Future Made in Australia (Production Tax Credits and Other Measures) Bill 2024; In Committee

Opened the debate

Smith argued that the bill failed to address the root causes of high project costs, such as rigid industrial relations and duplicative environmental processes, instead offering a subsidy that risked becoming permanent corporate welfare. Smith contended that the community benefit principles were unclear and politicised, with the Treasurer holding sole discretion, which created political risk for businesses. Smith moved an amendment to prevent the community benefit rules from requiring enterprise agreements, reconciliation action plans, or additional environmental and Indigenous consultations beyond existing laws. Smith asserted that the amendment would provide necessary clarity and mitigate regulatory duplication, citing concerns from the Minerals Council of Australia and the Australian Chamber of Commerce and Industry.

Government response

Ayres argued that the bill directly lowered costs for eligible businesses through tax credits, specifically $2 per kilogram of hydrogen and 10 per cent of operational costs for critical minerals. Ayres stated that the community benefit principles were uncontroversial and aimed at boosting local investment, supply chains, and jobs, with rules to be set via disallowable instrument after industry consultation. Ayres emphasised that the policy would secure Australia's comparative advantage and economic resilience by attracting investment that might otherwise go offshore. Ayres rejected the coalition's criticism, attributing past manufacturing decline to their decade in office and warning that a coalition government would threaten the sector.