In his introduction to the Coalition Government’s industry policy, the prime minister Tony Abbott says “the guiding principle of the Government’s Industry Innovation and Competitiveness Agenda is to focus on Australia’s strengths, not to prop up poor performers.” But the policy does the opposite. Rather than focus on Australia’s competitive advantages, it is about old-fashioned picking winners.
A big winner is the fossil fuel industry. The loser is cleantech and the environment. The Industry Innovation and Competitiveness Agenda looks to be based on a hotchpotch of political ideology and helping the Government’s mates, making it a deeply flawed document. Here are three examples of those flaws.
The industry minister is to establish five non-profit Industry Growth Centres “in sectors where Australia has recognised competitive strengths”. Number three on the list is “oil, gas and energy resources”. Now, a sane person would think that to have a competitive advantage in oil Australia would actually have to have some oil – but Australia has less oil than a squeaky wheel. Something that everyone in the universe knows except federal cabinet.
If cabinet had used the environment minister’s well-known ability to consult Wikipedia on environmental matters and asked him to consult Wikipedia on oil matters, they would know that Australia ranks 29th in the world on known oil reserves – a paltry 4,158 million barrels compared to 297,170 million barrels for Venezuela and 269,913 million barrels for Saudi Arabia. How does having only 1.3 per cent of the oil that Venezuela has got give Australia a competitive advantage in oil?
That inconvenient truth is also not stopping the government pumping good money into dirty jobs. A $476 million Industry Skills Fund is to be established for “immediate priority areas’ that include, yes, oil.
A second example is the one-eyed view of Australia’s world leading resources. The document says “Australia has the world’s largest reserves of gold, iron ore, lead, nickel, uranium and zinc”. It says “Australia ranks among the top five worldwide for known resources of black coal, recoverable brown coal and uranium”. But it does not mention is our world class sun, our world class wind, our world class waves. This government is blind to our world class renewable energy resources.
In this document Australia’s industry and energy policies are not driven by Australia’s natural competitive advantages nor what is best for Australia. Indeed, nor what is best for the world. It looks like it is driven by ideology or looking after favourite sectors.
The third example is about intellectual capital. The prime minister says the Agenda is about “industry policy that fosters innovation and entrepreneurship”. But again it is only about fostering innovation in the government’s chosen sectors.
One of these is medical technologies and pharmaceuticals where it wants to create a $20 billion fund for more medical research. And of course medical technologies and pharmaceuticals is one of the five mooted Industry Growth Centres, and will benefit from the Industry Skills Fund.
But supporting medical research is like supporting motherhood. It’s safe and no one is against it, not even competitors as the big ones can just buy the research. The problem with the government’s position is that it ignores or perhaps does not understand how Australia – with less than half of one percent of the world’s population – got to be so good at medical research, or any other sector with intellectual property.
Australia did it by investing billions of dollars over many decades to build the intellectual infrastructure such as universities, research institutions, hospitals and a massive grants system.
Australia can become a world leader in any intellectual property field if it is prepared to spend the money. And Australia has spent the money and is a leader in other fields. One of these is renewable energy research. Australia was a pioneer in solar energy through photovoltaics, solar hot water and heat pumps. Australia leads in some areas of biofuels, geothermal energy, and Australian companies are leading the races to commercialize wave and tidal energy. There are other examples.
But none of this gets a mention in this very biased industry policy.
And the real crime is not that this government ignores this success, but that it has set about to dismantle the infrastructure of this success – the policies, programs, institutions, investor confidence, and public support that have all contributed to Australia’s world leading success in renewable energy research over many decades.
That is an energy policy crime. It is a social policy crime. With climate change, it is a crime against every creature on earth. And because it puts to waste billions of dollars of past investment over many decades, it is also a massive financial crime.
That’s what can happen when Labor implodes and the Coalition throws up a bunch of second rate intellects with third rate ethics who lied their way through opposition and are now lying their way through government.
Is Australia investing in good leadership? Why isn’t creating better leaders part of industry policy?
Victor Bivell is editor of Eco Investor magazine. See www.ecoinvestor.com.au
