Latest news with #FutureMadeinAustralia
Sky News AU
3 days ago
- Business
- Sky News AU
Energy crisis forces Labor to mull 'band aid solutions' for failing metal smelters as energy crisis plagues manufacturers
The Albanese government has been accused of considering 'band aid solutions' for major manufacturers struggling to stay afloat amid soaring power prices under Labor's renewable energy transition. Industry Minister Tim Ayres said Labor could provide taxpayer funds and long-term loans to assist ailing smelters crippled by energy costs and China-instigated trade distortions. 'The truth is, if these facilities didn't exist, governments would be trying to build them,' Mr Ayres told The Australian Financial Review. It comes as many smelters and refineries struggle to stay afloat in Australia. Rio Tinto-owned Tomago, which is Australia's largest aluminium producer, is seeking billions of dollars from the federal and NSW governments amid high power prices and as cost-effective and consistent renewables remain largely unavailable. Two Australian smelters owned by international minerals and metals producer Nyrstar are also under threat and the local CEO has begged various state and federal governments for a handout as losses mount to "tens of millions a month". Meanwhile, Glencore's local smelters and refineries similarly struggle in a massive blow to the Albanese government's Future Made in Australia plans. Centre for Independent Studies policy analyst Zoe Hilton told this revelation from Mr Ayres showed how Labor's net zero plans were hurting local industries. 'The government has shot itself in the foot on energy policy,' Ms Hilton said. 'The consequences of its commitment to a wind- and solar-dominated grid are being acutely felt by smelters and the pain will continue until the root cause is addressed. 'Equity injections and long-term loans for smelters are merely band aid solutions that will force taxpayers to pay twice – first for underwriting renewable energy projects and second for propping up industries that can't afford electricity price hikes driven by renewables.' Labor has vowed to make the nation a 'renewable energy superpower' with an energy mix of 82 per cent renewables by 2030 and green energy driving local manufacturing. The Albanese government is looking to boost this through production tax credits for leading Australian aluminium smelters, including Tomago, and give $2 billion back to help with the energy transition. Concerns over Australia's long term manufacturing capabilities also arose from AI Group chief executive Innes Willox who warned that 'bailouts cannot be for business as usual'. 'Short-term relief measures must be complemented by a long-term perspective that addresses the energy, skills and technology challenges weighing on our metals sector,' Mr Willox told He said the upcoming productivity roundtable hosted by Treasurer Jim Chalmers, where the Albanese government's second term economic agenda will come under the microscope, is crucial for examining problems plaguing manufacturing in Australia. 'It is a seminal moment for industry and a legacy moment for the country as a whole,' the AI Group boss said. 'We just can't keep going as we have been because what's got us to this point isn't going to make us successful in the future.' Soaring energy prices have particularly hurt the metals industry in Australia since the pandemic. Mr Willox said manufacturer gas costs are up 48 per cent for the past five years and for trade exposed industries like metals, passing these customers onto consumers is not possible. Other concerns about metal smelting in Australia come from Nyrstar boss Matthew Howell, who recently asked the government for help upgrading the company's facilities to make it more competitive in the global market. Mr Howell said the Chinese government subsidises companies to purchase Australian materials at prices local smelters could not afford. China then subsidises the processing of these materials and enforces export controls on the finished metals, hurting Australian producers in the process. Meanwhile, Glencore's head of corporate affairs Cass McCarthy lamented the company's ability to compete while high energy and labour costs hurt its profitability. 'This is bigger than Glencore and goes to the heart of state and federal government critical minerals policies when you have a number of smelters and refineries across Australia clearly at breaking point,' Ms McCarthy said, per The Australian. The NSW government in June confirmed it was in talks to save Tomago, which uses about 10 per cent of the state's power supply and makes about 37 per cent of the nation's aluminium. Premier Chris Minns stressed Tomago was a 'big employer in NSW, it's a dynamic part of the state, the Hunter and manufacturing is a big part of its future'. 'It's difficult for me to speculate about what the next steps are,' Mr Minns told reporters. 'In order for us to have an effective intervention, we need to have commercial discussions with the owners and operators of (Tomago). That's what we're doing.' Rio Tinto's chief executive Jakob Stausholm earlier this year flagged concerns about the producer's electricity costs where he warned power price contracts beyond 2028 would render Tomago unviable.
Sky News AU
5 days ago
- Business
- Sky News AU
Shadow treasurer Ted O'Brien warns Albanese government ‘definitely going after taxing capital' at economic round table
Shadow treasurer Ted O'Brien has accused the Albanese government of plotting to raise taxes on capital, ahead of Treasurer Jim Chalmer's economic round table. Mr O'Brien told Sky News Sunday Agenda that the government was laying the groundwork to increase taxation across key areas of the economy. It comes after leaked treasury advice warned that the government would need to hike taxes or cut spending in order to avoid massive budget blowouts. 'I think it's clear the government wants new taxes, and I think that's one of the things we have to prosecute over this first sitting of the parliament,' Mr O'Brien said. 'They're definitely going after taxing capital. They're going after taxing investment. They're going after taxing companies. 'I believe they have an agenda to tax — there's just no doubt about that.' The government has invited economists and business leaders to the economic round table from 19 to 21 August 2025 to address possible tax reform. However, Mr O'Brien questioned the integrity of the roundtable, suggesting Labor may already have made up its mind on key economic reforms. 'My fear here is Labor might actually have an agenda already, and that this is nothing but a talk fest,' he said. The opposition has called for a broader, bipartisan approach to tax reform, with Mr O'Brien signalling the opposition was open to a 'holistic' discussion. 'If it's done holistically, if it's looking at more efficient taxation, if you're looking at fixing up what is currently a mess with Labor being overly reliant on income taxes.' Labor is facing mounting fiscal pressures including ballooning NDIS costs, an expanding defence budget, and the cost of the Future Made in Australia program. Former Treasury secretary Ken Henry recently warned that without stronger productivity, the government would be forced to either raise taxes or cut spending. 'If we continue on that trajectory … we will have no option but to raise taxes,' Mr Henry told the National Press Club on Wednesday.
Sky News AU
16-07-2025
- Business
- Sky News AU
Labor will be forced to 'raise taxes quite significantly' or cut spending if productivity stalls, Ken Henry declares
Labor has been warned it will be forced to hike taxes quite significantly if productivity continues to stall as the Albanese government powers on with its second term economic agenda. Former Treasury secretary Ken Henry faced the National Press Club on Wednesday where he weighed in on the economic challenges facing Australia. Mr Henry, who authored a highly recognised white paper on tax reform in 2010, warned Labor that lagging productivity would mean the government will be forced to either hike taxes or cut spending. It comes as Labor faces growing fiscal pressures on the budget such as the ballooning NDIS and demands for Australia to increase defence spending. 'If the budget is to meet these growing spending pressures, then we've got two options: We either increase taxes as a share of GDP, or we grow the economy faster,' Mr Henry told National Press Club on Wednesday. He said the slump in productivity that continues to plague Australia's economy would force the government to find revenue elsewhere. 'Over the decade of the 1990s, average productivity growth was 2.31 per cent a year,' Mr Henry said. 'Over the past 25 years, it's averaged 0.98 per cent a year. That's a pretty fundamental difference. 'If we continue on that trajectory … we will have no option but to raise taxes. And quite significantly, by several percentage points of GDP ... or cut spending.' Mr Henry also voiced concerns about the Environment Protection and Biodiversity Conservation Act (EPBC) during his address, which he said needed an overhaul to boost productivity. 'I can think of other reforms to boost productivity. Some even harder, though none more important. And if we can't achieve environmental law reform, then we should stop dreaming about more challenging options,' Mr Henry said. He argued changes to legislation are critical for Labor as it wants to balance environmental concerns with ambitious projects, including delivering 1.2 million new homes and continuing with the Future Made in Australia plan. It would also mean changes to laws surrounding mining and critical minerals projects. 'The Australian government has an ambition to massively increase critical minerals exports and downstream processing here in Australia,' Mr Henry said. 'This means more mines, new industrial facilities, and more pressure being loaded onto broken EPBC project assessment and approval processes.' Labor is considering a raft of changes to boost productivity. The nation's economy will take centre stage at the productivity roundtable in August where leaders across business, economics, politics and unions will come together. A coalition of 28 businesses and industry groups have listed overhauling the EPBC as a major priority. Australia's enormous superannuation sector, alongside major industries including artificial intelligence and manufacturing, will also come under the microscope.
Sky News AU
16-07-2025
- Business
- Sky News AU
Fix environmental laws to productivity boost, Australian Climate and Biodiversity Foundation chair Ken Henry tells Labor
Fixing national environmental laws holds the key to boosting productivity in Australia, a leading environmental expert has told the Albanese government. Ken Henry, the former Treasury secretary who handed down a highly recognised white paper on tax reform, now serves as chair to the Australian Climate and Biodiversity Foundation and will address the nation's flailing productivity at the National Press Club on Wednesday. Productivity has become a major focus point for the Albanese government in its second term as it looks to bolster Australia's growth. Mr Henry will tell attendees the Environment Protection and Biodiversity Conservation Act (EPBC) - Australia's main environment legislation - needs a radical overhaul. 'I can think of other reforms to boost productivity. Some even harder, though none more important. And if we can't achieve environmental law reform, then we should stop dreaming about more challenging options,' Mr Henry will say. He will says changes to legislation are critical for Labor as it wants to balance environmental concerns with ambitious projects, including delivering 1.2 million new homes and continuing with the Future Made in Australia plan. This also includes changes to laws surrounding mining and critical minerals projects. 'The Australian government has an ambition to massively increase critical minerals exports and downstream processing here in Australia,' Mr Henry will say. 'This means more mines, new industrial facilities, and more pressure being loaded onto broken EPBC project assessment and approval processes.' He will call for a 'quick and efficient' delivery of the ambitious projects in a 'way that not only protects, but restores, nature' as Labor attempts to reduce carbon emissions. 'To put it bluntly, there is no chance of Australia meeting stated targets for net zero, renewable energy, critical minerals development, housing and transport infrastructure without very high-quality national laws that set clear environmental standards for major projects, a strong national decision maker respected by all parties, and significant improvement not only in Commonwealth environmental protection systems, but also in those of the States and territories,' Mr Henry will say. 'And all these projects will be critical to enhancing economic resilience and lifting flagging productivity growth. 'Boosting productivity and resilience relies upon environmental law reform.' Labor is considering a raft of changes to boost productivity. The nation's economy will take centre stage at the productivity roundtable in August where leaders across business, economics, politics and unions will come together. A coalition of 28 businesses and industry groups have listed overhauling the EPBC as a major priority. Australia's enormous superannuation sector, alongside major industries including artificial intelligence and manufacturing, will also come under the microscope.
Sky News AU
15-07-2025
- Business
- Sky News AU
Mining giant Rio Tinto urges Albanese government to reimpose carbon tax and boost green energy subsidies to meet renewables targets
Mining giant Rio Tinto has used it's submission to the Productivity Commission ahead of the Albanese government's economic roundtable to lobby for the re-imposition of a carbon pricing scheme and bolstered green energy subsidies. Letters to the Productivity Commission's five pillars review, which will compile the agenda of the Albanese government's reform roundtable are beginning to flood in from a range of business groups and bodies. The Australian Chamber of Commerce and Industry used its submission to rail against the implementation of a 2035 emission reduction target larger than 65 per cent, stating the move would impede economic growth and stymie manufacturing. Meanwhile, the Australian Council of Trade Unions submission to the PC called on the government to consider imposing a Julia-Gillard style, economy wide carbon tax and said the policy was the best measure the government could take to ensure Australia was meeting its international climate obligations. The nation's second largest mining company joined the ACTU in advocating for the government to roll out a carbon tax, a policy which has been shelved for more than a decade since the fall of the Gillard government in 2013. Rio Tinto told the five pillars review that a new carbon pricing scheme was the only way the government could achieve its ambitious goal to have 82 per cent of Australia's electricity grid powered by renewables by 2030. 'Market-based price on carbon is the most effective way to incentivise the private sector to make low-carbon investments and drive down emissions,' Rio Tinto's submission read. The multinational company went a step further than the ACTU and outlined that a carbon tax alone was not enough to lower emissions in line with federal deadlines, arguing for the government to expand subsides to renewable energy producers. The consortium said greater federal funding packages were needed if the government wanted to bring down emissions in heavy industry while remaining 'commercially competitive in a global market.' Rio Tinto is one of the most significant inheritors of the Albanese governments Future Made in Australia fund that provides up to $1.5 billion in grant funding to support pre-commercial innovation, demonstration and deployment of renewable energy and low emission technologies. The company has several clean energy projects nationwide including large-scale solar and wind farms, battery storage facilities and renewable energy purchasing agreements. Rio Tinto, unlike the ACCI resoundingly backed in the government's goal of achieving 82 per cent renewable energy generation by 2030, and said the target 'provides certainty that Australia is committed to a decarbonisation pathway underpinned by the development of renewable energy at scale'. Australia's highest profile business leaders, including Rio Tinto CEO Kellie Parker and Fortescue founder Andrew Forrest joined Mr Albanese in Shanghai, on the second day of his six day long China visit and urged the PM to unleash greater collaboration on green steel and industrial decarbonisation efforts. 'We will create the future together of steel decarbonisation,' Ms Parker said. Fortescue, who's former CEO Andrew 'Twiggy' Forrest is an ardent renewables advocate used its submission to call on the government to boost taxpayer funded stimulus packages for renewable projects and lashed the ATO for not providing an adequate environment for clean energy investment. 'The Australian tax system does not currently provide sufficient incentives for major investment in new renewable or decarbonisation projects,' Fortescue's submission read.
