Andrew Leigh (Fraser, Australian Labor Party, Shadow Assistant Treasurer) Share this | Link to this | Hansard source

Foreign investment over the last two centuries has been important to the economic growth of Australia. In the 19th century foreign investment helped to build Australia's wool industry. In 1855 CSR's investment helped to shape our sugar industry. In 1877 we saw Schweppes, the United States firm, set up in Australia. In the 1920s we saw Kraft and Kellogg investing in Australia. Kraft would shortly afterwards buy Vegemite in 1935 and, as David Uren points out in his terrific book Takeover: Foreign Investment and the Australian Psyche, without foreign investment it is plausible that Vegemite would not have attained the success that it ultimately did under Kraft. Foreign investment in our beef industry from Britain, the United States and Japan has been vital to developing that industry. Investors like the controversial Vestey family, International Ranchers and King Ranch from Texas were important in building Australian beef. Kodak set up here in 1908, Coca-Cola and Heinz in the 1930s. And one can never discuss foreign investment without recognising the role of foreign investment in our automotive sector. Over the course of the 20th century, cars were built in Australia by a range of foreign automotive firms including General Motors, Ford, Chrysler, Leyland, Toyota and Nissan. The withdrawal of that foreign investment, goaded in part by the Treasurer's calling on Holden to speak out or pack up, has been damaging to Australia. The removal of foreign investment has been damaging, just as the addition of foreign investment has been beneficial.

After World War II we saw a strong inflow of foreign investment into the manufacturing sector, particularly from the United States, with many United States officials in that period noting the benefit of the Australian business climate as encouragement to them to invest. It is ironic, I sometimes find, when you see News Limited tabloids running headlines such as 'It is time to save our farms from foreign investors' because, of course, News Limited is itself a foreign owned firm. Certainly some have argued that the Australian media sector has been one of those which have benefited from foreign investment. Without foreign investment in media there would be fewer journalists employed in Australia.

Australia overall has on one estimate one in eight of all workers employed by a foreign owned firm. We have foreign investment in part because almost all of the past 2¼ centuries has seen us with a current account deficit. While there have been an occasional year or two, as David Uren points out, where we have had a current account surplus, over that period there has not been a decade of current account surpluses. Australians save, and our savings rate has gone up over the past decade. But we are a capital hungry nation. There are many investment opportunities here in Australia and that makes us an attractive destination for foreign investors.

Foreign investment is of a piece with the internationalisation of other parts of the Australian economy. We are a nation where a quarter of us were born overseas and another quarter have at least one parent born overseas. They include my three children because my wife was born overseas. A fifth of the Australian GDP is made up of exports, and imports are a similar quantum. Naturally, Australians are outward foreign investors as well. Our outbound foreign investment has been about two-thirds the size of inbound foreign investment, going to destinations such as New Zealand, Papua New Guinea and Singapore. Overall, in agriculture, around one per cent of agribusinesses, according to the Australian Bureau of Statistics, have foreign or some portion of foreign ownership, and about 11 per cent of all Australian land is partly or wholly foreign owned.

Foreign investment in Australia has been hotly debated over the decades. David Uren quotes 'Black Jack' John McEwen saying:

We want US businesses here with all its magnificent skills of management at all levels but we don't want to be taken over. We will not be taken over.

He also then argued:

It is not good enough for this country to live by selling a bit of its heritage every year. We do not want to see Australia have its industries unduly owned in foreign hands.

McEwen continued to advocate against increasing foreign investment through the 1950s and 1960s. John Gorton, travelling in Britain, argued in 1969:

It has seemed to me that the posture of Australia in seeking overseas capital has been the posture of a puppy lying on its back with all legs in the air and its stomach expose saying, 'Please, please, please give us capital.' Tickle my tummy—on any conditions.

Critics of foreign investment like McEwen and Gorton have their heirs in the parliament today. The member for New England, Barnaby Joyce, and Senator Heffernan follow in that tradition of scepticism of foreign investment that runs strong within the Liberal and National parties of Australia. On this side of the House we have indeed had members who have doubted the benefits of foreign investment, but we do look to those such as Paul Keating, who once said:

I took the view that not only was it imperative that we leave the country open to funding the current account by more than simply portfolio investment but by direct investment as well. Therefore, we had to take a more liberal attitude to foreign ownership of various sectors of the economy. It was for these reasons that I liberalised foreign investment. My general philosophic view of overturning the whole Deakonite legacy, which was my job to do, including tariffs, central wage fixing and the rest, a part of that was dealing with a phobia about foreign investment and more than a phobia a direct retardant to economic growth.

Senator Wong has also spoken firmly in favour of foreign investment. As David Uren notes:

Labor has staked an even more liberal position than that espoused by the Liberals.

Indeed, that difference was highlighted when Archer Daniel Midlands made their bid for GrainCorp, a bid which those of us on this side of the House said, from what public information was available, we were broadly supportive of but which was ultimately blocked by Treasurer Hockey—the first major United States foreign investment bid to have been blocked.

David Uren goes to the history of the Foreign Investment Review Board. The Foreign Investment Review Board flowed out of the Chiko Roll. In 1972, US conglomerate ITT made a bid for frozen foods, and that led the McMahon cabinet to debate the question of whether there ought to be checks on foreign investment. Ultimately from that flowed the Foreign Investment Review Board. The Foreign Investment Review Board has counterparts in other advanced countries, but according to an OECD study by Takeshi Koyama and Stephen Golub, who categorise OECD countries by the degree of restrictiveness on foreign investment, where zero is unrestricted and one is completely restricted, Australia sits at 0.28—higher or more restrictive than the OECD average of 0.15. It means our foreign investment regime is more restrictive than that of Britain, Canada, New Zealand and the United States.

The Foreign Acquisitions and Takeovers Legislation Amendment Bill 2015 makes substantial changes, introducing civil penalties and additional and stricter criminal penalties to ensure that foreign investors and intermediaries do not profit from breaking the rules. It enables the transfer to the Australian Taxation Office of responsibility for regulating foreign investment in residential real estate and it enables the lowering of screening thresholds for investments in Australian agriculture. While Labor do not have a concern with the first two of those—the civil penalties and the transfer of residential real estate to the ATO—we are concerned about the lowering of screening thresholds for investments in Australian agriculture. That is a red-tape burden and sends a troubling signal to our overseas partners.

We can see that if we simply go through the countries that accounted for Australia's foreign investment inflows in 2013-14. At the top of that list is China, with $28 billion of inbound investment in Australia. Chinese investment would be subject, under the preferred approach of this government, to a $55 million screening threshold for agricultural land. Then we have the United States, responsible in that year for $17 billion of inbound investment, which will now be subject to a $1 billion threshold. Moving down the list, the seventh largest investor is Japan, with $6 billion of inbound investment, subject to a $55 million threshold, as is our 16th largest investor, South Korea, accounting for $2 billion of investment, with a $55 million threshold. Then there is New Zealand, our 18th largest inbound investor, with only $1.6 billion of investment and a $1 billion threshold, and Chile, which is not one of our top 18 investors, with a $1 billion threshold. So the approach of $55 million for some countries and $1 billion for other countries is not consistent with the neutral approach that Australian policy settings ought to be taking, whether they be in immigration or trade or investment.

We are not the only ones to be concerned about the degree of red tape. As Senator Wong has pointed out, the exposure draft and regulations account for more than 170 pages and are accompanied by a 105-page explanatory guide. It has been noted by the one of the Minister for Trade's own investment specialists:

… the new fees have fuelled the narrative around Australia being a high-cost destination to invest in.

The Office of Best Practice Regulation has revealed that the new red-tape burden that is being imposed by the government has been imposed without proper assessment of the increased regulatory burden.

Under the government's proposals, we have 22 different screening thresholds and categories, which vary depending on the value and type of investment and the nationality of the investor, and 33 different levels and categories of application fees, ranging from $5,000 to $100,000. The increase in fees is significant, and Labor will be guided by the response of the relevant Senate committee to these significantly increased fees. They will make Australia a less attractive investment destination. It is hard to see how raising the fees on foreign investments can do otherwise.

A final portion of the bill has a register of foreign ownership of agricultural land. The aim of that is to provide greater transparency around foreign ownership of agricultural land, and Labor support that part of this package. But we need to ensure that this is not being suggested as the sole solution to housing affordability. It worries me that the current Treasurer has made much of forcing the sale of a Point Piper mansion and that, somehow, that might improve housing affordability in Smithfield and Greystanes. If temporary migrants and non-residents are not following the rules, of course those laws should be enforced. But let us not pretend that forcing the sale of a mansion is somehow going to make it easier for struggling families to buy their first home. We need an overall package on housing affordability to deal with what is a significant challenge in Australian policymaking. The government needs to have that strategy rather than suggesting that forced sales of mansions will somehow do the job.

We also need to be a nation which is welcoming foreign investments, and that is why I took some time at the outset of my comments, drawing significantly on David Uren's new book, to talk about the history of foreign investment in Australia and to make the point that without foreign investment in Australia there would be fewer jobs and those that exist would not pay as well as they currently do. The National Farmers' Federation has estimated that for Australian agriculture to reach the capacity needed to meet rising demand, it will require investment of between $1.2 trillion and $1.5 trillion over the next 35 years. That investment will be harder to attract if we make the system more complex and raise the application fees.

It is no great surprise that this bill has been criticised by a number of parties. The Business Council of Australia, the National Farmers' Federation, the Food and Grocery Council, the Queensland Farmers Federation and the Chamber of Commerce and Industry of Western Australian have all raised concerns about the impact of this bill on creating jobs and economic growth in Australia. The government might sloganeer about being 'open for business' but, in reality, we have a government which is making foreign investment more difficult. There are not many coalition policies that you would imagine would attract criticism from the BCA, the NFF, the AFGC, the QFF and the CCIWA, but this policy has done that. That is a concern to those of us on this side of the House who are keen to see a strong relationship with business, a constructive relationship which boosts growth in Australia.

The application of the new rules has led to some bizarre outcomes. One of Australia's largest agribusinesses has been forced to make multiple applications for approval to purchase small parcels of land. In one case, a transaction valued at just $6,000 required a separate application. Every square metre acquired was, they said, 'a big complication'.

We need a government that engages in debate with the Australian public about foreign investment. It is a complicated debate. It is one which requires engagement and careful explanation because it has, over Australia's history, been too easy to engage in fearmongering about foreign investment. Given the benefits that have flowed in the past and the benefits that can flow in the future, we need a foreign investment regime that not only has a strong Foreign Investment Review Board carefully doing its job but has politicians who advocate for foreign investment that is carefully scrutinised under our current system.

John Cobb (Calare, National Party) Share this | Link to this | Hansard source

I listened to what the opposition spokesperson had to say about the Foreign Acquisitions and Takeovers Legislation Amendment Bill 2015, which we are debating together with the Foreign Acquisitions and Takeovers Fees Imposition Bill 2015 and the Register of Foreign Ownership of Agricultural Land Bill 2015. I make this comment: nobody is more supportive of foreign investment than we are or I am. We just want to make sure we know where it is, who is doing it and that it is in Australia's interest.

Whatever may have been the case in the past, we are dealing with the present and the future. I think the free trade bills we have already put through, plus the one Labor are currently trying to destroy for reasons best known to themselves, put the lie, if I may put it that way, to a lot of what he said. We are of course very much committed to working at a global level with countries like China. We are encouraging them to invest and to create work and jobs in Australia.

This legislation ensures a welcoming environment for foreign investment but includes safeguards to enable us to detect investment that is contrary to our national interest. It will provide a transparent process and ensure more scrutiny of foreign ownership. The reforms include a more simplified, modern framework better targeted at meeting community expectations.    It will introduce stricter penalties for foreign investors breaking the rules—and every country is different in this regard. The bill ensures Australian taxpayers will no longer fund the cost of the administration system for foreign investors—and that administration is no light task, no light task at all. This package will see a system that is open for foreign investment that will strengthen our nation's economy while ensuring we make strategic decisions for our country's future.

The Foreign Acquisitions and Takeovers Legislation Amendment Bill 2015 marks the biggest overhaul of the legislation in four decades. It will bring about stricter criminal and civil penalties to ensure investors and intermediaries do not profit from breaking the rules. Existing criminal penalties will be increased from $90,000 to $135,000 for individuals. Divestment orders will also be supplemented by civil pecuniary penalties and infringement notices for less serious breaches of residential estate rules. The Australian Taxation Office will take over the responsibility for regulating foreign investment in residential real estate. Third parties who assist foreign investors in breaking the rules will also now be subject to penalties. There will be stronger enforcement and auditing of existing rules to ensure better compliance.    It is important those breaking the rules face ramifications and this bill will ensure a better system is in place to detect breaches.

The bill will also enable the lowering of screening thresholds for investments in Australian agriculture to ensure significant investments in this sector are overseen. Note that I said 'screening thresholds'—not 'stopping'. This is not about stopping investment; it is about knowing who is doing it.

Joel Fitzgibbon (Hunter, Australian Labor Party, Shadow Minister for Agriculture) Share this | Link to this | Hansard source

You are hedging your bets now!

John Cobb (Calare, National Party) Share this | Link to this | Hansard source

It is good to see the member for Hunter in the House. It is good to see him here learning about foreign investment and worrying about agriculture.

From 1 March, the screening threshold was lowered from $252 million dollars—which clearly, in the case of agriculture, was something of a joke; a few years ago we thought there was probably only one property in the whole of Australia that would have come under that screening process—to a cumulative $15 million. Once again, it is not about stopping investment; it is simply so we know what is happening. As well, from 1 December 2015 a $55 million threshold, based on the value of the investment, will be introduced for direct investments in Australian agribusiness.

The Foreign Acquisition and Takeovers Fees Imposition Bill will introduce fees on foreign investment. Quite frankly, the administration of Australia's foreign investment framework is an expensive business, so this measure does make sense—that administration costs quite a lot of money. Those who are making the application will now have to pay the cost of the administration. That is estimated to represent about $735 million over the forward estimates. It will mean that foreign investors will not have to wait so long—because there will be more resources in the ATO to deal with their issues. To ensure a fair transition, there will be an amnesty period to allow foreign investors to check their compliance so that, if they are in breach, they can avoid penalties. Already the government has required the mandatory divestment of six illegally held properties under this program.

Quite clearly we should know who owns our agricultural land—and the Register of Foreign Ownership of Agricultural Land Bill will enable us to do that. It is an accident of process that, to the best of my knowledge, there is only one state in Australia—and it is your state, Deputy Speaker Vasta—that has a register of foreign ownership. Every other state in Australia, as far as I am aware, simply records the name of the entity rather than whether there is all or part foreign investment involved in it.

A lot of thought went into how to do a register. Initially, the thought was that we would get the states to register, but that does not actually deal with those properties that have already been purchased, wholly or in part, and whether it is a full or partial investment. Obviously it has to be retrospective or we would not know what is already held. It will be run by the Australian Tax Office, the ATO. Foreign investors will be required to give all essential information on their existing holdings and subsequent acquisitions of Australian agriculture land. From July, the ATO started collecting information on all new foreign investments in agriculture for the purpose of the register. That information will obviously include name, contact details of both parties, location and the size of the property. It will be on the legal owners, the foreign entity, to register the correct information about their holdings with the ATO, including the country of origin, their ABN or their Australian company number.

I think it is a common-sense thing for us to know who owns what in our country. This is not to stop them doing so but to ensure that we know. It is quite amazing to note the differences around the world. In America, as far as I can see, each state controls foreign investment and some have carte blanche and some have none. That is within one country. Obviously, we are going to be a little more organised than that, but that is the way they do it. It is not about stopping foreign investment; rather, it is about implementing a more transparent application process. For those who trigger the screening process, it will be on a case-by-case basis. We expect the register to begin making aggregated information on foreign ownership and agricultural land available in the first half of next year, 2016.

As far as foreign investment goes, I am very much in favour of it. Australia needs it. Unfortunately, Australians seem to have something of a problem when it comes to investing in agriculture. Of course, I am not talking about farmers, who obviously invest. But Australian companies seem to have a bit of an issue with investing in their own country agriculturally. We get far more interest from trust funds overseas, particularly in the USA. It is about us talking our country up rather than down, and we, as farmers, do play a role in this. We are very prone to crying wolf sometimes when we should be praising ourselves about how good we are at it and how sought after our own products are around the world—for very good reasons. I am sure the opposition spokesman for agriculture would agree with me on that.

We have a long history as far as foreign investment. Government policies have changed over the years. When I was a young person, more of Australia—in acres—was probably owned by foreigners than is the case today. I am not talking about the value of land but the area of land, particularly in the north. I am sure more of it was owned by non-Australians than Australians. At that time, we were probably talking about English companies—who, in those days, we probably did not even think of as being foreign. So things do change—and they do change a lot. I am in favour of foreign investment. I think that most of us realise the necessity for it, but I think we also realise the necessity to know who is investing and where they are.

I would say to those who are nervous about foreign investment in land that you cannot take land and water with you. As far as the product goes, if Australia is in danger of not having a particular product, at the end of the day, the states control the buying and selling of land but only the Commonwealth can give an export permit for it to leave our country. I am not suggesting that we are about to use those powers but, at the end of the day, we do have the ability to ensure that a commodity does not leave Australia. I welcome foreign investment, but I also welcome the ability for our country to know who it is that is investing, where they are and if it is suitable.

Joel Fitzgibbon (Hunter, Australian Labor Party, Shadow Minister for Agriculture) Share this | Link to this | Hansard source

You can hear the member for Calare moderating his language. Out there in the electorate, the Minister for Agriculture, the member for Calare and their partners in the Nationals are saying, 'We can't have these Chinese investing in our farmland'—and the dog whistle is alive and well. But, when the member for Calare got to his feet in here, he could not say often enough, in very moderate tones, 'Mr Deputy Speaker, this is not about discouraging investment in our farmland; this is just about making sure people know what is going on.' If only that were true.

We know what this is about. This is about introducing into this country for the first time in our history a discriminatory foreign investment regime. From the day this bill passes the parliament, if you are a citizen of the United States, a citizen of Chile or a citizen of New Zealand and you want to invest in Australian agriculture, you will face a billion-dollar screening threshold. If you are a citizen of just about any other country, in particular of Asia, which is what the agriculture minister has in mind in particular, you will face a screening threshold of just $15 million for farmland and $55 million if you are classified as a stage 1 agribusiness processor or higher.

So let's not one have conversation outside of this place and another conversation inside this place. Members like the member for Calare need to be consistent and present their case for what it is, and that is a dog whistle to those who have unfounded fears about, first, the level of Asian investment in Australian agriculture and, second, how that might impact on Australian agriculture.

So that is just one thing this bill does. It also makes other changes to the Foreign Acquisitions and Takeovers Act 1975, including the introduction of civil penalties and additional and stricter criminal penalties to ensure foreign investors and intermediaries do not profit from breaking the rules. The bill also enables the transfer to the Australian Taxation Office of responsibility for regulating foreign investment in residential real estate, which will further enable stronger enforcement and better compliance with the existing rules. It also enables the lowering of the screening thresholds, as I have suggested.

Surprisingly, I want to go back and concentrate on the agriculture and agribusiness components, but I do want to say that the opposition, while not opposing the measures here, does not accept that the issue of Sydney property prices will be comprehensively addressed by these changes. Peak housing bodies such as the Property Council of Australia have expressed concern that, indeed, the bill may serve to undermine rather than promote housing affordability in our capital cities.

But again I want to return to what, for me, is the most important aspect of the bill, and that is the impact on Australian agriculture. It is well known that if we are to fully capitalise on the so-called dining boom—in other words, if we are to fully take the opportunity provided by global food demand and, in particular, growing demand for high-quality food amongst the growing middle classes of Asia—we will need substantial levels of investment in this country.

Let's just take stock of what is happening in agriculture, because it is a very interesting point. We all talk very optimistically about the future in agriculture, as we should, but it is fair to say that the challenges in agriculture are just as significant as the opportunities. For example, productivity in Australian agriculture has at best plateaued. More likely it is in decline, but at best it has plateaued. Government investment in research and development has shrunk in real terms. The rate of adoption and extension of that innovation is poor. Our share of global market trade is actually in decline, not on the rise. Our workforce is ageing. Our weather patterns are working against us. Our limited natural resources are more likely shrinking than growing. The allocation of those resources is in many cases inefficient. We remain too dependent on commodity markets where we are typically price takers, subject to the vagaries of global markets. And, very importantly, we are underdone in infrastructure terms, both on farm and off farm—off farm in particular, in just about every area: road, rail, ports and, indeed telecommunications.

So one of the key messages for Australian agriculture—or, more particularly, for governments which might seek to guide the future of Australian agriculture—in addition to productivity more generally, including the more efficient allocation of natural resources and the sustainable use of those resources, is how we attract the significant amounts of investment we will require to fully capitalise on those opportunities.

I welcome the Minister for Agriculture here. It is good to see he is speaking in another debate on the second reading of a bill. It is becoming a regular practice, although he was not prepared to do so on the Environment Protection and Biodiversity Conservation Amendment (Standing) Bill 2015 last week—but I will return to that.

But how do we attract this investment, and how much will we need? I have cited the Greener pastures report here before, and I give credit to the member for Hume, who was, I think, one of the primary authors of the report. Amongst other things, it suggested that out to 2050 we would need $600 billion—that is with a b—worth of investment in agriculture if we are to fully realise our dreams. It is axiomatic that, as an island continent with a population of 23 million or 24 million people, we just do not have the domestic savings to meet that hunger for investment. On that basis, as has always been the case, as a country we will remain heavily reliant on the savings of others for that investment. There is a lot of talk about our domestic superannuation funds, and like everyone in this place I would like to see more of our domestic savings through our superannuation funds going into Australian agriculture, but even if we took all of it it would not be enough. So we need this investment desperately.

So the question becomes: does this bill enhance our prospects on that front or make it more difficult? It is fair to say that this bill sends all the wrong signals. Competition for capital around the world is intense, and those looking to secure returns in agriculture as an opportunity to exploit growing demand around the world have many choices. They can invest in places like New Zealand or South America, or they can come here to Australia. Of course they will look at where the returns are, but they will also look for the path of least resistance. All this bill will do is create a huge logjam at the Foreign Investment Review Board, which will be dealing with hundreds and hundreds and hundreds of applications which, in the scheme of things, are an 11th-order issue and are unlikely to derive an adverse report of any description from the FIRB. This bill will send away foreign investment in this country. It is also a gouge. It dramatically increases application fees, putting money into the coffers of this government but at the same time acting as a further disincentive to that investment.

I return to what I said in the beginning: this is just a dog whistle. This is a message to rural Australia, feeding off those concerns people have—legitimate concerns, mainly due to misinformation about the level of Asian investment in Australian farmland. We recognised this concern in government, and we were the first to suggest that we should have a foreign investment register in this country. We left office before we had the opportunity to implement that. The now government said it would do the same. It has taken two years for it to do so, and we are told that we still will not have a register until about January next year as I understand it. That will be well on track to three years that it has taken this government to do the most important thing, and that is to build transparency into the equation so people, with the click of a mouse, can quickly see who is investing in what where and how much they are paying. That is what we need. We need, as leaders in this place, not to be fuelling the misunderstandings in the regions and the unnecessary concerns, but to be showing leadership and demonstrating to people—showing people and helping people to fully comprehend—that foreign investment in our agriculture sector is unequivocally a good thing. We simply cannot get enough of it.

I have mainly spoken about agriculture; I should say something about agribusiness. We do have a future in food manufacturing in this country. We must have a future in food manufacturing in this country. We have a very solid food manufacturing sector in this country, when you think of meat processing and dairy, for example, as key manufacturers—and they are, and they have a very bright future. The range of the endeavours in the future will be almost limitless, if we are smart.

We do need to make sure that we do not put unnecessary red tape in the way of those investors. And this bill does that for agribusiness. It goes to the first-stage manufacturers. That means someone who is producing a jam, for example, gets caught up on this.

If we want to expand food manufacturing we need investment, and this is the wrong way to go about it. Dare I say, country-of-origin labelling is a bit the same. Asking people to implement this thing—after this government procrastinated for so long—within six to 12 month periods will cause unnecessary red tape and compliance issues and cost; that is something that this government said it was going to do just the opposite of.

The opposition does not oppose these measures. We will send them to a Senate committee, though. We will have these discriminatory thresholds scrutinised for the likely adverse impacts on Australian agriculture and Australian agribusiness.

It has been a tumultuous week in Canberra, with the execution of a first term Prime Minister. That is obviously going to cause disruption right across the government. The minister at the table, Minister Joyce, made it clear in the lead-up to the change that he thought that the bloke from Point Piper was likely to produce bad results for rural and regional Australia. I share those concerns about the extent to which the new Prime Minister understands the needs and aspirations and challenges of rural and regional Australia. But it is very clear that in particular the Minister for Agriculture has very grave concerns about the leadership change and what it may mean for rural and regional Australia. To his credit, and typically, he made those concerns very well-known in a very, very public way. The problem now is that he has gone very quiet. He now claims that he has an agreement. He has an agreement with the new Prime Minister that is going to do wonderful things—it is as if he has extracted all of these concessions from the new Prime Minister that are going to change the face of rural and regional Australia. The only problem with that is that he has given us no details. He has given us no details of these concessions that he has extracted—with great pain to the Prime Minister—from the new Prime Minister. The details are very vague, at best, in this new red-hot deal that he has for rural and regional Australia. We are told that the Prime Minister has promised that it will take the effects-test back to cabinet. But there is no promise that it will have an effect, and of course that is causing an enormous rift, not only between the National and Liberal parties, but of course for those within the National Party; there seem to be a few different views.

Russell Broadbent (McMillan, Liberal Party) Share this | Link to this | Hansard source

There is no rift between Mr Joyce and me, Member for Hunter.

Joel Fitzgibbon (Hunter, Australian Labor Party, Shadow Minister for Agriculture) Share this | Link to this | Hansard source

I beg your pardon?

Russell Broadbent (McMillan, Liberal Party) Share this | Link to this | Hansard source

There is no rift between Mr Joyce and me.

Joel Fitzgibbon (Hunter, Australian Labor Party, Shadow Minister for Agriculture) Share this | Link to this | Hansard source

Oh, I absolutely accept that and respect that, Mr Deputy Speaker. But the minister at the table can fix this today if, when he rises to his feet, he simply tables the coalition agreement. What is the big secret, Minister? Surely the Australian people, particularly those living in rural and regional Australia, are entitled to know the basis on which you have now rolled over, to exclaim that you think the election of Malcolm Turnbull—the boy from Point Piper—is a good thing for rural and regional Australia. It is very simple, Minister: just get to your feet—

Mr Joyce interjecting—

when I sit down in nine seconds time, table the coalition agreement, and show us, in writing, what these concessions are that you extracted from the Prime Minister, because I think they are nil. (Time expired)

Barnaby Joyce (New England, National Party, Minister for Agriculture) Share this | Link to this | Hansard source

It is great to be able to rise to my feet to show yet another issue that the National Party has been in pursuit of being delivered, which is the change to the Foreign Investment Review Board guidelines. So often, I rise to my feet to say: 'The issue with the Labor Party is that they just don't have any policies. The only thing they can ever do is comment on our policies—our agricultural policies—because they just do not have any.' But today that is not the case, because we do have a difference in policy. We believe that the Australian people have a right to review when an individual from overseas buys a property worth $15 million or more. That is our view. We believe that people have a right to know, because it is their nation.

Mr Fitzgibbon interjecting—

Mr Clare interjecting—

And the Labor Party have a position too—and to the people of Canning: I hope you hear this. The Labor Party believe that you do not have the right to know until a purchase goes over $1,000 million. In Canning, a person from overseas can buy the north of the electorate on Monday, the south of the electorate on Tuesday, the west of the electorate on Wednesday and the east of the electorate on the next day, and it never has to go the Foreign Investment Review Board. It never has to go there. Well, this is the difference, and this is a sign that the Labor Party, when it comes to agricultural land in this nation, has just completely and utterly lost the plot and is obviously not talking to the people on the land. They want to know. They have a right to know. It is, after all, their country.

Even today, we had the shadow minister at the dispatch box talking about concerns with Asian investment. It is not the Asian investment review board; it is the Foreign Investment Review Board. He is deliberately, once again, stoking the fires that he has started—fires that he can see in The Weekly Times, today, where they are saying, 'Save the FTA.'

Who does not want to have a free trade agreement? Who has been ambiguous at best about a free trade agreement with China—our biggest agricultural trading partner? It is the Labor Party. The Labor Party is standing in the way of our negotiations with our biggest trading partner. And it is not just the tariffs that will be removed if we get this through, it is also the sentiment—and that is just as powerful. I thought that someone from the Labor Right would have the capacity to stand up in their caucus and take on those former grandchildren of the BLF and make sure that this free trade agreement goes through. But, of course, you will not do that because you do not have the ticker to take them on.

So here we are, we are supporting this—I am proud to say that it is a policy that the National Party has been pursuing, and it is great to see it delivered—and making sure that the Australian people will have the right to review land purchased that is valued at more than $15 million—not banned, reviewed. It can be paid for if there are lots of people—you are saying lots and lots of people coming to buy land. I am not surprised; it is a great asset. That is why ABARES today has told us that gross agricultural output will go up by eight per cent—remarkable! What a marvellous government; what a great outcome. Somebody must be doing something right. And of course it is.

Let me go through some of the pertinent details of this. When you say the United States, you are dead right: in some states of the United States foreigners are not allowed to buy land at all. They are just not allowed. If I go to China, I cannot buy land at all. I am not allowed. Not even their own people are allowed. If you go to Japan, you cannot buy it; Korea, you cannot buy it; Indonesia, it is highly restricted. Even New Zealand is vastly more restricted than Australia. Australia remains the most liberal country on earth, and the Australian people have a right to know what is happening in their country. We are going to give them that right. And the people who are standing in the way of that right, the people who want to change it so that you do not know, who want to keep it hidden from you, are the Australian Labor Party. Isn't that bizarre? They have one position where they want to block the Chinese free trade agreement—and we know exactly why they are doing it; it is just dog whistle politics—and yet they have another position on this: when we say that Australian people have a right to know, they do not believe in that. Do not tell the Australian people; do not let them know.

This bill comes in three parts. The first one is the reduction in thresholds, and one part of that is agribusiness. Agribusiness, by its own function, has the capacity to dominate large sections of an agricultural precinct. If you control a sugar mill you, naturally enough, control all of the sugar farms around it because they do not have the capacity to just pick up their product and take it somewhere else; it is vitally important. If you control an abattoir in a certain area, you might control a certain line of cattle that certain people produce, and that can have major effects. If you control certain strategic assets in certain areas—dairy production facilities—inherently, ipso facto, you have control over the farms. We have seen this. Certainly the best example is in railway lines. Once people have control of a railway line, they just keep on putting up the prices to take the margin from all of the people who have to move their produce by rail. We do not want that; it is not good for our economy. We want to make sure that we have a strong economy, and we want to make absolutely certain that the Australian people know what is going on.

We have already started the passage of this: as of 1 July, the Australian Taxation Office will start delivering the information so that Australian people can basically see who owns what. That will either dispel people's concerns, or maybe, in some instances, it could confirm people's concerns. One of the most sacred duties we have is the proper oversight—

Joel Fitzgibbon (Hunter, Australian Labor Party, Shadow Minister for Agriculture) Share this | Link to this | Hansard source

Show some leadership!

Barnaby Joyce (New England, National Party, Minister for Agriculture) Share this | Link to this | Hansard source

and control of the land we stand on. I think that is a sacred responsibility. It is a responsibility that is conveyed to us up and down the countryside.

Mr Fitzgibbon interjecting—

There is a concern, that we have taken on board through this process, that we make sure there is better transparency. One of the inceptions of this process was the Cubbie Station issue. This was then brought forward as an issue to try to make sure that those concerns that were evident in the past are dealt with—that is what you do in government, you try to deal with concerns.

Joel Fitzgibbon (Hunter, Australian Labor Party, Shadow Minister for Agriculture) Share this | Link to this | Hansard source

How's Cubbie going?

Barnaby Joyce (New England, National Party, Minister for Agriculture) Share this | Link to this | Hansard source

But I am still waiting for a policy from the Australian Labor Party on agriculture. They say it is so important, but we have never had any policy from them. They can comment on our policies because we have them, we have the white paper—

Mr Fitzgibbon interjecting—

The white paper is out there. We are changing farm management bonds to $800,000 and we are going to allow people to offset them against the loan that they have got. We are making sure that we have the capacity to pull more of our product through by making sure that we have, in countries such as China, such as Thailand, such as Korea, invested in the resources in those countries so that we can deal with the issues of—

Mr Fitzgibbon interjecting—

And he keeps on interjecting because he has got nothing.

Joel Fitzgibbon (Hunter, Australian Labor Party, Shadow Minister for Agriculture) Share this | Link to this | Hansard source

I just don't understand what you're saying.

Barnaby Joyce (New England, National Party, Minister for Agriculture) Share this | Link to this | Hansard source

I will take the interjection. He is so concerned that the National Party would go into bat for our constituents and deliver a great coalition agreement, an agreement that gets more for our people. It is more than what you, of the Labour Party Right—at least, that is what you use to be a member of—

Mr Fitzgibbon interjecting—

Russell Broadbent (McMillan, Liberal Party) Share this | Link to this | Hansard source

I am not taking the interjection.

Barnaby Joyce (New England, National Party, Minister for Agriculture) Share this | Link to this | Hansard source

Do not allow the interjection! I know how upset you are, to turn on the television set to find, once again, the National Party going into bat for their people. I know how galling that must be, when you are standing there going into bat for the Greens, going into bat for GetUp! and going into bat for the BLF—Norm Gallagher's grandson! When are you going to have the ticker to stand up to your people and get the Chinese free trade agreement through?

When are you going to do it? If you could do one thing for agriculture, it would be to get that through. It is the only part of your portfolio where you actually can be relevant, and you can be relevant today.

You can come to the dispatch box today and say that you are going to make sure that the Chinese free trade agreement goes through. You can stand in line with the National Farmers' Federation, the Victorian Farmers Federation, the Tasmanian farming groups and AgForce. You can stand in line with Jay Weatherill and Annastacia Palaszczuk. You can stand in line with the Premier of Victoria, Daniel Andrews. You can stand in line with them and our nation and get this agreement through or you can stand in line with the BLF. You can make that choice today. If you have got the ticker to do it, you will do it.

Russell Broadbent (McMillan, Liberal Party) Share this | Link to this | Hansard source

I think we should begin to refer to the bill.

Barnaby Joyce (New England, National Party, Minister for Agriculture) Share this | Link to this | Hansard source

Mr Deputy Speaker Broadbent, this is about foreign investment. Of course we want foreign investment. We want a proper review of foreign investment. We want to make sure that not only is there foreign investment going into our nation but that we have the capacity to export our product from our nation.

If in the near future—because this has got to go through by Christmas; the Chinese free trade agreement has got to be finalised by Christmas, and we do not have that many more weeks in this parliament. We are relying on the cooler heads, the sensible heads, in the Labor Party to stand up for common sense. If there is one portfolio that has that responsibility, it is agriculture, but we have not heard a whisper out of the member for Hunter about trying to get the Chinese free trade agreement through. We have had commentary on our policies, because he has got none.

Mr Fitzgibbon interjecting—

He is sitting over there like a babbling brook—commentary on our policies, because he has none—but he does not have the ticker to stand up when it really matters.

In conclusion, we are proud of the changes to our Foreign Investment Review Board guidelines, because we believe in the right of the Australian people to understand who owns what. We reacted to what they have asked of us and we have delivered by bringing about these changes. Soon it will be discernible for all—like a Terrence Alick map, which you get in Queensland, that notes all properties—to see who owns what. We believe it is a right, and I think, actually, you support that section. The process has already started.

We also believe in this bright agricultural future, the biggest turnaround in agricultural soft commodity prices in living memory—something that this government can actually deliver; something that you have been nothing but obstructionist about, that you have done nothing for. I can point to two things straight off the cuff—if you want to know about Labor Party policies, I will give you the two big ones: they banned the live cattle exports and absolutely destroyed the cattle industry. You think they would have learnt their lesson but they said, 'Oh no, that was in the past. That'll never happen again. We'll never do that again. We've learnt our lesson. We'd never be that destructive. We'd never be that obstructive. We'd never be such dilettantes that we would make such a catastrophically stupid mistake ever again.' And here they are: back into it. They are about to stop the Chinese free trade agreement. Why? Because they want to stand up for the BLF and they do not want to stand up for the Australian people.

Matt Thistlethwaite (Kingsford Smith, Australian Labor Party, Shadow Parliamentary Secretary for Foreign Affairs) Share this | Link to this | Hansard source

In June of this year, Sydney's median house price hit $1 million. This represents a 23 per cent increase on the previous year and the quickest rise in house prices since the late 1980s. Housing affordability is a massive issue in my community and not a week that goes by where I do not get a phone call, an email or a comment from, in particular, parents who are deeply concerned and worried about housing affordability; and the ability of their children and grandchildren to be able to afford to live in the community that they have grown up in and that their family resides in.

Housing affordability is a big issue. It is an issue that this government appears to have ignored. In this bill they are attempting to paper over the heart of the issue and look like they are doing something and taking action. When you look at the details of this bill and read the fine print in the explanatory memorandum, it is actually not what they are doing at all; it is just a papier-mache exercise.

There isn't much about this government that isn't inconsistent. As we have seen in the last 24 hours, it doesn't matter what it is: whether it is the promise not to cut education, health, the pension, ABC or SBS—or indeed not to cut down a first-term Prime Minister—this government cannot be trusted to do what is in the best interests of the Australian people.

One of the key figures in the events of the last 24 hours—and perhaps even one of the key reasons for the events of the last 24 hours—the Treasurer, has been infamous for some of his offensive comments about economic management and, in particular, his offensive comments to working people. In the context of housing affordability, the Treasurer put his foot in it some months ago when he said that those who cannot afford to get a foothold in particularly the Sydney property market should just go out and get another job—a better-paying job.

If you are a nurse, a teacher, a childcare worker or a builder working in my electorate, it is not that easy. You cannot just walk into the boss and say, 'You should pay me more, because I'm living in an expensive area' or 'You should give me a promotion, because I'm living in an expensive area.' It is a clear insight into just how out of touch this government is when it comes to housing affordability. This particular bill is a bandaid solution trying to look like they are doing something on the issue. The Foreign Acquisitions and Takeovers Legislation Amendment Bill 2015 is a classic example of that.

This package introduces fees on foreign investment applications, which will ensure all Australian taxpayers no longer fund the administration of the system while providing additional resourcing to the Treasury and the ATO to improve service delivery for investors. Labor does support this element of the bill. If temporary or nonresidents do not follow rules then any allegations of this need to be thoroughly investigated and, if there is found to be a breach, individuals prosecuted. But we are also conscious of the fact that this is not the silver bullet to housing affordability. This is not going to cure the issue of housing affordability as the Treasurer and those opposite have said in this debate. Finding and forcing the sale of one Point Piper mansion is not going to do much for a young family in Botany, Maroubra or Randwick who are struggling to afford to buy a new home.

That is exactly what we are talking about in respect of this bill. It purely relates to the application of the system and the fines that are associated with the system when someone is found to have breached the rules and also the administration of the system. There is no doubt that foreign investment has had a positive impact on housing supply in Australia. If Mr Hockey seriously believes that, by eliminating foreign investment in the Australian market, property price rises will ease, I think he has another think coming. It is not simply about foreign investment. When you look at the existing supply of housing, particularly in my area, it is not foreign investors that are competing for the existing supply of housing. In fact foreign investors are prohibited from investing in existing property. They may only invest in new housing stock. The philosophy behind that is to grow the housing stock but also to support the construction industry, and by all accounts that has worked well.

The important point from this element of the three bills that are being debated here today is that every dollar that is secured by this fee that applicants will have to pay must be ploughed back into the administration and enforcement of the regime. I was fortunate to sit on the economics committee review into the foreign investment regime in residential property in Australia, and the evidence that came before the committee was that the system has been lax, that the Foreign Investment Review Board and Australian Taxation Office have not been diligent in enforcing the rules. So the money that is raised from this scheme must be ploughed back into those agencies so they are given the resources to ensure that they are enforcing the rules.

Another element of this bill is the foreign investment in agriculture and agribusiness through the Register of Foreign Ownership of Agricultural Land Bill 2015—the register bill. Investments in agriculture in particular in Australia are vital to achieving our potential and maximising our nation's future prosperity and productivity, and investment in agriculture and agricultural land is very important for the productivity and liveability of rural and regional communities. The problem that we have with this particular element of these three pieces of legislation is the government's differentiated thresholds that have been applied to different countries, serving to hold the industry back.

Let's not beat around the bush here. This is purely political. The differing thresholds are purely a National Party stunt. The differing thresholds are that the government has reduced the investment screening threshold for agricultural land to $15 million for investors from China, Korea and Japan. Anyone or any business from those nations that wishes to invest in agricultural land at the $15 million threshold will need to go through a Foreign Investment Review Board process. But, if you are from Singapore or Thailand, the threshold, amazingly, increases to $50 million. If you are an investor from the United States, New Zealand or Chile, the investment jumps to $1,094 million. So there is this clear discrimination in the thresholds that apply to China, Korea and Japan; Singapore and Thailand; and the United States, Chile and New Zealand.

I have a friend who works in China who contacted me recently regarding the debate about the FTA and encouraging Chinese foreign investment in Australia. He said to me: 'I cannot work out what's going on with the Australian government. On one hand you're negotiating a free trade agreement with China and attempting to open up and encourage greater flow of goods and services between our two nations, but on the other hand you're increasing the barriers and making it harder for Chinese businesses to invest in agricultural land. It doesn't make sense.' That is exactly the view that we have expressed in respect of this bill: it does not make sense. The discriminatory nature of those thresholds does not make sense and will put a brake on important foreign investment, which drives jobs growth, productivity and growth within rural and regional communities.

Furthermore, the new $15 million threshold on investment in agricultural land even applies where an existing investor seeks to make improvements to their property. Buying a small adjoining parcel of land, perhaps to facilitate significant investment in improved farm infrastructure, triggers a Foreign Investment Review Board review if it takes the cumulative value of the investment above $15 million. So the new rules are not just a deterrent to new investment; they also create disincentives for existing investors to improve their operations, and that is very important for productivity. If you are talking about improving the productivity of the land that you may be farming or operating on, providing space for new machinery or new operations is very important. This legislation, if it is passed, will provide a disincentive to that. The government is also proposing to reduce the screening threshold for investments in agribusiness to $55 million and to define agribusiness to include around half of Australia's food manufacturing industry. Again discriminatory rules apply, with investors being treated differently depending on their country of origin.

The final piece of legislation is the Foreign Acquisitions and Takeovers Legislation Amendment Bill 2015. This bill makes substantial changes to the Foreign Acquisitions and Takeovers Act 1975 to modernise the rules and strengthen the enforcement of foreign investment in the system. The bill introduces civil penalties and additional and stricter criminal penalties to ensure foreign investors and intermediaries do not profit from breaking the rules. The bill enables the transfer to the Australian Taxation Office of responsibility for regulating foreign investment in residential real estate, which will further enable stronger enforcement and better compliance with the existing rules. The bill also enables the lowering of screening thresholds for investments in Australian agriculture to ensure significant investments in this sector are scrutinised.

The government has made a massive song and dance about the efforts to cut red tape, most notably through their red tape repeal day bills, which turned out to be little more than a massive exercise in proper punctuation. In some cases these involved little more than changing the word 'facsimile' to 'fax' or changing the spelling of the word 'email' and claiming them as massive reductions in red tape for businesses throughout the country. In this year's budget the government also announced $735 million in new application fees for foreign investors; so, in some respects, it is actually increasing red tape for many foreign investors. It is making Australia a less attractive investment destination while making it harder for the agriculture and agribusiness sector to raise capital. They are the concerns that Labor has about this particular piece of legislation. It is no surprise that, in respect of these new barriers to entry and red tape on foreign investment, the government has been criticised by many organisations including the Business Council of Australia, the National Farmers' Federation, the Australian Food and Grocery Council, the Queensland Farmers Federation and the Chamber of Commerce and Industry of Western Australia.

Once again, with this bill we are seeing little more than bluster and no action from the government when it comes to really tackling the issue of housing affordability. By contrast, Labor is attempting to listen to the community. That is why we have not ruled out changes as part of the taxation review.

In conclusion, in many respects some of this bill is nothing more than a ruse. Whilst I do support elements of the bill—in particular, those provisions that relate to covering the costs of the operation of the foreign investment review scheme—it is important that the funds raised from that increasing cost are ploughed back in, particularly into research by the Foreign Investment Review Board and by the Australian Taxation Office, and into giving both of those organisations the necessary resources to police the scheme and, where appropriate, to undertake prosecutions.

Ewen Jones (Herbert, Liberal Party) Share this | Link to this | Hansard source

I rise to speak on the Foreign Acquisitions and Takeovers Legislation Amendment Bill 2015. In doing so I would like to put out there from the very beginning that I love foreign investment, my city loves foreign investment and our country has loved foreign investment since 1788. One of my previous bosses, Richard Ferry—a great real estate agent and raconteur around Townsville—started his life as a jackaroo but ended up working for Elders. He was at Charleville, standing under the wing of a DC-3 when Lord Vestey came through to inspect his sheep flock when Lord Vestey owned most of western Queensland and basically all of northern Australia. We have loved foreign investment since then.

The beauty of foreign investment is that it crunches the time for you. In Australia today we do not have enough cash in our society to fund our own mortgage system, let alone to build the roads, bridges and other infrastructure we need to become a powerhouse into the Asian century. We need that foreign investment to be able to build the things we need, so that we can improve our trade routes and raise our productivity. It would crunch the time for doing the Bruce Highway from the 60 years we would have to wait until Australia could afford it down to just the 10 years that Minister Warren Truss is talking about at the moment. Those are the sorts of things that foreign investment can do. It can raise these things. It also brings the impetus to make sure we are staying on top of those things.

Foreign investment is vital to developing northern Australia as well and to creating the economic growth and the jobs that north Queensland needs, but we need to have the right safeguards in place to protect our national interest whilst welcoming foreign investment. This bill ensures our investment framework walks that line. The big thing about this is that it was a commitment that we made going into the 2013 election. It was one of those things that we said we would do, and here it is—hey presto! Surprise, surprise—we are actually doing it.

This bill implements a number of changes to the foreign investment framework, including the key previously-announced commitments of lowering screening thresholds and establishing a land register for agricultural investment, to increase transparency. One of the things people talk to me about in my city of Townsville is who owns what. We want to know. People want to know and want to be aware of it. They are not anti foreign investment; they are not anti any particular country; they just want to know what is going on and what is happening in their communities, because of a lot of the things that we see. One of the worries we have in my city is that the profit no longer stays in the region. We have to make sure that our farms and our agricultural land are managed and that they prosper, so as to make sure that jobs in the towns, and then the cities, are fostered.

It will impose a stricter penalty regime to allow pursuit of foreign investors who are breaching the rules. You have seen the Treasurer, Joe Hockey, doing that in Sydney on a number of housing purchases. It establishes fees on foreign investment applications so that the taxpayer will no longer fund the cost of administering the application screening, and it will transfer responsibility for regulating foreign investment in residential real estate to the Australian Taxation Office, so that we do know who is buying what and why. And there are measures to modernise and simplify foreign investment legislation.

The Labor Party support the register but oppose lowering the screening thresholds, even though we won the election with these as our policies. They oppose the application fees because, once again, Labor will stand in front of absolutely anything that does anything towards bringing money into the government. They oppose the penalties for people who flout the rules. So, again, what Labor stand for is flouting of the rules and getting away scot free from anything. As to the 'additional red tape on foreign investors', I do not see this as additional red tape; I see this as just changing numbers on the existing red tape, and I think everyone is there.

I have recently been to China and have had conversations with Chinese investors in Australia. They are quite comfortable with this. They understand the difference between international relations and local politics and what we have to do as a country. China have a lot of laws themselves that we disagree with, and yet we are still able to manage a relationship between the two peoples and between the two countries.

This fulfils the coalition's election commitment to lower screening thresholds and create a foreign ownership register of agricultural land.

The package of bills will make important changes to strengthen the integrity of our foreign investment framework, ensuring that Australia maintains a welcoming environment for investment that is not contrary to its national interest. The Treasurer has been in front of the people in relation to this. This is what happens inside Australia. This is not about our relationship with any other country; this is something that we are doing for Australians to make sense to Australians. For years we have wanted to know who owns what in this country, and we have never been able to. This legislation actually makes that possible.

These bills implement the reforms that were announced by the government on 2 May 2015 to ensure that, from 1 December this year, the Australian foreign investment framework is more modern, simpler and better targeted to changing demands and community expectations. That is what we are reflecting here: the community expectations. These changes will deliver a robust regulatory framework, increasing community confidence and providing a predictable and welcoming environment for investors. As I said, when I speak to people who have come to Townsville, Charters Towers and the Burdekin—and when I was in China—they understand the difference between international politics and local politics. They understand the need for locals to be catered for, as every sovereign nation does around the world. The bills are about welcoming essential foreign investment that is not contrary to our national interest, investment that strengthens Australia's economy, creates new jobs and unlocks innovation.

The Foreign Acquisitions and Takeovers Legislation Amendment Bill 2015 represents the most significant overhaul of the Foreign Acquisitions and Takeovers Act 1975 since its introduction, almost 40 years ago. It provides essential changes to simplify the system, strengthen the framework and ensure that the rules are enforced. I will just digress a little bit here. I heard the previous speaker, the member for Kingsford Smith, talk about the Standing Committee on Economics, which looked into this. I think credit must go to Kelly O'Dwyer, the member for Higgins, for the work that she did on this in maintaining the debate and getting the result that the people actually understand. People understand exactly why we are doing this and the outcomes from it and that we are still able to organise everything that happens around the world without having to worry about this.

The bill introduces additional, stricter, civil and criminal penalties to ensure that foreign investors and intermediaries do not profit from breaking the rules. We have seen the stories in Sydney, particularly in the housing market, in relation to people not following the rules, and we have seen a Treasurer who is prepared to act. I think that one of the things that Joe Hockey will always take with him on this is his statement that he was prepared to act. We have a government that says what it means, means what it says and follows through.

The bill enables the transfer to the Australian Taxation Office of responsibility for regulating foreign investment in residential real estate, which will further enable stronger enforcement, audit and compliance with the existing rules. I know that there is debate, and this is all about Sydney. But, when you go to places like Cardwell, Charters Towers, Tully, the Burdekin, Ayr and Home Hill, they want people to come in and buy their houses. They want people to come in and build houses. They will do anything to fix those things up and make sure that our communities are growing. So, whilst I understand the reticence and the alarm that people in Sydney are feeling in relation to this, when it comes to my city of Townsville, we welcome people wanting to come here and build and buy houses and units, all the time.

The bill also enables the lowering of screening thresholds for investment in Australian agriculture, to ensure that significant investments in this sector are scrutinised. I think what you are looking for here is people making sure that we know what is going on. No-one is saying no to foreign investment here. We do need to make sure that we know who owns what. In my city of Townsville, that is the No. 1 question. We are not worried about which nationality owns it; we want to know who owns it and what is going on there. I will have more to say about that specific thing in a minute.

This bill introduces fees on all foreign investment applications from 1 December 2015. Fees on foreign investment applications will ensure that Australian taxpayers are no longer funding the administration of the system. Whilst we welcome foreign investment, we put these fees in place. We have to make sure that the Australian taxpayer is not carrying the burden here. If you are coming to buy in Australia, the Australian taxpayer must end up in front in the transaction. There is nothing wrong with that.

It will also provide additional resourcing to Treasury and the Australian Taxation Office to improve service delivery for our investors. It is about streamlining the system. It is about reducing the red tape and moving to the one thing so that you can get the answers quickly.

The Register of Foreign Ownership of Agricultural Land Bill 2015 complements these changes by establishing a register of foreign ownership, operated by the Australian Taxation Office. Foreign investors are required to register essential information about their existing holdings and subsequent acquisitions of Australian agricultural land, providing greater transparency around foreign investment in agriculture. That is important.

With this package of bills, the government are fulfilling our commitments to increase scrutiny and transparency around foreign investment. That is going to be well received, certainly in my community and around North Queensland. We reduce red tape and ensure that Australia remains open for business. Industry consultation has occurred throughout the policy development process and the drafting of this legislation, including releasing exposure drafts of the relevant bills.

Can I just go quickly to the thresholds that are imposed here. The $15 million threshold which will come in now will apply to the China-Australia Free Trade Agreement, and everyone is happy with that. It is negotiated; it is in the agreement; and the Chinese are happy with that. They understand what the rules are. The billion-dollar threshold for previous agreements is in the agreements we struck with those countries at that time. We do not believe in going back and changing the agreements. That goes to why legislation cannot be thrown around and cannot be mucked around.

I want to finish by saying that I have been involved in sales as an auctioneer and as a real estate agent for 25-years. Never in my career—not once—have I taken an offer which was accepted by a vendor where the vendor has said, 'What nationality is the vendor?' To people who fear foreign investment, I say: 'If it is not for sale, they can't buy it.' If they are making the best offer, we expect, as an agent and a representative of the vendor, that we will present the best possible offer to our vendor, and if that comes from overseas that is fantastic. To the people who sit there and say that we should knock back foreign investment in my region and that we should not have foreign investment in our society or the people in my region who fear this, I say, 'You shouldn't fear this, you should welcome it.' This is positive; this is about what we do to set up our country.

I see a bunch of school kids have just walked into the viewing gallery upstairs. I say good afternoon to them, and I say that what we are doing here with the foreign acquisitions and takeovers bill, with the China-Australia Free Trade Agreement and with the agreements with Korea and Japan is not about us here in this room; this is about your future. This is about the future for you, so that, when get out of school, you can go to these countries and you can make your fortune there while still basing yourself in Australia. This is what we are trying to do here. The thing I like about the youth of today is that they are not afraid of foreign investment and they are not afraid of people of other ethnicities—where some of my generation and older do have this fear.

When we look at foreign investment we need to look at it through the eyes of what is going to happen in 25 to 30 years. In the late 1980s, 25 to 30 years ago, my bosses bought their first mobile phone, in the late 1980s and it cost them $2,500 to have it fitted to the car. It cost $2.500 for a car phone, and you would not use it because it was so expensive to use it. To use the fax machine you almost had to have a university degree. Think about how much smaller the world is today. The iPad was introduced into this parliament by the member for Watson in 2010. In a world that is continually getting smaller, what we have to do is understand that capital is more fluid and we need foreign investment. We need foreign capital in this country; otherwise, we will not have the roads, we will not have the bridges, we will not have the ports, we will not have the airports, we will not have the airplanes and we will not have the trade.

If we in this parliament do not do this right now, when you guys finish your university degrees or your apprenticeships—and come out as electricians or landscape gardeners et cetera—and you think to yourselves, 'They are doing a lot of work on the environment in China; we should probably go over there and have a look at this to see if we can add to what they are doing,' you will not be able to, and you will look back on this parliament as people who squibbed it. You will look back on this parliament as the people who put out robocalls from the Labor Party and the CFMEU to people saying that we have to be afraid of foreign investment and we have to be afraid of what the Chinese bring to Australia through this China-Australia Free Trade Agreement. If we do not pass this legislation, we will look back on this time in this parliament and we will find that it was one of the dirtiest, nastiest pieces of work ever done in this country.

I am very proud of these bills and I am very proud of the work done by the Treasurer, by the member for Higgins and by all the people involved in this. My city welcomes foreign investment. My city welcomes the future, and we should all be getting on with it.

Chris Hayes (Fowler, Australian Labor Party) Share this | Link to this | Hansard source

The member for Herbert is right: we are very much living in a globalised world. As a consequence of that, part of the challenge is how we structure foreign investment in this country to the point that it does not jeopardise our sovereignty or the deployment of internal wealth to the detriment of Australian citizens. For some time now, I think governments of both political persuasions have been tempted to work towards ensuring that there is opportunity for foreign investment in this country. The influx of capital is something that goes very much to increasing the supply of jobs and is a catalyst for construction and most other services that we come to rely upon.

In this highly globalised world we need to seize the opportunity of foreign investment but also safeguard our national interest when it comes to the increased trade and investment across international borders. It is important that we strike a balance—and get it right—between welcoming foreign investment and ensuring that we are not compromising our national interest. Reducing red tape and ensuring greater certainty for investors are aspects of that equation, and we certainly see those covered in the bills before us today.

The three bills before the House, the Foreign Acquisitions and Takeovers Legislation Amendment Bill 2015, the Foreign Acquisitions and Takeovers Fees Imposition Bill 2015 and the Register of Foreign Ownership of Agricultural Land Bill 2015, make changes to Australia's foreign investment framework and update and modernise the system to cater for increased levels of foreign investment in Australia. The Foreign Acquisitions and Takeovers Legislation Amendment Bill 2015 makes necessary amendments to the Foreign Acquisitions and Takeovers Act to modernise the rules and to strengthen the enforcement capabilities in our foreign investment system. The Foreign Acquisitions and Takeovers Fees Imposition Bill 2015 introduces fees on foreign investment applications to ensure that Australian taxpayers are not footing the bill when it comes to the processing and administrative side of foreign investment applications.

The Register of Foreign Ownership of Agriculture Land Bill 2015—and I note that the minister is at the table—establishes the register of foreign investment ownership for agricultural lands to be operated by the ATO, so that we have greater transparency regarding the level of foreign ownership of agricultural lands in this country. That is certainly not something that is being demanded by people I represent but, when I read the papers, I see that there is a broad range of people who believe it is absolutely essential that we have at least a registry of foreign ownership of agricultural lands to ensure and preserve the sovereignty of agricultural land ownership in this country.

As I stated earlier, one of the main aims of this package of bills is to strengthen Australia's foreign investment framework. One of the methods by which that will be achieved will be through the introduction of fees on various foreign investment applications. These fees will ensure that the Australian taxpayer will no longer be footing the bill for the cost of processing, the cost of administration and, indeed the cost of enforcement of matters associated with foreign investment. Some of these fees include $5,000 for purchasing an established residential agricultural dwelling worth $1 million or less. Higher fees will apply for purchases of more expensive properties, commercial real estate and business applications.

These new fees on foreign investment applications will go very much towards lending greater resources to Treasury and, in particular, to the Australian Taxation Office to improve the service delivery for investors. It is estimated there will be in the vicinity of $735 million of increased revenue over the forward estimates and that will be hypothecated in respect to the Australian tax office for the specific purpose of administration, process and enforcement.

It is also important that this is not just seen as a raising of critical revenue but it is actually seen as the money that will in fact be hypothecated towards administration and enforcement of the new rules applying to foreign investors. Therefore, those activities will no longer be considered a tax burden against Australian taxpayers. Nevertheless, we do have to be careful not to see this as changing the foreign investment system in this country. It is certainly not the panacea, in my opinion, for reducing house prices or increasing housing affordability in various parts of Australia. The peak housing bodies, including the Property Council of Australia, have seriously questioned the effect these new fees could have on housing affordability. They have even suggested the prospect of having a negative impact on the supply and therefore on housing affordability generally, leading to increased housing prices.

There is much good that will come from foreign investment, as I said at the outset, particularly in areas of real estate and as it applies then to construction, increasing the supply of new dwellings—housing, home units et cetera. I understand that governments, federal as well as state, are under pressure and have been for some time in respect to the sustainability of property prices in Sydney and Melbourne. But there are certainly serious questions as to whether scaring off foreign investors would make it easier for a first-home buyer to purchase in the market in Sydney. My view is that this is not going to have an impact on that.

If you think about the recent tabloid coverage of the forced sale of the Point Piper mansion which was purchased by foreign investor, I do not think that is going to have any impact on people in my electorate when they are lining up to buy their first property. I do not think that is going to have an impact on the average home buyer in Sydney or Melbourne.

The bills before us also introduce charges to deal with noncompliance in foreign investment, introducing civil penalties and additional and more stricter criminal penalties to ensure that foreign investors and their intermediaries do not profit inappropriately from breaking our laws. Currently the maximum penalty that can be applied under the act is a fine of $90,000 or a two-year imprisonment or, in some cases, both. But the criminal penalties will be increased to $135,000 for an individual, supplemented by civil pecuniary penalties for less serious breaches of the real estate law.

Since these charges are relatively new, it is only right that we are allowing foreign investors the ability to self-report noncompliance. In those instances, they will face significantly reduced penalties and that process is quarantined for a limited period of time. The new compliance penalties will match the damage that the noncompliance poses to Australia. Clearly the penalties will be in line with the severity of the offence but they will ensure that those who commit and break the rules certainly do not profit from their activities. The charges also affect third parties that are often involved in foreign investment including real estate agents, conveyancers and migration agents. The third parties will now be subject to civil and criminal penalties in cases where they knowingly assist a breach of the rule which allows profits to be improperly made as a consequence of their action.

It is important that the ATO plays a more effective role through the new investment and compliance powers. It is an important aspect of this suite of bills in strengthening our foreign investment system. The ATO has the capacity to cover more than six million transactions each year through a sophisticated data-matching program. The additional revenue gained through these new fees proposed in the bill will help the ATO improve compliance and enforcement of the foreign acquisition rules themselves.

The act enables officers from the ATO to exercise broad-ranging investigative powers in addition to the Treasurer being able to require a person to give information and to produce documents on request in respect of those investigations. Transferring to the Australian Taxation Office responsibility for regulating foreign investment in residential real estate will enable stronger enforcement and better compliance with the rules.

One of the more contentious aspects of the bills before us is in the area of increased scrutiny and transparency for foreign investment in agriculture. The government propose a lowering of the screening threshold for foreign purchases of agricultural land from $252 million to $15 million. Clearly, they are less worried about the acquisitions taking place now in agricultural land than what was previously reflected in various well-reported articles in broadsheets, particularly last year.

Lowering the screening thresholds for investment in Australia's infrastructure, in particular the proposal to apply different thresholds for investment from different countries of origin, is of concern. We are concerned that the government is saying some countries are more entitled to invest in Australia than others. In this country, we should be moving to proper rules and enforcement regimes to encourage investment in this country as a whole.

This is additional red tape that may negatively impact on our relationship with our trading partners. Before coming to office, the government promised to reduce red tape. As a matter of fact, they have a bill before the parliament at the moment purporting to do just that. If they want to be honest about it, this suite of legislation actually imposes additional regulation, which is fine. But for some other areas of foreign investment, it will probably impose greater regulation than is necessary, particularly where we are going to have disproportionate rules applying to various countries in terms of their entitlement to invest in Australia.

As a whole, these reforms are supported by the opposition. We do so on the basis that it is streamlining compliance and enforcement regimes. It will be more understandable for foreign investors moving to invest in this country, and we are removing the burden from taxpayers in terms of financing the administration, compliance and costs associated with foreign investment.

On this side of politics, we understand and support foreign investment. We know that it is the catalyst to help this country grow, and the changes that will take effect as a result of this legislation will assist to attract a greater degree of foreign investment under a more sustainable international framework, and certainly a more understandable framework at that.

Keith Pitt (Hinkler, National Party) Share this | Link to this | Hansard source

I rise to speak on the Foreign Acquisitions and Takeovers Legislation Amendment Bill 2015. This is a very important bill for people in regional Australia. These reforms will ensure Australia's foreign investment framework is modern, simple and effective. It will add integrity to the system so that everyone plays by the rules. It will also grant new compliance powers to the Australian Taxation Office and the Foreign Investment Review Board. I note that in a press conference just some hours ago, the Australian Taxation Office stated very, very firmly that they will be targeting the third-party facilitators that are being used to break Australian laws, and they will do that through the new penalty systems introduced as part of these bills.

There are new penalties for a foreign person who makes an acquisition without approval. There is an increased criminal penalty for an individual, a natural person, of 750 penalty units, which is equivalent to $135,000 or three years in prison. For a company, it will be 3,750 penalty units, which is equivalent to $675,000. The civil penalty for individuals is 250 penalty units or $45,000; for a company, 1,250 penalty units and $225,000. A foreign person who fails to comply with the condition of approval will get the same penalty levels as the previous one. It is important to note that without strong penalties and a strong enforcement framework this legislation will not work.

Foreign ownership, not foreign investment, is an issue of great importance to the people of my electorate, but not only for the people of Hinkler. I have travelled across our great nation, particularly throughout Queensland, whether it be the people in Flynn or the people in Capricornia, whether they are in Betoota or Birdsville, this is an issue of concern to them. It is something which has been of concern for a very long period of time. In fact, for the Nationals this has been an issue for many years, as I am sure the Minister for Agriculture, who is at the desk this morning, would agree with me. We have been fighting for this for a long time.

Clearly, now that it is affecting the people of Toorak and the good people of Sydney Harbour, it has certainly created a lot more interest. So I thought I would take the time to see how far back in time this has been an issue for. I was fortunate enough this morning to sit through a presentation from the National Archives. I was not aware how important a role they play, so imagine my surprise when I searched Hansard and found this issue went all the way back to the constitutional debate of 1901. I identified one speech in particular, by Senator Guthrie of the Nationalist Party on 13 June 1923 in the address-in-reply to the Governor-General's speech. For those people who might be listening to this broadcast, the Nationalist Party is not the National Party. The Nationalist Party went on to become the United Australia Party, the precursor and the basis for the modern-day Liberal Party—as I am sure you are aware, Acting Deputy Speaker Goodenough, as a man who knows his history.

Even in June of 1923, there was discussion about the amount of suitable land that was available and its ownership by Australians or otherwise. Also in the same speech, if I could have some indulgence, was talk of a north-south railway. Well, that is something we will deliver. The Deputy Prime Minister has announced those things just this week—the additional money to ensure that we can put the link through, to finalise the great inland railway for the delivery of cargo. And I am sure the Minister for Agriculture will be interested in this: they spoke about water. One of the precursors of the great Liberal Party spoke about the need for water from the Great Artesian Basin and its protection, and the need to open up the rich and fertile lands of the Murrumbidgee, the Murray and Darling—things that are just as important now as they were almost a hundred years ago.

This bill is about getting the balance right. We need to ensure we get the balance right between foreign investment and foreign ownership. In my view, our fears of the unknown are always worse than the reality. Foreign investment in Australian real estate, according to the FIRB report of 2013-14, was just under $40 billion for commercial real estate and around $34 billion for residential real estate, totalling $74½ billion for the year. So acquisitions are not that unusual and under this legislation they will continue, but we have ensured that there is a framework to get the balance right.

I will speak briefly about some of the acquisitions that have occurred in my electorate's recent history. These acquisitions were of great concern at the time, but many of these companies have gone on to become great local citizens, great corporate citizens of my electorate. That includes Bundaberg Sugar. Bundaberg Sugar is one of the largest landholders in the country, one of the largest agricultural landowners in this country. They provide employment, sugar milling services and railways. They grow all sorts of agricultural products and they have been around for over 125 years. But even they have a history of acquisitions and takeover—from their takeover by a company called Tate & Lyle through to their current ownership by Societe Financiere des Sucres—but they have stayed in business, employing local people, providing local jobs and ensuring the local economy continues to grow.

I will declare that I was an employee of Bundaberg Sugar for many years. In fact I went through an acquisition in the north—an organisation called South Johnstone Mill, a private grower owned cooperative. I really felt for the people of South Johnstone. It was a terrible process for them. But South Johnstone went on to be acquired by Bundaberg Sugar and has since been acquired by Maryborough Sugar—so this is not something which is unusual. This is something which continues to go on, but it is of great concern to the community.

Taxation and financial regulation can be a minefield. It is a complicated beast. It can sometimes be difficult to navigate and understand. I will give a really simple example of how we are protecting the nation. Previously foreign purchases of agricultural land were only subject to the national interest test and close scrutiny if they were worth more than $252 million. On 1 March this year, we reduced that screening threshold to $15 million. That means that any agricultural land purchases worth more than $15 million are now subject to close scrutiny. I know that this will create some difficulties for companies like Bundaberg Sugar, especially since the $15 million is a cumulative amount. They clearly have assets above that, so the test will be triggered when they purchase additional land in the local area.

Foreign investors will be required to register information about their existing holdings and subsequent acquisitions of agricultural land. Up until now only the state of Queensland has held such a register. This government is getting on with practical measures not only to assuage people's fears but to ensure we have the detailed information that is required to make assessments.

This suite of bills does more than just protect agricultural land; it also relates to company holdings of residential and commercial real estate. From 1 December this year there will be stricter civil and criminal penalties that ensure foreign investors do not benefit from breaking the rules. The Treasurer today announced that there are 500 Foreign Investment Review Board investigations underway into $1 billion worth of illegal real estate holdings by foreign nationals. That is an enormous number of investigations. It is a significant achievement in such a short period of time and I congratulate the FIRB. They are getting on with this and ensuring that the new framework will be enforced.

Fees on foreign investment applications will give Treasury and the ATO additional resources and ensure that Australian taxpayers are no longer funding the administration of the system. These fees are expected to raise $735 million in revenue over the forward estimates. Effective from 1 December 2015, these fees include $10,000 for vacant commercial land, $25,000 for commercial real estate, $10,000 for new business proposals and internal reorganisations, $25,000 for business acquisitions where the value of the investment is less than $1 billion, and $100,000 for business acquisitions where the value of the investment is greater than $1 billion. For a $1 billion investment I do not believe $100,000 is unreasonable. If you were to look at the process Adani have gone through over the last five years, you would see that they have invested millions and millions of dollars in a mine which is not yet approved—a mine which would have created thousands of jobs, not only in Central Queensland but across the entire east coast.

As I have said, this is a matter of significant concern in the community. Whether I am at a market or a business drop-in, whether it is through emails, letters or phone calls, this is something that has constantly been raised with me over the two years I have been here. People are concerned about foreign ownership. This legislation strikes a balance—and it is this government that has taken action. We will get the balance right. We will continue to do what is right by the Australian people and I commend the bills to the House.

Jim Chalmers (Rankin, Australian Labor Party, Shadow Parliamentary Secretary to the Leader of the Opposition) Share this | Link to this | Hansard source

As other speakers have mentioned, the Foreign Acquisitions and Takeovers Legislation Amendment Bill 2015, along with its associated bills, introduces fees payable for foreign investment applications, lowers the screening thresholds for certain investments in Australian agriculture, introduces civil and criminal penalties for breaches of the foreign investment framework, and transfers to the Australian Taxation Office the responsibility for administering certain aspects of the foreign investment regime. Labor will be supporting these bills through the House today, but we do have some significant reservations about aspects of the package. We plan to await the Senate report on the bill before we determine our final position on those aspects.

Foreign investment would not have a bigger supporter in this chamber than me. I am a huge supporter of foreign investment because it is a vehicle through which we create jobs and growth in our community. I have always been a huge supporter of foreign investment, subject always of course to appropriate safeguards and screening to ensure it is in the national interest. But as a principle I think foreign investment is crucial for a country like ours. My side of the parliament has always understood that foreign investment plays an important part in driving economic growth. It is a simple fact that Australia's pool of domestic savings is not deep enough or substantial enough to drive the kind of investment we need to ensure a vibrant, job-creating economy.

We do not have, in Australia, sufficient capital to maintain the sort of employment opportunities and living standards that Australians have a right to expect and that Australians deserve. Labor knows that we will not improve living standards for working people in this country by pulling down the shutters on the world. On the Labor side we have a really strong track record of encouraging trade and investment. Prime Ministers Hawke, Keating, Rudd and Gillard and trade ministers like John Dawkins, Peter Cook, Simon Crean and my own predecessor, Craig Emerson, have all played important roles in dismantling protectionist barriers.

Between 2008 and 2013, the years of the last Labor government, there was an investment boom in Australia. Foreign direct investment was up 40 per cent over that period. In a former role that I had in this place, I was very proud to be involved in the maintenance and improvement of the foreign investment framework in this country and particularly proud to see that boom in foreign investment go up 40 per cent over the life of the Rudd and Gillard governments. It helped boost supply in Australia. It was certainly a factor in our continued growth while the rest of the world went backwards and shed tens of millions of jobs during the great recession.

Now, as domestic demand in Australia slows, foreign direct investment in Australia will continue to play that crucial role in encouraging growth. In one sector, for example—one that the minister at the table would be aware of—the National Farmers' Federation has estimated that for Australian agriculture to reach the capacity needed to meet rising international demand it will require investment of between $1.2 trillion and $1.5 trillion over the next 35 years. We need to meet this demand by encouraging foreign investment in an open and transparent manner while making sure that big investments are in our national interest. Labor will support today—and will always support—policy that encourages growth of foreign investment in Australia while ensuring that safeguards remain in place to ensure that that investment is in the national interest as well.

This legislation, in summary, is a bit of a mixed bag. We have concerns about the bills before the House. There are some measures, of course, which will legitimately strengthen our foreign investment safeguards, but I think it is also true that there is the risk that some other aspects of these bills will throw up unwanted barriers to attracting foreign investment into our country. For example, we will be supporting the introduction of a register of foreign ownership of agricultural land because we believe that foreign investment works best when it is open and when it is transparent. But we have real concerns about the changes to the foreign investment screening thresholds for agricultural land, which we believe have the potential to discriminate against investors based only on their nationality. To prove that point, consider that we will have a bewildering situation where the threshold for investment review in agricultural land will be set at $15 million for investors from China, Korea and Japan, while at exactly the same time it is $50 million for investors from Singapore and Thailand and it is over $1 billion dollars if you are from New Zealand, Chile or the United States. This means the screening threshold for Chile is around 73 times higher than the screening threshold for Japan.

On top of all of that, from December this year we will see the FIRB screening threshold for agribusiness investment capped at $55 million. This was an issue that was raised with the trade minister in this place earlier this week. There was a total inability to explain why we would want this dog's breakfast of different levels of screening thresholds depending on the nationality of the investor. The government has yet to provide any economic or foreign policy rationale for this complicated system of investment screening thresholds for different countries and different types of businesses. What is worse, these new barriers to investment would apply even where existing investors seek to make improvements to their property. They are not just a potential deterrent to new investors but also a disincentive for people who are already investing who want to improve their operations.

It should come as no surprise that this rushed mismatch of red tape and barriers to trade have been criticised by a variety of Australian industry associations including the Business Council of Australia, the National Farmers' Federation, the Australian Food and Grocery Council, the Queensland Farmers Federation in my home state and the Chamber of Commerce and Industry of Western Australian. But what could be worse is the potential reaction of foreign investors who will be met with this chaotic framework of red tape and fees which will make Australia a less attractive destination for investment.

There is cause for concern in this bill. As I have said, our final position will be made after all the evidence has been considered by the Senate committee—that is only reasonable. We have got a Senate process that will get under way, and it is our prerogative to weigh up all the evidence before that committee before we land on a final destination. In the meantime, we call on the Minister for Trade and Investment to explain to the parliament and to the Australian people how these retrograde changes to our FIRB screening thresholds will do anything other than deter future foreign investment in Australia?

The other main set of measures in this package of bills relates to foreign direct investment in real estate. Labor will be supporting the government's proposal that foreign investors cover the cost, the impost, of having their application for investment reviewed by FIRB rather than burdening the taxpayers with this cost. We believe that the fee will be very modest, compared to the investments being considered, and we do not think that it will act as a real disincentive for investment in Australia. But we say very clearly today that the revenue raised from this measure should be directed back into improving oversight mechanisms and service delivery for investors, not used just as a cash cow to sure up the government's budget mess where we have seen the budget deficit double from one budget to the next.

I was pleased to be on the House Economics Committee's inquiry which recommended the fees on foreign real estate investment contained in the legislation today. As I said throughout the proceedings of that committee—as I say now in the chamber—there were perceptions in the community about foreign investment in real estate which in many instances dwarf the reality of the incidence of foreign investment in real estate. We need to be really careful when we are discussing this area not to get carried away with tabloid overreaction to some of these issues. We need to approach it in a sober and clear-headed way to make sure that any measures we are taking in this place are consistent with the reality of what is happening on the ground and not just the hearsay and the anecdotal claims made by some from time to time. I think the committee, with members from both sides of the House, did a good job in getting to the bottom of a lot of the facts of these issues rather than the hysteria.

This government spends a lot of time talking about foreign direct investment in real estate. It makes it out to be the sole enemy of housing affordability in Australia. We got a bit of that, again, this morning from the Treasurer. Too often forgotten in this conversation are the benefits of foreign investment in Australia when it comes to the housing market. There was clear evidence through the economics committee process, that I described earlier, that foreign investment has the capacity to boost housing stock not just for foreigners but for the broader Australian community. Where that happens we should celebrate it. It is also clear that foreign buyers are, generally, not competing in the same markets as most first home buyers throughout Middle Australia.

The member for North Sydney has made a big deal, including again this morning, of forcing the sale of a handful of homes, including a Point Piper mansion, as this big solution to the housing affordability crisis in this country—'Let's concentrate it in Sydney and Melbourne'—but that is an indication of how out of touch the government is when it comes to housing. People in my community and across the country do not necessarily want to buy or have the means to buy some Point Piper multimillion-dollar mansion. They just want family homes to be affordable for everyday Australians.

The government did promise to address housing affordability before the election. They do not have a real plan. This is just something to say so they look like they are acting on housing affordability. In reality, they are not. In fact, they have taken backward steps, as the economics committee is now dealing with issues around housing affordability. We have heard witness after witness talk about backward steps from the government, which include abolishing the National Housing Supply Council and the National Rental Affordability Scheme and the changes it has made there. These policies were making a real difference to the affordability of housing for a large number of Australians from all parts of the community.

While we will be supporting in the House, today, the measures in the legislation around foreign direct investment in real estate we do not believe that is a sufficient total response to the housing-affordability crisis. The new Prime Minister and new cabinet, when it is announced, need to put some thinking into housing affordability and have a policy and a plan—not just some piecemeal approach for one or two mansions in Point Piper and forced divestments.

We have some reservations and will come to a final decision after the Senate committee reports. Our guiding motivation is to have a foreign-investment framework that encourages the much-needed investment in our country while ensuring that there are safeguards to ensure all foreign investment is in this country's best interest. We are not sure that the government's proposed discriminatory-screening thresholds and new red-tape barriers will support that objective. We also do not believe the government's proposed fees for FDI in real estate will solve the housing-affordability crisis.

Being open to business is about more than repeating that phrase endlessly at a press conference. I sincerely hope that the government—with a new Prime Minister and a new cabinet—will share Labor's enthusiasm for getting Australia's foreign-investment framework right and will not implement the measures in these bills that have the potential to deter foreign investment.

David Gillespie (Lyne, National Party) Share this | Link to this | Hansard source

I rise to speak about this cluster of bills, the Foreign Acquisitions and Takeovers Legislation Amendment Bill 2015, the Foreign Acquisitions and Takeovers Fees Imposition Bill 2015 and the Register of Foreign Ownership of Agricultural Land Bill 2015. These bills are putting into effect policies that the Nationals took to the country at the last election, and I am very pleased to see that we are delivering on our promises. They strengthen the integrity and management of foreign investment in agricultural land and agribusiness but have just as much relevance to the residential real estate market, and I will make some comments about that later.

Ever since Australia started off as an outpost of the British foreign office and was a dumping ground for the poor, the unwanted and lots of convicts, commerce has developed on the back of foreign capital. We do not have 1,000 years of wealth stored in the nation like European nations do that have huge stores of investor capital. We are not America with huge reserves of accumulated wealth from another couple of hundred years economic activity and 350 million people. In essence, we need capital invested in this country and Australia cannot provide it all. I would like to see Australian superannuation funds a bit more active in this agricultural land and agribusiness space, but that is another matter and I am digressing.

Essentially, we welcome foreign investment. But any nation that does not control, supervise and regulate—any system, whether it is foreign investment in residential real estate, agricultural land or agribusiness—is derelict in its duty. People want us to supervise these marketplaces because there are phenomena around the world that are having unintended consequences.

The register of all foreign land acquisitions that have an accumulative value over $15 million is a significant manoeuvre but is quite mild when you put it into the context of other countries. Just over the ditch, our cousins in New Zealand have very strict rules about foreign purchases of agricultural land. In fact, it is almost impossible. In many states of the United States it is not possible at all. Similarly, Japan, Korea and China—one of our biggest trading partners—have much stricter rules, in this regard, than we do. So we are being very generous and very business minded and employment minded and jobs minded by encouraging foreign capital into this country. That is what happens when you get investment in a country. You get business growth, you get employment growth and you get jobs out of employment. For those in this chamber who are obsessed with magic pudding economics, we cannot rely on grants from government to create jobs. We need businesses to create jobs. Businesses have to be capitalised. That is why I say at the outset that foreign capital is so important for this country.

This legislation will also require review by the Foreign Investment Review Board of foreign purchases of agribusinesses that reach the threshold of $55 million. That is also a very prudent manoeuvre because these purchases should go ahead if they are in the national interest. But, as you can appreciate, many of the agribusinesses have grown out of cooperatives or processing plants in geographically dispersed areas which control the market for whatever is being processed. Originally they were set up as cooperatives and they have been either commercialised or sold off. When someone purchases that processing plant, they are able to have the market by the short and curlies. It is a no-brainer. We have to make sure this is to the benefit of the people who are providing the raw product to that plant and that they are not going to be done over with a 'take it or leave it' price control mechanism because the value of the commodity depends on the price that one purchaser offers. If you have got dry goods or things that can be stored, transported around the country and sold at various times, it will be happy days—you can cherry pick the market at the best price. But if you have got a primary product that has to be sold because it is going to start rotting and there is only one processing plant in your area your market is one—whether it is milk or cane. Things like that are really important. When the Foreign Investment Review Board looks at these potential purchases they have to realise that. Sometimes I think people do not really appreciate what the market is. I am really pleased that this review process is underway. It is not stopping foreign investment but we have to analyse its pros and cons of the Australian community.

The bill that is being amended here was set up in 1975. It is timely that we do have stronger regulations. There will be civil penalties if the regulations are broken. Some of the measures brought in in 1975 are in effect sound principles but they have not been applied, or they have not been regulated, and they have been discreetly avoided by some of the purchasers. Penalty fees of $90,000 or $135,000 or divestment orders will really change behaviour in the market—whether it is residential land, agribusiness purchases or whatever.

In a lot of these purchases, particularly in residential real estate, third parties are allowing people other than themselves to skirt the regulations. In this legislation there will be fines and penalties for third parties who are breaching the regulations. There will be increased application fees for all these purchases. At the moment, the FIRB has a minimal budget. We do not want the cost of regulating all these foreign purchases to come out of general revenue that is meant to fund hospitals or roads. These fees that are being charged will give quite a significant income to the government to run this process—a net positive to the government of about $620 million—so it is not going to cause any disruption to the general revenue. The definition of 'substantial interest threshold' is also addressed in this legislation. It brings it into line with other existing commercial related legislation. That threshold is being raised from 15 per cent to 20 per cent. If you control more than 15 per cent of the body that is purchasing the land or the agribusiness, it triggers the review in the regulations.

I would like to digress and talk a bit about what is happening in the residential real estate market. As you can appreciate, China has huge amounts of capital and wealth that has been created as the Chinese Republic has paradoxically adopted the practice of state controlled capitalism. There is a huge flight of capital out of China to many cities around the globe. That has been to gateway cities such as San Francisco, Vancouver, Auckland, Melbourne, Sydney and even Perth. There has been a lot of talk in the financial and real estate press about whether there has been a bubble happening in Australia. The reason for saying there was not a bubble is that they have looked at the borrowings, at what the banks are giving out in loans.

When those comments were made about 12 months ago, there were not any figures on the borrowings funding real estate that would trigger that comment. But what lies behind those figures, manifesting itself through the supply and demand principles of everything economic, is that there is a lot of non-borrowed capital going into the residential real estate market. And it is not just super funds investing in commercial or residential real estate; there is a lot of foreign capital being invested in it. The Chinese property bubble is suddenly being deflated and there is all this capital going around the world. It is being put into the big cities of the world—London, San Francisco and New York. Some of that capital is coming here. So we have a lot of pent-up demand.

That is why these regulations are so important—because, if people are skirting the regulations and using third parties to park their capital here and we do not know about it, we should know about it and analyse it. If residents of Australia who are foreigners are purchasing property but then renting it out, that is breaking the regulations. The intent of the system is that they have a home while they live here for four or five years. If they leave the country but then do not sell the property, they will be breaking the regulations and these penalties will kick in. When you have $6 billion of non-borrowed money landing in Sydney, Melbourne and the other capital cities' residential markets from this flight of capital out of China—and other places, too—it inevitably puts a huge pent-up demand into the system. Unless we have an adequate supply of residential real estate, prices go up.

The other thing I should say is that, if some of that $6 billion can come here and build lots of houses and apartments so that we have a greater supply, it will make housing more affordable, particularly for first entrants into the market. How this capital is used is what is important. We do not want to have a bubble happening in our cities and then have everyone end up in tears a couple of years down the track, when the bubble bursts. We want sensible economic principles to apply. We love foreign capital to be invested to build new factories and homes, develop underdeveloped farms and increase production. That is great, but, if people are just using this as a piggy bank to park their money till they move it somewhere else, and our whole property market goes kaput later on, that will not be helping anyone, particularly if a lot of Australians borrow heavily on the values that residential real estate has now and then the market collapses. In Hong Kong years ago, there were plenty of people who did just that. Their property markets collapsed and their borrowings were greater than the value of the property. That is not a happy situation for anyone.

There is lots of good stuff in this legislation. As I said, it responds to the needs and demands of Australians, who want to know who owns our agricultural land. We want agribusiness thriving in this country. We want it well capitalised, but we do not want purchases that will be to the detriment of Australians. So I think that reviewing the process before it goes ahead is only sensible. I commend this bill to the House.

Tim Watts (Gellibrand, Australian Labor Party) Share this | Link to this | Hansard source

Foreign investment is crucial for Australia's prosperity. That is as true today as it has been at every point in our history. Most of our roads, rail, ports, telecommunications and water infrastructure has been built with foreign capital. The same can be said for much of our public, private and commercial property stock. While Australia is only two per cent of the world economy, it accounts for five per cent of global property investment activity. Foreign direct investment has been particularly crucial to sustaining the 23 years of uninterrupted economic growth in Australia that we have enjoyed in recent times. The United States and United Kingdom remain the largest sources of direct foreign investment in Australia by far, totalling almost 50 per cent of all foreign investment in our nation. Despite the importance of foreign investment to Australia's economic future, and despite the 'open for business' rhetoric of the previous Abbott government, foreign investment, or at least some sources of foreign investment, is routinely demonised by those opposite for political ends.

The bills before the House contain three related pieces of legislation relating to foreign investment in Australia: the Foreign Acquisitions and Takeovers Legislation Amendment Bill, the Foreign Acquisitions and Takeovers Fees Imposition Bill and the Register of Foreign Ownership of Agricultural Land Bill. These bills outline a series of new arrangements governing foreign investments in real estate property, farmland and business. They seek to strengthen the enforcement of foreign ownership laws, introduce an effective user-pays system for foreign investment and drastically reduce the threshold for assessment of acquisitions by the Foreign Investment Review Board.

When Joe Hockey, the member for North Sydney, was still the Treasurer and not the seat warmer for the current Minister for Social Services, he used to talk up this bill as though it were some kind of silver bullet for Australia's housing affordability crisis. In fact, this bill represents the sum total of the government's housing affordability policy—from their perspective, it has to be the silver bullet because it is the only bullet in the chamber. True, the Treasurer had promised to release a housing affordability policy in the lead-up to the last election, but, like many other promises made by the former Abbott government, it has not been forthcoming. In fact, the government has done its best to grind real political change on this issue to a halt.

Just two months after coming to government, the government abolished a range of non-statutory bodies, including the National Housing Supply Council. The council's role was to provide projections and policy advice in relation to housing supply and demand. The council's terms of reference included: to strengthen the evidence base for decision making by advising the minister for housing on the state of the housing market, including land supply and construction; to examine the implications of city planning and infrastructure projects on housing availability; and to provide advice to the minister for housing to improve housing supply and affordability, particularly for low-income households. However, just as the minister for housing was abolished under the former Abbott government, so too has the council. Abolishing non-statutory bodies like the National Housing Supply Council leaves the government without important analytic tools and institutional support and exacerbates the problems they were introduced to address.

If we are going to make progress in tackling the affordability problem in the residential property market in Australia, we must focus on increasing housing supply through the construction of new dwellings—a goal that will unavoidably rely heavily on foreign capital. Yet the Property Council of Australia's submission to the Senate Economics Legislation Committee argues that the changes in this bill could exacerbate this problem and contribute to an increased rise in the cost of housing. The Property Council's submission stated:

The cost of these [new] fees will not only impact the feasibility of a particular project, but will in all likelihood be passed on to the end purchaser. This is particularly important for residential developments, where the costs will be directly added to the end price of a house, serving only to increase the cost of housing in Australia.

We will see whether this transpires. What is clear, however, is that foreign investment should be a part of the solution to the housing affordability crisis in Australia by funding an increased supply of housing stock and should not be treated as some kind of bogeyman that is single-handedly responsible for putting the Australian dream out of reach of Australian families.

Yet the former Treasurer has treated foreign investors in residential property in Australia as being akin to some kind of cartoon criminal mastermind—indeed, caricaturing Commissioner Gordon from the Batman series. The Treasurer even convened a press conference in Sydney to announce the divestment of seven residential properties illegally acquired by these super villains. It might have been amusing if it had been a puffed up suburban real estate agent. But, for the Treasurer of Australia, it was just sad.

In the open, diverse, multicultural and modern Australia that we all live in, there is a high cost to the symphony of dog whistling that we have heard on this issue. Some of the media coverage that has been invited by the government's rhetoric on this issue has been appalling. An article in The Australian last year quoted unsubstantiated claims that foreign buyers of Australian property added 10 per cent to the price of Australian homes. This article quoted a real estate agent as saying:

… easy to tell when buyers were unlawful foreign investors purchasing in their sons' and daughters' names because you could see them talking to their parents on the phone throughout the auction.

As a member of an electorate with a large Asian-Australian population, I can say that it takes more than a phone call to mum and dad and a few foreign words to determine someone's citizenship. Around 15 per cent of Australians describe themselves as being of Asian heritage. And guess what? Like other Australians, they need a place to live. And they often participate in housing auctions to buy properties. Many of them will call mum and dad for advice when buying a home, like most Australians do—and like my family did. The description in this article could have easily been made about Asian-Australian members of my family, like my wife—Australian citizens, all.

Another article in the Herald Sun this year, entitled 'It is not racist to point out these home truths', claimed that Asian buyers were making property unaffordable in Australia. The article even made the extraordinary claim that in some Australian schools:

… Australian-born children are outnumbered 10 to one by newly arrived Chinese students.

This is, frankly, a nonsensical statement. I challenge the author of this article to name one school in Australia that would meet that definition. I represent an electorate where over 60 per cent of the population were either born overseas or their parents were born overseas. I can tell you that not one of the 50 schools in my electorate come close to matching that definition. Most disturbingly, this article frequently conflated foreign nationals with Asian-Australian citizens, drawing a distinction between 'Australian-born children', 'new residents' and the 'newly arrived'.

According to the Reserve Bank, the majority of the Asian faces at auctions in Australia are Australian citizens. Based on Foreign Investment Review Board approval figures and data from the Australian Bureau of Statistics, it is estimated that Chinese residential real estate investment totals round two per cent of all residential real estate transactions in Australia. In a 2014 report on the Australian residential property market, the RBA noted that 'foreign residential purchasers do not appear to have a major presence' in the Australian property market and that:

… the degree of competition with foreign buyers is still likely to be fairly small.

We do our Asian-Australian communities a great disservice when we allow ourselves to buy into this kind of scaremongering. Yet the symphony of dog whistling that has been kicked off by the government's rhetoric on this issue has not been restrained. It should be below the government to use the politics of xenophobia to divide Australian society for political purposes, and I call on the new Prime Minister to put an end to it.

We should investigate allegations of breaches of foreign investment laws but we should not pretend that this alone will fix the broader problem of a lack of supply in the Australian housing market. That is the core of the housing affordability issue in Australia.

We see a similar story in the agriculture sector. Foreign investment is a key driver of our agricultural sector. For years, Australia has been positioning itself to be the food bowl of Asia, preparing to supply the increases in demand for more high-value food for our region in the coming decades. In a few short decades, the Philippines, Indonesia, Thailand, Vietnam and Malaysia will join India and China as some of the biggest economies in the world. By 2050, our region will be home to 10 of the world's 25 largest economies. The Asian century will make our region more populous and more prosperous. Australian agricultural exports should be one of the big winners from this process.

To take full advantage of the increase in demand from the soon to be 'dining boom', we need to increase the productivity of our agricultural sector. We need to increase the output of our agricultural sector. We need to increase the efficiency of our agricultural sector. To fully capitalise on this opportunity, the sector will need huge amounts of capital investment, mainly sourced from foreign investment.

Darren Chester (Gippsland, National Party, Parliamentary Secretary to the Minister for Defence) Share this | Link to this | Hansard source

But not China!

Tim Watts (Gellibrand, Australian Labor Party) Share this | Link to this | Hansard source

'But not China!' And it belled the cat! This is what this debate is about.

Mr Chester interjecting—

I will come to Barnaby. I will come to the rhetoric about 'not China'. We will talk about Cubbie Station. We need investments in our hard infrastructure like our roads, ports, rail and water infrastructure. Yet the rhetoric and political posturing of this government is unrelentingly hostile to foreign investment. As I said before, there has been a symphony of dog whistles: some forms of foreign investments are welcome, but not Chinese foreign investment.

The Minister for Agriculture defended the former Prime Minister's emphasis on cutting the screening threshold for foreign investment in agriculture, saying, 'If foreign investment wasn't such a big issue, he wouldn't be putting his endeavours towards it.' This is a bit of a non-sequitur, but I can tell the Minister for Agriculture that the reason it is a big issue is not because foreign investment is hurting Australia; quite the contrary. It is because of the political game playing of those opposite—game playing like that of the agriculture minister, Barnaby Joyce, on issues like the sale of Cubbie Station, and the nonsensical rhetoric that implies that the Chinese government will somehow airlift Australian agricultural land back to China or build a pipeline from Dirranbandi to Dalian to somehow steal our water.

It is telling that the opponents of foreign investment in this place cannot actually articulate the harms being caused to Australia by foreign investment in this country. They cannot articulate them because they do not exist. Australia's history has been one of benefiting from foreign investment, and it is something we should all welcome in this place.

The burden of all this political pointscoring will again fall on the Foreign Investment Review Board, which is significantly underfunded and will be asked to do significantly more in future—an extra burden that will hinder the board from performing its key function effectively and efficiently. It is important to appreciate that the board does not have the power to block proposals by foreign investors itself but only makes recommendations to the Treasurer, who makes the final decision if there is reason to believe that a foreign investment proposal is not in Australia's national interest. Ironically enough, the Treasurer is not even required to take into consideration these screening thresholds; he or she can review and block any proposal, regardless of the value. The same applies to the National Security Committee of the cabinet. No controversial investment proposal escapes the interest of the government, regardless of the value, and I would challenge the government to highlight an instance when a screening threshold has allowed a controversial proposal to go through.

The bill also highlights the double standards the government displays when it comes to regulatory burdens. As the shadow minister for agriculture, the member for Hunter, has said, the thresholds for agricultural land included in this bill would be 'a red-tape nightmare' and risk driving investors away when the sector was hungry for capital. The soon-to-be-former Treasurer did not call it red tape, though. In an Orwellian twist of language, he called it 'providing greater certainty for investors'. This gives lie to the rhetoric in this chamber that was often heard from those opposite in the debate about the omnibus repeal bill, sometimes better known as the red tape repeal day bill. Those opposite are perfectly happy with regulatory red tape when it serves their political rhetoric. I am concerned about the message that some of the rhetoric of those opposite regarding this bill sends to overseas investors. I am also concerned about the message it sends to Asian-Australians living in our community—the 16 per cent of Australians who identify as Asian yet are currently being vilified and treated like boogiemen at auctions around our nation. They do not deserve this kind of treatment, and we ought to stamp it out in this place.

It is important to note that this bill differentiates on investment in agricultural land based on an investor's country of origin. The cumulative $15 million threshold will apply to some countries but not others. For example, the existing threshold of $1,094 million will still apply for investors from the United States, New Zealand and Chile while a new, lower threshold of $15 million for rural land will apply to investors from China. As I say, it bells the cat. Why are the Chinese different? Why is Chinese capital different? There have been undertones of xenophobia in this debate—one might call it a xenophobic fear campaign—from those opposite, highlighted by the way the former Treasurer singled out Chinese foreign investors in this bill. Australia has benefitted from hundreds of years of foreign investment, and if we are to succeed in realising our potential in the Asian century we must continue to harness it in order to grow. To do that, we need foreign investment, and everyone in this House should welcome it.

Darren Chester (Gippsland, National Party, Parliamentary Secretary to the Minister for Defence) Share this | Link to this | Hansard source

Like my colleagues on this side of the House, in both the Liberal Party and the Nationals, I rise to speak in support of the package of three bills to strengthen Australia's foreign investment framework—the Foreign Investments and Takeovers Legislation Amendment Bill 2015 and two related bills. It is a great pleasure to follow my friend the member for Gellibrand, who gave us a lot of misinformation and accusations about double standards and hypocrisy and suggested that the people on this side were conflicted in relation to our dealings with China but failed to mention that the basic problem with the argument from a Labor perspective is that they are opposed to the Chinese free trade agreement. The member for Gellibrand has left the chamber, but I look forward to catching up with him soon and hearing more about how he now supports investment between Australia and China.

It is always very amusing for members who come from regional communities—like my colleagues the member for Forrest, Nola Marina, and the member for Lyons, here behind me, Eric Hutchinson—and who actually represent farmers in this place to get lectures from members such as the member for Gellibrand about farming. He talked about increasing agricultural productivity but then failed to acknowledge that the Chinese free trade agreement actually provides more opportunities for Australian farmers to deal with the Chinese market and puts them on a level playing field with our Kiwi cousins. We are at a price disadvantage right now with New Zealand, particularly with Fonterra. The Chinese free trade agreement actually provides opportunities for us to trade into that market on a more competitive basis.

So, I welcome the opportunity to debate this issue, and I welcome the contribution from the member for Gellibrand, because it just shows how hopelessly conflicted the Australian Labor Party is on this issue. I refer to the second reading speech by the member for North Sydney, about the nature of the legislation before the House. As he indicated, it is all about making sure that this legislative package will ensure that Australia has a welcoming environment for investment and also one that ensures that the investment is not contrary to our national interest. Surely that is the fundamental reason we are here debating this bill today—making sure that the foreign investment that occurs in Australia in the future is not contrary to our national interest. It adds more integrity to the system so that everybody plays by the rules, and with that integrity comes the opportunity for more compliance measures. I expect—and I think the vast majority of people throughout Australia who have raised this issue with me also expect—that our foreign investment rules are strong, that they are effective and that they are actually enforceable.

With this package of bills before the House we are implementing an election promise and keeping faith with the Australian people on our commitment to increase scrutiny and transparency around foreign investment in agriculture. These bills are common-sense bills, and they have the support of the vast majority of regional Australians I have had the opportunity to meet with in my role as a member of parliament for the past seven years. Foreign purchase of agricultural land is an issue of great interest to people not only in my electorate of Gippsland but, more broadly, throughout regional Australia. Fundamental to the issue is getting a handle on exactly what is going on in our nation right now. There is an opportunity here to properly measure what is occurring throughout regional Australia rather than guessing, as has been the case in the past. So, when these new measures were announced in February I said that people in my electorate would welcome this legislation, and that has been the case in the ensuing months as I have met with people throughout Gippsland.

The vast majority of people in regional areas are not opposed to foreign investment as such and recognise that foreign investment has been critical to the economic development and the growth of Australia, not just regional Australia. We know that when it comes to agriculture the foreign investment regime strengthens our economy, promotes growth and can be in our national interest. But that does not mean that we should not apply proper oversight to the rules as they apply in this nation. These measures are not about stopping foreign investment but are about providing Australians with more information about who is buying land in our nation and how much land they are buying. As other speakers have recognised, foreign investments can bring many benefits and can support both existing jobs and the opportunity for new jobs.

Bruce Scott (Maranoa, Deputy-Speaker) Share this | Link to this | Hansard source

Order! The debate is interrupted in accordance with standing order 43. The debate may be resumed at a later hour. The member will have leave to continue his remarks at that time.