Pat Conroy (Charlton, Australian Labor Party) Share this | Hansard source

I must put on the record that I was disappointed by the contribution by the member for Riverina. He is better than the last five minutes of narrow ideological cant. I would expect that from a member of, perhaps, the Liberal Party but not a Nat. I do wish him well in his new assistant minister role. I hope he goes well. I do not wish him well in the passage of the Shipping Legislation Amendment Bill 2015, because this legislation represents the annihilation of the Australian shipping industry. It represents the annihilation of the shipping workforce that this country depends upon. Do not take my word for it and do not take the Labor Party's word for it; you only have to read the regulatory impact statement that accompanies this legislation to understand that what we are debating here through the Shipping Legislation Amendment Bill 2015 is the decimation of the shipping industry workforce. The government's own regulatory impact statement, when you look at table 2, admits that 1,000 of the 1,100 workers employed in that industry will be sacked as a result of this bill. Let me repeat that: more than 90 per cent of the workers in that industry will lose their jobs if this bill passes the parliament of this country. That is the truth of this. The truth is that this legislation embodies the annihilation of a very important industry.

Why is this industry important? Australia is obviously an island nation; we have 10 per cent of the world trade moving to and from Australia by sea; we have the world's fifth-largest shipping task; and we have one of the world's longest coastlines, with scenic icons and tourist destinations all around our coast. Australia has a strategic national interest in having a local shipping industry. It is important economically, providing control over both freight reliability and price stability for shippers in all circumstances. It is vital environmentally. It is vital to protect local coastal icons, such as the Great Barrier Reef, or other parts of our environment. Only last month I was on Nobbys Beach in Newcastle—the beach where the Pasha Bulker washed up during the great storms of 2007, when the master of that ship disregarded instructions to move away from the coast. It was a foreign crewed ship that showed complete disregard for our coastal environment. On the point of the Great Barrier Reef: the Great Barrier Reef sees 122 tankers move through it each year; it employs 65,000 Australians in the tourism industry; it has gross value of over $6 billion; and yet we had 122 foreign flagged oil tankers detained in Australia since 2004 for risks to seaworthiness.

This issue of great substance to the environment of this country, it is of great importance to the economic interests of this country, and it also has national security and defence perspectives. Only last month I was at Merchant Navy Day to honour the 435 Australians who lost their lives serving in the Merchant Navy. In fact, on a percentage basis, there were more Australian casualties in the Merchant Navy than in any other service, other than Bomber Command. I honour their sacrifice.

But, because of this bill, their successors in the Australian shipping workforce are now at risk of losing their livelihood. This bill imperils that industry. It imperils a very important service. Labor believes that shipping is an industry in itself and cannot just be seen as a cost to manufacturers or farmers. We believe competition advances the national interest, but it is in the national interests of Australia to have an efficient coastal shipping industry, because it keeps downward pressure on costs. But it is also vital that we regulate to ensure that Australia retains and fosters its domestic maritime capability.

The coastal trading walls put in place by Labor created a level playing field, requiring that Australian wages and conditions be observed and be in place if a ship were to be here for a certain amount of time. What we are seeing now is 'Work Choices on water'—an undercutting of wages and the driving down of costs to Third World proportions. Many ships are flagged in other nations, where taxation, wages and compliance are less vigilant. So all we are talking about here is maintaining Labor's record and regulations, which say that if you are on the Australian coast for a certain amount of time you need to pay Australian wages and conditions, versus what is proposed here, which is undermining that.

We are not extreme in this. We are not the only act in the world saying that you should pay local wages and conditions. All nations in the G20 have more-restrictive coastal shipping policies than us. Free market economies like the US, Japan, Canada, the UK and most nations in Europe have more restrictive coastal shipping laws than Australia. Even the Chinese coastal shipping routes are closed. In the United States, through the mighty Jones Act, not only do you have to pay US wages and conditions but you have to employ US seafarers on ships built in the United States. The Jones Act, in that bastion of a free market economy, guarantees that US built ships have US seafarers being paid US wages and conditions.

That is why Labor is proud of our shipping reforms—shipping reforms that followed four years of extensive consultation following a drastic drop in trading ships under the Howard government. Forget all the furphies from the Deputy Prime Minister about when the loss of Australian coastal trading vessels occurred. It occurred under the Howard government, where the number of vessels fell from 55 to 21. The coalition government was responsible for the dramatic decline in Australian coastal shipping, and Labor committed to reversing that precipitous decline. We led a series of consultations with the industry. We set up an advisory group. We provided a 2010 election commitment to revitalise our shipping industry. We released a discussion paper on it. We established reference groups with industry to work through these issues. Members of those reference groups were across the breadth of the maritime industry: ports, the blue water and offshore sectors, the cruise industry, regulators, unions and trading providers. We even engaged across government with Treasurer and Finance officials, the dreaded central agencies. We managed to get agreement on what was a very constructive package that, if given a chance to work, if moved away from the argy-bargy of political partisanship, can revitalise the shipping industry in this country. That led to legislation in 2012.

There were four key elements to that package: tax reform, to encourage investment in new and more efficient ships that would enhance the industry's productivity, including a zero tax rate and seafarer tax exemption; an Australian international shipping register, to help grow our international fleet; a new licensing regime, to provide clarity and transparency, which would enable long-term planning and set clear boundaries around the necessary role of foreign vessels in our coastal trade; and, the establishment of a maritime workforce development forum to progress training and help us to build a highly-skilled maritime workforce.

Progress under the package has been limited, I must confess, but this can clearly be attributed to the huge uncertainty created by the clear signals the current government has sent from the day the legislation was enacted that they would tear the package up. That uncertainty has led to huge consternation in the local shipping industry. This issue is underscored by the fact that through the Senate estimates process we heard recent revelations that the Department of Transport and Regional Services advised Australian operators to flag their vessels overseas and sack the Australian crews and replace them with crews on Third World wages. This has been confirmed time and time again by shipping industry operators. When they explain the impact of this bill on their business, the department has told them that they need to sack their workforce.

Yet the coastal act had a chance to work and can work. ANL has stated that since the coastal act was enacted their cargo volumes increased by 25 per cent. Rates have fallen by eight per cent on those routes, and sea freight remains half that of rail freight. Let me repeat that. Under Labor's coastal act, ANL has said that their cargo volumes increased by a quarter; the rates they charged Australian producers fell by eight per cent; and sea freight remained half as expensive as rail.

So, while we fully oppose the bill we are debating in this parliament, improvements can be made and we are open to that discussion. But this bill is not part of that productive discussion. This bill to deregulate coastal trade will cost jobs and will work against our national interest.

If you look at the regulatory impact statement on the coalition's bill, which sets out the saving associated with the bill, 88 per cent of the savings from this package come from sacking that 1,000 workers. Official modelling provided with the bill nominates where the jobs will be lost, but fails to nominate where a single job will be created. The costs for the bill do not include the cost of the jobs that will be lost. It does not calculate the jobs lost in land transport modes, despite noting that freight will shift to ships. The analysis of the risk has found that over 1,000 jobs will be lost. We need to put this in context to other modelling that was released when Labor's coastal act was put in place in 2012. A report by Deloittes that was commissioned by those opposed to Labor's coastal act—industries arguing for cost reductions in coastal shipping; typically, the cement industry was one example—found, with some very skewed assumptions, that Labor's coastal act would cost 200 jobs. Let me repeat that: 200 jobs were supposedly at stake if Labor's laws were put in place, versus the government's own modelling, which admits that over 1,000 jobs will be lost if they are repealed. Even if we take the generous and skewed assumptions of those supporting the coalition, this bill will create, at most, only 200 jobs, versus the 1,000 jobs that we know will definitely be lost by this policy—five times the number of jobs lost because of this retrograde legislation.

We need to look at the principles that drive this legislation. If we are saying that, to keep our coastal shipping industry competitive, we should not have Australian wages and conditions, what next? Does it mean that we cannot pay Australian wages to the truck driver who takes the cargo from the production facility or the farm to the port? It is exactly the same logic to say that we must cut the wages of the truck driver or that the truck should be registered not in Australia but in the Philippines. Taken to its next logical extension, the argument is that that factory should not employ Australians on Australian wages; they should be paid the lowest possible wages of competitor nations such as China, India, the Philippines, Thailand or South Africa—wherever their competitors are. That is the logic undermining this bill. It is a logic that is flawed, it is a logic of a race to the bottom and it is a logic that I am confident the Australian people will reject. They will reject it and say that Australia can do better. We can have a competitive industry paying Australian wages and conditions. We can have an Australian industry that provides support to farmers and to manufacturers but creates well-paying jobs for our Australian workers.

I note the previous speaker to this debate talked about addressing a conference of Australian pilots. That is a very important industry and very important to my home port of Newcastle, where we have lots of tugboats and pilots bringing people in and out of the coastal area. Their own RIS says that, at most, there will be 88 positions available in the Australian shipping industry for seafarers to be trained up to give them the skills that eventually lead them to becoming pilots. Even the industry operators—not unions but employers—question whether those 88 jobs will exist. My simple question for the government is: if you argue that pilots and other seafarers are very important for the future of this country, the future security of the nation and the future environmental integrity of our ports and our coasts, where are the jobs they will be trained through? Where are the jobs that will allow them to be trained up to get the skills to be the experienced next generation of pilots we need? That is what this bill is about. This bill is about undermining those training opportunities, undermining an industry that is important to our national interest and undermining the environmental integrity of our nation.

Let me repeat that, since 2004, 122 foreign flagged oil tankers have had their licences suspended, have been fined and have been found to be lacking in the appropriate safeguards to navigate our Australian coastline, imperilling the 65,000 direct tourism jobs in the Great Barrier Reef, imperilling the $6 billion gross value that the Great Barrier Reef adds to our economy and imperilling areas such as mine, around the beautiful beaches of the Newcastle region. This is all at stake with this legislation, and it is a huge pity. I went to a shipping industry summit attended by employers, the union and users such as the cement industry. All have a tremendous spirit of cooperation. They all want to improve the industry, recognising that there are challenges—but instead we see a race to the bottom, a race where this government's only solution is to cut wages, because that is what it is. Their solution is to cut wages, sack Australian workers and replace them with people who are paid a lot less and are subject to huge bullying. We saw the unfortunate murders that occurred on a ship entering Newcastle a while back. This is what is at stake with this legislation, and that is why I stand with the rest of the Labor Party in saying: we will not support this legislation. We will not support anything that destroys 1,000 jobs and undermines Australian wages and conditions. I proudly condemn this bill. (Time expired)

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