Jim Chalmers handpicked Danielle Wood to be one of the most powerful figures in the Australian economy… But she’s got some bad news for him

Treasurer Jim Chalmers has dismissed as “nonsense” suggestions that Labor’s Future Made in Australia policy will drive up inflation – after economists, including one he appointed to a powerful body, dismissed the plan.

The federal government’s new multibillion-dollar program would target taxpayer subsidies to local manufacturers that make products related to renewable energy.

Some critics of Labor’s proposed Future Made in Australia Act have argued it is a waste of taxpayers’ money that will drive up prices.

Meanwhile, Danielle Wood, the new head of the government’s Productivity Commission, fears this will leave companies reliant on subsidies.

Dr. Chalmers angrily rejected these suggestions on Monday.

“There has been, I think, a bit of rubbish said and written about the potentially inflationary impact of a Future Made in Australia,” he told reporters.

‘It is wrongly assumed that all the investments we are considering will hit the economy at once from the front.

“What we’re talking about is a long-term plan, because these are long-term opportunities.”

Mrs. Wood, whom Dr. Chalmers, who was appointed in September, has raised concerns that the Future Made in Australia policy would create a class of companies dependent on government subsidies and would also divert resources from other sectors of the economy.

“If we support industries that don’t have a long-term competitive advantage, that can be an ongoing cost,” she said. The Australian Financial Review.

‘It diverts resources, meaning workers and capital, away from other parts of the economy where they can generate high-value applications.

“We risk creating a class of companies that are dependent on government subsidies, and that can be very effective at bringing you back for more.”

Labour’s national president and former treasurer Wayne Swan, who was previously Dr. Chalmers was, Ms. Wood called, “completely out of touch.”

Ms Wood declined to elaborate further when contacted by Daily Mail Australia on Tuesday.

“I will not be commenting further on Made in Australia at this stage,” she said by text message.

But she denied that the government had told her to stop being so outspoken. ‘No, it is simply not appropriate for this role to provide ongoing commentary on the issue.’

Last month, Ms Wood was also critical of the government for ruling out nuclear power after Opposition Leader Peter Dutton announced that disused coal-fired power stations would be converted into nuclear power stations.

“My view is that we should always be technology neutral, so we should be open to different solutions,” she told the AFR Business Summit.

“I don’t think we should raise our hands and say, ‘Not nuclear.’

“We have the opposition leader who opened the debate. We will have to look at all these factors before we can decide whether this makes sense for the country.”

Dr. Chalmers nominated Ms Wood for the position in September, with her five-year term starting in November.

Former Reserve Bank of Australia board member Warwick McKibbin was also scathing about the Future Made in Australia policy.

“Those who lose taxpayers’ money must lose their money first,” he said on X.

‘Those who win from government subsidies must return the taxpayer’s investments times 1+x.

“Politicians who pick losers should be held financially accountable.”

Despite Labor’s announcement, electric vehicle charging company Tritium DCFC and its Australian subsidiaries entered bankruptcy on Thursday – a year after Prime Minister Anthony Albanese toured the Brisbane facility and hailed it as “a great success story”.

Dr. Chalmers said this is the kind of company Australia needs to transition to net zero carbon emissions by 2050.

“I think what we’ve seen with Tritium is a missed opportunity for Australia,” he said.

‘Those are the types of industries where we should be much more competitive.

“The future of our economy should have businesses like this – more competitive businesses – making themselves part of the global net-zero economy, and I think the Prime Minister has made a similar point.”

Tritium, an Australian company, is also listed on the American technology stock exchange Nasdaq and is active in 42 countries.

For decades, successive Australian governments have subsidized Holden, Ford, Toyota and Mitsubishi to make cars in Australia after import tariff barriers were lifted – only to end production of local passenger cars in 2017.

Dr. Chalmers will present his third budget on May 14.