Australia’s manufacturing industry had a better start to the year after activity hit a low point heading into Christmas.

The business surveys underpinning the Australian Industry Index signalled a recovery in industry across the first quarter of 2024, but the indicator remained in contractionary territory.

The overall index lifted 9.5 points to negative 5.3 points in March.

A negative reading is indicative of a contraction in industrial activity, with the index stuck under this threshold for 23 months running.

Over the month, input prices lifted while sales and wage indicators dipped a little, “suggesting continuing margin pressure on businesses”.

Speaking at a small business conference, opposition leader Peter Dutton walked through his plan to kickstart economic activity and drive better conditions for the private sector.

“Increased centralised government and union power over our economy is only driving down productivity at a time when we need it to surge,” he said at the Council of Small Business Organisations Australia event on Wednesday.

The opposition leader singled out the government’s industrial relations changes, tax reforms and “renewables only” energy policy as examples of economic mismanagement, in his view.

“The coalition’s vision for the country is to make our nation competitive again and to restore economic confidence,” he said.

He promised to wind back “excessive government intervention” and “remove regulatory roadblocks”, which he said would allow businesses to “flourish”.

A yet-to-be-announced energy policy involving nuclear technology was also flagged as an opportunity to drive economic competitiveness and productivity growth by bringing energy costs down.

“Australia must be an energy powerhouse if we want to keep manufacturing in this country,” he said.

The opposition has already foreshadowed a tilt towards nuclear technology and is working on a policy with possible sites for reactors on old coal station locations to take advantage of existing transmission infrastructure.

He said he wanted to broaden the nation’s manufacturing capabilities by growing the resource and defence sectors and developing a domestic green steel industry.

“But these goals cannot be achieved without cheap, consistent and clean power,” he said.

“Nuclear is the only proven technology which emits zero emissions, which can firm up renewables, and which provides cheap, consistent and clean power.”

Treasurer Jim Chalmers took aim at what he described as an “uncosted nuclear fantasy”.

“If (the opposition) really cared about workers and small businesses they wouldn’t have voted ‘no’ to our electricity rebates which are helping families and small businesses with their energy bills, or threatened to unwind our cost-of-living tax cuts for middle Australia,” Dr Chalmers said.

“Inflation and unemployment were higher under the Liberals, business investment and productivity were weak, real wages were going backwards and there was debt and deficits and waste as far as the eye could see.”

Poppy Johnston
(Australian Associated Press)