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Government Announces Industry Innovation And Competitiveness Agenda

The Federal Government today announced an Industry Innovation and Competitiveness Agenda.


Speaking at a press conference in Canberra, the Prime Minister, Tony Abbott and the Minister for Industry, Ian Macfarlane, announced a series of measures to life apprenticeship rates and encourage employee share ownership. The plan also aims to promote science and technology skills in school, reform the 457 visas programme, and establish Industry Growth Centres.

  • Listen to the joint press conference with Tony Abbott and Ian Macfarlane (37m – transcript below)
  • Watch Abbott and Macfarlane (37m)

Downloads (PDF)

Statement from Ian Macfarlane, Minister for Industry.

Strengthening Australia’s competitiveness is the key to our future prosperity.

Improved competitiveness means more exports, more jobs and higher living standards for Australians.

Today the Abbott Government released the Industry Innovation and Competitiveness Agenda.

This is a central part of our Economic Action Strategy to build a strong, prosperous economy and a safe, secure Australia.

Its guiding principle is to focus on Australia’s strengths and not prop up poor performers.

Our Competitiveness Agenda details how we will:

  • lift apprenticeship completion rates and give young Australians the best opportunity to get a job;
  • encourage employee share ownership;
  • promote science, technology, engineering and mathematics skills in schools;
  • improve the investor visa programme and reform the 457 visa programme; and
  • encourage better use of Australia’s world class researchers through the establishment of Industry Growth Centres.

The Government is working to strengthen the economy.

We’ve already scrapped the carbon and mining taxes; cut over 10,000 pieces pages of unnecessary legislation and regulations; commenced the largest infrastructure construction programme in Australian history and signed free trade agreements with Japan and Korea.

This document is taken from the website of the Department of Industry.

Industry Innovation and Competitiveness Agenda

The Industry Innovation and Competitiveness Agenda was announced on 14 October 2014. It focuses on providing the right economic incentives to enable businesses, big and small, to grow. It contains immediate reforms which will boost competitiveness and a range of proposals for public consultation.

The Agenda is organised under four overarching ambitions:

  • A lower cost, business friendly environment
  • A more skilled and flexible labour force
  • Better economic infrastructure
  • Industry policy that fosters innovation and entrepreneurship.

Key initiatives under the Agenda are:

  • Encouraging employee share ownership
  • Reforming the vocational education and training sector
  • Promoting science, technology and mathematics skills in schools
  • Accepting international standards and risk assessments for certain product approvals
  • Enhancing the 457 and investor visa programmes
  • Establishing Industry Growth Centres.

There are a range of other initiatives that the Department has a role in progressing including boosting commercial returns from research, streamlining certification of medical devices, streamlining industrial chemicals assessment, and streamlining construction regulation.

Industry Growth Centres Initiative

A new policy direction for Australia

The Industry Growth Centres Initiative (the Initiative) is the centrepiece of the Government’s new industry policy direction and part of the Industry Innovation and Competitiveness Agenda. It will lift competitiveness and productivity by focusing on areas of competitive strength. This will help Australia transition into smart, high value and export focused industries.

The Initiative will enable national action on key issues such as deregulation, skills, collaboration and commercialisation. It will drive excellence, not dependence and create an economy that ensures Australia’s ongoing prosperity.

The Initiative is ongoing with $188.5 million in Government funding over the first four years.

The Initiative will initially focus on five growth sectors in which Australia already has a competitive advantage:

  1. Food and Agribusiness
  2. Mining Equipment, Technology and Services
  3. Medical Technologies and Pharmaceuticals
  4. Advanced Manufacturing
  5. Oil, Gas and Energy Resources

The Centres will also facilitate engagements between enabling services and technologies, such as Information and Communications Technology, where they provide essential and direct support to the growth sectors.

Role of the centres

Strategic objectives

Industry Growth Centres will be established in each of the five growth sectors to deliver the Initiative.

The Centres will

  • improve collaboration between businesses, scientists and researchers, enabling the adoption of new processes and development of new products;
  • increase the commercialisation of new ideas;
  • identify ways to remove stifling regulation placing a burden on Australian businesses;
  • get more businesses identifying and participating in global supply chains and markets;
  • implement skills strategies to future ready the nation’s workforce.


Centres will be not-for-profit organisations led by industry leaders. They will be rolled out from early 2015.

Each Centre will operate with a Board which will be responsible for operation of the Centre and the development and implementation of Centre activities.

Board members will have a range of expertise and experience including small to medium business operators, prominent scientists and researchers, respected business leaders and representatives from multinationals.

The Minister will be seeking expressions of interest across the five sectors from parties interested in establishing the Centres. Through a facilitated process Chairs will use the expressions of interest to work with their respective sectors to develop the Centre proposals for the Governments consideration. Facilitators will be well respected within the sectors and will assist the Chair to develop and refine Centre proposals, negotiate contractual arrangements and establish the Centres.

Growth Centre Infrastructure

Funding of $63 million will be available to the Centres to develop and deliver large scale collaborative projects to build the capability and competitiveness of the sector. Project funding will focus on market, value chain or technology issues to deliver commercial outcomes. Sector projects will not only benefit the project participants but have impact across the whole sector and contribute to the outcomes of the Initiative.

As part of the Initiative, $60 million in funding will be available on a competitive basis to help convert ideas with high potential into profitable commercial realities. This element, comprising grants of up to $1 million, will be delivered through the Entrepreneurs’ Infrastructure Programme.

In addition to these critical projects, a new information technology platform will be established. The Industry Growth Network will provide essential infrastructure for Centres to collaborate and extend their reach. It will include websites, stakeholder support and online collaborative tools.

Centres in action

The Initiative will accelerate the competitiveness and productivity of high growth sectors through focusing on the following key themes: reducing excessive regulation; improving workforce skills; strengthening value chain linkages; encouraging business-research collaboration; and improving commercialisation.

While the Centres will be flexible in their approach to addressing barriers to success they will be tasked with looking at four broad themes:

  • increasing commercialisation opportunities,
  • enhancing workforce skills,
  • addressing regulatory barriers, and
  • forging closer links with supply chains in their specific sector.

They will also build export ready capabilities of firms in the sectors.

Overarching activities that all Centres will complete include:

  • Development and implementation of a roadmap to lift sector competitiveness;
  • Provision of advice to Government on how to best reduce regulatory burden within their sector; and
  • Development of annual industry knowledge priorities to help inform the research sector of industry needs and commercialisation opportunities.

Below are some examples of activities that the Centre’s may undertake.

The food and agribusiness Centre may assist food manufacturers to work with packaging companies and researchers to consider packaging solutions to extend the shelf life of products, especially into regional export markets where the lack of refrigeration is a problem.

The mining equipment, technology and services (METS) Centre may identify global market opportunities to enable establishment of METS consortiums to target opportunities with product and service export packages and access to information on global supply chains.

Through the medical technologies and pharmaceuticals Centre, businesses may be assisted to identify new opportunities through linking with medical device and materials researchers to develop new biomedical devices and platform technologies to improve health outcomes and business profitability.

The advanced manufacturing Centre may bring together researchers and small chemical manufacturers to enable them to adopt new chemical flow and carbon fibre technology, in turn allowing them to develop new, low cost chemical products which are competitive with those produced overseas.

The oil, gas and energy resource Centre may assist businesses to lower costs through greater collaboration, better sharing of infrastructure and logistics support (especially on remote projects), greater development and uptake of new technology and innovation, and improved planning across all areas of the resources value chain.

Transcript of joint press conference with Prime Minister Tony Abbott and Industry Minister Ian Macfarlane.

Industry Innovation and Competitiveness Agenda

PRIME MINISTER TONY ABBOTT: Thanks very much for being here. We have a strong economy – a very fundamentally strong economy – but we can never rest on our laurels, because every day, every week, every month, every year, our competitors are seeking to do better. So, in order to stay a step ahead of the game, we’ve always got to be striving to do better ourselves. That’s what this Competitiveness Agenda is all about. It’s about ensuring that we make the most of our strengths in the months and years and decades ahead.

There are four pillars to our Competitiveness Agenda. We want lower costs, we want higher skills, we want more infrastructure and we want more entrepreneurship.

There are a number of specific policies in this agenda that we release today. Essentially, we want to see far more encouragement and incentives for employee share ownership. We are reversing the changes that the former government made in 2009 which essentially stopped employee share ownership in this country. As well, for young businesses with turnover of less than $50 million a year, there will be tax incentives for employee share ownership.

We are going to make 457 visas more useable, but very importantly, the usual protections will stay in place to ensure that Australian workers and their wages are protected.

Very importantly, we are going to have five Industry Growth Centres. The whole point of these Growth Centres is to put science at the centre of industry policy. In oil and gas, in mining technology, in medical technology, in food and agribusiness and in advanced manufacturing, we are going to have these Industry Growth Centres which will link up business with researchers – it’s very important that we link up business with researchers.

There are a range of other measures which are outlined in this Agenda and what we’re intending to do is to have a series of round tables, which will be led by the ministers before you today – Minister Robb, Minister Briggs, Minister Billson and Minister Morrison, they will be leading these round tables along with Minister Pyne. We will be further refining proposals in a range of areas, such as, for instance, coastal shipping that will add to our competitiveness.

So, this agenda that we release today is the start of a process. We are very confident that at the end of this process, our competitiveness will be very significantly and substantially enhanced.

I want to thank the members of my Business Advisory Council who have been heavily consulted on this agenda paper that we released today. I also want to thank the Business Council of Australia whose work has helped to inform the measures that we announce today.

I’d now like to throw to the Industry Minister, Ian Macfarlane who’s done an excellent job. This paper is his work more than anyone else’s and I want to thank him for the work he’s done.

INDUSTRY MINISTER IAN MACFARLANE: Thanks, Prime Minister. Industry policy in Australia has gone through a very significant change if we look back over the last century. We saw industry policy initially based around agriculture, we transitioned into manufacturing, and the third stage – or the current stage – is one of services and the industries associated with providing components into a global supply chain. That is the way of the world. We are simply making sure that we position Australian industry where the rest of international industry is.

Componentry is a critical part of international trade. It has doubled in the last five years and I’m sure Minister Andrew Robb will confirm that it’s probably likely to go up another 10 to 20 per cent as we look forward over the next four or five years.

We want to ensure that we have industries that are both competitive and innovative and by linking them with science and by giving them this third leg to industry policy – the first two were announced during the Budget, that is the Entrepreneurs’ Infrastructure Programme and the Industry Skills Program – by putting this third leg in place, we believe we have a very sound and secure industry policy moving forward.

ABBOTT: Ok. Do we have some questions?

QUESTION: This policy has been criticised in the past by some as picking winners. There’s five sectors of the economy that have been identified. If you’re in business outside these sectors, is that sort of it in so far as expecting support from the Government?

ABBOTT: Well, there’s something like $10 billion worth of research which government funds every year and we are determined to try to ensure that we get more commercial bang for our research dollar. That’s why we want to put science at the centre of industry policy and that’s what we’re trying to do today: to put science at the centre of industry policy.

Yes, there are these five Industry Growth Centres that we have announced today and there are five sectors where these Growth Centres will be located, but these are very much the strengths of contemporary Australian industry. I don’t see it as picking winners. I see it as playing to our strengths.

If you have looked at the work of this Government over the last 12 months, we are not in the business of picking winners. We know that all too often, when governments have tried to pick winners, they’ve done the very opposite, but we do know for a fact that these are very successful sectors and we want to build on that strength. That’s what we want to do.

QUESTION: Can you just give a practical example, Prime Minister, of how these centres will operate? If you do work in agribusiness, for example, what will you get from one of these centres?

ABBOTT: I’m going to ask Ian to elaborate, but in broad terms, we want these centres to be industry-led, so we will be asking businesses and consortia of businesses to come to us with proposals for these centres. But, the whole point of these centres is to integrate practical people in business with those who are doing the cutting edge research in the relevant field.

MACFARLANE: Well, that’s very much the model and the practical execution of that is that if you’re an SME out there and you’ve got a good idea but you’re not sure how to progress it, then you would go to the relevant Growth Centre, the Growth Centre would either guide you to someone who can assist you in research and perhaps finalising the development of the product, or take you to someone who’s involved in commercialisation. These are not government bodies. These are people who are already in those businesses, or in the case of science, already working in those areas and then it will provide you with assistance to commercialise that product, all the time drawing in the expertise that exists in industries in Australia. So, you’re going to have big companies helping small companies, you’re going to have small companies accessing multinational, international companies so that their products when they’re commercialised are taken into global supply chains and actually sold right around the world.

So, it is about collaborating between the sectors of industry, the sizes of industry that perhaps some are already successful, some just need a little something to get them over the line, and then bringing science into it. CSIRO and science will be very much a key part of this strategy. We want to ensure that businesses are using the latest and best science. There’s no better organisation to assist them with that than CSIRO, but it means getting products that may stall through to commercialisation by using companies and individuals who are already involved in that field.

QUESTION: Just further elaborating on that, and you’ve mentioned CSIRO and it does do a lot of work in this sort of area, where would these centres be based? And when you say that they’re going to be industry-led and there’s X amount of funding from the Government, would businesses actually have to pay some sort of cost towards using them or make some sort of contribution, or would you envisage this funding, being from the Government, being enough to fund the centres in total?

ABBOTT: In terms of location, that’s part of the round table process. Obviously, we already have the whole of the food industry centre of excellence that was set up by the previous government. Whether we continue with that or whether we put a new body in place is really up to the industry to decide, but industry must be involved and they must do so at their own expense. So, if you’re involved in agribusiness and you’re a large operator and you see some advantage in expanding your stock or your product lines, by bringing another company in, by being involved in the food and agribusiness Growth Centre will give you that opportunity, but you do so at your own cost. If you’re an SME, there will be some assistance as you go through that process, but in the end these Growth Centres need to be self-sustaining. They’ll be set up on a very strong corporate governance line, they’ll have personnel on them from the corporate sector, they won’t be government appointments in terms of each of the growth fund boards, they’ll be established by industry and it won’t be necessarily on the basis of who brings the most dollars to that Growth Centre, it will be on the basis of who has the best expertise to offer in that area. As I say, they will be set down with key performance indicators and they will be run as a company should run, not as some sort of jumble of trying to stitch together various pieces of policy.

We have gone over this issue very closely; we’ve collaborated, not only with the likes of the Business Council of Australia, and Catherine Livingston has been very outspoken on the need for these, but we’ve also looked at the models that are operating successfully internationally. But, the key thing is they must work towards self-sustainability. This Government is about taking industry from being dependent to being excellent. That’s part of this process.

QUESTION: Mr Abbott, two questions. If you want to put science at the centre of industry policy, isn’t there a case for having a designated science minister? And secondly, this may be in all this paperwork, but what is the total cost of the package and what are the offsetting savings?

ABBOTT: The total cost of this package is about $188 million for the Growth Centres, $200 million for the employee share incentives. There’s $12 million for the science, technology, engineering and maths education component. There may be a little bit extra, but that all adds up to roughly $400 million and funding for this will be detailed in the MYEFO statement that will come out in a couple of months’ time.

QUESTION: What about the dedicated science minister?

ABBOTT: Look, we have a dedicated science minister and I’m standing beside him now. Now, I know there’s been some disgruntlement, if you like, at the lack of someone who is designated minister for science. But you know, the most scientifically successful country on earth is the United States and they don’t have a secretary of state for science. It’s what you do rather than what you call people that counts. Ian Macfarlane is working very, very hard every day in the cause of science.

QUESTION: Mr Abbott, one of these releases says there will be a Commonwealth science council created. Does that replace the Prime Minister’s Science Council? And I’m also wondering if Minister Macfarlane could explain, just a bit more detail, the difference between the industry growth centres and the cooperative research centres, the CRCs that currently exist?

ABBOTT: Well, look, my understanding and I will ask Ian to elaborate is that these are going to be very much industry driven. The Government, other than designating the broad sectors is not going to say there will be a CRC for submarine building or anything like that. We’re going to say look industry in these broad sectors you come to us with your proposal. So, we are trying to make this as industry driven, utilising the best science as we possibly can.

MACFARLANE: Look, the CRCs have been around for a very long time and some of them have produced some amazing outcomes and some of them basically have gone off on their own path. Now I’m not going to start naming them, but I have asked David Miles who was the previous chair of Innovation Australia to do a review on CRCs. We see CRCs as having an important role but aligned with the growth centres. So, we want to bring industry research development and the whole policy area into focus and having CRCs as an adjunct to this just simply won’t work. We’ll be looking at how we bring them into this process. Some CRCs will continue and complete their contracts. Some will be folded into this process and some will terminate but I will wait to see David Miles’ recommendations in relation to that.

QUESTION:QUESTION: My question on the Commonwealth science council, is that replacing the Prime Minister’s Science Council?

ABBOTT: Yes, it is and look the idea is that it will meet at least twice a year and I will chair at least one of the meetings.

QUESTION: The Russian embassy has hit back at your comments yesterday…

ABBOTT: Let’s finish with questions about this and then we’ll go on to other subjects.

QUESTION: You said you want to get more bang for your buck out of the research spending. Do you envisage a big change in the mix of research that’s being conducted in Australia? Secondly, on a slightly different topic, every time we have an innovation statement we hear we need to do better at maths and science at school. What’s gone wrong in the past and what makes you think that this – what are you going to do differently to actually get some results here?

ABBOTT: The more contact there is between the science sector and the corporate world, the more likely we are to get a correlation of interests and activities between the two sectors. The more familiarity there is between the research world and the world of business, the more likely the cooperation is between, if you like, the High Street and the ivory tower so to speak. That’s what we want to see. We want to see our best researchers come out of their universities and get involved in our workshops and factories. That’s essentially what we want to see. Anything we can do to familiarise the one with the other is a good thing. Now, you’re right, we have been saying for decades, if not for generations, that we need to improve our science, our engineering, and so on. I think there’s no doubt that we’re getting better at it all the time but we can never rest on our laurels. That’s why it’s important every so often that you have new initiatives such as this designed to ensure that we are rededicating ourselves to excellence in all of these things. It’s very important that in all of the soft sciences and the social sciences, in all the fields of culture and arts, in all the fields of philosophy, that we do very well indeed. But we can’t neglect the hard sciences. We can’t neglect engineering and this is an important statement, an important declaration of purpose from the Government.

QUESTION: I’ve got a question for Mr Macfarlane. Just in regards to the industry growth centre on oil, gas and energy resources, I imagine that would be WA focused. Is that going to replace the new WA centre of excellence and what will its targets be in getting more investment, focusing on FLNG, investment post-Browse, that sort of thing?

MACFARLANE: You can make that assumption and I won’t want to burst your balloon today about where it will be located, but obviously if we’re playing to natural advantages, Western Australia’s got a head start on everything else. Secondly, in terms of the centre you mentioned, that’s part of what we’re trying to address through this process. We have centres of excellence scattered across Australia, some of them duplicating each other. So we will be looking at how that can be incorporated as part of the growth centre in oil and gas. Growth centres aren’t about attracting investment, say in oil and gas production in Australia. They are about attracting industries that are involved in particularly the supply of componentry and if we talk about the oil and gas industry there’s a classic example in Western Australia, where we’ve seen an SME with a small device about this long a yellow tag that you place on a piece of equipment, who’s actually sort of got it through collaboration with companies like Cisco and Woodside, but if we’d had a growth centre in place that collaboration and that commercialisation, that product would’ve been much quicker. So it’s about industry products and services that we can then put out internationally, into global supply chains or in the case of the oil and gas industry and also the resource industry, how we can sell our services overseas and create jobs back here in Australia.

QUESTION: There are changes in here about the 457 visa programme. I just wanted to check, on labour market testing – will you be making any changes on labour market testing? And secondly, the funding for a P-tech-style facility, how do you see that playing out in practical terms?

ABBOTT: Well the P-tech was, if you like, a technology high school. An industry linked technology high school which I was lucky enough to visit in New York on my trip to the United States in June. We would like to explore a similar concept here in Australia. So I think that’s very important. On the 457s, labour market testing will remain, but we want to be easier to engage in. We want it to be less burdensome for the businesses that are doing it. I really do want to stress, though, that there will be no dilution of the requirement that people be paid proper market wages and that they be paid above the threshold, because 457s are a way of getting into this country the skills we need. They’re not about undermining anyone’s pay and conditions. They’re about making our country more prosperous so that overall we can pay everyone more. We’re certainly not in the business of undercutting anyone.

QUESTION: Also on the P-techs, just a follow up on that – what’s your current thinking and vision for how far you can go with this, how much industry could get involved in curriculum for those senior high school years?

ABBOTT: It’s very important for any school to teach the standard academic curriculum, but as well as ensuring that people can do the basics, there’s plenty of room for specialisation, and in New South Wales, for instance, we’ve got high schools that specialise in languages, we’ve got high schools that specialise in sport, in the performing arts, in all sorts of things, so there’s no reason why somewhere in our country, we couldn’t have a number of schools which specialise in science, technology, engineering and maths in conjunction with particular businesses, and the P-tech that I was visiting in New York, I think it was being done in conjunction with IBM, and look, let’s explore what might be possible here in Australia.

QUESTION: Australia’s largest service export industry is education, and it’s at the heart of technological disruption with new forms of delivery and so forth. I’m wondering why that was not included as one of the priority sectors and how the five sectors that were included were chosen?

MACFARLANE: The Education Minister and I will be releasing a separate policy in relation to education and industry and that will be out the next few weeks.

QUESTION: And how were the five chosen?

MACFARLANE: The five were chosen off the basis of natural strength, but not just in our view, but people like Deloitte, McKinsey and as I mentioned the Business Council of Australia had identified these areas as areas where we have a natural advantage and competitive advantage that we could build on. That’s what it’s about. As I said, we want to take industry away from a dependency mindset, and into an excellence mind set. The first thing you do is look at those industries that were already excelling in terms of trade performance.

QUESTION: Under all this policy you’ve talked about making Australia having a competitive edge for industry, but paint a picture if you will for parents at home thinking how all of this is going to make a difference for their kids. Where are the new jobs of the future going to come for them out of this policy?

ABBOTT: It’s very easy for people to think the motor industry is shrinking, there’s a lot of competition in agriculture and elsewhere. But each generation of Australians has conquered its fears and embraced its opportunities. Each generation of Australians has let hope triumph over fear. We are a fundamentally optimistic people and the grounds for optimism is our innate ability and willingness to have a go. The fact that over the years, we have not just maintained but improved over the last 30 years or so our position on most of the competitiveness indices, we’ve improved our position in most of the world league tables. Sure, we’ve fallen a bit over the last six years, but I think there were obvious governmental reasons for that. The fact that we have between the 1980s and very recently been remarkably successful at pulling ourselves up, I think, should give Australians great confidence that we are more than capable of meeting the challenges of today and tomorrow.

QUESTION: Talking about having a go, Russia has hit back…

ABBOTT: We’re going to exhaust questions on this subject. I will come back to you. Phil?

QUESTION: Two separate questions. Will you retain the sort of integrity measures to stop the more widespread use of those schemes which could have quite an impact on revenue beyond start-ups. And just separately on the P-tech model, obviously, extra funds would be required and there’d be some sort of state/federal thing. Would you envisage an industry sponsor perhaps kicking in to make up the difference required as a P-tech school?

ABBOTT: Well, that’s, as I understand it, how the P-tech in New York worked. IBM were contributing a modest amount of money and quite a lot of mentoring there. That’s the kind of thing we’ll look at doing here in Australia.

QUESTION: [Inaudible]

ABBOTT: Yeah, look, there will be the usual anti-avoidance kind of measures but the problem with the changes that the former government made is that they virtually stopped employee share ownership schemes dead in this country. They are a very important way of getting clever people to get involved in start-up businesses.

QUESTION: A lot of emphasis in the paper on start-ups and I just wondered, a lot of start-ups have been pushing for a patent box type arrangement to assist them. Is this something that you have considered and now ruled out? Is that the way we should read this paper?

MACFARLANE: No, that’s not the case at all. In fact, there is quite some enthusiasm for consideration of a patent box type scheme within the Government and that will be part of Treasurer Joe Hockey’s review along with a number of other areas particularly crowd funding that will help in this area of financing of start-ups but we certainly are interested in that scheme. We have to make sure that it does what it says it does. There are mixed results or mixed analysis coming out of the patent box system that’s used in the UK but we are going to have a further look at that.

QUESTION: The division of pharmaceuticals, is that, as an industry growth centre, is that inspired by the fact that Australia grows half of the world’s legal opiates and that we’re not doing enough to produce the drugs rather than just grow them in Tasmania and soon Victoria?

ABBOTT: Well, there may be some deeper agenda to your question, Andrew. But as a former Health Minister, I know that pharmaceuticals were the largest advanced manufacturing sector in our country. Now, the pharmaceutical sector has certainly laboured under some difficulty, but it still has an enormous amount of potential. That’s why medical technology is something which is going to be one of the five growth centres.

QUESTION: Following on from Phil’s question, PM, you mentioned that you could look to imitate the US model that would see industry making a small contribution to schools, adopting the P-tech model essentially. Your Government is launching a Federation White Paper that envisages a smaller role for the Commonwealth in terms of funding. You have also projected in the Budget an easing in the growth trajectory of Commonwealth funding for education. Could industry, is this where you’re going, could industry, to some extent, make up that shortfall moving forward in the next 5 to 10 years?

ABBOTT: I think that’s a pretty long bow if I may say so, quite a long bow. What we want to do is explore the potential of this model, not because we want the Commonwealth to run public schools, not because we want to usurp the right of the states here, not because we’re trying to cost-shift; just because we think that particularly for kids getting towards the end of high school, it may well help them to get jobs, it may well help our science, technology, engineering and mathematics skills base if there is more involvement by particular types of businesses in schools. Now, I guess it’s simply an elaboration, a further development on the kind of school-based apprenticeships that we’ve seen in some states. Certainly it’s seemed to work well for some people. It’s an elaboration on that. It’s not part of some dramatic new redesign of educational architecture.

QUESTION: How many of these schools would you want to see, potentially, years down the track and what type of companies would you envisage being involved? Would you want mining companies being involved? Could McDonald’s help fund a school? What type of companies are we talking about?

ABBOTT: I’m not sure that McDonald’s is particularly involved in STEM, but nevertheless if it’s about the application of engineering principles to the fast food sector, maybe, conceivably, there could be some role. But what we’re doing is putting aside a modest amount of money here. I think it’s about half a million dollars. We’re putting aside a modest amount of money here, to explore what might be possible. Yes, we can speculate about all sorts of things that might happen down the track. But I saw a school that I thought had a lot of potential in New York and we are going to explore something along similar lines here in Australia.

QUESTION: Prime Minister, just back on 457s, you stipulated here that you want greater flexibility on English language testing and skill requirement. I’m just wondering if you can tell us what sectors would be advantaged by being able to lower, which I presume it’s what it means, the English language required to get jobs in Australia and also to lower the skill level given that this is a skilled migration category and, I presume, that it means lower levels in both. What sectors would benefit and why? And just if I could follow up quickly on Andrew’s question on a health industry related issue – the New South Wales Government wants to proceed with a clinical trial on medicinal use of marijuana. What’s your attitude to that trial? Is the Commonwealth supporting it? Do you support it?

ABBOTT: I will deal with the first part of the question and then I will see if there’s any further questions on this broad topic before we go into other subjects.

It’s going to be looked at sector by sector, business by business. We want these to be more flexible, we want these to be a way of helping business to grow; 457s are not a way of substituting overseas labour for domestic labour. They are a way of helping Australian businesses to grow so that Australian workers have more opportunities and higher wages. So, where there is the chance of more investment and substantially more employment for Australians, if we are more flexible, that’s what we want to look at.

QUESTION: And the medicinal marijuana, have you got a view on that?

ABBOTT: Well, if we’ve exhausted questions on the subject of the Competitiveness Agenda Paper.

Look, Mike Baird was letting all of his First Minister colleagues know at the COAG meeting last Friday that he had an announcement coming up and we all indicated that we were broadly supportive of that announcement. So, I’ve asked Peter Dutton to be as helpful as he can be to the initiative which New South Wales announced. I do want to stress though that there is a world of difference between using a drug for medical purposes, under medical supervision, and using it for recreational purposes.

No one will be tougher on drugs than I will be. I absolutely abhor the use of recreational drugs. I think people do an unbelievable amount of damage to themselves when they play around in this area. But just as we have long used various opiates for medicinal purposes, sure, they’ve been misused but nevertheless they play a very important part in pain relief. Let’s see what we can do with medical marijuana.

QUESTION: Prime Minister, You previously said that don’t think there needs to be another trial because there’ve been so many. Are you willing to give your backing to the states to let them legalise medical marijuana?

ABBOTT: Well I’m not quite sure that’s what I have said. Mike Baird has been looking pretty closely at this and I’m happy to support what he’s doing.

QUESTION: Prime Minister, through your choice of words, you implied you were going to have a physical confrontation with the Russian… with Vladimir Putin. Why did you choose such a loaded term and are you actually going to follow through on that?

ABBOTT: Well we’re going to have a very robust conversation. A very, very robust conversation, because plainly, 38 innocent Australians were murdered. This was an atrocity. It wasn’t a tragedy – it was an atrocity. It wasn’t an accident – it was a crime. It was a plane brought down by Russian-backed rebels using Russian-supplied equipment. So, I’m going to have a very robust conversation with President Putin should he come to Australia.

QUESTION: Are you going to shirtfront him?

ABBOTT: I’m going to have a very robust conversation with President Putin should he be here for the G20 and I’m going to make it very clear that the Australian people expect, that the world expects, full cooperation by Russia in the criminal investigation so that the people who committed this atrocity can be brought to justice.

QUESTION: Prime Minister, the Russian Embassy has called your remarks immature. Do you regret saying you were going to shirtfront President Putin?

ABBOTT: I certainly am determined, absolutely determined, to have a very robust conversation with the Russian President. We’ve all seen the impact of Russian policy in Eastern Europe. We’ve all seen the impact of Russian policy on the innocent people on board Flight MH17. I think the very least I can do, speaking for Australia’s dead and speaking for the families of Australia’s dead and indeed speaking for the world’s victims, is to have a very robust conversation with President Putin.

QUESTION: [Inaudible] bilateral because the Russians are saying that no bilateral request has come through yet.

ABBOTT: Well, it’s still a month till the G20. My programme is still being finalised, but I certainly expect that while he’s a guest of Australia, he will undertake to have a conversation with the Australian Prime Minister.

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Malcolm Farnsworth
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