Tuesday, 3 December 2019
Special Recreational Vessels Bill 2019; Second Reading
I rise to speak on the Special Recreational Vessels Bill 2019. This bill has been put forward in this place by the government to ensure that Australia's tourism sector continues to thrive. Tourism is an important facet of the Australian economy, with over 300,000 businesses in this area directly contributing a total of $57.3 billion of GDP in the last financial year and employing over 650,000 people. This amounts to 5.2 per cent of the nation's workforce and additionally accounts for over 10 per cent of our total exports. The fact that this sector grew three times more than Australia's GDP in the last financial year is further evidence of tourism's importance in promoting a diverse and strong economy.
Our commitment to driving demand in this sector can be seen in the Tourism 2020 and Tourism 2030 strategies. This program was developed through the Department of Foreign Affairs and Trade in conjunction with state and territory tourism ministers and over 160 industry leaders. These were developed to drive demand in the tourism sector by implementing an industry framework that will allow businesses to operate in a dynamic global environment. We on this side of the House want a strong tourism industry, not a weaker one, which provides world-class services to travellers as well as creating jobs for all Australians—high-paying jobs that Australians deserve.
This bill is only one example of the government's commitment to continuing to develop these ongoing strategies. In accordance with this vision, this is a bill that allows special recreational vessels, commonly referred to as superyachts, to obtain coastal trading licences to operate passenger and cargo charter services on the Australian coast. There are some 5,000 of these vessels around the world. Australian based vessels will see a huge increase in marketing exposure for chartering in Australia. The marketing budget for these large overseas vessels that are chartered for in excess of $1 million a week is more than our industry currently spends as a whole per year. Let me repeat that. A million dollars a week, which is what these boats or vessels often rent for, is more than we spend in an entire year. With a few of these vessels open for charter in Australia, the whole charter industry will benefit from this exposure.
If this bill is passed, we will also see huge infrastructure investment to refit maintenance yards, with hundreds of millions of dollars already being spent in recent years in preparation for this expected change. The domestic fleet will also benefit from these upgrades, while creating many jobs along the way. Another benefit of this bill is that we will see an increased demand for skilled tradespeople to maintain the increased workload, creating more jobs, not less, and opportunities for upskilling amongst the current workforce.
To examine why this is necessary, we need to look over the current framework for coastal commerce in Australia and judge whether it is sufficient in ensuring that the economic benefits of tourism are harnessed to their full potential. Over the next 18 months the Pacific region will experience both the 2020 Tokyo Olympics and the America's Cup in Auckland. These events will create a large increase in international sea traffic, which provides Australian businesses with a great opportunity to benefit from this boost in activity.
Through the government's ongoing monitoring of market conditions, along with the feedback that we are receiving from the industry, it has been shown that there is an immediate need to supplement existing legislative provisions. The maritime tourism industry has advised that ensuring that businesses have the ability to receive the benefits of increased international maritime activity is important to their ongoing success over the next couple of months. We in this place must ensure that maritime businesses have the best chance of taking advantage of this increase in buoyant maritime market conditions. An integral aspect of some feedback that the government has received from the industry is that the current legal framework for maritime commerce is insufficient to provide certainty to international operators of charter services, which would like to engage with the Australian market over an intermittent period of time. We must, therefore, ensure that we can give certainty to the industry in order to maximise the benefits that will be felt by all Australians.
The current framework is structured around the Coastal Trading (Revitalising Australian Shipping Act) 2012. This act has not been substantially amended to reflect the changing market dynamics since its creation. While the act is well suited to established commercial operators, it has not been adapted to suit the business operating model of smaller or short-term recreational vessels. The problem with this act is that it does not allow superyachts to obtain a temporary licence to operate charter or hire services in Australian waters. Let me make that clear: superyachts are not allowed to operate in Australian waters. The impact of that is that every week we are dropping at least $1 million that could be going into the Australian economy. Because these vessels are not able to obtain temporary licences they're not able to obtain the exceptions contained in the coastal trading act, meaning that the vessels are subject to the Customs Act's importation duties and taxes even though their stay may be less than four weeks. It is an absurdity that's costing ordinary Australians millions of dollars and businesses in my electorate tens of millions of dollars.
While the coastal trading act has provided an effective framework and process for obtaining general, temporary and emergency licences, it has explicitly excluded recreational vessels from obtaining these. You have to ask yourself why. As well, temporary licences to commercial vessels under the coastal trading act require a minimum of five voyages. It is absurd. Noting that here a voyage is defined as departure from an Australian port to another Australian port, this is inconsistent with the operating model of superyachts, which is often a single voyage to take advantage of an opportunity to offer the vessel for charter—likely to and from the same port—chasing weather, or to a specific destination. This rigidity of the existing act is incompatible to the business model of superyachts. There must be a degree of flexibility in our maritime trade law, which supports the business model of the vessels, in order for it to be attractive for them to operate in Australian waters and, thus, further enable related tourism businesses and other matters to receive the incidental economic benefits of these activities, not to mention the fact that it will employ Australians at high wages. It will create investment for businesses in Australia. Why the Labor Party is opposed to this can only come down to simple class warfare.
As a consequence of the deficiencies of the current act they introduced, inflexible in providing temporary licences, most of these vessels pass Australia and, instead, make port in Fiji, Vanuatu or New Zealand. We are literally exporting money, jobs and business investment to New Zealand. The maritime laws in these places are better suited, which is a complex way of saying they make sense. It would be remiss of us here if we continued to let Australian businesses lose out on an array of economic benefits and opportunities to New Zealand.
This bill is simple but effective in correcting the previously mentioned insufficiencies of the coastal trading act. It is not attempting to replace existing provisions of the coastal trading act but, rather, supplement and strengthen the operations of the existing act. It makes you wonder what is really behind the member for Ballarat's amendments to this bill. The bill will enable special recreational vessels to apply for a temporary licence to carry passengers or cargo in Australian waters. Alongside the current licensing process of the coastal trading act, the bill will also permit owners of superyachts to submit declarations that apply to international voyages. Under the current act, these cannot be made by this type of vessel.
The ability of general licence operators to challenge the granting of a temporary licence will still be available to them. The bill will ensure international operators are attracted to operating within our pristine waters, from up north at Cape York to down along the coast to places like Port Douglas, the Whitsundays and the Sunshine Coast, even to the Gold Coast and as far south as Pittwater. Nemo made it to Sydney Harbour, so I assume the superyachts can make it that far too. The greatest thing about this is thousands of dollars will be spent in our regional communities that are currently doing it tough due to the drought.
For the owners and operators of superyachts wishing to conduct a charter, they may apply for a special recreational vessel temporary licence. Flexibility is an integral part of the act, providing the minister or designated senior executive with the ability to grant a temporary licence for a single voyage, charter, that takes a round trip, between various Australian ports, of a number of voyages, over 12 months. Vessels may apply for a further temporary licence after the cessation of their existing licence. Further, these vessels will gain an exemption from the Customs Act's importation duties and taxes, which will alleviate a significant cost to the current operators of charter yachts in Australian waters. It also makes sense that you wouldn't charge duties and taxes of an import nature on something that you're not importing. This is something that I would have thought the member for Ballarat, before she moved her amendment, would have been able to see.
Opening Australia to the superyacht market will bring important trade and tourism benefits, particularly to rural and regional areas on the Queensland coast. This will contribute to the international image that we want to project to prospective tourists. We want those wanting to travel to this country for tourism to feel that they can have an experience they would be unable to have anywhere else in the world—a unique experience. This act is in line with doubling tourist expenditure by 2020 on 2015 levels.
Regional communities will be able to experience the benefits of the boost in economic activity. In fact, 43c of every tourism dollar spent goes towards benefiting regional communities across Australia. Additionally, many small businesses in Cairns, the Whitsundays, Port Douglas, Pittwater, Sydney Harbour, Melbourne, Hobart and even Perth, among others, are poised to benefit from superyacht tourism. The bill should make coming to Australia more attractive, not less, for these vessels, the people who want to sail on them and the associated economic benefits that create jobs, regional growth and economic and business investment. The economic benefits of this bill cannot be overestimated. It will unlock an additional 11,800 jobs and over $1½ billion by 2020-21. Chartered vessels make up more than half of the world's superyacht fleet, and under the current regulations we are not allowing them to operate commercially in Australia unless they are imported.
It is also important to note that those who defend the current laws and pretend that they have done good should keep in mind that the Australian fleet is now 10 per cent of what it was before those laws were introduced. They have decimated our charter industry, they have decimated Australian shipping and they have kept economic growth from both our regions and our cities. They have not allowed our businesses to enjoy, to promote and to utilise the expert skills they have in this country in the superyacht and boatbuilding sector. Looking ahead, it is important that we continue to consult stakeholders within the tourism industry and maritime operators in particular. A skill shortage is forecast, and I highly recommend this bill to the House.