Virtual Address, Australian Industry Group

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Speech
30 Nov 2021
Prime Minister
E&OE

PRIME MINISTER: Well, thank you very much Chris for that kind introduction, and to Innes and everybody else joining us today, thank you for joining us for what is an important time for us to come together.

It’s it’s good to join you and all of your members.

Let me begin, of course, by acknowledging our Traditional Owners.

Here in Canberra, of course, that’s the Ngunnawal people, and I pay my respects to their Elders past, present and emerging.

And, you know, I always like to acknowledge members of our Australian Defence Force or veterans who may be joining us, as well, and I thank them for their service.

Let me begin by thanking you also for your commitment and dedication to keeping our economy moving through what has been an incredibly challenging time.

It’s never lost on me that the decisions we take as a government, of course, impact on you and your businesses, your your members, your employees, your suppliers and and the wider community in in profound ways.

For governments, businesses, families, individuals, COVID has unleashed an era of radical uncertainty and disruption of a scale rarely seen outside of wartime.

The full magnitude of what the world has endured in the nearly past two years since SARS-COV-2 first emerged in Wuhan in China bears a brief reflection, because that is the context.

The pandemic has cost us more than 5.2 million lives worldwide.

That’s a very conservative figure, by the way. Some estimates approach three times that number.

It has resulted in the deepest economic recession in nearly a century, with economies on strikingly different paths to recovery.

We now face some new uncertainty, with the Omicron variant. We’ve seen other variants before, and this is a new one.

And we will need the same focus and fortitude and balance and calm that has helped us preserve lives and livelihoods since the start of the pandemic.

Taking decisions based on the best and most recent evidence and the best medical advice.

And getting the balance right between the competing objectives that are there to ensure the common good for our country.

Enlisting your assistance and forbearance as we just navigate that way ahead.

And last night I announced, we announced together as a government after the National Security Committee met, just a temporary pause on the next step to safely reopen Australia to international skilled and student cohorts in our migration program, as well as humanitarian, working holiday maker and provisional family visa holders. We’ve just pushed it back from the 1st of December until the 15th of December.

It’s a temporary pause, and this is just simply to ensure we can gather information to better understand the Omicron variant, including the efficacy of vaccines and the range of illness which we can expect and the level of transmission.

Now, my expectation is that in a fortnight’s time, perhaps sooner, but I would think in a fortnight’s time, we’ll be able to press on. But there is very much a a no regrets policy, and ensuring we just move carefully so we, the whole point here is to ensure that we can remain safely open, and we don’t want to prejudice anything that might compromise that objective.

The goal here is not no cases and low cases, the goal here is ensuring that our hospital system is able to cope with the pressure. And we’ve already seen in Victoria and New South Wales in response to the Delta variant, where we have had large numbers of cases in Victoria - over a thousand a day - and yet the hospital system has been performing well. That is the objective.

That’s how you live with the virus, that’s how you live together with the virus.

The National Plan is there so we can open safely and stay safely open.

And I would contend that this is the only sustainable approach from both a public health and economic perspective.

I have always said from the outset of this, it’s about saving lives and it’s about saving livelihoods. And as Prime Minister I’ve always tried to ensure that we got that proper balance.

I said it also at the start of this pandemic that we were a strong people, but we’re going to find out just how strong we were. And we have.

What I believe we discovered is that we are stronger and even more capable than we imagined - particularly when we work together.

We have saved, we have no doubt, well over 30,000 lives. Just reflect on that for a second. All the sacrifices that have been made, all the difficulties that have been faced - that has saved over 30,000 lives.

JobKeeper itself though, and the many other measures we took, supported around four million individuals and one million businesses - saved over 100, sorry, 700,000 jobs.

Lives and livelihoods being saved while providing support that ensure that we could have that spring back in our economy when we’re able to move forward, as we indeed now are.

Australia is coming back.

The RBA, as you know, is forecasting the Australian economy will grow by 5.5 per cent next year.

Unemployment to fall to four per cent by the middle of 2023.

Balance sheets, as you know, they’re healthy - both on household and businesses. Cash holdings have increased dramatically.

We’ve retained our AAA credit rating in the midst of this absolute storm, all three ratings agencies - one of only nine countries in the world to do it.

Vaccine uptake, one of the highest in the world - ahead of France, UK, Sweden, the United States, Israel, the list goes on.

Our vaccination rate - with Australia now 87 per cent fully vaccinated, and even states like Western Australia and Queensland closing in on that important 80 per cent mark - that provides genuine cause for optimism as we end 2021 and we move into next year.

Our resilience as a country is not just about our capacity to absorb shocks, though.

It’s also about our capacity to learn, to adapt, to improve - so we are prepared and ready for the challenges of today and tomorrow.

And this morning, I just want to focus on a couple of areas, a couple of areas where Australia must continue to learn, adapt and improve - our supply chains and our skills and training system.

As you know, the Government’s agenda spreads well beyond all of those issues, of course. But these are important, very important parts of our plan, our economic plan, to secure that economic recovery, which you all know cannot be taken for granted.

This recovery cannot be locked unless we can have confidence in the economic management that is going to see us have the right balance and the right balance and policies to ensure that that economic recovery can be secured.

There’s a lot at stake.

In many ways, what I wish to talk to you about today, are the micro-foundations of our economy - providing the hardware and the software that allows the economy to remain flexible and innovative amidst the challenges that we have before us, to secure them and those opportunities.

Supply chains, we know, are under increased pressure around the world due to international COVID-related factors. It was a key focus of our discussions at the G20.

Global container shipping costs, congestion and supplier delivery times all remain around historically high levels.

Global shipping prices are up around six-fold since the beginning of the crisis.

Australian shipping prices have likewise risen sharply, you know this.

And congestion and delays are having flow on effects for domestic supply chains and consumers.

Now, that said, supply chains in Australia have proved generally resilient throughout the pandemic, despite COVID measures, isolated cases at Australian ports and industrial action and other localised disruptions.

And encouragingly, the IMF and the OECD both expect the inflationary effects of these supply chain pressures to moderate in 2022, as consumer demand for goods rebalances and industry responds by bringing on more supply.

The Government’s Office of Supply Chain Resilience, that I established, is monitoring supply chain vulnerabilities right across our economy and coordinating whole-of-government responses to ensure access to essential goods.

Economic ministers, together with myself, continue to be briefed regularly on supply chain pressures, and the National Coordination Mechanism - so critical, so critical for business during the course of this pandemic - is meeting weekly with industry players in the run-up to Christmas.

We have learnt through the pandemic just how much better we can get that integration between how our Government integrates with businesses on these most practical of issues.

The key focus is on the flow of goods from overseas suppliers to Australian businesses and consumers.

And our Government is also keeping a close watch on the potential for industrial action to disrupt economic activity, noting that industrial action at Patrick Terminals is on hold until at least the 10th of December.

Now, we encourage the parties to this dispute to negotiate in good faith and to resolve their issues to get this sorted.

But at the same time, I want to assure you that our Government will take action, if needed, to protect the Australian economy from serious harm.

In light of the recent ACCC Container Monitoring Report, the Government is also examining broader issues associated with the relative productivity of Australian ports.

Ports are the gateway for our economy. Inefficient ports are a tax on all of us.

Coalition Government’s - Liberals and Nationals - have always understood this, and have always been prepared to take action to ensure our ports can serve our economy as best as they possibly can.

And we are taking action by improving port productivity through infrastructure projects, tackling regulatory inefficiencies at the Australian border through the Simplified Trade System - which will streamline compliance costs for Australian importers and exporters while replacing legacy ICT systems.

Now, it’s clear, however, that productivity challenges remain in Australia’s maritime logistics system. These relate to competition, industrial relations, infrastructure constraints and technology uptake.

Now, shortly the Treasurer will be releasing the terms of reference for a Productivity Commission enquiry into the efficiency of our maritime logistics system. This is not an enquiry that I see going on for a long time. I want to see this back here by the middle of the year.

Having supported our economy strongly at the end of next year, I should say, having supported our economy strongly on the demand side through the pandemic, our focus inevitably turns to the supply side levers as the economy recovers, because it's those supply side levers that can have such a big impact on inflationary pressures that put pressure on all Australians, whether mortgage holders or small business, as they try to make their payments and ensure their businesses can proceed forward in getting access to the capital they can to take advantage of the recovery.

Nowhere is this more important, though, in all the issues we're dealing with on supply side than with workforce and skills challenges.

Now, here the responsibility sits with governments, with business and with individuals as well to seize those opportunities that suit their natural talents and predispositions.

And there are many opportunities that are out there. Job ads now at the highest level in 13 years.

We've seen encouraging signs about the increase in jobs post the Delta lockdowns from the ABS payroll data, and 350,000 jobs in five weeks have come on.

But the strong recovery does present us with a workforce challenge to ensure that we have enough workers and enough trained workers to fill vacancies and ensure that our recovery is not held back. This is a difficult challenge. Was a challenge before the pandemic.

Skilled migration, of course, will be part of that solution, and we are taking a responsible path to gradually reopening those borders, as I mentioned earlier, and targeted migration to fill critical skills and labour gaps will continue to play an important role.

And we are doubling the number of Pacific workers to meet workforce shortages in regional Australia, bringing in an extra 12,500 by March of next year. And we're progressing our new agricultural visa.

But our core focus must be on getting Australians into the workforce and increasing their skills and getting them into jobs.

The Government is committed and we have committed a record $6.4 billion in skills and training this year to help develop the skills of Australians.

It has led to the highest number of Australians in a trade apprenticeship - that’s some 217,000 - since records began in 1963. I mean, how many times have you heard people say, ‘Oh, we're not training enough apprentices.’

We have the highest number of Australians in trade apprenticeships training right now since 1963.

Now, that is extraordinary. That is delivery. That is following through on what has been one of the most key issues that have been faced in our economy - get these skills.

And we have also seen the total number of apprentices and trainees increase by 27 per cent on pre-COVID levels.

Support for apprenticeships was one of the first steps we took as a government after COVID hit, and it has been one of the great successes to see so many Australians, including many young Australians, in a job and developing throughout the period.

I can tell you, the reason we moved so early on apprentices in the pandemic is I was concerned that we were going to have a lost generation of skills in this country because of the pandemic.

A lost generation of skills - apprentices, trainees that had started their apprentices, last on, first off, never to come back, never to get those skills again.

And so in the midst of the uncertainty as we faced the abyss of the pandemic, one of our first measures was to say we need to hold onto our skills.

And I think that says a lot about our Government and where that sits in our thinking about the economic link between skills and our economy, the opportunity that Australians needed so they would not become a lost generation in skills.

And this is what is now paying off in setting us up for the recovery. That's how you secure an economic recovery.

The work to secure the economic recovery began the day the pandemic started, and we laid the foundation for the recovery right from the get go.

We also established, as you know, in that vein, the JobTrainer program, in partnership with the states, to further develop those skills, with the overall program supporting 460,000 places and 270,000 have already been enrolled.

Now, these programs are vital because we will need a skilled domestic workforce to take advantage of these opportunities, as I’ve said.

We will need to fill an estimated one million new jobs in the next five years.

And while this presents a great opportunity for Australians out of work or seeking additional work, it also presents risks for employers and the wider economy if we don't have the workforce with the required skills to meet employer’s needs.

I consider this one, if not one of, our biggest challenge to our economic recovery is getting the skills in the workforce.

Like many developed economies around the world, our labour market is shifting towards higher skilled jobs.

We need to ensure we meet those demands through a world class skills and training system that is designed to better match employer needs and job seeker skills, provide targeted assistance to job seekers who need the most help to get a job or undertake further training, and engage businesses so the training system reflects the skills that employers need - not what people want to teach, build skills in critical sectors to maintain Australia's global competitiveness and sovereign capabilities, and encourage employers to take responsibility to upskill their own workers.

When I was out at Western Sydney International Airport, Nancy Bird-Walton, the other day, I was incredibly excited about the progress that has taken place there.

You want to talk about nation building projects, that’s going to put Australia in a completely different place - that, the Inland Rail, Snowy Hydro 2.0 - all of these, massive projects on unprecedented scale.

But what I was even more excited about when I saw that airport 25 per cent completed was the workforce that they are building there - a workforce of highly skilled people that will be able to apply their their skills to more and more tasks into the future. Incredibly exciting.

It's happening in cyber training, cyber skills, medical instrument manufacturing, design and engineering skills.

That's why we are reforming our training system to better engage industry in the design of training, ensuring qualifications updated faster to meet the needs of industry.

And it's why we are working with the states and territories on a new skill, national skills agreement.

I wish it was proceeding more quickly, and we're making great progress with states like New South Wales who understand the importance of this.

But we are meeting resistance in other places and it's important that we work together to ensure we can reform these skills systems.

They're done by the Federal Government in providing funding, but also by state governments. And so for it to work, we have to work closely together to get that right.

Increasing investment, we're very happy to do. I'm very happy to continue to invest in this area, but I'm not going to invest into a system that doesn't work and that refuses to be reformed.

And we will take the action necessary to ensure that the additional funds we want to invest goes to a better system that can support business and workers to get the skills that they need.

And why we're establishing, it’s also why we're establishing a new industry cluster model, which will strengthen employer leadership and engagement, giving industry a more prominent role in our skills system.

You know, there is nothing that thrills me more as a Prime Minister. It's one of the key reasons that I feel so passionately about what we do as a government, is getting young people into work.

It changes a life. It changes a family. It changes a community and it changes a country.

It's so important, and you are such an important partner in that great ambition to see Australians get into work, but particularly those younger people and those who are transitioning their careers, often late in life where their uncertainty is great.

I was down in Adelaide on Friday. I met former Holden workers, now working in a, on a portable brain scanner technology, and they're making the machines.

They were making cars before. Now, they're making some of the advanced medical equipment in the world, and so many of their mates are doing exactly the same thing.

Our economy does have that capability to transform and to take up new opportunities, to see what's ahead - the new energy economy, the other uncertainties are there - and to meet and beat it.

And I believe you believe the same thing.

So at this critical point, friends, I want you to know that I have great confidence in where we're heading. Great confidence. I am confident about our future. I'm excited about it.

There are a number of areas that I could have focused on this morning, but time is short and there'll be other opportunities.

But I want to shout out to all your members and say a massive thank you for everything you're doing to support that spring back in our economic recovery and the industry and jobs of tomorrow.

And happy to take some questions and and discuss any of those other matters further. But thanks for your attention.