighten our industrial relations system,” Mr Howard said.

“They would lighten, not ­increase, the regulatory burden on risk takers. Instead of beating his chest in falsely claiming that President Biden’s Inflation ­Reduction Act is an exercise in economic reform, he (Mr Albanese) would call it for what it is: a massive increase in government spending.”

While the government has been tight-lipped about the ­details of the Future Made in Australia Act, it is expected to bring together several existing bodies, including the $15bn National ­Reconstruction Fund, the $20bn Rewiring the ­Nation Corporation and the Net Zero Economy Authority.

Jim Chalmers on Monday said that Made in Australia would be a “big feature” in the May budget, and has flagged it will include a major package of policies aimed at boosting investment, including “substantial” new spending measures and tax incentives.

“I see the Future Made in Australia Act as a really important ­opportunity to impose very strict rules and frameworks over the substantial investments that we want to make in the future of energy and the future of our industries and the future of our resources base,” the Treasurer said.

“We don’t want this to be some kind of free-for-all of taxpayer money – we want to make sure it’s responsible and focused and targeted and governed by really strict frameworks and that’s what the act will help us do.”

Mr Howard highlighted the vast gap between the reform credentials of Mr Albanese and Mr Hawke, whom he recalled in a 1991 speech had argued powerfully against the very proposals being put to the Australian people by the current government.

“The major component of that speech was a significant reduction in tariff protection for Australian industry,” Mr Howard said.

“In his speech the then prime minister (Mr Hawke) rejected the views of the so-called ‘new protectionists’ because they were proposing in effect the same discredited policies that had isolated our national economy and caused the damage that the then government claimed to be addressing.

“With remarkable relevance to the current debate Hawke said, ‘our own self-interest is served by a steadfast refusal to return to the days of protectionism’.

“I had said, before I became prime minister, that the most courageous policy decision taken by the Hawke government was the dismantling of tariff protection.”

Mr Howard said that action “defied Labor’s trade union ­origins” and that “high protection had been an article of ALP faith since its formation.”