Ayres defends government cash for businesses

The Assistant Minister for a Future Made in Australia Senator Tim Ayres has used one of his first outings since promotion to defend the use of government cash to encourage business investment under the Future Made in Australia programme.

Speaking on ABC Newcastle Breakfast radio he was asked why government money was being used to encourage private industries, rather than relying on the market and private money.

Ayres said: “Firstly, there is a global race for investment, – governments around the world are moving to speed up their industrial transformations.

“Americans with the US Inflation Reduction Act is just one example of the IMF identified two and a half thousand measures being undertaken by governments around the world to speed up industrial investment.

“And Australia needs to compete at scale and in a proportionate way, focused on our comparative advantage.”

Senator Ayres, who was in the Hunter region to discuss Australia’s energy transition said Australia had to be to be at the big table, bringing the biggest manufacturers here.

He said it was in Australia’s national interest to act in order to secure its future economic resilience and comparative advantage.

“We’re going to need to be more resilient and that means rebuilding Australian manufacturing, and that’s what a Future Made in Australia is all about.

“…But there’s also the question about the future shape of the Australian economy and making sure that we’re safe, that we’re resilient and that we’ve got a prosperous economic future that the region shares in.”

Asked how the government could avoid backing industries that aren’t able to stand on their own, Ayres said the government’s National Interest Framework put strong guardrails around government decision making ‘so that what we’re supporting is industries that are in the national interest and industries that are going to have a future comparative advantage’.

Ayres said the alternative was a less complex economy where Australia was just exporting commodities offshore rather than adding value here.

“If we’re a less complex economy, we’re less productive and people will be poorer as a result of investment in the future of the country.”

Ayres said other measures measures included Production Tax Credits which become payable when a firm manufactures in Australia.

“All the issues about future sustainability, future scale and capacity are being driven into the model.

“Investments will only occur where they are sustainable and where they’re going to have future markets and future comparative advantage.”

Picture: Senator Tim Ayres