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Posted: 2023-02-24 18:00:00

National security, the Prime Minister told us this week, can have many faces. 

There's the usual pouting about defence and border security, of course.

And at his first address to the National Press Club on Wednesday, Anthony Albanese argued another face was Australia's standing and influence, particularly in the Pacific.

But the pandemic gave us a whole new different sense of national vulnerability when it exposed how the erosion of our manufacturing base has left us without critical supplies. "Supply chains" were suddenly an issue of which we had all become very aware.

We now have the lowest manufacturing self-sufficiency in the OECD. We don't make stuff.

The fact that we don't make stuff — but the government wants us to — and the promise that our new AUKUS arrangements will help us make more stuff in the future were two interwoven themes of the PM's speech.

Separate from any discussion about defence manufacturing through AUKUS, the PM and his industry minister Ed Husic have linked the proposed $15 billion National Reconstruction Fund to national security.

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Anthony Albanese delivers major speech on national security

The NRF is "about national security through economic sovereignty — our capacity to stand on our own two feet", Albanese said.

Whatever the underlying policy principles, you can see the sheer politics of this: the Coalition is opposed to the National Reconstruction Fund and it drives them mad to have the fund mentioned in the space of national security which it still regards as its own.

Opposition industry spokeswoman Sussan Ley said this week that "when they tie the AUKUS agreement to the passage of a bill in the parliament called the National Reconstruction Fund, which is about domestic manufacturing, that's not taking national security seriously".

The value of AUKUS

The NRF has tended to be mostly reported on through the prism of who in the parliament will support it. There's been talk about it being a slush fund, or not being a slush fund.

While such nation-building funds have a long history of being regarded with scepticism in Australia (often with good reason), the fact that the touted model for the fund is the Clean Energy Finance Corporation puts it in a slightly different space.

That's because the CEFC has been a great success. It's been a great success because it has been independently run as an enabler of projects, not a major investor. There might have been loans or particularly loan guarantees. But they have been only for projects assessed to be commercially viable, just struggling to get going because of a lack of links to investors.

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