A $15 billion (US$9.97 billion) manufacturing fund is at risk of stalling as the government works to shore up the support it needs for its signature investment vehicle to pass.
Negotiations continued deep into Monday, with the government working to get crossbenchers David Pocock and Tammy Tyrrell over the line.
The coalition is opposing the fund, saying it’s inflationary and poorly designed, but the Greens have signed on after assurances money will not go towards coal or gas projects or be used to directly finance the logging of native forests.
It leaves the fund in the hands of the crossbench, with two independents needed to pass the legislation in the Senate.
Nationals senator Bridget McKenzie said the Greens amendment would hurt regional Australia.
“Cutting investment into resource projects will mean higher energy prices here at home, negatively impacting our advanced manufacturing sector,” she told AAP.
It’s also risked Senator Tyrrell’s support for the fund, with the Jacqui Lambie Network senator angry the Tasmanian logging industry could be stripped of investment.
The Tasmanian is moving her own amendment to ensure companies that engage in native logging can still receive funding.
“If the Greens amendment has the potential to extend way beyond what is intended, then that should be fixed,” she said.
“This amendment is a guardrail against companies being prohibited from investment per accident.”
She also wants to ensure the continuity of projects, pushing for protections against new ministers re-prioritising sectors and projects.
“It shouldn’t be that easy to tear up every contract of a $15 billion fund,” she said.
“The areas the fund is supposed to invest in should be set slowly, deliberately and strategically. You want there to be a forward plan for investments.”
Senator Pocock is pushing for startups to have better access to the fund as they head towards commercialisation.
He’s already secured the government’s agreement on shortening the term of board members and bringing forward a review of the fund to the end of 2026.
The ACT independent remains locked in negotiations with the government, with both sides hoping for a breakthrough on Tuesday morning.
Labor senator Karen Grogan said the fund would allow businesses to receive the investment necessary to stay onshore.
“With solar panels, a significant amount of that intellectual property was developed here but was shipped overseas, where it was further developed,” she said.
“The product is developed, and then we buy it back.
“There are so many opportunities for us to cut that step out to keep our industries and our ideas onshore to the fruition of their development.”
The government is facing an uphill battle to pass key pieces of legislation this week, which is the last time parliament will sit before the May budget.
On top of the reconstruction fund, it’s also continuing to negotiate with the crossbench on its housing fund and climate policy.
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