In a speech in the critical electoral state of Queensland, the Prime Minister will lay the foundations for a second-term Labor agenda, announcing that his government will create a Future Made in Australia Act to underwrite new investment in clean energy and local manufacturing before the year is out.

A "Future Made in Australia" had been an early domestic manufacturing and innovation mission of the Albanese government supporting the delivery of the Buy Australian Plan and the $15 billion National Reconstruction Fund.

However, stating there is not "unlimited time" and this moment of opportunity will pass, Mr Albanese is to flag a commitment to backing all that is homegrown in a local version of the US Inflation Reduction Act. There will be a greater role for government.

"We recognise that for Australians to share fully in the rewards, government needs to be prepared to use its size and strength and strategic capacity to absorb some of the risk," he is expected to say.

"Only government has the resources to do that, only government can draw together the threads from across the economy and around our nation.

"To anchor this reform and secure this growth, today I announce that this year our government will create the Future Made in Australia Act."

While there is not a lot of detail in the speech to the Queensland Media Club in Brisbane, Mr Albanese is to say it will be a "whole package of new and existing initiatives to boost investment, create jobs and seize the opportunities of a future made in Australia."

"We want to look at everything that will make a positive difference," he is to say in his speech. "Investing in new industries - and ensuring that workers and communities will share in the dividend."

"That means giving the new Net Zero Economy Authority every tool it needs to support resource communities in particular through the coming decades of economic change. Town by town, worker by worker."

Mr Albanese is to say that there is a need to be "clear-eyed" about the economic realities of this decade which are "changing in ways far more profound than the consequences of the pandemic or conflict alone."

He warns that the role of government needs to evolve if Australia is to succeed.

"Government needs to be more strategic, more sophisticated and a more constructive contributor," he is to say.

"We need sharper elbows when it comes to marking out our national interest.

"And we need to be willing to break with old orthodoxies and pull new levers to advance the national interest."

The Prime Minister regards this as not old-fashioned protectionism or isolationism, rather it is the "new competition" as countries investing in their industrial base, their manufacturing capability and their economic sovereignty.

The government has been using foreign investment powers to block foreign companies from taking over local critical mineral operations.

"Nations are drawing an explicit link between economic security and national security," Mr Albanese will say.

"The so-called 'Washington consensus' has fractured - and Washington itself is pursuing a new direction.

"The United States has implemented the Inflation Reduction Act and CHIPS Acts and pursued what they call a 'small yard, high fence' approach to critical industries.

"The European Union has introduced its European Economic Security Strategy. Japan has the Economic Security Promotion Act. The Republic of Korea is re-framing its economic policy around a National Security Strategy. And Canada has brought in new rules to tighten foreign direct investment in their significant critical mineral reserves."

The Albanese government is just shy of two years in power and just weeks out from what is expected to be a defining May budget cast against an ongoing cost-of-living crisis. Labor's primary vote has dropped behind the Coalition in recent political polling but there are few expectations the Prime Minister will rush to the next election due before May 2025.

Mr Albanese has added urgency to action as the last year of this term closes in. He is to say the heavy lifting of economic transition and industrial transformation must be empowered by national governments.

"Securing jobs, attracting investment and building prosperity has never been a polite and gentle process where every nation gets a turn - it's always a contest, a race," he is to say.

"Governed by rules, driven by competition. And Australia can't afford to sit on the sidelines.

"Being in the race does not guarantee our success - but sitting it out guarantees failure."