Richard Colbeck (Tasmania, Liberal Party, Shadow Parliamentary Secretary for Fisheries and Forestry) Share this | Link to this | Hansard source

( I rise to make my contribution to the debate on the Illegal Logging Prohibition Bill 2012. I note that this legislation has a reasonable history through this place with two Senate inquiries so far, through which the opposition has played a very constructive role in its development. The government is trotting around the countryside a whole range of allegations about where the opposition is on that, which I am more than happy to refute. But I indicate that we will not be supporting this legislation because the government is not prepared to put in place some sensible modifications which we have suggested over a period of time to actually make this legislation workable and not become a weapon to be used against the forest industry by extreme environmental groups. And we know that that is what will happen because we have experienced it and we have seen it.

The government claims to be negotiating with industry around this legislation, but as late as today the Australian Timber Importers Federation said: 'It is considered that in its present form the bill is inefficient, bureaucratic and probably unworkable.' This comes from the organisation that the government has been negotiating with around the regulations that sit under this piece of legislation. The opposition remains concerned about the way the regulations align with the legislation. But it is not only the opposition that remains concerned; some of our key trading partners also remain concerned.

In what has been a quite unusual circumstance in relation to a piece of legislation, the Rural and Regional Affairs and Transport Committee has received representations from Canada and New Zealand—not countries you would think of as having poor forest management standards or systems, or even associate with illegal logging—expressing their concerns about the impact this legislation will have, the bureaucracy it will impose and the costs it might impose on the industry. Also, Indonesia, Malaysia and Papua New Guinea have expressed concern about the legislation, the level of the government's consultation with them and the mechanisms by which the government proposes to introduce the legislation. And that comes back again to the concerns that the opposition has had.

It is not as if we have not taken this process seriously. We have participated in two Senate inquiries, and I do not think you could accuse us of having been anything but constructive when the government brought forward the exposure draft of this legislation. In fact, I am happy to acknowledge that government senators on the Senate committee were more than happy to take up a number of recommendations made by the opposition. So there have been some changes to improve the bill to align it with what the opposition saw as reasonable to try and make it a systems based system and less bureaucratic than it was—and it was an absolute minefield to start with. So seriously have we taken this legislation that the Leader of the Opposition actually wrote to the Prime Minister to outline our concerns and put them in front of the government. The concerns relate to the implementation of the bill. The regulations are so important and so fundamental to the workability of the bill that we want to see them before the bill comes into effect.

It is important that that is the case. If they do not, we will see a range of allegations made against companies importing timber from overseas as to their legality. Whether they are true or not, those allegations will be made and Australian businesses, being defensive of the perception of them as businesses, will take defensive action as well and, most likely, stop importing the products. That is going to create significant issues for those importing nations.

The opposition wants to work cooperatively with these companies. We recognise that they are working to put processes in place to deal with illegal logging. Like the government, we had a policy at the last election to take measures to prevent illegally logged timber coming into Australia. We acknowledged the problem; we acknowledged the issue. There are currently two processes operating in other parts of the world. The United States has the Lacey Act, which itself has its own problems—which, I think, has been recognised by the moves to modify the Lacey Act at the moment to take out some unintended consequences. The European Union, the EU, are looking at the FLEGT process. That process works on a bilateral system where countries within the EU negotiate country-to-country arrangements with their trading partners to put in place regulations or systems to prevent illegal logging and the sourcing of illegally logged timber—a cooperative process and a process that builds capacity in those countries that are looking to do that.

That is the sort of thing the opposition want to see. We do not want to provide a blunt instrument for rogue environmental groups to attack legitimate business and legitimate industry with allegations that they are importing or exporting from a country and importing into Australia illegally sourced products. That is what will happen; we have already seen that process commence. Greenpeace in evidence to the inquiry alleged that up to 80 per cent of the timber coming out of Papua New Guinea, for example, was illegally sourced. What is the basis for those allegations? The basis for those allegations is that they—that is, Greenpeace—have determined what the definitions around illegally sourced timber will be. The problem is that we do not have any of that sort of work decided yet as part of the process.

Having spoken to industry players just last Friday night, we know that the regulations are nowhere near being ready yet. One of the things the opposition wanted to do in a cooperative way with the government as part of the approval process for this legislation—we have had these conversations with the minister—was to have the regulations pass through a Senate inquiry process so that we could check that the capacity to misrepresent was not there and the regulations were working. Now the minister has indicated to us that the regulations might be available by the end of the year. Indications to me from industry as late as last Friday night were that they have no chance. We are looking to have a process where, because the regulations under this legislation are so important and so fundamental, everybody who is participating in the timber trade industry has a good understanding of those before everything comes into effect.

The government are desperate to get some achievement out of the ag portfolio, given that this is the only policy for agriculture that the government took to the 2010 election. There was nothing else to do with anything else within agriculture; Tony Burke released one policy only and that was the illegal logging policy. We should be very suspicious of anything Minister Burke puts on the table given his performance over the past few months. But this is the only policy they had and they are so desperate to get some achievement on the table that they are prepared to push this through. They are not prepared to be cooperative. They will do a deal with the Greens—there is not much doubt about that—and they will create a weapon to be used against industry by extreme environmental groups. I have no doubt about that. You can see it being lined up right now.

Greenpeace say that 80 per cent of the timber coming out of PNG is illegal—on the basis of their own definitions; they make up their definitions, which is the way these groups often operate—and so what is that going to do to Papua New Guinea's forest industry? It is a $60 million-odd export industry; about one-third of that comes to Australia. So are we going to create through this process a crash in the New Guinea forest industry and are we going to see that impact work back down through the local communities? The Papua New Guineans think that is the case; it is what they are concerned about. They are more than happy to work to stop illegal logging. They do not want an organisation like Greenpeace to come in and define for them what is legal and what is illegal. They would like to understand what our regulations are, they would like to understand what our regulations say and they would like to work cooperatively with Australia to develop mechanisms to prevent illegal logging.

At what point do we recognise what a government says is illegal or not? That is one of the fundamental questions we have been asking through the development of this legislation. If a government says to us something is legal, who are we to say it is not? One of things that has been put into place as part of the development of this legislation is a requirement of due diligence. Industry generally has accepted that that is a reasonable way to go. I know that the PEFC system, a global umbrella group that takes forest certification schemes and aligns them across a global platform, has said that it is developing a due diligence system to incorporate into its forest certification system.

That should be welcomed because, as I said before, it puts in place a systems based mechanism, as part of an industry's general certification process, to ensure that due diligence is taken to ensure that a product has been sourced legally. It can become a verification scheme as a part of that proper due diligence process. That should be welcomed. I would urge other certification systems to do the same.

The Indonesian government is putting in place a timber legality assurance system. My understanding is that there is a lot of work being done between Indonesia and the EU around the recognition of their system. It is called the SVLK. I will not try to pronounce it, because it is difficult and I would probably get it wrong, but let us call it the SVLK because that is how it has been recognised. It is their national timber legality assurance system. One of the things that the opposition wanted as part of this process was adequate, sensible time for these systems to be put into place so that the allegations, which I know will come from these extreme environmental groups against companies importing timber and countries who were exporting timber to us, have some parameters around them—so we know what the rules are. At this stage we do not know which timber products are in and which are out.

The reality is that the more complex a timber product—the more it has been modified—the more likely it is to have illegally sourced timber in it. A medium-density fibreboard, for example, is the sort of product where you are most likely to find illegally sourced product. It is not likely to come in the form of solid timber products. The allegation might very well be made that it will, because that is about stopping forestry—that is the Greens and the extreme environmental groups' agenda of shutting down forestry—but the greater likelihood is that it will be in complex products. It may also, perhaps, enter in things like furniture where the timber is sourced from a number of different places.

Let us not pretend that the issue of illegal logging is not a problem. I am aware of the study out of Laos where the official inputs to a particular sawmill were something in the order of 350,000 cubic metres per year of logs, while the output was something like 650,000 cubic metres—so either they have a fantastic conversion rate or there is something going on. It is quite obvious that something is going on and we need to deal with that. We genuinely need to deal with that, but from my understanding a lot of that timber is going to a neighbouring country to be put into furniture. We do not know whether that is going to be included in the scope of the legislation yet, so, at the moment, what the government proposes is to create an offence. At the moment the proposed date of effect of that is the date of the royal assent to the legislation; then, two years after that, the regulations will come into effect. They will define other elements of the offences, including what particular products are going to be included and whether those highly modified, complex products are included.

Are paper, MDF boards and small batches of furniture that a small business might go to South-East Asian countries to buy going to have to be declared at the border? Are they going to have the capacity to do the due diligence down the supply chain—to actually determine whether the products are legally sourced or not? None of that is yet known. The opposition is saying, 'Let's deal with that once we have put the offence in place; let us deal with that properly once we have decided what is in and what is out—once we know those things.' Let us not create a bureaucratic nightmare that industry is not going to be able to manage properly. Let us let them know what the rules are before we throw them out for the extreme environmental groups to get hold of.

If the government do not believe that that will happen, they only have to look at their complete mismanagement of the IGA process—the Tasmanian Forests Intergovernmental Agreement—where they created the weapon. Again, Tony Burke is involved in this. Tony Burke, Julia Gillard and Lara Giddings signed an agreement around forestry negotiations in Tasmania, and notional reserves, or areas to be considered for inclusion as reserves, were created as part of that process. Those forests immediately became a weapon against a company called Ta Ann in Tasmania. Accusations of them logging in those forests were made in their markets. Industry and business moved away from their products.

Ta Ann are not a logging company. They do not harvest a stick; they take product that is supplied to them by Forestry Tasmania. They are not involved in logging operations. They do not get to choose where their timber comes from. Their markets were told that they were selling old-growth products out of these reserve areas—or areas proposed for reserves; they have not been declared. That company, after making an $80 million investment, is now considering leaving the state. One hundred and sixty jobs may be lost, all based on misinformation and the allegations made against them in their markets. So, if anyone does not believe that the government's mismanagement can create a problem, there is the perfect example and this company is the victim. That is exactly the same thing that will happen as soon as this declaration comes into effect with the passing of this legislation. There will be allegations about illegal sourcing of timber and Australian businesses which are the recipients of that product, particularly at a retail level, will have market campaigns run against them. They will take the only defensive action available to them, which is to stop sourcing the product. That will happen. You can see the environmental groups lining up. Worse—if you look at the amendments proposed by the Greens, they are looking to give another layer of armour to those environmental groups by making it about trade between states. If the government does not believe that that is part of the process, just read the amendments that are being proposed by the Australian Greens to this piece of legislation in this place. That is what will happen.

We have treated this process with respect. We have negotiated or tried to negotiate with the government. Tony Abbott wrote to the Prime Minister suggesting a way forward. Minister Ludwig has written back to Tony Abbott rejecting that way forward. They would prefer to deal with the Greens and they would prefer to give the environment groups a weapon against Australian business, Australian industry and our trading partners, so for five countries to express concern is quite a step. Canada and New Zealand—as I said before, not countries that you would associate with bad logging or forestry practice—have even expressed concern about the issues around that.

In that context, the opposition cannot support this legislation even though we have a similar policy, because we recognise the government's complete failure to be able to manage the process properly. (Time expired)

Christine Milne (Tasmania, Australian Greens) Share this | Link to this | Hansard source

I rise to support the Illegal Logging Prohibition Bill 2012, which starts the process of dealing with illegal logging around the world and seeks to stem the trade in illegally logged timber. This is something the Greens have been passionate about for a long time, and I am interested in Senator Colbeck's remarks because the coalition are always standing up at rallies where we are arguing for an end to native forest logging in Australia, saying, 'Why don't you do something about the illegally logged timber elsewhere?' We are doing something about timber illegally logged elsewhere, and it is the coalition now who are worried about the conservation outcomes of stopping illegal logging and do not want to support the bill. So let it be on the record the next time they get up and say, 'What about the people trying to stop native forest logging here not wanting to stop it elsewhere?' I think we have the coalition on record: they are not going to participate in trying to deal with illegally logged timber.

Senator Colbeck says a number of countries have expressed some views about the bill, but in March this year the World Bank put out a report called Justice for forests: Improving criminal justice efforts to combat illegal logging. They said:

Every two seconds, an area of forest the size of a football field is clear-cut by illegal loggers around the globe. A new World Bank report released today shows how countries can effectively fight illegal logging through the criminal justice system, punish organized crime, and trace and confiscate illegal logging profits.

The report, Justice for Forests: Improving Criminal Justice Efforts to Combat Illegal Logging, affirms that to be effective, law enforcement needs to look past low-level criminals and look at where the profits from illegal logging go. By following the money trail, and using tools developed in more than 170 countries to go after ‘dirty money,’ criminal justice can pursue criminal organizations engaged in large-scale illegal logging and confiscate ill-gotten gains.

The World Bank estimates that illegal logging in some countries accounts for as much as 90 percent of all logging and generates approximately US$10–15 billion annually in criminal proceeds. Mostly controlled by organized crime, this money is untaxed and is used to pay corrupt government officials at all levels. The new report provides policy and operational recommendations for policy makers and forestry and law enforcement actors to integrate illegal logging into criminal justice strategies, foster international and domestic cooperation among policy makers, law enforcement authorities and other key stakeholders, and make better use of financial intelligence.

“We need to fight organized crime in illegal logging the way we go after gangsters selling drugs or racketeering,” said Jean Pesme, Manager of the World Bank Financial Market Integrity team that helps countries implement effective legal and operational frameworks to combat illicit financial flows.

Despite compelling evidence showing that illegal logging is a global epidemic, most forest crimes go undetected, unreported, or are ignored. In addition, estimates of criminal proceeds generated by forest crimes do not capture their enormous environmental, economic and societal costs— biodiversity threats, increased carbon emissions and undermined livelihoods of rural peoples, with organized crime profiting at the expense of the poor.

“Preventive actions against illegal logging are critical. We also know that they are insufficient,” said Magda Lovei, Sector Manager at the World Bank. “When implemented, the recommendations of this publication can have a strong deterrent effect that has been missing in many actions taken against illegal loggers.”

Organized crime networks behind large scale illegal logging have links to corruption at the highest levels of government. The investigation of forest crimes is made even more complex by the international dimension of these operations. Recognizing these challenges, this study calls for law enforcement actions that are focused on the “masterminds” behind these networks—and the corrupt officials who enable and protect them.

That was the World Bank on 20 March 2012. I heard Senator Colbeck's contribution, but I am also very well aware of just what a disaster is going on around the world. Recently in the Jakarta Postthere was an article by a police chief in West Sumatra saying:

Illegal logging is one of the illegal activities on top of our priority list for us to eradicate.

There we have in West Sumatra a local police chief saying, 'We have to do something about it. It is one of our top priorities.' The article noted that the police had uncovered 44 illegal logging cases as of September this year, so it is pretty prolific in Sumatra, for example.

In the Congo, there was a recent report from Reuters saying:

Derelict ports in Congo's riverside capital … are piled high with logs ready to be shipped out to China and Europe as part of the lucrative timber trade.

More than a million cubic metres of illegal wood was ready to be transported and was identified in those ports.

That just gives you some idea of the scale of illegal logging. It is difficult to estimate, but it is believed that more than one-half of all logging activities in the most vulnerable forest regions—South-East Asia, Central Africa, South America and Russia—may be conducted illegally. Worldwide estimates suggest that illegal activities may account for over one-tenth of the global timber trade, representing products worth at least $15 billion a year.

For too long consumer countries including Australia have contributed to these problems by importing timber and wood products without ensuring that they are legally sourced. You only have to go around and look in many of the outdoor-living shops to see furniture that you know has been made from imported timbers and which has no certification to say where the timber has come from for that outdoor setting. There is nothing about it at all, and that is where we need to get serious.

The breaking of laws on harvesting, processing and transporting timber or wood products is widespread in many major timber-producing countries. By logging in protected areas such as national parks, overallocating quotas, processing the logs without acquiring licences and exporting the products without paying export duties, companies may be able to generate much greater profits for themselves than they would by adhering to national laws and regulations.

I have to say the Australian government facilitated logging of Indonesian protected forests. That was under the Howard government, when the Howard government facilitated the mining industry having a lobbying office in our embassy in Jakarta. The idea was that our mining industry was facilitating the overturning of forestry law 41 in Indonesia. That law was to protect the forests. With protected forests, we would not be able to have open-cut mines. But the Australian government, on behalf of the mining industry, went in and threatened to take the Indonesian government to international tribunals asking for compensation for those mining companies which had been given leases under what I would regard as the corrupt years of previous Indonesian administrations. Of course, the result was the Indonesians changed and overturned forestry law 41, allowing Australian mining companies to go in and clear-fell for open-cut mining in massive areas of Indonesia's protected forests. So we do not have a glamorous record ourselves in relation to encouraging logging of protected forests in Indonesia. But we know that the corrupt logging goes on. As I have just said, it often comes down to how the licences were acquired for either logging or mining.

Not only do you have environmental impact in terms of depleting forests, losing habitat for critically endangered species, destroying wildlife habitat generally and impairing the ability of land to absorb carbon dioxide emissions, with the resultant climate change impacts; you also have the ongoing effects. In December 2004, for example, there were flash floods and landslides in the north-east of the Philippines which killed over 1,000 people. The government blamed illegal logging which had denuded the mountain slopes. That is not just a story for the Philippines; it often happens in Asia in particular, but we have also seen it in other parts of the world.

There are budgetary implications because illegal logging means that governments do not get the revenue that they ought to have. A Chatham House briefing paper report estimated that in Indonesia the government is losing more than $1 billion a year from unpaid taxes and charges in relation to illegal logging. Future generations will suffer even more. World Bank studies in Cambodia have suggested that illegal extraction at least 10 times the size of the legal harvest has left a level of forest logging that is completely unsustainable in that country.

In terms of social impacts, when you have illegal logging it undermines the respect for the rule of law and it is frequently associated with forcing local communities out of the forest areas in which they live or on which they depend for their livelihoods. So you get illegal groups moving in or licences issued corruptly. They push the local people out of their forest areas. The local people get nothing from the flattening of their forests. You also get trade related issues because illegally logged timber is cheaper than legitimate products. It distorts global markets and undermines incentives for sustainable forest management. A study published by the American Forest and Paper Association—and I admit it is dated, being from 2004—estimated that world prices were depressed by between seven and 16 per cent by the presence of illegal products in the market. That is why the forest industry in Australia did come out in support of the bill when the government first announced it. I understand they have mixed views about it, but essentially they understand that illegal timber coming into Australia drops the value of forest products and that has a knock-on effect for them.

Politically, revenues from illegal logging have been known to fund national and regional conflict in, for example, Liberia, the Congo and Cambodia, where for several years the Khmer Rouge forces were sustained primarily from the revenue from logging areas under their control. So there are all kinds of reasons why Australia would want to do more to deal with the issue of illegal logging, and that is all bad news.

The better news is that in recent years producer and consumer countries have been paying increasing attention to illegal logging. One of the main initiatives includes measures to exclude illegal timber from international markets, notably the European Union's Forest Law Enforcement, Governance and Trade Action Plan. That initiative centred on the exclusion of illegal products from the EU markets. That is the intent of what we are trying to do here in Australia.

Whilst this bill is a step in the right direction, it does not go far enough. Senator Colbeck is right to say that the Greens have a number of amendments which would strengthen this bill. At the moment, the only regulation that exists in Australia to control importation of illegally logged timber is the Convention on International Trade in Endangered Species of Wild Flora and Fauna, and that convention targets only a limited number of timber products that have been derived from an endangered species; therefore, large amounts of timber continue to be imported without any requirement to verify its legality other than through voluntary industry measures.

When in 2010 at the election the Labor Party committed to encourage the sourcing of timber products from sustainable forest practices and sought to ban the sale of illegally logged timber products, the Greens were very supportive. It is long overdue and we need to get on with it. However, there are some serious shortcomings, and the first is the definition of illegal logging. We are not persuaded by the government's reasoning that if you go to a prescriptive definition then you might through that exclude something by omission. We do not believe that is the case and we retain the view that the Australian definition should be consistent with the European Union definition. If we are going to deal with a global problem, we need globally consistent definitions of what constitutes illegal timber; otherwise you are going to have a situation where what is rejected by the EU will be put into Australia and allowed here under a different definition.

Secondly, in relation to due diligence, we do not believe that the due diligence provisions should remain unclear. The DAFF officials, in a working group meeting in August 2011, indicated that the declaration should include, amongst other things, the following information critical to satisfying due diligence: the name of the importer, the name of the supplier, the botanical name and common name of the timber product, the value of the import, the country of origin, the region and the coupe. The coupe is really important because it is no use saying it is from that region if you do not know which coupe it came from. Knowing the region is not enough because illegal products will almost always be sourced from areas where there is also legal logging. If you just say the region, that is no good at all—you have to be able to trace to the coupe. The reason to trace to the coupe is that then you can trace how that licence was given and how it was secured. That goes to the issue of corruption. It also goes to the issue of tracing the money. We argue that the due diligence requirements must provide for traceability to coupe level and an assessment of the risk of illegality due to corruption. That is a critical thing. The government has not got that there, and I encourage the senator in response to tell me, in the absence of traceability to the coupe, how you are going to deal with knowing whether a timber is sourced from an illegal source and how you are going to deal with corruption.

The other thing we are going to deal with is compliance. We believe that, in order to determine the levels of compliance and assist in assessing the standards used in due diligence, we need to have regular compliance audits and aggregated data reports. That is, I think, essential to where we need to be. We also need to give NGOs and timber industry competitors the ability to initiate action and have standing under the law in relation to the act. I think it is all very well to have a bill like this, but you have to be able to allow a large number of actors to be able to have standing in the courts when it comes to assessing it.

The Greens will be moving a number of amendments in the committee stage to strengthen this piece of legislation. Whilst it is a step in the right direction, I am desperately concerned that, if the amendments are not supported by the government, you are going to end up in a situation where Australia has a weaker definition than the EU. It has no traceability provisions to the coupe level, which is so necessary if you are going to, as the World Bank said, 'get to the Mr Bigs of the operation'. The 'Mr Bigs of the operation' are the people who secure the licences and get the money, and that is going to the issue of corruption in the host country. We know corruption exists and that is a large part of the timber trade, just as it has been a large part of the trade in animals, both live and animal products. We have to get down to actual detail here. When you go into a store to buy an outdoor setting or buy another thing, you should be able to see on in it some certification of where that timber has come from because, as it is now, illegally sourced or logged timber is shipped to China or somewhere else, where it is made into a lounge suite. That lounge suite or whatever is imported and a person would have no idea that the timber was illegally sourced somewhere, moved somewhere else where it was processed and then ended up in Australia. We need to have that on the labelling because it is critical that that is there for the consumer, but also for the importer, because that importer then knows exactly what they are doing. In the absence of that labelling, the importer may well be acting in good faith and they are not going to be able to satisfy the customer that product actually is certified as having come from a legal source. So there are a number of issues with the bill and I look forward to the debate in the committee stage.

Ron Boswell (Queensland, National Party) Share this | Link to this | Hansard source

I rise to speak on the Illegal Logging Prohibition Bill 2012. Amongst the penalties included in the bill are $33,000 for an individual and $165,000 for a corporation for offences that include importing regulated timber products and processing raw logs without complying with the due diligence requirements. Those fines no doubt will act as a strong incentive to comply with the due diligence requirements. But what exactly are the due diligence requirements that must be complied with? We only find out the answer to that question when the regulations are developed at some time in the future. However, the bill in proposed section 14(5) says

The regulations may provide for due diligence requirements for importing regulated timber products to be satisfied … by compliance with—

amongst other things—

… rules or processes established or accredited by an industry or certifying body …

Similarly, at proposed section 18 (5), referring to processed raw logs, the bill again says that the regulation may provide for due diligence requirements to be satisfied by compliance with rules or processes established or accredited by industry or certifying bodies. These certifying bodies, no doubt, will include the Forest Stewardship Council, the body supported by a number of radical green groups. For example, members of the Forest Stewardship Council ruling general assembly include Greenpeace, the Wilderness Society, the Australian Conservation Foundation, Friends of the Earth, the World Wildlife Fund—the WWF—and other environmental non-government organisations, or ENGOs.

The debate has hardly started, and yet we see the Greens making a big direct play to get these green groups to issue certificates so they get their snouts right in the trough. We see ENGO sustainable certification bodies established or projected in a number of primary production areas: for example, forestry and fishing, and now beef and others, I believe. This raises the fundamentally important issue of how Australia will be governed in the future. It is certainly about how food, fibre and timber products will be harvested. The growth of the certification bodies highlights an apparent abdication of responsibility by the current federal government for making important decisions about primary production. I believe it also represents a direct attack on science and the role of scientists in decision making in primary production and other areas. It also belittles the role of experienced resource managers and potentially sidelines them.

It highlights the growing power of the ENGOs, especially their financial power and their ability to exert influence over government decisions. We are all familiar with references to 'big business' as a general term for wealthy and influential business organisations. Now in Australia we are seeing the rise of 'big environment', a large, wealthy network of environmental activists. How wealthy they are was shown by the Canberra Times article in December 2009 which reported that in that year Australia's four largest environmental groups had spent a total of $70 million, much of it for political lobbying.

Under this Labor government we have seen 'big environment' grow more and more powerful and influential, to the point where environmental activists now seem to be orchestrating much of Labor's policy on primary industry and natural resources. It appears that the Illegal Logging Prohibition Bill 2012 will require both importers and domestic processors of logs to have a due diligence system in place to ensure that to the best of their knowledge they do not import or process products obtained from illegal logging. The exact requirements in relation to due diligence are not yet known and will be specified in regulations at some time in the future.

However, it is absolutely vital that the regulations must not give any form of preference to one certifying organisation over another. Industry people tell me that producers, exporters and importers are possibly faced with having to construct a whole new system to meet the requirements of this legislation and would feel themselves forced to join a sustainable forest management certification scheme. Our importers and domestic processors might also come to the conclusion that it is necessary, at the end of the day, to handle logs certified through such a scheme.

When this is the case, it is vital that they have more than one certifying body to choose from. It would be a nightmare scenario if the only organisation that the market enables to anoint timber products as sustainably produced was something like the Forest Stewardship Council Australia. The way the Forest Stewardship Council Australia, or FSC, operates is to force timber producers to go through an expensive series of steps to have their products accepted by the FSC as sustainable. In the case of the Australian timber industry, those industry groups and businesses that choose to go for a certification scheme for their products at least have a choice.

Apart from the Green-NGO dominated Forest Stewardship Council Australia, there is a body called Australian Forestry Standard Ltd, or AFS. AFS says that it covers the majority of certified forests in Australia, with more than 10 million hectares certified under Australian standard 4708, the Australian Standard for Sustainable Forest Management. However, through the supply chain from the loggers right through to the final end users, businesses are already under constant pressure to use FSC-certified timber.

One company that has experienced this is Ta Ann Tasmania. It uses timber harvested by others and which was previously destined for the woodchippers. Ta Ann value adds by veneering these previous woodchip logs into valuable veneer for plywood production. The timber is sourced from regrowth and plantation. Environmental activists are conducting what my Tasmanian colleague Senator Eric Abetz described in this place earlier this year as a:

… deceptive campaign to cruel the markets of Ta Ann around the world, prejudicing Tasmanian jobs when our unemployment rate in Tasmania is well over seven per cent, and heading north.

Ta Ann's reputation is being defamed, and their markets drying up.

One example is where an activist group called Markets for Change flew to London before the Olympic Games and convinced the local company buying plywood for a basketball court not to use Ta Ann's products that they had previously agreed to purchase. A spokesman for the London contractor was quoted in the media as saying:

The reason we've stopped or we've suspended purchasing from Ta Ann is mainly because of the controversy around the logging in Tasmanian forestry. The NGO's will have to be happy with any changes that they can make to enable the product to be purchased by us again.

The Olympic basketball court represented one contract. Far more serious for Ta Ann has been the persistent lobbying by Markets for Change of the company's overseas customers for flooring products, especially in Japan. I understand that this has directly cost the company a significant percentage of its market there, which must directly affect jobs in Tasmania.

It is no surprise, then, to see media reports that Ta Ann's board of directors could decide as early as the end of this month to close down the operations in Tasmania. This is a company which last year injected $45 million into the Tasmanian economy and provided hundreds of jobs. They are hoping that there still might be a so-called peace deal between environmentalists and industry emerging in coming weeks, despite the recent collapse of negotiations over the Tasmanian Forests Intergovernmental Agreement, or IGA.

As well as conducting an ongoing campaign against Ta Ann, the Markets for Change activists are also targeting retail chain Harvey Norman. Harvey Norman is selling furniture made from sustainable Tasmanian timber, but that is not good enough for Markets for Change.

Both Ta Ann and Harvey Norman products are certified by Australian Forestry Standard, but of course Markets for Change and their fellow activists say that that is not the right certifying body. The Markets for Change website tells businesses like Ta Ann and Harvey Norman what they should do, saying that they should:

… give preference to plantation products with full Forest Stewardship Council certification.

So there we are, trying to force producers and buyers to use Forest Stewardship Council approved material.

It is a familiar pattern. In July last year Greenpeace activists climbed on a construction crane on the Central Park development in Sydney in a protest over the use of plywood that the organisation claimed was sourced illegally. Soon afterwards, Greenpeace trumpeted the news that the developers had promised not to use any timber that was not certified by the Forest Stewardship Council—again, direct action to make sure that other companies use only FSC certified material.

The examples I have drawn here relate to timber and timber products. However, the aims of the ENGOs go far beyond just timber in Australia. In Australia we have already seen the formation of the Forest Stewardship Council for timber products, the Marine Stewardship Council for wild-caught seafood, the Aquaculture Stewardship Council for farmed fish, and now a so-called roundtable for beef production. These are all WWF initiatives. Last year WWF International stated it was focusing on commodities including beef, bioenergy, cotton, dairy, farmed fish, palm oil, pulp and paper, soy, sugar, timber and wild-caught fish. It intended to target companies such as commodity traders, manufacturers, retailers and banks, insisting they deal only with producers endorsed by WWF.

It is by no means far-fetched to say that WWF and other ENGOs fully intend that all food and fibre products harvested in Australia will be forced to go through one of its cash-producing 'sustainability certification' processes. They will want every food and fibre product—every single one—to be certified. Australian primary producers should think about that. These are the schemes that cost individual producers thousands of dollars for the initial certification process and then regular ongoing costs for auditing.

Someone who has studied the impact of such sustainability certification schemes worldwide is Alan Oxley, one of Australia's most influential advisers on international trade. He was previously Australian Ambassador to the General Agreement on Tariffs and Trade, or GATT, which was the predecessor to the World Trade Organization. Mr Oxley said:

WWF has made no secret of its strategy to pressure companies occupying strategic positions in the supply chain, such as dominant consumer goods manufacturers and retailers, to adopt its certification standards. Other NGOs such as Greenpeace and the Rainforest Action Network are aggressively attacking brand names and leading products of major companies to encourage them to join the strategy.

He went on:

ENGOs will also engage a method often referred to as 'greenmail' to force companies into certification. 'Greenmail' involves action to devalue the public perception of a brand name or company reputation of producers and retailers through advocacy campaigns aimed at consumers and processors. Running negative campaigns against brand labels with significant market position is common. The aim is to pressure these businesses to align with or adopt certification systems developed by NGOs. Once the company adopts that system, it has become an agent for delivering the sustainability values of the NGO. By these means, ENGOs are able to influence, and even control, the supply chain.

When they hear that statement, perhaps Australian cattle producers can understand why WWF has been so keen to include McDonald's, the largest single buyer of Australian beef, and JBS, our largest single beef processor, on its Australian Roundtable for Sustainable Beef. WWF sees this roundtable as a first step towards pushing Australian cattle producers into another one of its costly sustainability certification schemes.

A couple of years ago, WWF US Senior Vice President Jason Clay gave an interview explaining how WWF's roundtables work. He said:

… we convene roundtables—meetings of all the members of a commodity’s value chain—everyone from producers, traders and manufacturers to brands and retailers, as well as scientists and non-governmental organizations (NGOs). Together we agree on the key impacts of producing a commodity – deforestation, water us, and so on – then design standards to minimize these impacts, which are ultimately certified by an independent third party. The participants publicly commit to producing, buying and selling within these standards, to be part of the commodity roundtable, forming a chain of sustainability.

Of course, to successfully achieve what Mr Oxley accurately describes as 'greenmail' and devalue the public perception of the brand name or company reputation of producers, the ENGOs first have to convince the Australian public and international buyers that current practices in forestry or fisheries or beef are environmentally unsustainable.

How can they possibly do that? Australia rightly insists that its primary producers maintain production methods and standards that are amongst the very highest in the world from an environmental point of view. I will tell you why ENGOs can portray our primary production methods as 'unsustainable' and in need of their own particular brand of expensive sustainability certification scheme. The ENGOs can do that because, while the current government continues to insist on stringent environmental standards from our primary producers, this Labor government says and does nothing to defend them. Instead, being politically captive to the Greens and radical green policies, it surrenders at the first sign of manufactured outrage. Instead of governing on the basis of good science, sound management principles and good old-fashioned common sense, this government is itself managed by social media. For this government, science can be trumped by emotion. It surrenders fact to opinion and rational management to the 140-character Twitter message.

This is a government had responded to a television program by shutting down Australia's live cattle export trade. That cost the cattle industry millions and millions of dollars and is still hurting cattle producers and related business operators throughout Northern Australia.

Then of course later, realising the enormous harm it has done by such an emotional, knee-jerk reaction, the government reversed its decision.

This is the government that encouraged efficient harvesting of fish in southern waters and agreed to the use of a large international trawler but then panicked at some of the reaction to the vessel's arrival and banned its operation. What that did was effectively cast doubt over Australia's fisheries management and fisheries science. Our fisheries science and fisheries management are internationally acknowledged as amongst the very best in the world. This is the government that gave in to the slick, well-funded lobbying campaign of international environmental activists and closed much of the almost one-million-square-kilometre Coral Sea region to most forms of fishing. That was completely unnecessary.

This is the government that allows ENGO activists to use deceitful public campaigns to target timber suppliers operating sustainably in well-managed forests. This government does nothing. This government stands on the sidelines and watches. It does nothing to defend sustainable businesses providing vital Australian jobs. It allows damaging campaigns to be waged against markets for sustainable Australian products here and overseas without lifting a finger or saying a word to help protect the jobs of Australian workers.

Who is running this country? Clearly not the current government. It looks more like mob rule. Scientists and resource managers must be seething with anger and frustration when sound, long-term advice is overruled for expedient short-term politics. What we see from some green groups is in fact antiscience. Science is complex and rational. The ENGO messages are inevitably simple and emotional: 'Save this, save that and save the other; donate now.'

What is to be done? Clearly, the government must speak out on behalf of Australia's primary producers and the sustainability of their farming, forestry and fishing practices. Then they must take action to back up those words. They must support our wealth-creating, job-creating primary industries in the marketplace. In other words, they must refute the lies told about our primary producers by the ENGOs. Then these ENGOs must be made accountable. The government should urgently re-examine the exemption of the ENGOs from the secondary boycott provisions of the Competition and Consumer Act—for example, where the ENGOs encourage the boycott of products not carrying the sustainability certification label they prefer.

The government should also examine what looks to be a free ride for activists who take apparently illegal actions but use the excuse that they were doing it for the environment. Why do these big environmental organisations, which seem to be able to spend millions and millions of dollars lobbying government and running advertising, PR and social media campaigns to influence the public opinion, enjoy tax-free charity status?

Claire Moore (Queensland, Australian Labor Party) Share this | Link to this | Hansard source

Order! Senator, your time has expired.

Ron Boswell (Queensland, National Party) Share this | Link to this | Hansard source

I seek leave to incorporate the last page of my speech.

Claire Moore (Queensland, Australian Labor Party) Share this | Link to this | Hansard source

This has not been previously agreed. We will return to your request after we go through the next process. We will keep it under consideration. If you can show the remainder of your speech to the whips, that may facilitate it.

Debate adjourned.

Ordered that the resumption of the debate be made an order of the day for a later hour.