National Reconstruction Fund: consultation paper

AUSTRALIAN MANUFACTURING WORKERS’ UNION

SUBMISSION TO THE NATIONAL RECONSTRUCTION FUND CONSULTATION
February 2023

The AMWU welcomes the opportunity to provide feedback to the government on the National
Reconstruction Fund. When the fund was announced while Labor was in opposition, its stated aim was to rebuild Australia’s diminished manufacturing capabilities. It promised to:

… to support projects that create secure well-paid jobs, drive regional development,
and invest in our national sovereign capability, broadening and diversifying
Australia’s economy.1

As the leading voice of Australian manufacturing workers for the last 170 years, the Australian
Manufacturing Workers’ Union (AMWU) strongly supports these ambitions. Our union has been calling for the establishment of a federal government fund geared towards the reindustrialisation of
Australia’s economy for several years.2 In the A Fair Share for Australian Manufacturing report (from now ‘Fair Share report’), commissioned by the union and written by Professor Jim Stanford, the union argued for the establishment of an Advanced Manufacturing Investment Fund, with share funding from the federal government:

… to make strategic equity investments in projects identified and developed as part
of the Advanced Manufacturing Sector Councils, with a special focus on access to
finance for medium-sized manufacturing enterprises.3

The AMWU set out its vision for rebuilding Australia’s battered manufacturing Australian Manufacturing industry in four booklets published before the federal election last year. These Workers' Union
Registered as AFMEPKIU booklets have been included at the end of this submission. National Office

There is strong public support for local manufacturing, with the broader public largely understanding that the sector is vital to our nation’s economy and critical to maintaining high living standards.4 Research by the Advanced
Manufacturing Growth Centre found that:

1 Australian Labor Party (2020) National Reconstruction Fund. Available at: https://www.alp.org.au/policies/national_reconstruction_fund
2 Australian Manufacturing Workers’ Union. 2021. Rebuilding Aussie Manufacturing: planning for secure jobs and a strong future.
Submission to the Senate Economics Reference Committee’s inquiry into manufacturing. Available at: https://www.aph.gov.au/Parliamentary_Business/Committees/Senate/Economics/REFSManufacturing/Submissions
3
Stanford, J. (2020) A Fair Share for Australian Manufacturing: Manufacturing Renewal for the Post-COVID Economy. Report for the
Australian Manufacturing Workers’ Union. Available at: https://futurework.org.au/report/a-fair-share-for-australian-manufacturing/
4 https://www.amgc.org.au/media-releases/australians-perception-of-local-manufacturing-on-the-rise/
• 72% (+7% from 2019) of Australians believe manufacturing is important, or very important
to the economy.
• The importance of manufacturing is rated more highly in regional areas, compared to metro.
• 69% (+6% from 2019) of Australians believe manufacturing is important to maintain our
standard of living.
• 80% of Australians believe it is important to purchase local products where possible.
• 63% believe these products are of higher quality and 58% noted that locally made products
were worth paying a premium for.
• Almost half of the respondents view Australian manufacturing as high-tech and globally
competitive.

Below, we respond to some of the questions in the consultation paper and make some additional recommendations which would lay the foundations for the NRF to help reindustrialise Australia with high value adding industry and high-skilled, high-paying union jobs. Our response is informed by, and of relevance to, the work of our members across many of the priority areas identified for NRF funding. We welcome further discussion and collaboration on rebuilding Australia’s manufacturing industries for the benefit of workers and the economy.

In addition to this submission, the AMWU also intends to make a submission to the National
Reconstruction Fund Corporation bill 2022 consultation.5 In that submission we will address in detail the importance of a tripartite governance structure, and the need for robust accountability in grant- making and the subsequent assessment of outcomes.

Investment Needs and Opportunities
What are the opportunities for value-add, growth and diversification in each of the priority areas?
What are the manufacturing capabilities needed to support each priority area?
What are other capabilities needed to support each priority area?
In broad terms, the AMWU supports the inclusion of the seven priority areas identified in the consultation paper. Our union has long advocated for rebuilding Australian manufacturing around renewables and low emissions technologies6, medical technologies, transport equipment, value adding agriculture, and forestry, value adding to natural resources, and defence capabilities.7 In addition to these priority of these areas, we have also advocated for the importance of food processing, as one of the largest manufacturing sectors in the country.

Within the scope of the defined priority sectors and industries, there are four types of projects that the AMWU believe the NRF should be geared towards:

1. Ensuring Supply Chain Resilience and Long-term Import Replacement
2. Common User Facilities
3. Aiding Major Employers to Transition

5
https://www.aph.gov.au/Parliamentary_Business/Committees/Senate/Economics/ReconstructionBill2022
6 AMWU. 2022. Australia’s Opportunity: A Green Manufacturing Superpower. Available at: https://www.amwu.org.au/renewable_2022
7 AMWU. 2021. The Future of Australian Manufacturing. Available at: https://www.amwu.org.au/submission_manufacturing2021

2
4. Helping small and medium enterprises reach scale and new businesses with a commitment
to local manufacturing.

1. Ensuring Supply Chain Resilience and Long-term Import Replacement
The development of a robust and resilient local manufacturing section must take a whole of supply chain approach, investing in value-add projects from the point of extraction to the final product. In each of the identified priority areas, the government must develop an industry policy that identifies local and international market opportunities for product sales.

These industry policies must include expanding local capabilities, import replacement and supply chain resilience plans, which:

• Identify opportunities to build local replacements for supply chain inputs; and
• Map local and export markets to identify opportunities of scale.

In line with Victorian procurement legislation, the NRF should require all funded projects include minimum local content requirements and reporting. Where the planning process has identified gaps in Australian industry capability regarding local supply chain inputs, the government should look to encourage and support local industry to develop capabilities, in both direct and indirect ways:

• By directly assisting local manufacturing businesses to invest in new advanced production
technologies through provision of low-interest finance, government share capital, loan
guarantees, public ownership and other mechanisms;
• indirectly by establishing common user facilities (CUFs). CUFs (discussed further below),
which provides the capital, infrastructural, skills and logistical resources for alliances and
joint ventures of SMEs to achieve scale and deliver complex projects of national strategic
importance; and
• directly and indirectly by establishing skills centres nearby to CUFs and in industrial
precincts to guarantee a pipeline of skilled apprentices at a minimum ratio to workers, plus
ensuring the onsite upskilling of workers.
• Directly by establishing both a Manufacturing Advocate and a tripartite ‘Australian
Manufacturing Council’.

2. Common User Facilities
Rebuilding Australia’s manufacturing capacity requires strategic government investment in technology and infrastructure to help facilitate the growth of small and medium enterprises. CUFs in the vein of the Australian Marine Complex8 Western Australia have a demonstrated capacity to facilitate the growth of small and medium enterprises, diversify industry, and support the development of advanced manufacturing. The AMC CUF in Henderson is a large, 40ha integrated facility and has supported the development of a world class shipbuilding and maintenance industry in Western Australia. Since its establishment the AMC has delivered hundreds of infrastructure

8Development WA. Australian Marine Complex. https://developmentwa.com.au/projects/industrial-and-commercial/australian-marine- complex/about-the-amc
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projects and tens of thousands of jobs.9 The AMC CUF also supports fabrication and manufacturing for the WA mining, oil and gas industries.

The Western Australian government maintains ownership of the AMC CUF which provides open access to multiple users. Rather than handing out money to private enterprises the government invests in a publicly owned space and allows firms to bid for access. This model provides firms with access to cutting edge common use infrastructure including industry 4.0, additive manufacturing and machine learning technologies. CUFs support SMEs to achieve scale through alliances and joint ventures to bid for major projects. They can provide firms with access to research and development opportunities to help them innovate. Finally, these CUFs should contain skills centres, run in conjunction with TAFEs and universities, which provide access to state-of-the-art education and training facilities for the training of apprentices and the upskilling of workers. All these benefits are provided while maintaining public ownership over infrastructure; all proceeds generating from leasing the infrastructure is reinvested in the facilities.

The Business Council of Australia has advocated that the NRF be geared towards to building a handful of “internationally significant precincts” in strategic locations around the country.10 The
AMWU supports this idea but argues that public ownership should be maintained of these facilities in order to ensure long term benefits of the investments are controlled in the interests of the
Australian people. The CUF model—on a similar template to the AMC facility—should be expanded to facilitate the growth of advanced manufacturing in other locations in Australia.

3. Aiding major employers to transition.
In the context of rapid technological change and transition away from fossil fuels, many major employers in Australia will need to reorganise their production processes. This means that significant investment will be required to maintain global competitiveness and continue to employ large numbers of Australians. The NRF should be geared to ensuring major brownfields sites have the capacity to adopt new technologies in the move away from fossil fuels and to meet new product markets. Two examples within the AMWU’s coverage are illustrative here:

▪ Incat is a shipbuilding firm that employs more than 400 people in Hobart, Tasmania. In
addition to building ferries for Australian public transport and private sales, it also exports
boats to Asia, Europe and the Americas. The firm has recently begun to move from internal
combustion engines to electric engines in line with changes in demand. These technological
changes will require significant workforce retraining as well as investment in fixed capital.
The NRF has a role to play in assisting this transition through low interest finance or co-
investment.11
▪ A similar transition is occurring in Australia’s heavy vehicle market, as demand grows for
zero emissions vehicles. Some policy analysists and industry groups have advocated for a
change to Australian Design Rules (ADRs) for heavy vehicles to allow for the importation of

9 Government of Western Australia Department of Commerce. 2016. Australian Marine Complex Brochure.
https://www.commerce.wa.gov.au/sites/default/files/atoms/files/amc_brochure_may_2016.pdf
10 https://www.innovationaus.com/use-15bn-nrf-to-build-future-industry-precincts-bca/
11 https://www.aumanufacturing.com.au/incat-sells-first-electric-passenger-and-vehicle-ferry

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zero emissions vehicles made overseas. The existing ADRs act as a technical trade
requirement and changing them would risk thousand of Australian manufacturing jobs.
Australia maintains a significant footprint in heavy vehicle manufacturing including trucks,
buses and heavy vehicle trailers.
▪ Over the next decade, Australia will need to electrify millions of household appliances in a
shift from fossil fuel (gas) energy to renewable energy sources. To address medium-term
cost of living pressures, and long-term climate change adaptation, higher efficiency
standards will also be needed for refrigerators and ovens, and energy appliances like heat
pumps will be in huge demand as alternatives to gas-fired hot water and heating systems.
The demand-driven growth of a high-efficiency appliance manufacturing sector in Australia
will drive the scale and scope of local capabilities that make the sector economically
sustainable and a high potential for export markets. Beyond public procurement contracts,
initial government support to help transition the sector through investment support and
market creation will then support the sector to tailor products that meet differentiated
markets for products such as new homes, homeowners and landlords, and including
commercial, luxury and export orientations. The AMWU recently made a submission on this
topic to the government’s National Energy Performance Strategy. This is included at
Appendix 5.

4. Helping small and medium enterprises reach scale and new businesses with a commitment to local
manufacturing.
Many successful Australian manufacturing small and medium enterprises struggle to take the ‘next step’ and scale to larger enterprises due to the small size of the local market. The NRF should play a role in helping firms in this vein reach new markets and increase their opportunities to provide good jobs for Australian workers.

While noting the best international evidence suggests that start-ups and new businesses should not form the cornerstone of industry policy,12 the AMWU also believes that they have a role to play in rebuilding Australia’s industrial ecosystem. Here, firms with a commitment to developing a significant manufacturing footprint in Australia should be prioritised.

Industrial transformation is inevitable and indeed desirable for Australian industry to do higher value adding production, creating higher skilled jobs, and increasing international competitiveness.

How could the NRF consider Government policy priorities in performing its investment function?
In addition to financial returns, the NRF investment mandate must explicitly include as the creation of secure, well-paid jobs as a primary objective.

As a prerequisite for tendering, companies must have in place standards to ensure that employment is direct and secure, jobs have fair wages, safe working conditions, support for collective bargaining

12Mazzucato, M. 2014. Startup myths and obsessions. The Economist. Available at: https://www.economist.com/schumpeter/2014/02/03/startup-myths-and-obsessions
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and ready access to unionisation, and commitments to workforce development, training, and apprenticeship — especially for women and ATSI workers.

The Government’s proposed Secure Jobs Code should represent best practice in this regard and apply to the NRF, as well as other government funding and procurement. The Functions, Principles and Objects stated in the NRF legislation should mirror and enhance those contained in the Victorian
Local Jobs Act, the Queensland Procurement Policy 2021 and the NSW Electricity Infrastructure Act.

The AMWU proposes that the “Secure Australian Jobs Code” should include, at a minimum:

• Enterprise agreement with unions as a pre-condition of tender. Note: in the case of start-
ups, we may consider that an MOU to enter into an agreement as part of the tender process,
but the agreement must be finalised prior to award of tender. The requirement to have a
“current certified industrial agreement registered with the Fair Work Commission is a
current requirement for tenders under the full NSW Renewable Energy Sector Board plan.13
• To qualify for funding, a company must not have any unresolved, adverse industrial rulings
against it, including whether it has engaged in conduct that took advantage of, treated
unfairly or otherwise harmed its workers.
• Companies must commit to direct employment as a condition of tender. Where contractors
and/or labour providers are used, the indirect workforce must be employed on the same
conditions as the direct workforce.
• Requirements or ratios regarding the appointment of cadets, trainees and apprentices.

As a condition of funding, manufacturers should be required to appoint a minimum ratio of apprentices to tradespersons. This is already the policy of several state governments and has previously been implemented at a federal level. Applications by firms proactively meeting or exceeding quotes for women in skilled trades occupations, apprenticeships or traineeships should be assessed more favourably.

Increased union presence and growth in the uptake of collective agreements does not occur at the expense of investment returns.14 Instead, research shows that high union density is correlated with positive improvements in productivity, reductions in turnover, and significantly improved WHS.15 To take just a few examples:

• Increases in unionisation rates are associated with up to a 2.8% decrease in on-the-job
deaths. 16
• A Norwegian study of company data from 2002 – 2018, found that an increase in union
density of 1% raised overall firm productivity by 1.7%-1.8%. This was largely attributed to
the ability for workers to efficiently feedback and influence the company in a collective
manner.17

13
https://www.energy.nsw.gov.au/sites/default/files/2022-09/nsw-renewable-energy-sector-board-plan.pdf, p. 28.
14 For a review of the literature see: Trillium Asset Management (2022), The Investor Case for Supporting Workers’ Rights, https://www.trilliuminvest.com/news-views/the-investor-case-for-supporting-worker-organizing-rights
15
Ibid.
16 Ibid, p. 5
17 Ibid, p. 2

6
• Another study showed that non-union members demonstrated a mean intention to leave of
4.07 compared to unionized members’ intention of 2.87 on a scale of 1-10 (t = 11.10, p <
0.001).18

Returns, financial instruments and working with other investors
No response

Complementary reforms
Advanced Manufacturing Sector Councils
In many instances, the principal non-financial barriers to the development of Australian industry relate to a lack of industry co-ordination and planning. As a relatively small global market, Australian firms will often find it difficult to reach scale in the domestic market, which could then be used as a launching pad to enter export markets19. The role of government here should be to convene tripartite co-ordinating bodies for the seven priority areas to develop and oversee the implementation of industry plans covering the areas of research and development; technological adoptions; skills and training; supply chain co-ordination; and targeting export opportunities.

Policy research commissioned by the AMWU has advocated for the establishment of “a network of
Advanced Manufacturing Sector Councils, supported by a broad infrastructure and secretariat at the
Department of Industry, Science, Energy and Resources.”20 These Sector Councils would be made up of representatives from industry, government, and trade unions, and would engage sector stakeholders to identify the most promising sub-sectors for investment and development. Sector
Councils would develop investment and innovation plans for the identified sub-sectors and oversee the implementation of these plans with the support of other government bodies.

The Federal government’s National Rail Manufacturing plan21 involves three components that are aimed at addressing some of these issues:

(1) Office of National Rail Industry Coordination within the Department of Industry tasked with
co-ordinating regulation and standards in the sector to maximise consistency and help firms
reach scale;
(2) a tripartite Rail Industry Innovation Council tasked with assisting industry with research and
development and technological adoption; and
(3) a Rail Supplier Advocate, tasked with co-ordinating rail manufacturers and helping small and
medium enterprises gain a foothold in rail supply chains.

The AMWU is also advocating for the establishment of a tripartite National Innovation Council for
Zero Emissions Vehicles which would operate in a similar vein to the Rail innovation council. The

18 https://www.abs.gov.au/statistics/economy/finance/monthly-household-spending-indicator/nov-2022
19
Lin, F. L. and Ho, C. W. 2019. The knowledge of entry mode decision for small and medium enterprises.
Journal of Innovation & Knowledge. Volume 4 (1)
20 Stanford, J. 2020. A Fair Share for Australian Manufacturing: Manufacturing Renewal for the Post-COVID Economy. Report by the Centre for Future Work at the Australia Institute.
21 Chan, R. 2022. Government Pledges to Boost Rail Manufacturing. Rail Express, https://www.railexpress.com.au/government-pledges-to- boost-rail-manufacturing/
7
Federal government should consider similar reforms in other sectors to maximise the impact of the
NRF.

Skills and Training
Manufacturing skills have been neglected—and sometimes deliberately sabotaged—in recent years.
TAFE has been systematically underfunded by successive Coalition governments. The number of
Australians in apprenticeships and traineeships has declined significantly in the last 10 years, despite a recent uptick. The impacts of these policy failures are starting to be felt in the real economy through skills shortages.

The number of total apprentices and trainees in 2021 was 34 per cent lower than in 2012, while the percentage of all employment in apprenticeships and training was down 43 per cent. If Australia is to rebuild its domestic supply chains, significant investment is required to train the highly skilled workforce needed for Australia to harness its resource advantages in energy and minerals and become an advanced manufacturing superpower.

The recently established tripartite Jobs and Skills Australia should be properly resourced to assessed workforce and training needs. Funding to address any shortages identified should not be provided through the PRF but be apportioned through the broader VET and education budgets.

The AMWU has made several recommendations to other consultations to address skills shortages across the manufacturing sector as a whole, including:

• Nation-wide free TAFE, like the policies in place in Victoria and Queensland. Within this
framework, the union supports establishing a national Manufacturing VET policy board
tasked with developing and implementing measures to build a more coherent and
constructive framework for VET training, skills and qualifications in manufacturing.
• The federal government, in conjunction with industry and trade unions, must develop clear
guidelines to ensure we have proper governance of our skills system which incorporates the
principles enunciated in the original Award/Structural Efficiency processes. Such a
governance structure would help ensure our training system produces resilient and
adaptable workers with the skills and qualifications to do the work of the future, and secure
industrial mechanisms for recognising those skills and qualifications.
• A minimum ratio of apprentices-to-tradespersons on all projects that attract government
investment, finance, and other forms of support. This policy has been successfully
implemented at a federal level previously and is currently the policy of several state
governments. Previous federal governments and current state governments have induced
private firms to engage high levels of apprentices and trainees through procurement
policies. A tried-and-tested method involves requiring a minimum ratio of apprentices
and/or trainees on all projects that attract government support. When bidding for
government contracts, only firms that put their apprentices through nationally recognised
training packages should be utilised.

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Other Comments
In addition to this submission, the AMWU also intends to make a submission to the National
Reconstruction Fund Corporation bill 2022 consultation.22 In that submission we will address the importance of a tripartite governance structure, and the need for robust accountability in grant- making and the subsequent assessment of outcomes.

If the NRF is to be successful in building a strong, robust manufacturing sector now and into the future, the legislation must enshrine the stated mission of the NRF to create “secure well-paid jobs, building on our national strengths, diversifying Australia’s industrial base, developing our national sovereign capability, and driving regional economic diversification and development”.

The composition of the NRF Board must include two ACTU-nominated positions, two employer- nominated positions, and positions from representatives from academia and pro-union elements of civil society. Legislation should require the positions indicated above to be filled by individuals who meet certain skill requirements, namely knowledge, experience and understanding of industry policy matters, particularly at the industrial relations level. We are not opposed to the Government creating articles and having a Board administer them as a corporation. Rather, the deficiencies lie in the make-up of the Boards of those agencies the Government seeks to use as a model for the NRF, namely the Clean Energy Finance Corporation (CEFC). The CEFC has never included workers’ representatives. The Board composition of the CEFC should not be emulated in the NRF. Rather than following the CEFC model of four to six Board members, the NRF legislation should be much more specific in shaping Board composition.

The bill must also contain the right monitoring, compliance, and enforcement framework, including to monitor how the Board sets key performance indicators (KPIs) and environmental, social and governance (ESG) standards. The bill itself should contemplate the establishment of industry or sector-based tripartite reference committees (with union and employer representatives on the committees), the functions of which would include the provision of advice to the Board as well as playing a role in the monitoring, compliance and enforcement frameworks for specific industry sectors, as well as establishing, reviewing and recommending improvements to performance and procurement benchmarks for industry sub-sectors.

To ensure optimal oversight of performance, the NRF legislation should also contemplate the data recording and reporting requirements that will be needed including by ensuring the NRF is capable of interacting with other regulatory bodies and departments and uses (or establishes) a fit for purpose data warehouse for these purposes.

Finally, the NRF Board must have a clear function to work with the forthcoming Energy Transitions
Authority (ETA), recognising the NRF will need to play a role in receiving advice from and considering and assisting the implementation of the JTA’s policies, including, for example, facilitating investment to deliver projects identified by the JTA as priorities.

22 https://www.aph.gov.au/Parliamentary_Business/Committees/Senate/Economics/ReconstructionBill2022

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Conclusion
The AMWU welcomes the opportunity to make a submission to the Government’s NRF consultation.

Once again, thank you for the opportunity to make a submission. If you require any further information, please contact in the first instance.

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Rebuilding Aussie
Manufacturing:
planning for
secure jobs and
a strong future

Rebuild_Booklet.indd 1 8/6/22 4:16 pm
Prepared by the Australian Manufacturing Workers’ Union | June 2022.

First drafted as a submission to the Senate Economic References Committee Inquiry
into the Australian Manufacturing Industry | October 2021. Please note that some testimonies reflect this timing.

Rebuild_Booklet.indd 2 8/6/22 4:16 pm
Support
Aussie made

Contents
Introduction from the National Secretary 3

Skills for the future of manufacturing 5
Keith Lang, heavy plant mechanic: Sydney Trains, NSW 5
Haromi ‘Pepe’ Jones, process worker: Darell Lea, NSW 7
Gordon Entwistle, spray painter: Komatsu, Welshpool 8

Worker-centred technological adoption 10
Jason Chrimes, machine operator: Opal Packaging, WA 11
Jessie Rea, machine operator: Simplot, Bathurst 13

Australia’s energy transition 14
Cam Brady, printer: News Corp, Melbourne 15
Mick West, automotive electrician: Brisbane Bus Build, Brisbane 16

The role of government procurement 18
Tracey Davis, supply quality assurance co-ordinator: Department of Defence, Melbourne 19
Michelle Owen, machine operator: McCain Foods, Ballarat 21

Investing in supply chain resilience 22
Denis Webber, fabricator: Incat, Hobart 23
Dominic Vignale, boilermaker: Komatsu, Rockhampton 25
Matt Hastings, production employee: Electrolux, Adelaide 27

Conclusion 30
Summary of recommendations 31-33

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Rebuild_Booklet.indd 3 8/6/22 4:16 pm
Introduction
from the National
Secretary

For 170 years, our union has organised
and represented workers in the Australian
manufacturing sector. Today, the Australian
Manufacturing Workers’ Union (AMWU)
represents over 70,000 members in every
Australian city and region. We are proud of the
work we do. We build Australia’s trains, buses,
and ships. We process the food our farmers
grow. We service Australia’s mining equipment,
cars, and aircraft. We manufacture sustainable
packaging. We build whitegoods, manufacture
energy infrastructure, and print newspapers.
But we believe the Australian manufacturing
sector can contribute even more.

As we emerge from the worst of the COVID-19
pandemic, major economies around the world
are deploying radical policy initiatives to
protect, grow and diversify their manufacturing
sectors in response to the challenges
highlighted by the crisis. So far, Australia’s policy
response has been inadequate.

In the context of the biggest peacetime
disruption of global supply chains our nation
has ever experienced, the previous government
took a business-as-usual approach and failed
to develop the kind of co-ordinated industry
policy required to rebuild Australia’s sovereign
manufacturing capabilities.

The change in federal government represents
an opportunity to correct course.

I’ve spent a lot of time listening to our members
across the nation since becoming National
Secretary. They are skilled, passionate, and
have deep insights into the issues facing their
industries. That is why this paper is based on

3

Rebuild_Booklet.indd 4 8/6/22 4:16 pm
our workplace leaders’ lived experiences and
their vision for a manufacturing-led economic We need to build the infrastructure to
revival. Between them, these workers have harvest Australia’s abundant supply of
decades of experience from across the entire cheap renewable energy to make us a global
manufacturing sector and around the country. leader in energy intensive manufacturing.
This way, we can develop export industries
This paper is designed to give you the for manufactured goods like carbon neutral
opportunity to see the manufacturing sector metals, lithium-ion batteries, green hydrogen,
through their eyes, to understand what it and green steel, all of which will be in huge
means to the workers it employs and the demand as the world transitions to net zero
communities it supports. They believe, as I do, emissions.
that with the right policy leadership, Australia
can enjoy a manufacturing-led recovery that We need the government to use its powers of
creates secure, high-skilled jobs; promotes procurement to invest in Australian jobs and
economic development in our regions; industries and rebuild our domestic supply
increases our sovereign capabilities; and chains. Most of all, we need a government
diversifies the nation’s economy. with the vision and commitment to make that
happen.
At present, the Australian manufacturing
sector is battered but resilient. Despite So far, we have lacked policy leadership —
decades of policy negligence — and, at we hope we have reached a turning point.
times, deliberate governmental sabotage — There is so much potential to grow the
manufacturing remains a major employer in manufacturing sector in Australia, but
this country. But that neglect has left Australia governments hold the keys to unlocking that
as one of the world’s least self-sufficient potential. Below, some of our union’s leaders
industrialised nations when it comes to begin to sketch a policy framework for a
manufactured goods.1 reindustrialised Australia. These policies
alone would not be enough to make Australia
The change in federal government represents the advanced manufacturing superpower
an opportunity to reassess the policies that we believe it can be, but they would be an
have led to Australia’s industrial decline excellent start.
and to reconsider the role the government
— Steve Murphy, AMWU National Secretary.
should play in rejuvenating Australian
manufacturing. If Australia were to achieve
manufacturing self-sufficiency — to make
as much as we use, and export as much as 1
Stanford, J. 2020. A Fair Share for Australian Manufacturing: Manufacturing Renewal for the Post-COVID Economy.
The Centre for Future Work at the Australia Institute.

we import (something already achieved 2
Stanford, J. 2020. A Fair Share for Australian Manufacturing: Manufacturing Renewal for the Post-COVID Economy.
The Centre for Future Work at the Australia Institute.
by countries like Spain, France, and New
Zealand) — we would create 400,000 new
manufacturing jobs and a further 265,000 in
the supply chain.2

To do this, we need to upskill our already
highly skilled workforce and train new
workers for the jobs of the future. We need
to encourage businesses to invest in new
production technologies and processes to
increase productivity and make sure our
workers are operating the best equipment
money can buy.

4

Rebuild_Booklet.indd 5 8/6/22 4:16 pm
Skills for
Any policy initiative aimed at revitalising
Australian manufacturing sector must
address significant issues with our current
the future of vocational education and training (VET)
system. After decades of underfunding and

manufacturing
failed marketisation policies, our VET system is
struggling to meet our country’s need for highly
skilled manufacturing workers.

VET will be essential to facilitate the adoption
of new, advanced manufacturing technologies
which our sector needs to remain globally
competitive. Workers will need greater
technical and problem-solving skills as global
manufacturing shifts to increasingly advanced
digitally enabled technology and more
specialised, disaggregated production processes.
This shift to advanced manufacturing offers a
major opportunity for our manufacturing sector,
provided we have the capacity to produce highly
trained production workers, skilled tradespeople,
and high-level technology specialists.

Keith Lang,
heavy plant mechanic:
Sydney Trains, NSW
Keith began his career in the rail industry with
an apprenticeship as a heavy plant mechanic
at Sydney Trains in 2003, where he still works
today. He is responsible for the maintenance,
repair, and overhaul of Sydney’s track rolling
stock.

In his 19 years on the job, he has witnessed
significant change to the industry. “There
has been a shift from viewing our work as
providing a service to seeing us as providing a
profit.”

This shift has been especially noticeable in
two areas. First, workplace health and safety - a
central part of Keith’s role as a union delegate
and health and safety representative is to
ensure the working environment is a safe one
by holding the employer to account.

“My employer is good at talking the talk on
safety, but we spend a lot of time making sure
they walk the walk.”
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Rebuild_Booklet.indd 6 8/6/22 4:16 pm
Second, Keith has witnessed an erosion of the Recommendation 1:
respect and value management places on his
skills and work and those of his colleagues. The AMWU supports a minimum ratio of
He points out that Sydney Trains, as well as apprentices to tradespersons on all projects
other government agencies and enterprises, that attract government investment, finance,
previously played a central role in training and other forms of support. Furthermore,
apprentices for industry. These apprentices the AMWU advocates a national ‘common
formed the basis of a highly skilled workforce benchmark test’ for apprentices, to ensure
which would then support Australian industry that apprentices graduate with the skills
more broadly. More recently, however, “an they need, and employers can’t simply ‘tick
ideology of outsourcing and privatisation” and flick’ apprentices to meet their ratio
has taken hold in the industry. For Keith, this requirements.
privatisation and outsourcing has meant less
investment in skills and training which, in
turn, undermines and diminishes Australia’s
Recommendation 2:
broader manufacturing capabilities.
Australia needs to develop a National Rail
Manufacturing Plan to create jobs and
Keith strongly believes that the government’s
capabilities in the industry. This plan should
role in the rail industry should be to take
ensure that all rolling stock—both public
considered risks, invest in skills and training,
transport and freight—that we need in
and assist in building a highly skilled
Australia, is made in Australia - emphasising
workforce to support the manufacturing
the development of the skills of workers in
industry in Australia. Not only does he want
Australia and the collective capabilities of
Australia to design, build and maintain
Australian industry.
our own rolling stock, but to manufacture
equipment for export markets as well.

He points out that, in recent years, some state
governments have prioritised local content
in government procurement, including
transport infrastructure, and that this is
helping to build industrial capacity and a
skilled workforce. He contrasts this with his
home state of New South Wales, where recent
transport infrastructure like trains and ferries
have been procured from overseas. Federal
industry policy should view essential public
infrastructure like rail and ships as critical
to Australia’s future prosperity and, Keith
concludes, as an opportunity for “Australia
to build the skills, jobs and industries for our
future.”

6

Rebuild_Booklet.indd 7 8/6/22 4:16 pm
Haromi 'Pepe' Jones,
process Worker:
Darrell Lea, NSW
Pepe got involved in her union because she
wanted to do something about bullying
in her workplace. “We got people together
and worked on an anti-bullying policy,” she
explains. “Now it’s a much better place to work
because there is that fairness.”

Pepe has now worked as a process worker at
Darrell Lea in Sydney for around nine years
and has the skills to work across different lines
and in a variety of different capacities.

“I sort of float across different lines. I can work
on the liquorice stream, the chocolate stream,
the sugar panning stream. It gives me different
perspectives.”

Pepe is passionate about her work and wants
to make sure that future generations of
Australians can get secure, well-paid jobs in a
manufacturing sector where they are treated
with respect. Key to making this happen is
ensuring Australia’s Technical and Further
Education (TAFE) system is funded properly
and preparing people for the manufacturing
jobs of the future.

“We need to get people’s skills up, and that
means getting the TAFE system back up and
running,” she adds.

In terms of industry support, Pepe believes
the government can do a lot to onshore
manufacturing supply chains, both for primary
and secondary industry. “Before we look
outside our borders, we should prioritise our
products first. They always go on about ‘Oh,
it’s a little bit more expensive to get it from
Australia.’ But we should support our other
manufacturers and farmers by looking here
first.”

7

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Not only would this help create Australian Gordon Entwistle,
jobs, she argues, but it could help develop a
skilled manufacturing workforce and create
spray painter:
new opportunities to develop sustainable Komatsu, Welshpool
production in areas like recycled packaging
and lithium-ion batteries. Originally from New Zealand, Gordon is a
spray painter and panel beater by trade. He
Recommendation 3: has worked at Komatsu in Western Australia
for over 16 years. Komatsu employs around
500 workers at its Welshpool plant who
The AMWU supports nation-wide free
manufacture a range of equipment for civil
TAFE — similar to the policies in place
and mining applications.
in Victoria and Queensland. Within this
framework, the union supports establishing
“We make small excavators for civil projects,
a national Manufacturing VET policy board
right up to giant haul packs and excavators
tasked with developing and implementing
for the mining industry. Civil engineering
measures to build a more coherent
probably makes up around 30 per cent of what
and constructive framework for VET
we do. Mining probably makes up around the
manufacturing.
other 70 per cent of what we do. Over here in
WA, we tend to supply a very large amount of
mining equipment,” he explains.

Recently, the COVID-19 pandemic has
resulted in WA closing its borders to other
Australian states, while Australian borders
have remained largely closed to the rest of the
world. For Komatsu, this has caused a severe
shortage of skilled workers in its WA facilities.

Gordon says there is a shortage of high voltage
electricians and heavy-duty mechanical
fitters.

“To give you some idea of how bad it is, we’ve
been advertising for the last two months, and
we’ve only managed to pick up one heavy
duty mechanical fitter.”

Gordon says that the shortage of skilled
workers is not simply the result of closed
borders but reflects a long-term lack of
strategic thinking on training and industry
policy. He argues that firms and governments
have a long history of failing to invest in
training the manufacturing workforce
and instead relying heavily on temporary
immigration and recruiting workers already
trained by other employers.

8
9

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“Our company is fairly good in terms of training
apprentices, but a lot of companies aren’t. They
either rely on poaching tradespeople who have
been trained elsewhere or they bring in 457
visa holders or the equivalent work visa.”

To develop Australia’s manufacturing
workforce — and with it our manufacturing
capacity — Gordon argues that we need to
conduct robust market testing before issuing
worker visas and develop a national plan for
apprenticeships and training to ensure we have
a highly skilled manufacturing workforce.

“Serious local market testing before any
migrant workers can be brought in is essential,”
he concludes.

Recommendation 4:
Government policy must prioritise local
employment and the development of the
local workforce. This means the government
must require vigorous and meaningful
labour market testing and skills assessments
to be conducted prior to engaging visa
workers to ensure the Australian workforce
is developed and prioritised for employment
opportunities.

Recommendation 5:
The skilled migration program needs to be
urgently reviewed. Where there are jobs
available in Australia, employers must be
required to actively train young workers
to fill them. Where a skilled visa worker is
brought in, the AMWU believes that there
should be a requirement for their employer
to also undertake domestic training of
workers in the same skillset. Ultimately, we
believe that no job should be allowed to stay
on the skills shortage register for longer than
it takes to train an Australian worker to do
that job. The current system is failing workers
and must be overhauled.

9

Rebuild_Booklet.indd 10 8/6/22 4:16 pm
Worker-centred
technological adoption
A recent report commissioned by the
AMWU found that Australia is ranked 93rd
in the world for economic complexity.3
China’s ‘Made in China 2025’, The United
Kingdom’s Catapult Network, and the
United States’ ‘Smart Manufacturing
Leadership Coalition’ all reflect the fact
that the world’s leading economic powers
are redoubling their efforts to develop
and grow their advanced manufacturing
capacities. Australian underinvestment
in innovation means that we are not
building the jobs and industries of the
future.4

The AMWU believes that Australia
should be pursuing an ambitious
agenda of technological change,
embracing the digital revolution in the
manufacturing sector, and ensuring that
these technologies are worker centred.
A worker-centred policy agenda for
technological advancement can help
Australia create large scale employment
opportunities in high-skilled, high-paid
jobs, where workers have a high level of
autonomy over the work they perform.

3
Stanford, J. 2020. A Fair Share for Australian Manufacturing: Manufacturing Renewal for the Post-COVID Economy.
The Centre for Future Work at the Australia Institute.
4
Stanford, J. 2020. The Robots are NOT Coming (And why that’s a bad thing…)
The Centre for Future Work at the Australia Institute.

10

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Worker-centred
technological
adoption
Jason Chrimes,
machine Operator:
Opal Packaging, WA
Jason is a Machine Operator at Opal Packaging
in Perth where he is one of 69 workers. Opal
employs around 1,000 people nationally,
manufacturing renewable fibre packaging,
among other products. He has worked for Opal
— and the previous owners of the factory — for
around 20 years, and before that he worked as
a contractor delivering goods for the firm for
about five years. “A normal day for me involves
bringing in the blank cardboard from the paper
machine and then printing, folding, and gluing
the product to the customer’s requirements,
then sending it out on pallets,” he explains.

Union-management relations have undergone
significant change while Jason has worked at
the plant. Previously, industrial relations across
the business were highly antagonistic, and
industrial disputes were frequent. “There was a
realisation that relationships were broken and
were almost broken beyond repair,” he says.
“We were too busy fighting amongst ourselves
instead of making sure the business was
successful.”

Management met with union delegates and
explained that the firm was in a dire financial
situation. The then board of directors made
the decision that the business would either
offshore or close if drastic changes were not
made for the business to remain viable in the
Australian market. In response, management
and union representatives set up a series
of new channels of communication and
alternative dispute resolution procedures
11

Rebuild_Booklet.indd 12 8/6/22 4:16 pm
aimed at getting the business back to Recommendation 6:
profitability in a way that benefitted workers
as well as the firm. “We did it in 12 months and Research and development tax credits
generated a massive profit, so the workers are in urgent need of reform. A newly
really stepped up,” Jason explains. designed R&D tax credit must encourage
increased innovation and complexity in the
One of the key areas identified for Australian manufacturing sector. Further,
improvement was updating production accelerated depreciation provisions for
technologies. “Through the new intellectual property and new machinery
communication processes, we identified that and equipment should also be investigated.
machinery was outdated and that the workers
themselves couldn’t possibly deliver the
business improvements that they needed on
the old equipment.”

With the leadership of AMWU representatives
like Jason, the firm was able to update its
existing processes and machinery with
a heavy emphasis on upskilling workers.
“We’ve got an internal skill-based pay system
built into our agreement. We have on-site
assessors, which I also do, building the skill
matrix, identifying the gaps in skills through
regular skills audits. That stuff has made a big
difference.”

Recently, the firm has come under new
management, but Jason hopes that the
constructive processes the union has built can
survive the change of ownership. He believes
that the experiences of his firm demonstrate
that Australian manufacturing can grow and
thrive given the right policy settings, and that
workers and their unions will have a role in
decision making.

12

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Jessie Rea,
machine operator:
Simplot, Bathurst
Jessie started work at Simplot in Bathurst
in 2011. She worked as a machine operator
producing a range of fish products, which
supply major retailers and restaurants,
including Woolworths, Coles, McDonalds,
and KFC. Jessie holds a certificate III in food
processing. Her role could be highly technical,
involving troubleshooting, repairs, and
maintenance on production robotics that the
entire factory relies on to maintain product
flow and quality. She argues that for the food
processing sector to continue to thrive in
Australia, employers and governments need to
invest in worker training.

“I think skills and training are so important. The
AMWU has really pushed for the recognition of
skills and training in manufacturing and in food
manufacturing especially,” she says.

“I think a lot of people, and some bosses, treat
manufacturing workers like anyone could
come in and do your job. But it takes a lot of skill
to be good at this work.”

For Jessie, secure jobs are an essential part
of recognising and developing the skills
and expertise of Australia’s manufacturing
workforce. She worked for Simplot for almost
ten years before she won an application for
casual conversion with the help of her union.

“It was a huge relief to have a secure job,”
she says. Jessie argues that investment is
needed to grow manufacturing employment
opportunities, especially in regional Australia.
To win several large contracts, her employer
now needs to invest in a multi-million-dollar air
fryer: “They’re applying for government grants,
but it’s not looking very promising.”

Jessie describes the idea that dozens of good
jobs in regional Australia are at risk because
of ack of investment as “mind blowing”. Jessie
believes that the government has a role to
13

Rebuild_Booklet.indd 14 8/6/22 4:16 pm
play in ensuring the long-term viability of Australia's energy
Australian manufacturing through investment
in industry and by generating globally
transition
competitive renewable energy supplies.
Australia possesses abundant renewable
energy resources, and this represents
“Not only will renewable energy make
a tremendous opportunity for the
Australian manufacturing more competitive,
Australian manufacturing sector.5
because it’s cheaper, we could be
creating good, secure jobs by investing in
The AMWU has long maintained that a
environmentally sustainable technologies
strong Australian manufacturing sector
here, like electric vehicles.”
would need globally competitive energy
costs, which may be achieved most
Note: Jessie has since changed employment.
sustainably via significant investments in
renewable energy infrastructure. We also
Recommendation 7: believe that the Australian manufacturing
sector can and should play a central
The government should establish a role in the research and development
Manufacturing Industry Fund to assist of renewable energy technologies and
local manufacturing businesses to invest building the necessary infrastructure for
in new advanced production technologies a transition to renewable energy.
through the provision on low-interest
finance, government share capital, loan
guarantees and other mechanisms. The aim
of this fund should be the reindustrialisation
of the Australian economy with worker
centered technologies and to ensure that no Garnaut, R. 2019. Superpower: Australia’s low-carbon opportunity. Carlton:
5

La Trobe University Press.

Australian firm needs to go off shore in order
to expand, seek capital or break into global
supply chains.

Recommendation 8:
That the government immediately reverse
the recent changes to casual conversion
clauses, which have doubled the length of
time that manufacturing workers must wait
before accessing these important workplace
rights. A further, comprehensive overhaul of
provisions in the Fair Work Act and Award
system – including casual, labour hire,
rolling-contract and contracting out – that
allow insecure work to flourish.

14

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Australia's Cam Brady, printer:
News Corp, Melbourne
Energy Cam works as a printer at Newscorp in

Transition
Melbourne. In this role, he and his colleagues
are responsible for printing many of Victoria’s
daily newspapers, among other things. Print
work of this kind requires highly skilled
tradespeople. One of the things he enjoys about
his job is how varied his work is.

“There’s a mechanical side, a scientific side, and
an artistic side,” he explains.

Cam says he’s frustrated with Australian
companies that don’t support Australian
industry and jobs. He notes that recent
paraphernalia produced for a major
supermarket chain which depicted Australian
Olympic athletes were printed overseas.

“It’s all good to get behind the Aussie athletes,
but what about getting behind Aussie workers?”

For Cam, the COVID-19 pandemic has
demonstrated the strategic need for Australia
to rebuild its capacity to make things and
develop greater manufacturing self-sufficiency.
He points to two policies that would help
rejuvenate Australia’s manufacturing capacity.
First, he suggests that the federal tax system
could be used to incentivise firms to support
local jobs and local industry.

“What about we tax companies according to,
for example, how many people they employ
locally? The more they employ Aussies, and
use locally sourced products, then the less tax
they should pay, that should be their incentive.”

Second, Cam argues that the federal
government needs to invest in making
energy more affordable to make Australian
manufacturing more internationally
competitive.

“The cost of energy is killing manufacturing in
Australia,” he points out.
Cam believes the government has a central
15

Rebuild_Booklet.indd 16 8/6/22 4:16 pm
role to play in facilitating a transition to Mick West, automotive
renewable energy and investing to renew
the infrastructure of the national energy grid.
electrician: Brisbane Bus
He also holds that Australian industry can Build, Brisbane
and should play a central role in developing
and manufacturing sustainable energy Brisbane Bus Build is a joint commercial
technologies. arrangement between Volgren and Brisbane
City Council. It builds buses for Brisbane
Recommendation 9: City Council’s bus network, other Australian
public transport systems, as well as private
buyers. Mick West, an automotive electrician
The AMWU is calling for major investments
and AMWU delegate, is one of around forty
in the development of renewable energy
workers at the Brisbane factory. Mick and the
resources including offshore wind, solar and
other workers at Brisbane Bus Build take an
hydrogen. This should be complemented
imported, shortened chassis and build them
by major investments in the infrastructure
into a bus.
of the national electricity grid, including
firming technologies – like batters and
“We get a shortened chassis, which is basically
pumped hydro – that don’t lock carbon
a set of chassis rails, four wheels, a motor, a
emitting assets into our future energy mix.
steering wheel and a little seat. And we start
by chopping the chassis, we make a subframe
and weld the subframe in so it’s the full
length of the bus. And then we build the body
around them. Basically, we fit all the seats and
windows and make a bus out of it.”

Recently, workers at Brisbane Bus Build have
endured serious employment uncertainty
caused by insecurity in the firm’s pipeline
of contracts. “It’s a great place to work, and
management is pretty good, but we need
consistency in contracts,” he says.

Not long ago, he and his co-workers were
forced to take annual leave while they waited
for more work. “The only thing I’d change
about my job is just having some certainty.
More longevity in the contracts would mean
we know we’ve got work for the next few
months instead of waiting for another contract
of one or two buses.”

With certainty in contracts Mick argues that
Brisbane Bus Build could significantly expand
its productive capacity. combustion engine, it’s
an electric one.”

16

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Mick says that as transport providers around
the country are switching to electric vehicles,
this represents a major opportunity to grow
Australian industry and create good jobs. He
sees the role of governments as providing the
certainty businesses like Brisbane Bus Build
need to provide secure jobs and build 21st
century, environmentally sustainable public
transport systems.

He says that cost-minimising policy
makers sometimes miss the bigger picture,
emphasising the multiplier effect of jobs in the
manufacturing sector. “They just seem to think
about price, and not the value that making
things in Australia adds to communities in
terms of jobs, and skills, and taxes and the
rest. For every job you create here, you’re also
creating jobs for suppliers and hospitality
businesses and all sorts of things.”

Recommendation 10:
The federal government should support
local efforts to develop a domestic vehicle
industry. This should be focused on
supporting existing small and medium
enterprises (SMEs) to expand, investing
in research and development, and supply
chain development as part of a broader
manufacturing policy. As demand for
electric vehicles grow, local, state, and
federal governments will spend billions on
procuring new electric vehicles – everything
from fleet cars to highly customised specialty
vehicles. These billions could either be used
to support a domestic capability or shipped
offshore to support jobs in another country.

17

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The role of government
procurement
Supporting Aussie Made is one of
the simplest ways for the Australian
government to assist our manufacturing
industry. Australian governments are
massive consumers of manufactured
goods. They buy equipment to support
our health and education services; major
specialised equipment for our armed
forces across land, sea, and air; and for
civil applications such as trains, busses
and ferries.

Governments are major consumers of
manufactured products in infrastructure
projects like our energy grid, new roads,
and railways. A strong “Buy Australia”
program from governments would
not only help rejuvenate Australian
manufacturing, but it would also help
reduce the final net cost of procurement.
Supporting Aussie Made helps to
create jobs, build skills and it improves
government revenue.

As research commissioned by the AMWU
has noted, other countries — notably
the U.S. — regularly utilise domestic
content targets in procurement to
support domestic producers, all within
the constraints imposed by free trade
agreements.6

6
Stanford, J. 2020. A Fair Share for Australian Manufacturing: Manufacturing Renewal for the Post-COVID Economy.
The Centre for Future Work at the Australia Institute.

18

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The role of Tracey Davis, supply
quality assurance
government co-ordinator: Department
of Defence, Melbourne
procurement As a supply quality assurance co-ordinator,
it is Tracey’s job to ensure that suppliers of
clothing and personal protective equipment
to Australia’s Defence Forces are delivering
products that accord with their contracts. It
is a highly skilled position. Tracey started out
with the equivalent of an advanced diploma in
clothing studies and has continued her training
throughout her career.

Her role is essential to ensuring that the
Australian Defence Forces are well equipped
for whatever challenges they face. Her work
has illustrated to her the strategic importance
of maintaining a domestic manufacturing
capacity in this country. “Australia needs to
ensure we have the capacity to manufacture
not only what we need to survive and thrive
but also be ready to protect our nation from all
threats.”

She has witnessed Australia’s capacity to make
things diminish significantly during her time at
the Department of Defence.

One of the factors she identifies as
undermining Australia’s capacity to maintain
the strategic capacity to make the things it
needs is the proliferation of so-called free trade
agreements.

“It has been harder since we’ve been required
to apply the free trade agreements to our
procurements,” Tracey says. “Very quickly,
savvy suppliers were putting in two offers. One
would be an offer for Australian products at a
certain price and one would be an offer for an
overseas manufacturer. Clearly, the prices were
different.”

19

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Tracey argues that being forced to compete Recommendation 11:
with countries with low labour costs, and
to constantly bid for new contracts, has The Government's Commonwealth
undermined Australian business’s capacity to Procurement Rules should be rewritten
compete. to explicitly require government bodies
and procurement officers to preference
To rebuild Australia’s capacity to make local suppliers, manufacturers, and service
things for its Defence Forces, she says local providers. These rules should be geared
businesses need certainty in contracts. “I towards creating clear social value: creating
would like to give business the certainty that if good jobs, sustaining industry, and reviving
they were to establish industries in Australia, communities. This needs to be matched with
and if they were to pay workers a fair wage for a concerted effort to change the culture of
the work, if they were to reinvest their profits procurement within government, where the
back into Australian industry, and pay taxes lowest cost bid is always the biggest driver.
in Australia, that we would support them and
their business.”

Tracey concludes that rebuilding Australia’s
capacity to make the things it needs is
inherently linked to valuing the work of
people in the manufacturing sector: “Valuing
workers in Australia is central to the whole
thing.”

20

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Michelle Owen,
machine operator:
McCain Foods, Ballarat
Michelle is a machine operator at McCain
Foods in Ballarat. During her time at McCain,
Michelle has worked across a range of product
lines including potato products, pizza, and
frozen meals. She currently works as a machine
operator on the frozen meal line. Things have
been extremely busy for her and her co-
workers since the COVID-19 pandemic reached
Australia in early 2020.

“The business has definitely grown during
COVID, I mean, as you can imagine, there’s a lot
of people stuck at home. So, particularly in my
area — frozen meals — we’ve been really busy.”

McCain is a major employer in the Ballarat area.
Michelle says people in her community are
concerned about defending and creating good
local jobs, and that they are very receptive to
the idea of buying Australian made.

“I was recently talking to my neighbours — one
of them is in healthcare and the other works in
human resources in the Catholic school system
— and they were very receptive to the idea of
buying Australian made to support local jobs.”
Even her boss is sympathetic to the AMWU’s
campaign to buy Australian to support the
manufacturing industry: “he commented that
he liked my campaign shirt and asked if I could
get him one!”

In terms of policy, Michelle thinks the
government has a role to play in incentivising
business to onshore supply chains, both for
manufactured goods and primary produce.
“One of the policies would be with regards to
procurement and supplies,” she says.

“We should use the tax system and whatever
other mechanisms we have to push businesses
to look in their own backyard first, so to speak,
so Australian manufacturers should exhaust
all Australian made avenues before seeking
supplies elsewhere.”
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This way, Michelle argues, Australia can Investing in supply chain
rebuild its own industrial supply chains and
develop a launching pad for increased exports
resilience
of manufactured goods.
The COVID-19 pandemic and associated
health measures have significantly
Recommendation 12: disrupted global supply chains. At the
height of the crisis, when imports were
The AMWU supports a policy mandating uncertain, many Australian manufacturers
local content requirements in any project and their workers stepped up and helped
attracting government support, including produce essential equipment, including
improved and harmonised definitions of face masks and hand sanitizer. For many
"local content" that ensure only value that is firms, disrupted supply chains saw
added by workers in Australia is included. production grind to a halt and forced them
to re-learn how to produce components
themselves, or find domestic companies
that could step in.

It has been a reminder of the strategic
importance of maintaining significant
domestic supply chain capacity. Australia
can rebuild this capacity in a way that
creates secure jobs for workers in
Australia, drives economic development
in our regions, diversifies our nation’s
economy, and boosts our sovereign
capability.

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Investing in
supply chain
resilience
Denis Webber, fabricator:
Incat, Hobart
Denis is a trained cabinet maker who has
worked on and off at Incat for 30 years. Incat
employs around 500 people in Hobart and
builds catamarans for buyers in Australia and
internationally. As a fabricator, Denis and his
co-workers build ferries and other vessels,
ranging in size from small vessels around 30
metres long, through to vessels well over 100
metres.

“We build everything on a modular basis, so
we have a particular section to build, from
one bulkhead to another particular bulkhead,
and then the cradle takes it away to be put on
the boat,” he explains. Building these vessels
is highly skilled work, and Denis emphasises
the role that he thinks Incat should play in
developing a highly skilled manufacturing
workforce in Tasmania.

“Apprenticeships should be designed to teach
people a high level of skills — not just the basic
minimum. That way, we can send them out into
the workforce to learn new skills from other
people.”

Government procurement should play a key
role in developing a highly skilled workforce,
says Denis. He points out the Spirit of Tasmania
I and II were built in Finland, while the capacity
existed to build them in Tasmania. More
recently, he points out, the government of New
South Wales has sourced ferries internationally
rather than domestically. “Sydney Ferries
recently bought a bunch of boats from
Indonesia, and when they got to Australia,
they were a total disaster.”
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Rebuild_Booklet.indd 24 8/6/22 4:16 pm
He goes on to argue that these decisions Recommendation 13:
represent significant missed opportunities to
develop Australia’s industrial capacity. “We The AMWU supports the creation of more
might get them a bit cheaper from elsewhere, manufacturing common user facilities in
but that doesn’t mean that product is any the model of the Australian Marine Complex
good, and it comes at the cost of workers in in Western Australia. These facilities have
Australia and Australian industry.” a demonstrated track record of building
the capacities of SMEs and strengthening
For Denis, the COVID-19 pandemic has Australia’s supply chain resilience.
exposed the folly of failing to maintain
Australia’s domestic manufacturing capacity.
“We can’t get marine grade aluminium plate
Recommendation 14:
in Australia anymore because nobody does
To rebuild our heavy industry supply
it,” he says. “We’ve lost that capacity as a
chains, we recommend the establishment
country.” This meant that the workers at Incat
of a sustainable manufacturing cluster for
were forced to wait months for international
green (i.e., carbon-neutral) primary metal
shipments as COVID-19 disrupted supply
manufacturing. This would support and
chains.
promote adding value to our minerals like
bauxite and iron ore, support Australian
Denis emphasises the strategic importance of
jobs, and strengthen our sovereign
onshoring manufacturing capacity. “We need
capabilities.
to rebuild our manufacturing capacity so we
can be more self-sufficient as a country, but
also so we can create good jobs for people.”

He concludes that while international trade
is necessary, it should not come at the cost of
local workers or our manufacturing industry.

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Dominic Vignale,
boilermaker: Komatsu,
Rockhampton
Dominic has been active in the AMWU since
he began his apprenticeship in 1988. He’s a
boilermaker at Komatsu in Rockhampton,
and his workshop is responsible for the
maintenance, repair, and overhaul of
underground mining machinery, servicing
many of the mines in the area.

Work on this kind of equipment is complex
and requires highly skilled workers. “We
work on shuttle cars, continuous miners, long
wall equipment. It’s basically all the nuts and
bolts of underground mining equipment.”
His workshop employs over fifty workers,
including several apprentices.

The COVID-19 pandemic exposed the fragile
nature of the international supply chains
that the workers at Dominic’s workshop rely
on to get the job done. The business relies on
imported parts from the United Kingdom,
South Africa, and other places, many of which
have been severely delayed during the global
health crisis. “I would like to see some of the
parts we use manufactured here in Australia,”
he says.

Dominic points out that some of the parts
that have been delayed could be produced in
Central Queensland. “There are parts that we
are waiting on that could be manufactured at a
workshop just up the road.” Not only would this
employ local workers, but it would also reduce
the industry’s reliance on increasingly volatile
global supply chains.

He argues that Australian manufacturing could
be revitalised in part through onshoring some
of these supply chains. “If a company is making
a part in Australia, and it’s going to contribute
towards Australian industry and creating jobs,
then the government should be doing all they
can to help make sure that these businesses
and workers can do that.”
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Dominic notes that the economy of Central Recommendation 15:
Queensland is heavily reliant on cattle
farming and coal mining — an industry he The AMWU believes that any effort to
acknowledges has an unstable future. support the manufacturing industry
“In Central Queensland, if it doesn’t have a hole needs to have a focus on delivering jobs in
underneath it, it’s got a cow on top of it, “says regional communities. Not only does this
Dominic. approach deliver good jobs where they
are needed, but it takes advantage of the
He adds that the people in his community natural advantages that these regions have.
are intensely worried about their economic In a time of significant change, investment
and working futures. This knowledge bolsters in manufacturing, and the infrastructure
Dominic’s conviction that any effort to needed to make it successful will help these
revitalise the manufacturing sector must regions diversify their economies and
prioritise employment security and long-term provide new and exciting opportunities for
economic well-being of workers in Australia, skilled workers.
especially in regional areas.

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Matt Hastings,
production employee;
Electrolux, Adelaide
Alongside around 450 co-workers at his
Adelaide factory, Matt builds Electrolux
ovens. More specifically, he runs a robot cell
that assembles oven doors. “If you picture an
oven door, you’ve got the glass, the handle, the
columns and trims that hold it all together. I
load the parts into two different sections of the
robot cell and monitor the robot as it picks up
the components and glues them together.”

Previously, Matt’s plant employed as many
as 850 people and produced other products
such as cooktops, but some of these functions
have since been sent overseas. Electrolux also
had plants producing washing machines and
dryers in Adelaide, but the cookware factory
where Matt works is “the last one standing.”

When COVID-19 disrupted global supply chains
in early 2020, the Adelaide Electrolux factory
was forced to shut down for a month because
they couldn’t get the parts they needed.

“We found that due to the company
outsourcing so much stuff overseas, that we
just couldn’t get parts in. To get back up and
running, Electrolux was forced to bring several
functions that had previously been offshored
back in house. We started introducing parts
back into our press shop which we had been
getting from overseas just so we were able to
get up and running again,” he explains.

For Matt, this experience has demonstrated
the fragility of complex international supply
chains, especially when combined with just in
time inventory management. He says that this
experience has underlined the strategic need
to maintain domestic manufacturing capacity.

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“The cost difference isn’t that much when you Recommendation 16:
make it here, but obviously some bigwig at the
time decided to ship it off overseas to make it To improve our resilience and develop
there.” vital sovereign capabilities, governments
should require large Australian businesses
Matt concludes that he hopes the disruptions to make every effort to onshore their
caused by COVID-19 will motivate policy domestic supply chains if they want to
makers and senior managers to reconsider the access tax benefits (instant asset write offs,
benefits of strong domestic supply chains. for example). This would ensure that the
government got the best bang for its buck,
“I hope they’ve learned some lessons and that by using new or existing business support
the government is going to get behind local to help drive economic growth in domestic
manufacturing.” supply chains.

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Rebuild_Booklet.indd 30 8/6/22 4:16 pm
Conclusion

In their own words, AMWU workplace leaders have sketched
a policy plan for a strong, manufacturing-led recovery. Much of
it is based on previous research commissioned by the AMWU,
the research of other policy makers, and the cumulative
expertise of our union’s members and delegates. The
recommendations made in this report are ambitious and will
start the Australian economy on the path to manufacturing
self-sufficiency - producing much as we consume.

We have the opportunity to rebuild Australia’s industrial
capacity in a way that prioritises good, secure jobs; economic
development of our regions; bolstering our sovereign capacity;
and diversifying our nation’s economy.

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Summary of Recommendations
Recommendation 1: Recommendation 4:
The AMWU supports a minimum ratio of Government policy must prioritise local
apprentices to tradespersons on all projects employment and the development of the
that attract government investment, finance, local workforce. This means the government
and other forms of support. Furthermore, must require vigorous and meaningful labour
the AMWU advocates a national ‘common market testing and skills assessments to be
benchmark test’ for apprentices, to ensure that conducted prior to engaging visa workers to
apprentices graduate with the skills they need, ensure the Australian workforce is developed
and employers can’t simply ‘tick and flick’ and prioritised for employment opportunities.
apprentices to meet their ratio requirements.
Recommendation 5:
Recommendation 2:
The skilled migration program needs to be
Australia needs to develop a National Rail urgently reviewed. Where there are jobs
Manufacturing Plan to create jobs and available in Australia, employers must be
capabilities in the industry. This plan should required to actively train young workers to fill
ensure that all rolling stock—both public them. Where a skilled visa worker is brought
transport and freight—that we need in in, the AMWU believes that there should
Australia, is made in Australia - emphasising be a requirement for their employer to also
the development of the skills of workers in undertake domestic training of workers in
Australia and the collective capabilities of the same skillset. Ultimately, we believe that
Australian industry. no job should be allowed to stay on the skills
shortage register for longer than it takes to
Recommendation 3: train an Australian worker to do that job. The
current system is failing workers and must be
The AMWU supports nation-wide free TAFE overhauled.
— similar to the policies in place in Victoria
and Queensland. Within this framework, Recommendation 6:
the union supports establishing a national
Manufacturing VET policy board tasked with Research and development tax credits are
developing and implementing measures in urgent need of reform. A newly designed
to build a more coherent and constructive R&D tax credit must encourage increased
framework for VET manufacturing. innovation and complexity in the Australian
manufacturing sector. Further, accelerated
depreciation provisions for intellectual
property and new machinery and equipment
should also be investigated.

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Recommendation 7: Recommendation 10:
The government should establish a The federal government should support local
Manufacturing Industry Fund to assist efforts to develop a domestic vehicle industry.
local manufacturing businesses to invest This should be focused on supporting
in new advanced production technologies existing small and medium enterprises
through the provision on low-interest finance, (SMEs) to expand, investing in research and
government share capital, loan guarantees development, and supply chain development
and other mechanisms. The aim of this as part of a broader manufacturing policy.
fund should be the reindustrialisation of the As demand for electric vehicles grow,
Australian economy with worker centered local, state, and federal governments will
technologies and to ensure that no Australian spend billions on procuring new electric
firm needs to go off shore in order to expand, vehicles – everything from fleet cars to highly
seek capital or break into global supply chains. customised specialty vehicles. These billions
could either be used to support a domestic
Recommendation 8: capability or shipped offshore to support jobs
in another country.
That the government immediately reverse the
recent changes to casual conversion clauses, Recommendation 11:
which have doubled the length of time that
manufacturing workers must wait before The Government’s Commonwealth
accessing these important workplace rights. A Procurement Rules should be rewritten
further, comprehensive overhaul of provisions to explicitly require government bodies
in the Fair Work Act and Award system – and procurement officers to preference
including casual, labour hire, rolling-contract local suppliers, manufacturers, and service
and contracting out – that allow insecure work providers. These rules should be geared
to flourish. towards creating clear social value: creating
good jobs, sustaining industry, and reviving
Recommendation 9: communities. This needs to be matched with
a concerted effort to change the culture of
The AMWU is calling for major investments procurement within government, where the
in the development of renewable energy lowest cost bid is always the biggest driver.
resources including offshore wind, solar and
hydrogen. This should be complemented by Recommendation 12:
major investments in the infrastructure of
the national electricity grid, including firming The AMWU supports a policy mandating local
technologies – like batters and pumped hydro content requirements in any project attracting
– that don’t lock carbon emitting assets into government support, including improved and
our future energy mix. harmonised definitions of “local content” that
ensure only value that is added by workers in
Australia is included.

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Recommendation 13: Recommendation 16:
The AMWU supports the creation of more To improve our resilience and develop vital
manufacturing common user facilities in sovereign capabilities, governments should
the model of the Australian Marine Complex require large Australian businesses to make
in Western Australia. These facilities have every effort to onshore their domestic supply
a demonstrated track record of building chains if they want to access tax benefits
the capacities of SMEs and strengthening (instant asset write offs, for example). This
Australia’s supply chain resilience. would ensure that the government got the
best bang for its buck, by using new or existing
Recommendation 14: business support to help drive economic
growth in domestic supply chains.
To rebuild our heavy industry supply
chains, we recommend the establishment
of a sustainable manufacturing cluster for
green (i.e., carbon-neutral) primary metal
manufacturing. This would support and
promote adding value to our minerals like
bauxite and iron ore, support Australian jobs,
and strengthen our sovereign capabilities.

Recommendation 15:
The AMWU believes that any effort to
support the manufacturing industry needs
to have a focus on delivering jobs in regional
communities. Not only does this approach
deliver good jobs where they are needed, but
it takes advantage of the natural advantages
that these regions have. In a time of significant
change, investment in manufacturing,
and the infrastructure needed to make it
successful will help these regions diversify
their economies and provide new and exciting
opportunities for skilled workers.

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www.amwu.org.au

facebook.com/TheAMWU

twitter.com/theamwu

instagram.com/theamwu

Authorised by Steve Murphy, Australian Manufacturing Workers’ Union National Secretary. Proudly printed by AMWU members.

Rebuild_Booklet.indd 36 8/6/22 4:17 pm
Australia’s Opportunity:
A Green Manufacturing
Superpower

V2_REF_SENINQ.indd 1 3/6/22 1:27 pm
Prepared by the Australian Manufacturing Workers’ Union | June 2022

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Support
Aussie made

Contents
Introduction 5

An Abundance of Cheap, Renewable Energy 7
Samantha Facey, Quality Control: McCain Smithton, Tasmania 8
Cam Brady, Printer: News Corp, Melbourne 9
Recommendations 11

Building Green Energy Infrastructure 13
Jamie Wombwell, Welder: Portland, Victoria 14
Recommendations 15

Regions Undergoing Industrial Restructuring 17
Daniel Graham, Scaffold Supervisor: Muja Power Station, Collie 18
Recommendations 19

Electric Vehicles 21
Mick West, Automotive Electrician: Brisbane Bus Build, Queensland 22
Recommendations 23

Summary of Recommendations 24-26

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4

V2_REF_SENINQ.indd 4 3/6/22 1:27 pm
For too long, environmental sustainability It should also mean value adding to our
and creating more jobs in the minerals rather than simply digging
manufacturing and energy production them up and shipping them off to other
sectors have been seen as incompatible countries that use them to grow their own
with one another. The Australian sovereign capabilities in manufacturing.
Manufacturing Workers’ Union (AMWU)
rejects this framing. Our union — which Our union is proud to be a democratic
organises and represents almost 70,000 organisation. It is run by members, for
members from every city and region of members. That is why this policy paper
Australia — believes that the international is framed around the experiences and
shift to renewable energy represents ideas of our workplace leaders. Between
an unprecedented opportunity to them, they have decades of experience in
revive our nation’s battered but resilient the manufacturing sector, and they have
manufacturing sector. a deep knowledge of the challenges it
faces. Their testimonies are accompanied
Australia’s unique opportunity stems by a series of policy proposals that we
from our abundance of renewable energy believe would position the Australian
resources. Research shows Australia has manufacturing industry for significant
perhaps the greatest natural resources growth in the decades to come.
in terms of sun (solar), wind, and waves,
among other resources, of any developed The policies sketched in this document
nation.1 We also possess immense would not be enough to make Australia
mineral resources that will be in high the green manufacturing superpower we
demand in the coming decades, including believe it can be, but they would be an
lithium ion, which is essential to produce excellent start.
batteries for electric vehicles (EVs) and
other high demand applications.2
Garnaut, R. 2019. Superpower: Australia’s low-carbon opportunity. Carlton: La Trobe University Press.
1

Harnessing our immense renewable 2
DIISER. 2021. Resources and Energy Quarterly – September 2021. Department of Industry, Science,

energy resources would generate an Energy and Resources, Commonwealth of Australia (Canberra, Australia).

abundance of cheap power which can be
used to revitalise existing industries and
build new ones. This includes building
the renewable energy infrastructure,
such as wind towers and solar panels.

5

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V2_REF_SENINQ.indd 6 3/6/22 1:27 pm
An Abundance of Cheap,
Renewable Energy
Australia’s renewable energy resources With the introduction of international
in the forms of wind, solar, and waves are carbon tariffs in some jurisdictions
unparalleled in the industrialised world. and declining investment in fossil fuel
technologies, a continued reliance on
In this context, the global shift away from old energy sources will leave Australian
fossil fuels presents our country with a industry increasingly priced out of
tremendous economic opportunity. global markets.

By investing in Australian made green The alternative is an ambitious and co-
energy infrastructure to harness our ordinated industry policy to generate
abundant natural resources, we can electricity from renewable resources
generate huge amounts of affordable alongside major investments in the
electricity that fuels an industrial national energy grid and other energy
revival and helps us become a green infrastructure.
manufacturing superpower.

High energy prices are broadly
acknowledged as a handbrake on
the international competitiveness of
Australian manufacturing and industry
more broadly.

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Samantha Facey,
Quality Control
McCain Smithton, Tasmania

Sam works at McCain Foods Smithton Sam has been involved with the AMWU’s
in quality control. Along with her Support Aussie Made campaign from
colleagues, she is responsible for the start. She says that adding value to
processing locally grown potatoes into Australia’s natural resources is a message
the chips we buy at the supermarket. that resonates with a lot of the people she
talks to.
“I check the finished product. I make sure
that the bags, the boxes, the codes are all “People are crabby at the fact that we take
okay. And I check the product, the length, our natural resources, send them away,
the defects, the solids, the colour when it’s and they’re then made into things we’ve
cooked to texture, and make sure it’s okay. got to buy back.”
And if not, I make changes accordingly.”

Sam wants to see Tasmania’s renewable
energy resources being used to develop
an advanced manufacturing sector in the
state.

“It’s the same as with any of our resources.
I don’t want to see them dug up and sent
away, I want to see us adding value to
them and creating good jobs.”
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Cam Brady,
Printer
News Corp, Melbourne

“The price of energy is impacting our Cam wants to see Australia’s natural
industry a lot. Our suppliers recently said resources in wind and solar harnessed to
that due to energy and logistics costs, generate good manufacturing jobs and
they’re putting up the price of newsprint says that we need to move quickly to take
by 30 to 40 per cent,” says Cam, a printer advantage of the opportunity.
at News Corp.
“We need to look at renewables as a way
“That rings alarm bells for me, because to get costs down — because globally
we print a lot of smaller papers; that’s that’s the way we’re heading — and if
5,000 country papers, essentially. These we don’t get on board now, we get left
outfits aren’t going to be able to absorb behind and we’ll be buying everyone
a cost hike like that. That risks jobs, and else’s technology when, really, we’ve
it impacts the communities that rely on got an opportunity to create brand
those papers.” new industries and actually export our
technologies to the world.”
“One of the reasons that manufacturers in
this country cite for going offshore is that
energy costs are too high.”

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Recommendation 1: Recommendation 3:
The AMWU is calling for major The AMWU recommends the
investments in the development of establishment of a governmental
renewable energy resources, including body tasked with supporting research
offshore and onshore wind, geo-thermal, and development in advanced green
solar, and hydrogen. manufacturing technologies in Australia.
This may sit within the scope of the
This should be complemented by major Australian Renewable Energy Agency
investments in the infrastructure of the and must include a requirement that
national electricity grid, including firming all intellectual property, design, and
technologies – such as batteries and manufacture be maintained in Australia
pumped hydro – that don’t lock carbon by organisations receiving support.
emitting assets into our future energy
mix.

Recommendation 2:
The federal government should consider
the development of a National Hydrogen
Jobs Plan in the vein of the policy of the
South Australian government.

The plan would lay out areas and
projects to be prioritised for research
and development, and investment, with
a view to maximising good jobs and
providing Australian households and
industry with affordable energy.

This should include an examination of
water requirements for the electrolysis
process and the potential need for
desalination plants to compliment the
emergent hydrogen industry.

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Building Green Energy
Infrastructure
To capitalise on Australia’s immense Australia should move from a
natural resources in solar, waves, and ‘comparative advantage’ approach to
wind, a significant investment in green a ‘competitive advantage’ approach
energy infrastructure is required. which pro-actively favours value adding
industries that facilitate increasing
This represents a dual opportunity for economic returns in the long term.
our economy if we choose to build that
infrastructure in Australia. Building Australia’s renewable energy
infrastructure and goods for export, like
Unfortunately, this opportunity has batteries, presents a major opportunity
so far been squandered as imported for the federal government to lead both
infrastructure — often of inferior quality in Australia’s energy transition and its
— has systematically undermined high- industrial rejuvenation.
quality Australian producers.

As can be seen in the testimony of
Jamie Wombwell below, nowhere is this
negligence more evident than in the
Abbott-Turnbull-Morrison government’s
refusal to support Australia’s only wind
tower manufacturer, Keppel Prince, in
regional Victoria. Jamie has watched
imported wind towers being unloaded
at his local port while the jobs of his
colleagues disappeared.

Australia also has access to many of
the essential minerals for building
batteries for electric vehicles and other
applications. However, Australia has
long ranked poorly in terms of economic
complexity, relying heavily on extracting
natural resources and exporting them
without value adding.

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Jamie Wombwell,
Welder
Portland, Victoria

Jamie currently works at Portland that’s if they’ve been willing to support
Aluminium but previously worked at renewable energy at all.”
Keppel Prince where, as a welder, he
worked with his colleagues to build wind The loss of jobs has hit the regional
towers for Australia’s wind farms. Jamie Victorian city of Portland hard. “It’s a real
is not the only one of his colleagues who kick in the guts because they even bring
has had to seek out other employment. the imported, inferior quality towers in
through our ports.”
“I was out there recently talking to the
manager of the wind tower section, and Jamie hopes that the community
they’ve gone from about 150 workers to campaign that he and his colleagues
about ten,” he says. have waged to bring wind tower
manufacturing back to Portland can win
Why have so many jobs at mainland the support of the federal government.
Australia’s only wind tower manufacturer
disappeared? “If they can set up local content
requirements on every renewable energy
“Because the federal government project, it would of create thousands of
has seemed to be uninterested in jobs good because there are hundreds
supporting the jobs of the future in terms of these wind towers going up Australia
of renewable energy infrastructure, wide, and every single one is being
preferring to get stuff from offshore brought in from overseas at the moment,
because it’s a tiny bit cheaper, and every single one.” 14

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Recommendation 4: Recommendation 6:
The AMWU supports a policy mandating To rebuild our heavy industry supply
local content requirements in any project chains, we recommend the establishment
attracting government investment, of a green (i.e., carbon-neutral) primary
finance, and other forms of support. metal manufacturing sector council, to be
supported by a broad infrastructure and
This should include minimum secretariat at the Department of Industry,
requirements of 90 per cent local content Science, Energy and Resources.
in engineering and design services,
and for complex manufactures. New The council should be made up
regulations should also include improved of representatives from industry,
and harmonised definitions of “local government, and trade unions, and
content” that ensure only value that is engage sector stakeholders to identify
added by workers in Australia is included. the most promising sub-sectors for
investment and development. The
Further, intellectual property, and council would develop investment and
design and manufacture work must innovation plans for the identified sub-
be maintained in Australia where sectors and oversee the implementation
government investment or support is of these plans with the support of other
contributed. government bodies.

Recommendation 5:
The AMWU believes a National Battery
Manufacturing Strategy is required to
maximise the impact of government’s
policy levers across different portfolio
areas and support the developments of a
sustainable battery industry.

Our union welcomes the pledged funding
for a battery manufacturing facility in
Gladstone but believes that more work
needs to be done to identify and support
other projects.

A national battery manufacturing
strategy must be truly national and
support the development of export
products from the west coast as well as
support for the domestic market of the
east coast.

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Regions Undergoing
Industrial Restructuring
As with all major structural shifts in the A strong industrial future for these
economy, some workers and regions will regions will require governments to join
be impacted more than others. forces with workers and their unions
to navigate the restructuring of local
With the international shift away from economies.
fossil fuels, Australia’s coal mining and
energy production regions are going The AMWU is already active in this
to experience significant economic space, working with environmental and
reorganisation. These changes cannot be community organisations to advocate for
left to the whims of the market. economic diversification and industrial
renewal in areas like the Hunter Valley,
Instead, ambitious and targeted industry Central Queensland, south-west Western
policies are needed to ensure that well- Australia, and the La Trobe Valley.
paid, secure jobs are available that utilise
and build on workers’ existing skill sets Teske, S. et al. 2012. Wind turbines off the coast could help Australia become an energy superpower.
3

and ensure the prosperous futures of The Conversation. Available at: https://theconversation.com/wind-turbines-off-the-coast-could-
help-australia-become-an-energy-superpower-research-finds-164590?utm_source=twitter&utm

their communities. medium=bylinetwitterbutton

Research has demonstrated that these
regions possess existing advantages
that can form the basis of a shift to green
industries, including access to renewable
energy resources and highly skilled
workforces.3

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Daniel Graham,
Scaffold Supervisor
Muja Power Station, Collie

“Coal has been the blood that fills the Daniel and his colleagues are advocating
vessels for Collie. We have a number of for the creation of green metals
coal-fired power stations, and that’s really manufacturing and lithium-ion battery
been our main industry,” says Daniel, who manufacturing in Collie. “There’s been
works at the Muja Power Station. “Coal a feasibility study around the green
has created work for the people magnesium smelter and the battery
in our community going back for many processing facility. We’ve got great
decades.” facilities here, we’ve got a railway line,
our highway is in great shape, they’ve all
The Muja Power Station has been upgraded. And one of the things we
been scaling down its operations in have here in the South West is the skilled
recent years, though. “It’s in line with the labour to build these things. The people
global movement that we’re going to in this area have built up a skill base
reduce emissions and, obviously, phase over generations and have passed it on
out coal-fired power stations, and look through apprenticeships and training, so
into renewables.” we have the skilled workers.”

Daniel first got involved with the Daniel wants to see the federal
AMWU during the negotiation of a government invest in the infrastructure
new enterprise agreement at the plant required to get green metal
but soon became part of the union’s manufacturing off the ground in the
organising around a just transition for southwest of Western Australia.
coal industry workers. This included
work with the Just Transition Working
Group which brought together unions,
employers, community leaders,
government, and others to develop a plan
to protect the jobs and future of Collie
over the coming years, during which we
will see a decline in the demand for coal.

“Through organising with the AMWU,
we’ve been able to have a say in these
processes. Now we’ve been offered
training and a pathway for when the units
gradually close down, a pathway that’s
going to transition us away from this
industry and into new industries.”

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Recommendation 7: Maintaining and growing Australia’s
aluminium industry requires large-scale
storage and renewable builds to deliver
The government should establish a
reliable and sustainably priced energy
tripartite advisory body tasked with
inputs. Current policy settings have
assessing any major project or firm that
not addressed this critical issue as the
would attract government investment
grid shifts. Sector specific energy policy
or support for its social, industrial,
and public investment are required to
employment, and sovereign capability
ensure the stability and energy pricing
outcomes.
requirements of aluminium smelters are
met.
Recommendation 8:
Recommendation 10:
The AMWU supports the creation of
more manufacturing common user Value adding precincts — or clusters of
facilities in the model of the Australian industry, research, and education activity
Marine Complex in Western Australia. in a specific geographic area — should be
These facilities have a demonstrated established in existing energy generation
track record of building the capacities and extractive industry regions with the
of small and medium enterprises and express purpose of developing value-
strengthening Australia’s supply chain adding manufacturing industries and
resilience. When targeted at areas sustainable employment opportunities.
undergoing industrial restructuring,
they can help facilitate the retraining
and redeployment of workers in new
Recommendation 11:
industries.
We strongly support the Australian
Council of Trade Union’s call for the
Recommendation 9: establishment of a national Energy
Transition Authority to oversee the
Global demand for aluminium will orderly and equitable transition of
continue to increase as a key material for the energy sector. The key focus of
global development and decarbonisation. the authority would be to minimise
Smelters such as Tomago, Boyne, and the impact of power plant closures on
Portland drive the economies and workers and their communities through
industrial base of their regions. managing this transition and delivering
on plans for the future prosperity of
affected regions.

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Electric Vehicles
In 2017, Australia ceased to be a mass The AMWU believes this position should
producer of cars when Holden-General be leveraged to help rebuild mass vehicle
Motors and Toyota closed their last manufacturing in this country.
remaining plants.
EV manufacturing is highly complex and
In the years since, the production of innovation intensive and would provide
EVs has emerged as a major global an ideal anchor industry for developing a
manufacturing industry in which more advanced manufacturing sector in
Australia currently only plays a Australia. Such complex manufacturing is
supporting role. essential to building Australia’s sovereign
manufacturing capabilities.
The shift from internal combustion
engines to EVs represents a significant A mass production EV industry would
opportunity for Australia to rebuild create tens of thousands of good jobs,
and expand its manufacturing industry train thousands of apprentices and
by harnessing key existing industrial upskill other workers, and would have
strengths (infrastructure), capabilities a significant multiplier effect, creating
(skills and knowledge) and rich natural thousands more jobs across the economy.
resources (unrivalled critical minerals
reserves).

Australia still has a toehold in
global automotive value chains as a
components manufacturer, as well as
maintaining the capacity to build buses
— some electric — among other heavy
vehicles.

In Western Australia in particular, the
demand for electric vehicles for the
resource industry is set to increase.

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Mick West,
Automotive Electrician
Brisbane Bus Build, Queensland

Mick West, an automotive electrician Brisbane Bus Build is currently filling
and AMWU activist, is one of around fifty orders from councils and private buyers
workers at Brisbane Bus Build. from around the country, but Mick thinks
there is more that could be done to
“Things are going well right now and I support the industry.
think the firm is looking to hire more
people,” Mick says. “I don’t see much policy and action so far
from the federal government supporting
The joint venture between Brisbane City the manufacture of electric vehicles or
Council and Volgren takes partially built supporting the jobs this work creates.”
buses and performs the final assembly
and fitout for Australian clients. The plant With the right supports, Mick believes
has grown significantly in recent months that electric vehicle building in Australia
as they have received a surge in orders for could expand and become more
their electric model. complex.

“There’s a lot of interest in Australian built “At the moment we import the chassis
electric buses right now,” says Mick. and the electric drive, but we could
build them here and add value to
our resources. It would create a lot of
good jobs as well as environmentally
sustainable public transport.”
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Recommendation 12: Recommendation 14:
The federal government should create an EV value chains mean the entire life of
EV Manufacturing Industry Commission, the materials involved, and Australia
with a board comprising major should develop a plan for refurbishing
stakeholders from government, unions, and recycling EV batteries. These
and industry leaders, to be chaired by batteries require specialised skills,
an EV industry expert. The commission infrastructure, and facilities to transport,
would be tasked with holding a broad test, and — when possible — disassemble,
consultation and inquiry into Australia’s repair, and refurbish. When repair and
EV mass production possibilities, refurbishment is not possible, they
beginning with mapping the existing must be recycled. Australian must begin
automotive manufacturing sector, then building this capacity now.
examining how Australia can establish a
firmer foothold in global value chains and
how to attract one or more EV original
equipment manufacturers to Australia

Recommendation 13:
The federal government should identify
necessary investments in Australian
supply chains to strengthen capabilities
for participation in global EV value
chains. Investment tax credits could
be used to more closely link extraction
industries to manufacturing capabilities,
incentivising firms that typically export
raw resources to instead invest in or
connect to downstream production
to supply emerging EV battery and
components industries in Australia.

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Summary of Recommendations
Recommendation 1: a requirement that all intellectual property,
design, and manufacture be maintained in
Australia by organisations receiving support.
The AMWU is calling for major investments
in the development of renewable energy
resources, including offshore and onshore Recommendation 4:
wind, geo-thermal, solar, and hydrogen.
The AMWU supports a policy mandating local
This should be complemented by major content requirements in any project attracting
investments in the infrastructure of the government investment, finance, and other
national electricity grid, including firming forms of support.
technologies – such as batteries and pumped
hydro – that don’t lock carbon emitting assets This should include minimum requirements
into our future energy mix. of 90 per cent local content in engineering
and design services, and for complex
manufactures. New regulations should also
Recommendation 2: include improved and harmonised definitions
of “local content” that ensure only value that is
The federal government should consider the added by workers in Australia is included.
development of a National Hydrogen Jobs
Plan in the vein of the policy of the South Further, intellectual property, and design and
Australian government. manufacture work must be maintained in
Australia where government investment or
The plan would lay out areas and projects to support is contributed.
be prioritised for research and development,
and investment, with a view to maximising
good jobs and providing Australian
Recommendation 5:
households and industry with affordable
The AMWU believes a National Battery
energy.
Manufacturing Strategy is required to
maximise the impact of government’s policy
This should include an examination of water
levers across different portfolio areas and
requirements for the electrolysis process and
support the developments of a sustainable
the potential need for desalination plants to
battery industry.
compliment the emergent hydrogen industry.
Our union welcomes the pledged funding for
Recommendation 3: a battery manufacturing facility in Gladstone
but believes that more work needs to be
The AMWU recommends the establishment of done to identify and support other projects.
a governmental body tasked with supporting A national battery manufacturing strategy
research and development in advanced green must be truly national and support the
manufacturing technologies in Australia. development of export products from the
This may sit within the scope of the Australian west coast as well as support for the domestic
Renewable Energy Agency and must include market of the east coast.

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Recommendation 6: facilitate the retraining and redeployment of
workers in new industries.
To rebuild our heavy industry supply chains,
we recommend the establishment of a Recommendation 9:
green (i.e., carbon-neutral) primary metal
manufacturing sector council, to be supported Global demand for aluminium will continue
by a broad infrastructure and secretariat at the to increase as a key material for global
Department of Industry, Science, Energy and development and decarbonisation. Smelters
Resources. such as Tomago, Boyne, and Portland drive the
economies and industrial base of their regions.
The council should be made up of
representatives from industry, government, Maintaining and growing Australia’s
and trade unions, and engage sector aluminium industry requires large-scale
stakeholders to identify the most promising storage and renewable builds to deliver
sub-sectors for investment and development. reliable and sustainably priced energy inputs.
The council would develop investment and Current policy settings have not addressed
innovation plans for the identified sub-sectors this critical issue as the grid shifts. Sector
and oversee the implementation of these specific energy policy and public investment
plans with the support of other government are required to ensure the stability and energy
bodies. pricing requirements of aluminium smelters
are met.
Recommendation 7:
Recommendation 10:
The government should establish a tripartite
advisory body tasked with assessing any Value adding precincts — or clusters of
major project or firm that would attract industry, research, and education activity
government investment or support for its in a specific geographic area — should be
social, industrial, employment, and sovereign established in existing energy generation
capability outcomes. and extractive industry regions with the
express purpose of developing value-adding
manufacturing industries and sustainable
Recommendation 8: employment opportunities.

The AMWU supports the creation of more
manufacturing common user facilities in
the model of the Australian Marine Complex
in Western Australia. These facilities have a
demonstrated track record of building the
capacities of small and medium enterprises
and strengthening Australia’s supply chain
resilience. When targeted at areas undergoing
industrial restructuring, they can help

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Recommendation 11: Recommendation 13:
We strongly support the Australian Council The federal government should identify
of Trade Union’s call for the establishment necessary investments in Australian
of a national Energy Transition Authority to supply chains to strengthen capabilities
oversee the orderly and equitable transition for participation in global EV value chains.
of the energy sector. The key focus of the Investment tax credits could be used to
authority would be to minimise the impact more closely link extraction industries to
of power plant closures on workers and manufacturing capabilities, incentivising
their communities through managing this firms that typically export raw resources to
transition and delivering on plans for the instead invest in or connect to downstream
future prosperity of affected regions. production to supply emerging EV battery and
components industries in Australia.
Recommendation 12:
Recommendation 14:
The federal government should create an EV
Manufacturing Industry Commission, with a EV value chains mean the entire life of the
board comprising major stakeholders from materials involved, and Australia should
government, unions, and industry leaders, develop a plan for refurbishing and recycling
to be chaired by an EV industry expert. The EV batteries. These batteries require
commission would be tasked with holding a specialised skills, infrastructure, and facilities
broad consultation and inquiry into Australia’s to transport, test, and — when possible —
EV mass production possibilities, beginning disassemble, repair, and refurbish. When
with mapping the existing automotive repair and refurbishment is not possible,
manufacturing sector, then examining how they must be recycled. Australian must begin
Australia can establish a firmer foothold in building this capacity now.
global value chains and how to attract one or
more EV original equipment manufacturers to
Australia

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AMWU COVID-19 (Mandatory)
Vaccination Guidelines

27

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www.amwu.org.au

facebook.com/TheAMWU

twitter.com/theamwu

instagram.com/theamwu

Authorised by Steve Murphy, Australian Manufacturing Workers’ Union National Secretary. Proudly printed by AMWU members.

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The Skills We Need for
the Future We Want

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Prepared by the Australian Manufacturing Workers’ Union | June 2022
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Support
Aussie made

Contents
Introduction 4

Skills Now and Into the Future 6
Pepe Jones, Process Worker: Darrell Lea, Sydney 7
Recommendations 8

Trades and Apprenticeships 8
Karen Smith, Fitter: Ipswich, South East Queensland 9
Recommendations 10

Recognising and Rewarding Worker Skill 10
Paul Lavery, Quality Inspector: McCain Foods, Ballarat 11
Recommendations 12

Governance 12
Dominic Rozario, Health and Safety Representative: Opal Packaging, Scoresby 13
Recommendations 14

Procurement and Federal Funding 14
Chris Harper, Diesel Fitter: Batchfire Resources, 15
Callide Mine in Central Queensland
Recommendations 16

Summary of Recommendations 18-19

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For 170 years, the Australian Long term strategies to maximise
Manufacturing Workers’ Union has productivity through upskilling and
fought to upskill workers and ensure empowering workers have been crushed
that their skills are recognised and under the weight of short-term profit
rewarded. AMWU members make and maximisation.
repair Australia’s trucks, trains, aircraft,
and ferries. They process the food our Around the world today, the governments
farmers grow and create environmentally of most major countries are making
sustainable packaging to export them all significant investments in developing
around the world. highly skilled manufacturing workforces
to bolster their sovereign capabilities.
Looking forward, it is our members who These governments recognise the
will build the green energy infrastructure economic opportunities represented by
Australia requires for the 21st century. rapid changes in production technologies
They will build and maintain the medical and are positioning themselves to take
equipment that we use in our hospitals full advantage. Without a significant
and the electric buses that will get us rethink of skill development and
where we need to go. And it is AMWU recognition, Australia risks being left
members who will build the defence behind.
equipment used by our armed services.
The nexus between productivity growth
We will not make this transition without and wages was broken around the time
improving and enhancing the skills of of the Global Financial Crisis, but this
workers. Australia’s economic growth and trend accelerated under the Abbott/
international competitiveness previously Turnbull/ Morrison governments. To
benefitted from workers and unions re-establish the link between wages
being actively engaged in workplace and productivity growth requires both
and industry productivity discussions renewed investment in skills and training
which led to a compounding benefit of and greater recognition for the skills
improving workplace skills, flexibility, and workers already have.
workers’ wages.
Members of the AMWU understand
Over the last ten years, however, the skills this relationship inherently. Their lived
which will enable us to make, maintain, experiences and their vision for a robust
and repair have been systematically Australian economy centred on high-
undervalued, underinvested in, and skilled, well-paid manufacturing jobs
under recognised, while workers and is the basis of this paper and sketches
their unions have been systematically a framework for revitalising our skills
excluded from productivity discussions. and training system and positioning the
Australian economy for strong, inclusive
growth for decades to come.

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Skills Now and
Into the Future
In 2022, Australian policy makers face Sadly, manufacturing skills have been
several major challenges to ensure neglected—and sometimes deliberately
our nation’s ongoing and inclusive sabotaged—in recent years. TAFE has
prosperity. The COVID-19 pandemic, the been systematically underfunded by
resulting increased medical and care successive Coalition governments. The
needs of Australians, and the continuing number of Australians in apprenticeships
disruptions to global supply chains, are and traineeships has declined
ongoing. significantly in the last 10 years, despite
a recent uptick. The impacts of these
Climate change and the global movement policy failures are starting to be felt in the
from fossil fuels to renewable energy real economy through skills shortages
presents unprecedented challenges for and Australia’s inability to produce
Australia’s energy markets and for the things like medical equipment in times of
industrial restructuring of coal mining emergency.
and energy-producing regions. Rapid
technological change in areas like
robotics, the Internet of Things, and Big
Data, promises to significantly reorganise
work. All the while, increasing geo-
political instability in our region requires
the attention of policy makers at multiple
levels.

Meeting all four of these challenges
requires a highly skilled workforce who
can make, maintain, and repair Australia’s
food, transportation, green energy
infrastructure, and medical equipment,
among other things.

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Pepe Jones,
Process Worker
Darrell Lea, Sydney

Pepe has worked as a process worker at “Management needs better skilled
Darrell Lea in Sydney for around nine workers. If things are going to work right,
years. Together with her colleagues, Pepe you need people who know what they’re
makes many of Darrell Lea’s best-known doing.” Pepe argues that this applies to
products. Members of her team need to the economy more broadly, “For all of the
know how to operate multiple machines issues facing our country, we need skilled
and how to put together the relevant workers to address them. That means
recipes for their stream of production. having a strong TAFE system. It means
Pepe and her fellow AMWU members recognising and rewarding workers when
have worked hard to make sure workers they get new skills. It covers a whole lot of
are properly trained and their skills are problem areas we’re facing as a country.”
recognised.

“In the old days, you were classified
according to how well you got on with
your boss,” Pepe says. Thanks to the
union-led reclassification process, worker
skill is now recognised and upskilling
is incentivised. “We agreed to a process.
We undertook the training, followed
the agreed competency standards, and
undertook the assessments.”
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Recommendation 1: Trades and
The AMWU supports nation-wide free
TAFE, similar to the policies in place in Apprenticeships
Victoria and Queensland.

Within this framework, the union
supports establishing a national
Despite a recent boost which returned
Manufacturing VET policy board tasked
funding for the Vocational Education and
with developing and implementing
Training Sector to around 2012 levels, the
measures to build a more coherent
federal government has systematically
and constructive framework for VET in
underfunded VET for the better part of a
manufacturing.
decade.

Recommendation 2: Similarly, despite a significant recent
uptick, the number of total apprentices
The skilled migration program needs to and trainees in 2021 was 34 per cent lower
be urgently reviewed. Where there are than in 2012, while the percentage of all
jobs available in Australia, employers employment in apprenticeships and
must be required to actively train young training was down 43 per cent.
workers to fill them. Where a skilled visa
worker is brought in, the AMWU believes If Australia is to rebuild its domestic
that there should be a requirement supply chains and harness its resource
for their employer to also undertake advantages in energy and minerals to
domestic training of workers in the same become an advanced manufacturing
skillset. superpower, significant investment
is required to train the highly skilled
No job should be allowed to stay on the workforce required
skills shortage register for longer than it
takes to train an Australian worker to do
that job.

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Karen Smith,
Fitter
Ipswich, South East Queensland

Karen is a fitter based in Ipswich in skills they need, and after expressing her
South East Queensland. She first became dissatisfaction, she eventually left.
interested in doing a trade when “an
engineer came to my school and talked “They were teaching a skill set that is not
about what she did as a job.” nationally recognised, so the skills aren’t
recognised by other employers. They’re
She thinks similar initiatives would be not really turning out real tradespeople.”
useful in attracting women into trades
today. “Maybe there needs to be more Through her work and her involvement
information put out there, people saying in the AMWU, Karen has come to
to younger girls, hey, you can be an recognise this is a widespread problem.
electrician, you can be a mechanic, you
can be a heavy diesel fitter, you know.” “They [Karen’s previous employer] are
part of the group of big companies that
Until recently, Karen worked as the are watering down our trades.” She wants
apprentice supervisor at a major mining to see all apprentices get a nationally
company where she supervised 52 recognised qualification that meets all
apprentices. She was excited to take on the competency requirements of their
the role because she is passionate about relevant trade.
passing her skills on to a new generation
of tradespeople—especially young
women. She was disappointed to find that
apprentices were not being taught the 9

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Recommendation 3: Recognising
All trade qualifications should be
recognised through nationally recognised and Rewarding
Worker Skill
trade papers or licences which register
that the person holding the papers
has met aset of common benchmark
tests. These papers would reflect the
qualifications of the tradesperson and
ensure that apprentices graduate with
the skills they need, and employers can’t Correctly classifying workers to facilitate,
simply ‘tick and flick’ apprentices to meet incentivise, and recognise upskilling is
their ratio requirements. tremendously important for the future of
Australian manufacturing. At the same
Recommendation 4: time, underpayment of workers through
misclassification remains one of the most
under recognised forms of wage theft in
The AMWU notes the number of
Australia today. The AMWU maintains
women undertaking apprenticeships
that the ongoing process of reclassifying
remains low and supports initiatives to
workers in the manufacturing sector
remedy this underrepresentation. The
needs to be accelerated.
federal government should consider
quotas for women in apprenticeships
Here, the AMWU notes the success of
and traineeships in projects that attract
the Future Print initiative. The program
government investment, finance, and
of competency-based apprenticeship
other forms of support. Further, it
progression was a joint initiative of the
should explore options for promoting
AMWU and the Printing Industries
skilled trades to women and girls in our
Associated of Australia, designed to train
schooling systems.
and recognise the next generation of
printers. The initiative involved around
Recommendation 5: 100 employers and has resulted in over
1,000 printing apprentices. This initiative
The federal government should develop has helped develop and recognise the
and implement a ‘Principal Tradesperson’ skilled workers needed for Australia’s
qualification. This should encapsulate print industry to succeed.
qualifications gained through
apprenticeship as well as recognise Unfortunately, despite the centrality of
additional learning. This policy would the implementation manual in the
be in the vein of the German ‘Master Manufacturing Award and the success
Tradesperson’ category and would allow of the reclassifications it has facilitated,
skilled, experienced, and knowledgeable some employers continue to delay
tradespeople to be recognised and or frustrate efforts to classify workers
remunerated in the workplace. correctly. The federal government has a
role to play in ensuring that employers
participate in these reclassification
processes in good faith.

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Paul Lavery,
Quality Inspector
McCain Foods, Ballarat

“I’ve worked at McCain for about 32 years, Part of Paul’s work with his union has
in a range of roles, and as an AMWU been to get workers upskilled and have
delegate for about 24 of those years,” Paul their skills recognised and rewarded.
says.
“Our intention was always that people
Most recently, Paul has worked in get recognised skills, that the work is
an inspection role and before that assessed to understand skills that are in
as a machine operator. In his role as it, and if some of those skills go towards
machine operator, he needed a deep a certificate or some form of recognition
understanding of the computer interface, of the skills, that was important for us as
route cause analysis and troubleshooting, well.”
mechanical maintenance, and the ability
to analyse and respond to complex data. Paul says that it was a source of
frustration for him when management
“A person with a crash course might catch didn’t recognise the complexity of the
up and be slightly competent in three to work he and his colleagues did and failed
six months, but really, it takes years to to understand the importance of training
become really good at that job.” workers to make sure the plant operated
as well as it could.

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Recommendation 6: Governance
The AMWU calls on the government to
explore options to fund similar upskilling
and reclassification initiatives, such as the
When the Abbott government came
recent Future Print program, involving
to power in 2013, it systematically
industry bodies and trade unions in other
attempted to remove trade unions from
industries.
the governance of skills and VET in
Australia.
Recommendation 7:
Instead, they outsourced policy making
The federal government should reinstate to consultancies like PwC and KPMG.
funding for a trade union program around This has seen multiple attempts to reform
the development and recognition of skills. skills and training governance, the latest
This should include appropriate funding iteration of which — “skills clusters” — has
and support for the technical work of some benefit in that it allows workers
reclassification. some opportunity to have a voice in skills
and training governance.

Nonetheless, it can be said that the
interference of several governments has
stymied attempts by employers, workers,
and their unions to develop the training
package and recognition systems needed
for a thriving manufacturing sector.

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Dominic Rozario,
Health and Safety Representative
Opal Packaging, Scoresby

Opal employs around 1,000 people One of the key tasks for improving the
nationally, manufacturing renewable performance of the organisation was the
fibre packaging, among other products. introduction of new technologies and the
Dominic has been with the firm for 27 upskilling of workers. Through the newly
years and has seen dramatic changes in established communication channels,
management worker relations during that the firm worked with the AMWU to set
time. up mechanisms for training workers on
new equipment, assessing skill levels
Under previous management, relations and requirements, and recognising and
were highly antagonistic, and the rewarding the skills of workers. “I think
company was in financial difficulty. the lesson from our firm for the rest
Dominic recounts, “So, management of Australia is that when you listen to
came down and spoke with the workers workers, when you work with a union
and their union representatives and said and the people that are in the union,
‘We’re in some trouble here guys.’ But after companies can succeed. We are an
that, we built a plan to turn the company example of how when you work with a
around, and through the union and union and workers on things like skills,
management working together, we turned companies will succeed,” Dominic says.
things from a negative to a positive.” The
new arrangement helped return the firm Recently, the firm has come under new
to profitability in a relatively short space management, but Dominic hopes that the
of time and was seen as a success by constructive processes the union built
workers and management alike. can survive the change of ownership. 12
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Recommendation 8: Procurement
The federal government, in conjunction
with industry and trade unions, must and Federal
Funding
develop clear guidelines to ensure we
have proper governance of our skills
system which incorporates the principles
enunciated in the original Award/
Structural Efficiency processes.

Such a governance structure would help Previous federal governments and
ensure our training system produces current state governments have induced
resilient and adaptable workers with private firms to engage high levels
the skills and qualifications to do the of apprentices and trainees through
work of the future, and secure industrial procurement policies. A tried-and-tested
mechanisms for recognising those skills method involves requiring a minimum
and qualifications. ratio of apprentices and/or trainees on all
projects that attract government support.

The federal government also has a role
to play in directly employing apprentices
and trainees through the public service.
The AMWU believes the federal
government must reinstate funding for
a national trade union program for the
development and recognition of skills.
Taken together, these policies would
not only help restore Australia’s skilled
manufacturing workforce but help
rebuild the connection between skills
and their recognition in the labour
market.

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Chris Harper,
Diesel Fitter
Batchfire Resources, Callide Mine in Central Queensland

As a tradesperson and an AMWU shop He argues that instead of complaining
steward, one of Chris’s primary concerns about skills shortages, employers should
is ensuring he can pass on his skills to be stepping up and investing in skills and
a new generation of workers. He says training.
that while many employers think in the
short term about skills and training, the “Everybody’s screaming for tradespeople,
union has a long-term strategy around whether it’s electricians, plumbers, fitters,
building and maintaining a highly skilled mechanics, or boilermakers. Employers,
workforce. especially big employees, should be
putting on apprentices and building the
“They weren’t going to put on any skilled workforce we need. But they take
apprentices this year, so we as a union the short-sighted view that it’s a cost to
undertook a campaign and, belatedly, the business.”
they put some apprentices on a couple
of months ago. We know what it means if Chris has also been heavily involved in
they don’t put on apprentices each year the ongoing AMWU campaign to ensure
- in a couple of years’ time, they’ll feel the apprentices are learning high level,
pinch big time.” transferable, and nationally recognised
skills. “Some employers are dropping
down from the main competency
standards and training package to a lower
package, or site-specific stuff.”
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Recommendation 9:
The AMWU supports a minimum ratio
of apprentices to tradespersons on
all projects that attract government
investment, finance, and other forms
of support. This policy has been
successfully implemented previously at a
federal level and is currently the policy of
several state governments.

Recommendation 10:
When bidding for government contracts,
only firms that put their apprentices
through nationally recognised training
packages should be utilised.

Chris points out this this means new
tradespeople will have lower levels of
skills and many won’t be transferable to
other workplaces.

He’s proud that through the union, he
and his workmates have defended the
rights and skills of apprentices. “We had
a battle for a number of years to get a
good agreement for the apprentices, and
we were very insistent that they must be
on the Manufacturing and Engineering
Training Package, which is nationally
recognised.”

16
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Summary of Recommendations
Recommendation 1: Recommendation 4:
The AMWU supports nation-wide free TAFE, The AMWU notes the number of women
similar to the policies in place in Victoria and undertaking apprenticeships remains low
Queensland. and supports initiatives to remedy this
underrepresentation. The federal government
Within this framework, the union supports should consider quotas for women in
establishing a national Manufacturing VET apprenticeships and traineeships in projects
policy board tasked with developing and that attract government investment, finance,
implementing measures to build a more and other forms of support. Further, it should
coherent explore options for promoting skilled trades to
and constructive framework for VET in women and girls in our schooling systems.
manufacturing.
Recommendation 5:
Recommendation 2: The federal government should develop
The skilled migration program needs to be and implement a ‘Principal Tradesperson’
urgently reviewed. Where there are jobs qualification. This should encapsulate
available in Australia, employers must be qualifications gained through apprenticeship
required to actively train young workers to fill as well as recognise additional learning.
them. Where a skilled visa worker is brought This policy would be in the vein of the
in, the AMWU believes that there should be a German ‘Master Tradesperson’ category
requirement and would allow skilled, experienced, and
for their employer to also undertake domestic knowledgeable tradespeople to be recognised
training of workers in the same skillset. and remunerated in the workplace.

No job should be allowed to stay on the skills Recommendation 6:
shortage register for longer than it takes to
train an Australian worker to do that job. The AMWU calls on the government to
explore options to fund similar upskilling and
Recommendation 3: reclassification initiatives, such as the recent
Future Print program, involving industry
All trade qualifications should be recognised bodies and trade unions in other industries.
through nationally recognised trade papers
or licences which register that the person Recommendation 7:
holding the papers has met aset of common
benchmark tests. These papers would reflect The federal government should reinstate
the qualifications of the tradesperson and funding for a trade union program around
ensure that apprentices graduate with the the development and recognition of skills.
skills they need, and employers can’t simply This should include appropriate funding
‘tick and flick’ apprentices to meet their ratio and support for the technical work of
requirements. reclassification.

18

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Recommendation 8:
The federal government, in conjunction with
industry and trade unions, must develop
clear guidelines to ensure we have proper
governance of our skills system which
incorporates the principles enunciated in
the original Award/ Structural Efficiency
processes.

Such a governance structure would help
ensure our training system produces resilient
and adaptable workers with
the skills and qualifications to do the work of
the future, and secure industrial mechanisms
for recognising those skills and qualifications.

Recommendation 9:
The AMWU supports a minimum ratio
of apprentices to tradespersons on
all projects that attract government
investment, finance, and other forms
of support. This policy has been successfully
implemented previously at a federal level
and is currently the policy of several state
governments.

Recommendation 10:
When bidding for government contracts,
only firms that put their apprentices through
nationally recognised training packages
should be utilised.

19

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www.amwu.org.au

facebook.com/TheAMWU

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instagram.com/theamwu

Authorised by Steve Murphy, Australian Manufacturing Workers’ Union National Secretary. Proudly printed by AMWU members.

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AUSTRALIAN MANUFACTURING WORKERS’ UNION
AND
LABOR ENVIRONMENT ACTION NETWORK

JOINT SUBMISSION TO THE
NATIONAL ENERGY PERFORMANCE STRATEGY CONSULTATION PAPER

February 2023

The Australian Manufacturing Workers’ Union (AMWU), in collaboration with Labor Environment Action
Network (LEAN) welcomes the opportunity to make a joint submission to the National Energy Performance
Strategy consultation paper.

For 170 years, the AMWU has organised and represented workers in every city and region of the country.
Our members make and repair Australia’s trucks, trains, aircraft, and ferries. They process the food our farmers grow and create environmentally sustainable packaging to export them all around the world.
Looking forward, it is our members who will build the green energy infrastructure Australia requires for the
21st century. They will build and maintain the medical equipment that we use in our hospitals and the electric buses that will get us where we need to go. And it is AMWU members who will build the defence equipment used by our armed services.

LEAN is a grassroots network of ALP members and supporters, all concerned for the health of the planet and developing policy responses that can drive environmental protection, build sustainable communities, and place these values at the centre of Labor’s policy. This means placing concern and care for the environment at the centre of manufacturing industry policy.

At present, the Australian manufacturing sector is battered but resilient. Despite decades of policy negligence by the previous government manufacturing remains a major employer in this country. But that neglect has left Australia as one of the world’s least self-sufficient industrialised nations when it comes to manufactured goods. As Australia looks to build its sovereign manufacturing sectors, it must look to initiatives being deployed in major economies around the world and develop co-ordinated industry policy to ensure that our supply chains are resilient and able to successfully transition this country to a new economy.

Our submission outlines how a household appliances manufacturing industry, supported by government industry policy to transition to electrification, presents a major opportunity Australian Manufacturing
Workers' Union to develop Australian sovereign capability and a foundation of our economy’s
Registered as AFMEPKIU decarbonisation. This policy would be strengthened by social housing procurement policy, National Office strengthening our communities, addressing cost of living pressures, and creating sustainable private and commercial markets and export competitiveness.
With the development of dedicated, strategic policy for manufacturing that aims for high performance standards, our manufacturing industries can become more innovative and competitive. By doing so, the manufacturing sector can become a major driver of a just energy transition in Australia.

Once again, thank you for the opportunity to make a submission. If you require any further information, please contact in the first instance.
Electrifying Household Appliance Manufacturing in Australia:
Industry Policy for Social Procurement

Proposal overview

Over the next decade, Australia will need to electrify millions of household appliances in a shift from fossil fuel (gas) energy to renewable energy sources. To address medium-term cost of living pressures, and long- term climate change adaptation, higher efficiency standards will also be needed for refrigerators and ovens, and energy appliances like heat pumps will be in huge demand as alternatives to gas-fired hot water and heating systems.

Australia makes many different types of household appliance and should continue to make them in
Australia to meet the aims of a shift from gas to renewable energy sources by retooling factories, reskilling workers and redeveloping industrial capabilities to meet these transition targets. This will require that governments at federal and state level drive the transition through both supply side interventions and demand-driven strategy which taken together have broader market and regulatory implications:

Supply side intervention: Supporting the appliances manufacturing sector to retool facilities and reskill workers to develop local industrial capabilities to supply energy efficient electrical appliances.

Demand-driven approach: Guaranteeing a local market for these Australian-made goods through public procurement policy. This would be directed at high-efficiency Australian-made appliances being retrofitted into existing social housing stock, and rolled out in new social housing stock.

This would also create the conditions for demand from home owners and landlords in the private sector.
Social procurement would develop industrial scale; private sector purchasing in Australian supply chains could be mandated to meet regulatory standards for electrical appliances by purchasing Australian-made products and this would ensure a sustainable demand pipeline beyond socially procured appliances.

Market outcomes: This policy will stimulate jobs and industry growth in the household appliances manufacturing sector and grow local trades jobs in areas of retrofitting old homes, and fitting-out new homes with newly installed electrical appliances.

Regulatory outcomes: This sectoral strategy for appliance manufacturing will need to be measured in terms of its impact on emissions reductions, and benchmarks established for its regulation and broader manufacturing industry emissions regulation.

The demand-driven growth of a high-efficiency appliance manufacturing sector in Australia will drive the scale and scope of local capabilities that make the sector economically sustainable. Beyond public procurement contracts, initial government support to help transition the sector through investment support and market creation will then support the sector to tailor products that meet differentiated markets for products such as new homes, home owners and landlords, and including commercial, luxury and export orientations.
Australian manufacturing opportunities

Research by LEAN shows that there are approximately 30 commercial and household appliance manufacturing facilities in Australia, forming the bulk of a robust commercial and household appliance manufacturing industry sector. This sector is estimated to directly employ 5,000 people and indirectly support as many as 37,000 jobs throughout supply chains and local communities. Around 15 large manufacturing facilities in the sector employ more than 100 people. Most facilities and factories produce gas appliances, with around one quarter producing exclusively gas appliances (see Table 1 attached).

As Australia transitions to a zero-carbon economy over the next decade this manufacturing sector will need to both decarbonise and meet growing demand for electric appliances in Australian homes. It is important that Australia retain its commercial and household appliance manufacturing sector for several strategic reasons:

• to support (and grow) local Australian manufacturing jobs and employment in related supply
chains;
• to maintain and grow Australian manufacturing share in markets for products designed to service
specific Australian customer needs and cultural requirements1;
• to develop higher energy efficiency standards in our manufacturing industries;
• to spur manufacturing product innovations that safeguard consumers against high energy costs;
• to protect and expand sovereign manufacturing capability and potential export opportunities; and
• to meet growth in demand for household appliances with the supply of locally made Australian
products as Australia’s economy decarbonises.

Meeting Australia’s emissions reduction targets will in part mean electrifying household appliances (i.e., water heating, stovetops, cooking, barbecues etc.). This will have important energy cost-reduction implications for Australian households. There is also a need to electrify the appliance manufacturing sub- sector so it adapts with technological change and grows as part of an expanded Australian manufacturing industry.

Without transitioning gas-powered appliance manufacture to electrification, this Australian manufacturing sector risks becoming locked into the manufacture of products that are inefficient and expensive to operate. This will have social consequences in a lower socio-economic consumer market that traps many people in cycles of poverty through higher energy costs; and economic consequences in the loss of industrial capabilities, skilled jobs and resulting higher unemployment.

An industry policy for the Australian appliance manufacturing sector

Presently, government policy for improving appliance efficiency standards across Australia is shaped by supply side mechanisms that encourage greater flows of high efficiency appliances into consumer markets.
Often this results in the purchase of imported goods that have already had to meet high energy efficiency benchmarks in overseas jurisdictions (like the EU), with consumers receiving subsidies for purchasing them.
Overseas producers seize the opportunity to supply high-efficiency products to consumer markets, whereas many Australian manufacturers cannot compete on efficiency terms. Supply side policy does not control for where these products originate, thereby minimising any local manufacturing opportunities to compete.

1
For example, Australian kitchens are larger than many of their Asian and European counterparts; therefore, Australian manufacturers are best positioned to respond to local market needs.
A policy lever that works together with supply-side approaches to decarbonising household appliances is needed to support Australian made household appliance manufacturing. Alongside supply side interventions, a demand-driven approach can help to rapidly transition the manufacture of gas appliances in Australia to the manufacture of only electrified products with high energy efficiency ratings. This will advantage both gas appliance manufacturers by updating their product offerings, and electrical appliance manufacturers by raising the bar on the efficiency of their products.

Demand-driven policy through public procurement

The AMWU proposes that the federal government develop an industry policy for the commercial and household appliance manufacturing sector that meets dual industrial and social goals. We propose that a procurement-driven industry policy for Australian appliance manufacturing should be implemented to deliver a high-value energy efficient household appliance manufacturing sector. Procurement brings to the economy government’s fiscal power to transform labour policy by lifting wages, working conditions and labour standards.2 Beyond this, procurement delivers economic benefit by stimulating large-scale production and consumption of goods and services, and delivers social benefit by creating further employment opportunities.3

Industry policy, when built around public procurement, is a proven market-creating mechanism with evidence from a range of industries. It leads to improved firm performance, fosters innovation, creates economic diversification, and as a result is increasingly being put forward as a means of addressing challenges relating to climate change.4

Industry policy for manufacturing with a social procurement objective can drive down energy costs for
Australians living in social housing and create certainty and sustainability in domestic appliance manufacturing. Where public investment helps to de-risk the Australian appliance manufacturing sector, businesses can become cost-competitive, making efficient electrical household appliances cheap for all
Australian consumers. This would not just sustain the industry but also create a foundation for its expansion into broader consumer markets (i.e., commercial, luxury, and ultimately exports) that will grow as Australia reaches net-zero emissions targets.

Equipping public housing stock across the country with highly efficient electrical appliances can function as both an industrial and social procurement strategy. Industry policy should therefore be linked to a social housing procurement policy that:

2
Jim Stanford (2018), Raising the Bar: How Government Can Use its Economic Leverage to Lift Labour Standards Throughout the
Economy, Centre for Future Work at The Australia Institute (Canberra, Australia).
3
Maria Mupanemunda (2020), The promise of social procurement: Leveraging purchasing power to create inclusive employment opportunities, Parliamentary Library & Information Service, Department of Parliamentary Services, Parliament of Victoria (Melbourne,
Australia).
4
See Mariana Mazzucato (2018), Mission-Oriented Innovation Policy: Challenges and Opportunities. Working Paper, Institute for
Innovation and Public Purpose (London, UK);
Gunnar Eliasson (2010), Advanced Public Procurement as Industrial Policy: the Aircraft Industry as a Technical University, Springer
(London, UK);
Elvira Uyarra, Jon Mikel Zabala-Iturriagagoitia, Kieron Flanagan, Edurne Magro (2020), ‘Public procurement, innovation and industrial policy: Rationales, roles, capabilities and implementation’, Research Policy, 49(1);
Bernard Hoekman & Marco Sanfilippo (2021), ‘Public procurement as an industrial policy tool’, Industrial Analytics Platform, UNIDO
(Geneva, Switzerland).
• mandates local Australian-made appliances for all government owned or leased5 social housing;
• sets higher Minimum Energy Performance Standards (MEPS) for the manufacture of their products
and would only be eligible for procurement contracts if made in Australia and meeting local
content requirements at this higher MEPS level; and
• creates long-term demand for locally made appliances by expanding public housing infrastructure,
and building strong supply chains that can diversify into the economy.

Achieving coordination between industry policy for appliance manufacturing and social housing procurement will require federal government funding and regulatory policymaking, plus coordination with the states and territories responsible for administering social housing infrastructure. A social housing procurement-driven industry policy would be driven by several key mechanisms, as outlined below.

‘Mandating’ Minimum Energy Performance Standards (MEPS) for Australian-made appliances

A review into the Greenhouse and Energy Minimum Standards (GEMS) Act 2012 which regulates Minimum
Energy Performance Standards (MEPS) for household appliances describes Australia as highly dependent on imports to supply products covered by GEMS.6 An updated MEPS should reflect a shift in focus of the regulatory framework that targets growth in local high energy efficiency appliance manufacturing. The objective of this would be to create a technical advantage for Australian manufacturers to compete with imported products.

• The establishment of Mandated (as opposed to Minimum) Energy Performance Standards is an
important lever for the electrification of all Australian household appliances, where it sets a target
for all Australian appliance manufacturers to meet, plus incentives to exceed.
• Mandated EPS could be applied to targeted products within the household appliances
manufacturing sector to begin the process of application to other products in a process of phasing
in mandatory higher standards.
• Altogether, the implementation of an updated MEPS that brings Australia up to international
standards should be implemented in coordination with demand-driven policy and investment in
local manufacturing capacity to supply new products for Australian procurement contracts (and
then beyond this into diverse consumer markets).

Legislate infrastructure changes for the retrofitting of existing homes with highly efficient electrical appliances, and legislate mechanisms to measure the contribution of high-efficiency Australian-made household appliances to emissions reduction

• This would commit governments to the long-term purchase of Australian-made electric appliances
for social housing and help families and individuals living in public housing with cost-of-living
pressures relating to energy costs.

5
By ‘leased’ we refer to public housing stock that is serviced by not-for-profit organisations based on state government tenders.
6
Commonwealth of Australia (2019). Independent Review of the Greenhouse and Energy Minimum Standards (GEMS) Act 2012,
Canberra: Australia.
Provide fiscal support for appliance manufacturers to upgrade production facilities for highly efficient electric appliances

• This is related to the MEPS mechanism, in that any shift to highly efficient electrification must be
accompanied by capital investment and production innovations amongst Australian firms
manufacturing within Australia.
• Direct government investment in the form of loans, grants, direct capital investment and even
public equity should be considered to avoid the potential offshoring of production if no support is
given to the industry to recapitalise, retool and upgrade.
• This can contribute to the growth of sovereign manufacturing capabilities amongst Australian
SMEs, enhancing innovation and diversifying the economy.

Worker training and reskilling for electric appliance production lines

• Training and reskilling is essential to ensuring that skilled workers transition with the shift in
production processes and innovations.
• Training and reskilling would need to include minimum apprenticeship ratios for appliance
manufacturing sector workers and create quotas for local community apprenticeships in social
housing construction and retrofitting or installation of electric appliances in social housing
dwellings.
• The state and territory TAFE systems would deliver training packages in urban and regional
locations. Training packages would be based on industry and union mapping of occupation profiles
and competencies relating to new efficiency standards for the sector. These new qualifications
would also need to be transferrable across other industries and sectors transitioning to renewable
technologies.
Table 1. Appliance manufacturing firms in Australia
Company State Employees* Appliance type/s
Robert Bosch VIC 740 Water heating
Rheem NSW 500 Hot water
Stoddart Australia QLD 415 Commercial cooking and refrigeration
Electrolux SA 400 Cooktops, ovens
Rinnai VIC 345 Water heating
Actron Engineering Pty Ltd NSW 300 Heating/Cooling
Rheem VIC 300 Hot water
Seeley International SA 280 Heating, hot water, whitegoods
Brivis (subsidiary Rinnai) VIC 270 Heating
Daikin NSW 200 Heating/Cooling
Climate Technologies (subsidiary of
Symphony Limited) SA 200 Heating/Cooling
Temperzone NSW 150 Heating and cooling
NSW
Seeley International VIC 120 Gas heaters and cooktops
Middleby Australia Group Pty Ltd NSW 100 Commercial cooking equipment
Dux Manufacturing NSW 100 Water heating
Roband Australia Pty Ltd NSW 70 Cooking
LUUS Industries Pty Ltd VIC 65 Commercial cooking equipment
Cookon (Langford Metal Industries Pty Ltd) QLD 55 Commercial cooking equipment
Williams Refrigeration Australia Pty Ltd VIC 50 Commercial Refrigeration
Real Flame (subsidiary of Glen Dimplex) VIC 50 Heating
Archer Gas Log Fires VIC 50 Heating
Trent Refrigeration VIC 40 Commercial Refrigeration
United Refrigeration Pty Ltd VIC 30 Commercial Refrigeration
IXL Group (Cannon gas heaters) VIC 30 Heating
Heatlie Barbecues SA 25 BBQs
Illusion Fires VIC 25 Heating
Scandia VIC 10 Heating
*Count of employees is based on publicly available data and confirmation with facilities