Labor Future Made in Australia tense amid bill impasse

Labor’s flagship Future Made in Australia bill faces a parliamentary impasse with the Coalition opposing the legislation and the Greens withholding their support.

Treasurer Jim Chalmers. Picture: NewsWire / Martin Ollman

Labor’s flagship Future Made in Australia bill faces a parliamentary impasse with the Coalition opposing the legislation and the Greens withholding their support, placing the framework for the spending of billions of taxpayers dollars in jeopardy.

Jim Chalmers told The Australian the Coalition wanted to “cause chaos on this legislation” and the government’s bills sought to “embed into law a disciplined and rigorous approach that will govern Future Made in Australia investments”.

“The biggest part of our plan is tax breaks, because a Future Made in Australia is all about attracting private investment – not replacing it,” the Treasurer said.

“The Coalition should support these laws on their merits, just like the business community does.”

Opposition Treasury spokesman Angus Taylor told parliament on Tuesday night the $22.7bn Future Made in Australia agenda was a plan for more “pork barrelling” and “more government, not more business investment.” He said Australian manu­facturers would benefit more from stronger policies aimed at “getting the basics right”, including “affordable and reliable energy, flexible workplaces, less regulation, and an incentive based tax system”.

Mr Taylor told the Coalition joint partyroom that more than $1bn had already been committed by the federal government to manufacturing solar panels and US-based company PsiQuantum ahead of Labor’s investment safeguards even being introduced to the parliament.

He also expressed concern the bill could entrench greater union influence across the economy and fail to direct investment into key energy technologies, including blue hydrogen, carbon capture and storage as well as gas.

Greens leader Adam Bandt made clear the minor party was refusing to back the legislation for different reasons. He said it could cement a future for coal and gas past 2050 and create a new mining boom without ensuring a proper return to the public.

“We think there’s a real risk that the government does with critical minerals what it did with gas and just opens it all up to the highest bidder, potentially with taxpayer funds, and you end up with Australia in 10, 20 years’ time not having enough of these minerals for ourselves,” he said.

In a new criticism, Mr Taylor told the parliament the government’s bills contained a hidden election-year slush fund for Labor of up to $3.98bn through a number of proposed changes to the Australian Renewable Energy Agency. This claim has ignited a new political row, with the government strongly rejecting the accusations and arguing that ARENA was a completely independent body that could not be abused as a slush fund.

Mr Taylor said “the purpose, duties, and roles of ARENA” were being overhauled in the government’s proposed Future Made in Australia omnibus amendments.

The government’s legislation outlines changes to the agency, allowing it to support the “research, development, demon­stration, com­mercialisation, manu­fac­turing and deployment of renewable energy technologies”.

These renovations are seen by the Coalition as a major departure from ARENA’s remit, with Mr Taylor saying the agency had always been “a research and development agency”.

He said there were more “insidious” changes being proposed. “This bill gives the Minister for Climate Change the ability to boost its funding at a stroke of a pen. No parliamentary oversight. No scrutiny,” he said.

The Coalition is concerned the Future Made in Australia omnibus amendments embed a statutory appropriation for ARENA for the next 15 years. While specific ARENA budgets are set out in the legislation for 11 financial years, the Coalition is concerned the budget for three financial years (2024-25; 2037-38; 2038-39) will allow the government to allocate up $3.98bn through delegated legislation.

Mr Taylor said this provision would allow a Labor government to roll “up to $3.98bn out the door in an election year”.

“This is a slush fund, plain and simple,” he said. “Australian families shouldn’t be paying for Labor’s re-election strategy.”

Labor has ridiculed the claim, saying the $3.98bn cap was clearly identified in the explanatory memorandum as an “allocation mechanism”to be “used for the Hydrogen HeadStart program”.

Dr Chalmers told The Australian the Future Made in Australia legislation was aimed at making the “most of our net zero potential” and ensuring “benefits of these investments are widely shared and flow to local communities.”

He accused the Coalition of creating political mischief “so no one notices they have no policies and no credibility”.

Australian Industry Group chief executive Innes Willox told The Australian that the government’s proposals “have always had a touch of the curate’s egg about them – there are both good and bad elements”.

“While the principles of FMIA to encourage the development of technologies of the future are honourable, the devil has always been in the detail, or lack of it,” Mr Willox said.