Gillard’s cabinet changes could prove negative for manufacturing

Yesterday’s cabinet changes could have "significant implications for business in key policy areas where Australia’s competitiveness and productivity are at stake," according to outgoing Australian Industry Group (Ai Group) chief executive, Heather Ridout.

“It is especially important given the looming critical decisions related to the impact of the multi-speed economy which will have major implications for important sectors of the economy such as manufacturing," she said.

Prime Minister Julia Gillard yesterday announced a raft of changes to the cabinet and ministerial portfolios, including raising the number of cabinet ministers from 20 to 22.

Most important to Manufacturers’ Monthly readers is Senator Kim Carr’s ejection from cabinet, to be replaced by Greg Combet, who will be appointed Minister for Industry and Innovation  with the help of Senator Carr as Minister for Manufacturing and Defence Materiel.

A newly-expanded Department of Industry, Innovation, Science, Research and Tertiary Education will be established, with Greg Combet MP and Senator Chris Evans at the helm.

"Greg Combet should be better placed with his new portfolio mix to address the looming implementation issues associated with the introduction of the Carbon Tax next year and its direct impacts on business. At the same time the Industry portfolio is critical to the productivity challenge and addressing the impact of the multi-speed economy and broader industry issues should be given a priority independent of climate change issues,” said Ridout.

"Manufacturing has an important role to play in Australia’s economic development and Senator Kim Carr’s previous engagement with the sector gives him a head-start in his new position. However, it is disappointing that this big employing sector, which is so vital to a balanced and diverse economy, will not have a direct voice at the Cabinet table.

"Separately, industry will look to Senator Carr as Minister for Defence Materiel to focus on boosting productivity and building on our skills base, as well as improving tendering and contracting for defence capital equipment. As well, we will continue to work with Senator Chris Evans under the new portfolio arrangements to progress the national education and skills agenda.”

Shadow Innovation Minister Sophie Mirabella has also spoken publicly about the changes this morning, claiming Combet, the “carbon tax architect”, will be “inflicted on industry”, while manufacturing is “chucked out of cabinet.”

“Julia Gillard confirmed today she has learnt nothing from the backlash against her toxic carbon tax with her appointment of Greg Combet as a de facto Industry Minister amid an extraordinary downgrading of the importance of manufacturing and industry policy,” said Mirabella.

“As well as dumping the beleaguered Industry Minister Kim Carr from his job, Ms Gillard has effectively trashed his entire portfolio as well – in a bizarre new carve-up of responsibilities. 

“For the first time in living memory in Australia, responsibility for manufacturing policy has been shifted out of Cabinet – and this at a time when Australian manufacturing is in the midst of its worst crisis since the Great Depression.”

Senator Carr told Manufacturers’ Monthly yesterday: "There’s a future for Australian manufacturing and I’m committed to working for it and the one million Australians who work in it.”
 

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