The Coalition will oppose Labor’s flagship industry policy when legislation is debated later this week, claiming the $15 billion fund is economically irresponsible and lacks governance.
Shadow Cabinet discussed Labor’s National Reconstruction Fund (NRF) on Monday night, deciding not to back the proposal which would set up an agency to disperse $15 billion in loans, equity investments and guarantees to priority projects over the next six years.
The Coalition decision comes just days ahead of NRF legislation returning to the Parliament and has angered the Albanese government, which committed to the plan in late 2021 and campaigned on it during last year’s election.
“Now, they can’t say we didn’t have a mandate for it,” Prime Minister Anthony Albanese told caucus on Tuesday.
“This was included in my budget reply speech, when budget reply speeches had policy announcements, which ours all did. And we spoke about it, day in, day out, during the election campaign and we’ve spoken about it ever since.”
The NRF will begin with an initial $5 billion allocation from government, with the remaining $10 billion to come by 2029, according to the National Reconstruction Fund Corporation Bill currently before Parliament.
The money will go to areas of priority decided by the government – so far known to be renewables and clean technology, medical manufacturing, value-adding in resources, ‘critical technologies’, advanced manufacturing, value-adding in agriculture, forestry, fisheries, food and fibre, transport, defence capabilities and enabling capabilities like artificial intelligence.
But the government could not direct the corporation make specific investments. Investment mandates and target rate of return are yet to be determined, with public consultations still underway.
InnovationAus.com in June reported the potential challenge to the NRF and other government off budget measures, together worth $45 billion.
The shadow Treasurer’s office declined to comment on a reported Shadow Cabinet decision on Monday night to oppose the NRF, reportedly over concerns it “lacks transparency, exposes taxpayers to risk and enshrines inappropriate ministerial discretion”.
But the Opposition party room agreed not to support the NRF on Tuesday.
“The Coalition opposes Labor’s National Reconstruction Fund because it is bad for taxpayers, bad for businesses, bad for manufacturers and bad for the economy,” Deputy Leader of the Opposition and Shadow Industry minister Sussan Ley said.
“Labor’s National Reconstruction Fund fails to address the issues our manufacturers need the government to show leadership on: high energy prices, disrupted supply chains and acute labour shortages.”
Ms Ley added the government should be focused on completing agreements with companies that had successfully won grant funding from the Coalition’s manufacturing scheme nearly a year ago.
Industry minister Ed Husic told InnovationAus.com the NRF will support, diversify and transform Australia’s industry and the government has a mandate to implement it.
“The Albanese government was elected on a mandate to drive the transformation of Australian industry and revitalising manufacturing to make world-class produce in Australia,” he said.
Earlier in Question Time, Mr Husic attacked the Coalition’s decision to try and block the NRF, labelling the party the “Noalition” and hypocritical after pork barrelling scandals dogged the then-government’s funding programs.
“We have to be a country that makes things. And modern economies need strong manufacturing capability if they’re going to keep going on into the long term. And manufacturing matters because it generates full time secure, well-paying jobs,” Mr Husic told Parliament.
“…[The NRF will be] independently run with an investment mandate looking at delivering a return to the taxpayer building, capability, and not a colour coded spreadsheet. Politicians [will] not making the core the investment decisions made in the national interest not in political interest.”
The National Reconstruction Fund Corporation Bill is expected to be debated on Wednesday or Thursday.
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