Acknowledgements and introduction 

I begin by acknowledging the Gadigal people of the Eora Nation, the Traditional Owners of the land we’re on today, and extend my respect to Elders past and present.  

I thank everyone who has come along today from Australian manufacturing and heavy industry, the energy sector, the tech and investment communities, colleagues from the union and business communities and government. 

And I thank the McKell Institute for hosting today’s discussion. 

There’s a lot for any modern Labor Government to admire about the McKell era. 

Bill McKell was a boilermaker who worked in the Eveleigh rail workshop, just a few kilometres from here. 

He brought decency, professionalism and purpose to public administration in 1940s New South Wales. 

In the face of the Second World War, his government worked hard to provide this state with greater security, good jobs, decent homes and better living standards.  

Having seen the human costs of conflict between Macquarie Street and Canberra during the Depression years, McKell worked hand-in-glove with the Curtin and Chifley governments to give practical effect to Labor’s post-war reconstruction agenda.

Establishing the Joint Coal Board, for example, to maximise the provision of ‘power for industrial purposes’ across this state. 

Subsidising electricity, owned by government, to deliver industrial development for New South Wales and for Australia. 

The 2020s are not the 1940s. The priorities are different, and so are the levers available to policymakers. 

But the Albanese Government is a proud inheritor of the McKell tradition. 

And these times do require that level of ambition and statecraft in Australia’s interest, as well as the NSW interest. 

Budgeting for resilience

Our Government is building a more secure, self-reliant and productive Australia, fit to face an unsteady world. 

It’s an agenda built on timeless Labor principles of economic inclusion, national resilience and a fair go for every Australian. 

This Budget is about getting Australia through the disruption of the global oil shock – the worst the world has seen. 

The industry portfolio has been working across government to bolster supply chain resilience. 

Monitoring fuel supplies, urea stocks and risks in Australia’s polymer and plastic resin supply – with more support in the Budget for the Office of Supply Chain Resilience.

And support for CSIRO’s Transport Network Strategic Investment Tool (TraNSIT), which tests for supply chain problems in our transport infrastructure and identifies the investment needed to address them.  

And using this intel to secure more of what we need, where we need it.

Central to this Budget is the $10 billion Australian Fuel Security and Resilience Package, improving fuel and fertiliser security, adding 10 days of liquid fuel stockholding, and providing for a new Government-owned Fuel Security Reserve of roughly a billion litres of jet fuel and diesel. 

Making the future

While focusing on the immediate, the Budget builds on 4 years of delivery with impact for a stronger, more productive industrial Australia. 

I can’t help reflecting on the difference between McKell’s approach to industrial statecraft and the lazy, complacent approach that Australia endured in the decade to 2022. 

When institutional capacity was reduced, strategic realities were ignored and industrial capability forfeited on a grand scale. 

I saw what the offshoring of automotive manufacturing did to Australia – 

Decimating jobs and communities like Elizabeth in South Australia and Geelong in Victoria – 

Kneecapping Australia’s economic complexity, productivity and technological readiness. 

In the volatile world of the 2020s, there’s no way Australia would willingly throw that capability away, as the Coalition did a decade ago. 

And yet, conservatives and consultants trot out the same tired arguments when it comes to Australia’s metals manufacturing industries. 

Their productivity prescriptions haven’t changed – labour market deregulation, welfare cuts and a Darwinist approach to industry policy that says manufacturers must survive or die, regardless of causes and strategic consequence.  

The current leader of the Liberal Party was one of those very consultants who urged Australian aluminium processing to go to China. 

I notice that a few Liberals and Nationals – chiefly those with leadership ambitions – have lately discovered the term “sovereign capability”. 

And as always, the political opportunists in the One Nation party fly in and out of regional communities, on their billionaire-funded private jet, talking about Australian industry and manufacturing jobs –  

As if their star recruit wasn’t second-in-charge of the government that sent automotive manufacturing offshore. 

None of them are different from one another – just pretending to be. 

It did not take supply chain shocks abroad and political realignment at home for this Government to take onshore capability and resilience seriously. 

Remember: it was Anthony Albanese who set the agenda for economic and energy resilience and reindustrialising Australia. 

Not last week in response to a focus group, but 6 years ago in response to another global shock whose lessons Labor took care to learn.  

That’s why, in our first term, we laid the foundations for the Future Made in Australia plan, including legislating the $15 billion National Reconstruction Fund. 

Investing in firms and startups in applied artificial intelligence, critical minerals processing, medical manufacturing and defence technologies.  

Giving every Australian a stake in the success of industrial breakthroughs made on home soil. 

It’s part of this Government’s broader effort to establish strong foundations for high-tech, high-productivity industries in Australia. 

And the Budget accelerates that effort by taking crucial first steps in response to the recent Ambitious Australia report – the most comprehensive evaluation of Australian R&D in nearly 20 years. 

We’re delivering $2 billion of new spending on R&D across government. 

Expanded venture capital incentives, and a retargeted Research and Development Tax Incentive. 

Funding provisioned for Australia’s association to this round of Horizon Europe, the world’s largest research, development and innovation fund. 

Investing in the work and infrastructure of national science agencies like the CSIRO. 

A new National Resilience and Science Council to better coordinate public sector investment in R&D, aligning that effort more closely with key national priorities. 

And a consolidated Investor Front Door, relocated from Treasury to my Department, and combined with the Major Projects Facilitation Agency, so that it delivers real regulatory support and investment coordination with faster approvals for nationally significant projects. 

In short, we are throwing everything at shaping a stronger Australia. 

Including attracting data centre investment that is coupled with new renewable energy generation – and I’m really pleased to see the States get on board with our Data Centre Expectations.

Industrial anchors

The full benefits of new industrial firms and technologies are less likely to materialise if there are smelter-sized holes in regional industry – 

If we forfeited the economic and strategic resilience of our metal smelters and refineries – 

Committing Australia to a future of low value ore exports and falling economic weight and complexity. 

That’s not a path to future productivity and competitiveness. It is rocky road to impoverishment and strategic weakness. 

In my 12 months as Minister, we’ve made critical investments in the future of 5 Australian metals processing facilities and their wider supply chains. 

Defending industrial capability in strategic materials like copper, aluminium, steel, lead and zinc.  

Unlocking pathways to the production of critical minerals like germanium and antimony – vital materials for electronics and defence industry.  

Making Australia stronger, rather than just a customer at the end of global technology chains. 

Backing more than 30,000 good blue-collar jobs at Mount Isa, Port Pirie, Hobart, Whyalla and Gladstone. 

This Budget commits to continued funding for the administration at Whyalla Steelworks – laying the pathway to a successful sale.    

We’ve announced a domestic gas reservation scheme that makes the equivalent of 20% of gas export production available for Australian users from 1 July 2027. 

That is a decisive Labor reform, addressing a foundational failure in Australia’s national gas market. 

Delivering real energy security and the lowest possible prices for Australian heavy industry and homes. 

The industry and energy nexus

I don’t have much time for those who argue that Australia should let factories close and data centre investment pass us by, as if economic shrinkage were the path to energy security.

The same fallacy shaped Peter Dutton’s nuclear energy modelling: a smaller economy with lower energy demand and more costly supply. 

Reliable and affordable electricity is key to Australia’s industrial future. 

In turn, Australia should be manufacturing the cutting-edge clean energy technologies that we, and the world, need. 

If I were an economic consultant, I might call that a virtuous circle. 

And nowhere is that virtuous circle more apparent than in our aluminium sector. 

Australia is one of the only end-to-end aluminium supply chains in the world. 

The ‘ubiquitous’ metal is central for data centre infrastructure, lighter-weight vehicles and renewable energy components.

Australia should be a place where renewable energy powers aluminium smelting, which in turn produces renewable energy infrastructure.

Boyne smelter in Gladstone, and Tomago Aluminium in the Hunter, are both lynchpins in a wider supply chain populated by industrial services and machinists, aluminium fabricators and more. 

In the 1980s, people called the Hunter ‘Wran’s Ruhr’. 

For postwar generations, the Ruhr in western Germany symbolised industrial strength and European integration; in Australia, the Hunter’s growth carried a similar nation‑building and security significance.

It really was thanks to Neville Wran, and the statecraft his Labor Cabinet performed through fixed-term coal-fired power contracts, that an aluminium smelter was built at Tomago. 

Tomago Aluminium is Australia’s youngest aluminium smelter – and the largest. 

It’s a good asset and could have many productive years ahead.

However, it is at an energy crossroads.

No longer the low-cost solution of yesterday, coal is now the expensive, unreliable problem forcing electricity-dependent industry offshore. 

Renewable electricity generation is what the private sector demands.

The recent 50:50 $2 billion investment in the Boyne smelter, from the Albanese Government and the Queensland Government, delivers $7.5 billion worth of underwriting and investment in new electricity generation and transmission from Rio Tinto. 

Driving down prices for Queensland homes and businesses over time.  

And making Queensland a world leader in solar and wind-powered aluminium production. 

A similar opportunity to score an economic home run exists at Tomago, where a successful path forward means energy security, productivity and economic resilience for New South Wales. 

In truth, that’s not the only path forward. 

As I see it, there are 3 ways that we could address the electricity price challenge faced by Tomago Aluminium. 

Option 1: The Albanese and Minns Governments perform the kind of collaborative, creative industrial statecraft that was second nature to Chifley and McKell. 

Leveraging Commonwealth energy assets and special investment vehicles to increase and accelerate new electricity supply to Tomago. 

Delivering new electricity investment on a scale that would improve statewide competitiveness and productivity, just as in Queensland. 

Creating jobs, hundreds of them, in the energy and aluminium supply chain, construction, logistics and manufacturing. 

The scale of Option 1 is ambitious – big public investment, crowding in billions more in private sector investment for the facility itself and, most importantly, the broader grid that powers it and the people of New South Wales.  

The serious, detailed policy work required to make Option 1 viable and attractive is happening now. 

Option 2: We just provide an energy subsidy for the smelter and do nothing to fix the root cause of the problem – ageing coal. 

It’s a less satisfactory option, because it does not address the underlying competitiveness challenge faced by heavy industry in New South Wales. 

It offers no long-term benefits for industrial efficiency and decarbonisation.   

It misses the opportunity to provide long-term certainty for workers, Tomago and businesses up and down the supply chain, and opportunities to expand energy infrastructure across the region.

In this option, we shun responsibility and wait for the market.

To drive the investment required in energy generation, storage and transmission that will unlock Australia’s global energy advantage, we should do more than hope, more than maintain the status quo. 

We should be proactively securing the future. 

Option 3: We sit back and watch the smelter close. 

We stand by as Australia’s youngest and largest aluminium smelter ceases production, jeopardising hundreds of buyers and suppliers, and 6,000 jobs in one of Australia’s great industrial heartlands. 

We wilfully give up local production capacity in a strategic material that makes Australia stronger, just when global supply chains are under pressure. 

We pass up an opportunity to drive lasting change in the composition of the state’s energy grid and industrial system, and the jobs created by accelerating new energy investment. 

We forfeit the advantage of an end-to-end aluminium supply chain, in an era where global demand is growing and prices are rising. 

There are simply no good arguments for Option 3. 

Conclusion

The world is an unpredictable place right now. 

The Albanese Government is working collaboratively, with Australia’s industrial and science sectors and with state governments, to make sure Australia can manufacture its own future. 

We have an ambitious agenda with plenty of sideline sceptics and comfortable critics. 

McKell had his sceptics, too. 

That didn’t stop him from pursuing investment in Australia’s industrial development, because he was committed to making Australia stronger and delivering good jobs in our outer suburbs and industrial regions. 

The Labor Governments of the 2020s will do the same. 

Thanks very much.