Already a subscriber?The federal government is right to recognise that careful interventions and targeted incentives are needed to expand Australia’s manufacturing capabilities. The world is awash withBut boosting manufacturing incentives and public expenditure is only half of the equation. The other half involves improving Australia’s attractiveness for capital investment. Commentators on different sides of this debate will suggest we can do one without the other.
In Manufacturing Australia’s latest report, companies cite four key hurdles to investing in Australia, and the federal government’sFirst, project approvals take too long and are more complex than in other jurisdictions.Federal Treasurer Jim Chalmers knows this and his recent comments in support of a “single front door” for major capital investments are welcome. Streamlining and expediting approvals is a tool used worldwide to attract manufacturing investment.
We subsidise, for example, imported heat pumps that put local manufacturers at risk. We typically have low, or no, local content requirements on big projects.
We need more funding for applied research and skills development in Australia. Our R&D tax incentives need to be globally competitive and include premium rates for manufacturing-linked R&D, and we should seek to establish a heavy engineering sector capable of taking the lead on nationally significant projects, for which we are largely reliant on international companies today.