The claim comes as business groups, unions and environmental organisations weigh in on Labor's $22.7 billion manufacturing plan before a parliamentary inquiry.
The government wants to fund clean energy projects and create new jobs under its Future Made in Australia package.
Australian Manufacturing Workers Union national secretary Steven Murphy told Wednesday's hearing that rebuilding the nation's domestic manufacturing sector was essential to decarbonisation.
"We are in a global race for the jobs of the future, and we've been distracted ... by a decade of climate cultural wars, we've missed the starters' gun," he said.
Referencing the plunge in rankings for economic complexity experienced by Australia, Mr Murphy said the nation was well placed with the transition to renewables.
"Australia has become a quarry, a farm, and a nice place to visit," he said.
"As our region struggles with how we respond to the climate crisis, Australia has an opportunity to be a trusted neighbour, a trusted partner and a leader in our region's response."
The Greens have declared the subsidies cannot go to funding more coal and gas projects.
Australian Conservation Foundation campaign director Paul Sinclair urged the government not to "walk both sides of the decarbonisation street".
"It's important that the (Future Made in Australia) supports a genuine transition. It must not be an opportunity to build clean industries at home, on one hand, while ramping up fossil fuel exports overseas on the other.
"To be credible (Future Made in Australia) must explicitly rule out public funding for coal, gas, carbon capture and storage and nuclear."
The Business Council of Australia warned "firm guardrails" were needed to ensure the policy is successful and taxpayer dollars were not wasted.
"There must be suitable 'off ramps' - the scope to withdraw, or limit, funds based on outcomes being missed or achieved," its submission reads.
"We must not invest in projects that can stand alone from the outset with private investment, or those which will never stand alone without government support."
Ai Group has suggested six key reforms to ensure the manufacturing plan is successful, including a provision for greater immediacy in delivering policy and investment outcomes
The current package lacked a "sufficient degree of policy certainty to achieve its outcome of encouraging private investment", it said.
In its submission, the Australian Council of Trade Unions said the transition to net zero could create up to two million new direct jobs by 2050.
"Considering the scope of economic opportunities of the transition and the motivation behind ambitious industrial policies across peer economies, the ... bill represents the right, proven approach to modern industrial policy that would be foundational in creating the next generation of Australian jobs," the ACTU said.
13°C