MICHAEL MCLAREN, HOST: So, where to from here? Well, Tim Ayres is the Assistant Minister for Trade. He's also the Assistant Minister for a Future Made in Australia. He's with me on the line. Minister, thank you for your time.
SENATOR TIM AYRES, ASSISTANT MINISTER FOR A FUTURE MADE IN AUSTRALIA AND TRADE: G'day, Michael. Good to be on the show.
HOST: It's not the end of the world, mind you, you would have liked the win.
SENATOR AYRES: Well, I think your introduction pretty much summed up the news that's come through. It is unwelcome development, that is for sure. It's unjustifiable, it's unprovoked. It is ultimately - as you've said - it's been applied to countries all around the world. Australia sought an exemption but at this stage tariffs will be applied across steel and aluminium and the net result of that will be, of course, that tariffs aren't good for American consumers. American
families and businesses will be paying more for steel and aluminium products as a result of this decision. We will continue the work with the new Trump administration to press the case for Australia's interest. Whether it's over this question or all of the other trade questions that are coming up in front of us, we will continue making the case. Australians can be confident of that. But I think your listeners would be pretty disappointed to learn of this unprovoked and unjustifiable action from the United States.
HOST: I mean, what the Americans are trying to do, and I think this is what Peter Navarro is getting into Donald Trump's head, is that we need to have sovereign capability with strategic industries. Look, America obviously has a steel industry, it has aluminium manufacturing. They're saying we should have more, a lot of blue collar jobs in the so called flyover states if we do it. So, let's leverage our economic muscle to achieve that end. I mean, it's from a globalist point of view, it seems self-destructive, but from a nationalist point of view, I mean, you can see the argument they're trying to mount.
SENATOR AYRES: Well, certainly that's been a consistent position across a series of US Administrations. Concern about rebuilding and revitalising American manufacturing. Whether this actually serves that interest or not is another question.
HOST: I was going to say, Minister, in some ways this is ironic because this really would have been Labor Party bread and butter sort of political ideology 40 years ago. Right. I mean, well, I was going to—
SENATOR AYRES: I was about to make the point. Yeah, I was about to make the point, Michael, that what you see from this government, if we just move off the American question for a moment and think about Australian manufacturing. Australian steel, Australian aluminium. The government stepping up with a very aggressive agenda that is very different from what previous governments have done, that is mobilised from exactly the same concern. The Albanese government has the biggest pro-manufacturing package of any government in Australian history because we see the urgent national interest imperative in terms of our economic resilience and our economic security in focusing on building manufacturing capability. That's why we went out on aluminium just a few weeks ago with a $2 billion package to make sure that Australian aluminium producers are globally competitive. That's why we've stepped in just a week ago with the package to support Whyalla Steel operations, our second largest steel operations, because we want to secure Australia's manufacturing advantage for the future. That's our approach. It's not tariffs because ultimately tariffs just put up prices for consumers. But it's absolutely determined national interest action to support Australian manufacturing. And at the end of that, Michael, the beneficiaries are your listeners and their kids who want jobs in good blue collar jobs in the outer suburbs and our industrial regions. That's our agenda for the future for manufacturing. It's opposed by our opponents. So, you think that Australia isn't up to it, you know, who are talking the national interest down all of the time. But we’re for a Future Made in Australia and building Australia's future. And at the heart of that for Anthony Albanese is a vision for the future of Australian manufacturing.
HOST: Whether it's a vision or a hallucination, though, I think, Minister, only time will tell. But let me just explain the reality as far as I see it. I mean we can prop up Whyalla all we like, and we can prop up different industries all we like, but if we have the 8th or 9th highest power prices in the world, which we do. We are making ourselves needlessly uncompetitive. I mean, you said there we have the big—well, you, that is the government, have the biggest manufacturing package in Australian history. That might be true, but you're also overseeing the highest power prices in our history. They're counterproductive policies, right?
SENATOR AYRES: Optimism point first and then I want to come to some of these practical realities because I think they're both important. I start and the government starts from the premise that Australians have got the capability to do these things, and our industrial capability can be built for the future. Angus Taylor, before he came into Parliament, was trying to persuade Australian aluminium producers to move offshore. That was his contribution. At least he stayed consistent, I suppose, with his hostility to Australian manufacturing. Our opponents are always about talking us down, about talking Australians down and Australian manufacturing down and saying that it's not competitive. Well, I've spent my life in Australian manufacturing and our firms can win. They just need government to be on their side and that's what you've got with Future Made in Australia.
HOST: But the best thing government could do would be to get the power prices down. That's what they're all screaming about.
SENATOR AYRES: Let me come to electricity. On gas prices and on electricity prices, we have got our shoulder to the wheel on all of these questions. We move to cap the price of gas for East Coast manufacturing. The Liberals and Nationals opposed it. It has meant, while I am not pretending for a second that East Coast manufacturers haven't had an awful lot of price challenges to deal with - particularly in the gas area - there are many of them that are there today that would not be there but for the Albanese government's tough action in the gas sector. Closed again by the Liberals and Nationals on electricity prices.
HOST: But equally, before you move on to that, it's not helped by a lot of your Labor state colleagues. Particularly in the People's Republic of Victoria that have never seen a gas well that they don't want to open, right? I mean, they just want to keep it all in the ground ideologically.
SENATOR AYRES: Well, we need gas for East Coast manufacturing, and we need gas for peaking capability in electricity. Let me come to electricity for a second because it's important. Tomago Aluminium is a good example. That firm owned by essentially run by Rio Tinto and others, is setting about the process of decarbonising its electricity mix. Not because they're hippies, but because they see that their market is shifting, and they have to supply zero emissions or close to zero emissions aluminium. Because aluminium is essentially bauxite plus electricity, right? Tomago aluminium consumes about 12% of NSW’s electricity. It's a massive user of electricity.
HOST: The biggest.
SENATOR AYRES: Yeah, the question. The question is not whether they move to lower emissions electricity. That is going to happen. The question is do they do it in Australia or do they do it in the Middle East or in China or in the United States? I'm determined to fight for them doing it here in Australia. That's why. That's why we're working hard to modernise the electricity sector. That's why we've provided the $2 billion package. That's why they're committed to maintaining their manufacturing presence in Australia. The alternative plan, Michael, is nuclear reactors that would come on in the 2040s that would make electricity far more expensive and Australian industry far less competitive. And in the heart of the Liberals own costings - in black and white - it says that electricity intensive manufacturing in Australia has to reduce by 40% to make way for their nuclear reactors. Like, they pretend to be caring for the patient while they're busily setting about murdering the patient. This is a, they are in an upside-down world for the Liberals and Nationals. Where they have, where they are saying ‘they are for Australian industry’ but their policy prescriptions would make Australian industry far less competitive and condemn many of our manufacturing sectors to closing.
HOST: But see, I think a lot of people listening would say probably pox on both your houses. Because I mean, for example, I mean we talk about what Tomago are attempting to do. Mind you, they're winding it back a touch from their previous bravado statements. But look at the nickel situation now. I mean, your side of politics said we're going to have this green nickel everywhere, right? And because everyone around the world was environmentally conscious, they were going to pay a premium for green nickel. Well, the industry's collapsed. Collapsed because China have moved into Indonesia, polluting the environment like all buggery, and the international buyer doesn't care. I mean, people talk. There's a lot of sort of chin-wagging at Paris and these sort of climate conferences. But when the rubber hits the road and the buyer's got to put the hand in the pocket, be it a state institution or a private investor, they buy the cheapest thing they can get on the market. I mean it's going on everywhere. And so our green nickel dream fell in a heap. All this stuff about green hydrogen, well that's going nowhere fast, reversing at 100 miles an hour. I mean, I'm not against changing the electricity grid, but we've got to make sure we do it in a practical way, not just driven by ideology. And it looks like a lot of ideology is driving your position.
SENATOR AYRES: I couldn't agree more. It's got to be practical, it's got to be pragmatic, it's got to be focused on the future. If these things were easy to do, Michael, they would already have been done.
HOST: Okay, but then why will Whyalla is a green steel manufacturing superpower, why will that be successful when green nickel wasn't successful? Green hydrogen hasn't got off the ground and there are many other examples to the list. Why is the “investment in Whyalla” - which between you and me may not have helped the tariff negotiation just quietly with America - but why will that work where all of these other green schemes haven't?
SENATOR AYRES: Yeah, yeah, there's a few things in that question. Firstly, don't assume the technological trajectory is, you know, the kind of technology that is available now is what is going to be available in the future.
HOST: No, I don't. I don't. But you are investing now, you're investing now in that.
SENATOR AYRES: Michael, just. Of course, let me finish the point. In order to have iron and steel production in Australia - that is not just exporting iron ore to our customers around the world, but going up the value chain. At the moment we are about 2% of the global steel sector, but we export an enormous amount of iron ore in bulk carriers around the world. Our ambition is to move up the value chain. As you see what's happened in terms of our exports, not just in terms of the United States here, but terms of recent developments in China and around the world. Australia must diversify our economic position, move up the value chain, diversify our markets and diversify our products. And iron and steel are very good example, right?
HOST: That's right. We have to do that.
SENATOR AYRES: I want to see iron production here in Australia. I want to see steel production here in Australia. And if we are to be competitive in 10 years’ time, then that means moving through to lower emission steel products so that we are selling into markets that will exist in 10 years’ time, not the markets of today.
HOST: So, are those markets going to be there in 10 years or maybe are they going to be there in 50 years? I mean there's always this sense of urgency with climate change, right?
SENATOR AYRES: It doesn't materialise, which is why I wanted to finish this point. In order to get there, we have to protect the industry today. Today. That is Whyalla coal powered steel production. We are supporting that today. We are supporting Tomago aluminium today. The Liberals and Nationals will never do it. They will never step up for industry or manufacturing. That's why the car industry went offshore. We have got a different approach mobilised by the kind of values that we talked about at the beginning of this conversation. We are for blue collar workers, for manufacturing, for Australian industrial capability. And that's what the Future Made in Australia agenda is about. It's about backing them now and backing them for the technological change and the investments that they need to make for the future markets. So, we are absolutely pragmatic about what is required to be done here and we are putting our shoulder to the wheel. And that is why industry is working so closely with the government and why I object to the sort of yahooing that you get, the political opportunism that you get. Whether it's on industrial policy or on trade policy where the Liberals and Nationals know who they want to blame whenever something goes wrong, but they never have any solutions. They spent a decade last time around squandering the opportunity to invest in Australian capability.
HOST: And I won't disagree, I won't disagree with that assessment. I don't disagree with that assessment.
SENATOR AYRES: You're now Johnny on the spot pointing the finger at everybody else. As if they'd ever—
HOST: I'm not. I haven't said they've got the answers. Believe me, I don't think they do. But just finally, because you've got to go I know. Is industry working closely with the government because they believe ideologically, they're bosom buddies with you? Or maybe I'm too cynical here, but are they working closely with the government because you've got the cheque book, it's pretty open and you're signing the cheques?
SENATOR AYRES: Oh mate, there's no ideology in this stuff. There's only Australian interest.
HOST: That was the first porky you've definitely told. There's ideology dripping from this stuff.
SENATOR AYRES: Look, if you're a university student writing an essay, you say there's ideology everywhere. But what point I'm trying to make is, we are for the industry, like we're working with them. It doesn't mean that everybody agrees all of the time. That's not the Australian way. But we are backing Australia's capability here and we are fighting for Australia's manufacturing future. That's our position. It’s never perfect but, we're doing the hard work with industry. We've done it this term. We're going to be fighting in a few weeks, of course, in an election for an opportunity to do it again. And what your listeners can be confident about is that we are for those good blue-collar jobs in the outer suburbs and the regions. We have backed it with the biggest pro-manufacturing package in Australian history. It's not just an announcement. There are years and years and years of work to do. New manufacturing facilities, new factories aren't built in five minutes. It requires constant effort, engagement and partnership with the private sector, with the world's best manufacturers to build manufacturing here. To build an electricity and energy system that can meet Australia's needs in the cheapest and most reliable kind of way and to work with our international partners in Australia's interest to make sure that we've got export markets to sell into. That's our game. That's what we're up to in the Albanese government. That's what we're going to keep doing. And I'm really delighted mate to have an opportunity to talk to you on your show about these issues because I can see that you care about them. Manufacturing really matters for our future, and we are going to keep slogging away to deliver for the suburbs and the regions.
HOST: Well, that's the pitch. Let's see what the listeners make of it. I thank you for being generous with your time Tim. Much appreciated.
SENATOR AYRES: Easy. Good to talk to you.
HOST: Tim Ayres, the Assistant Minister for Trade. What do you make of it? You tell me.
ENDS.
