Ms Catherine King (Ballarat, Australian Labor Party, Shadow Minister for Infrastructure, Transport and Regional Development) Share this | Hansard source

I, too, rise to speak on the Fuel Security Bill 2021, particularly in support of the amendment moved by the member for McMahon. This bill is an important bill. It extends support in an attempt to ensure the continuation of an essential Australian capability, to protect jobs and to ensure that Australia can continue to function in times of international strife and disruption. As all in this place know, Australia's fuel security is now at probably its most precarious level in our modern history. The COVID induced drop in demand has exacerbated underlying structural pressures in Australia's fuel refineries. We don't store enough fuel in this country, and we are fast losing any capability to refine fuel ourselves.

On 14 September 2020, as part of the 2020 budget, the Prime Minister and the energy minister announced an initial fuel security package. At the time, the government claimed the package would 'back local refineries to stay open wherever commercially possible'. Just six weeks later, BP Australia announced the closure of the Kwinana refinery. Then, in December 2020, the minister for energy announced that the government would bring forward the production payment to 1 January 2021, with $83.5 million to be paid over six months. In that announcement, the minister claimed that the government was 'taking immediate and decisive action to keep our domestic refineries open'. Less than two months later, ExxonMobil announced the closure of the Altona refinery. Two fuel security announcements in three months did nothing to stop the closure of two refineries, leaving us with only two refineries across the whole of this nation. This isn't a government that just got into power; this is a government that has been in power for eight long years, and it has absolutely neglected this important national security issue and our national capability.

The bill we're debating here is the government's third attempt. We hope, for the nation's sake, it is third time lucky. These bills will support the continued operation of our two remaining refineries through providing a subsidy when the market is low and imposing minimal stock obligations on fuel importers. The bill will also bring forward refinery infrastructure upgrades and accelerate the review of fuel standards in Australia, something that is long overdue. While these measures are welcome and Labor will support them, the bill does not do nearly enough to make up for this government's past failures.

To quickly sum up, half of Australia's remaining refineries have closed since the government's initial fuel security announcement in September 2020. Even after this package, Australia will remain non-compliant with its International Energy Agency obligation to hold 90 days of oil reserves, meaning we depend disproportionately on imports, and Australia still lacks a sovereign shipping capability, leaving us reliant on foreign owned and operated tankers. Hundreds of workers have lost their jobs. Australia's fuel security is worse than ever, and the government is still not doing enough to address the situation. This dire situation is the result of years of neglect. This neglect has played out not only in the closing of refineries but also in dirty, low-quality fuel and a consumer and industry fleet that is unable to accommodate the world's most modern and clean engines in this country.

It is well known across industry that Australia is a First World nation running on Third World fuel. We are one of only six nations in the OECD without fuel emissions standards. Our average emission intensity for passenger vehicles is 45 per cent higher than Europe's. The standards of our 91-, 95- and 98-octane fuel have been banned in Europe for over a decade. Our trucking fleet is older and dirtier. We can't import the most economical modern vehicle engines, because our petrol and diesel are not clean enough for them to run on. And these standards are due to remain unchanged for years to come in this country. At the same time, the government is standing in the way of electric vehicles, leaving Australia even further behind the pack when it comes to the future of vehicles across the world. The government should have got on with this years ago, encouraging electric vehicles, supporting and encouraging the upgrade of fuel refineries and ensuring that we have an adequate supply on our own shores. But the government has failed to do that.

This bill will take some action in bringing forward upgrades and accelerating the fuel standards review. But, given this government's complete failure and its record, it's hard to believe that this will be enough. They've made three announcements in eight months, but they haven't done the follow-up of securing our nation's fuel supplies, and this failure has left this country in a very vulnerable position. Fuel is important for what it does. It helps the transportation of goods, materials and people across our vast nation—our trucks, our ships, our cars, our buses, our trains and our planes. Australia runs on fuel. Our society cannot function without fuel, but we have very little here. Particularly with our limited refining capacity, we need to ensure that we have sufficient stocks onshore to maintain our society and our economy.

But once again, under this government, we are falling behind. Under International Energy Agency agreements, Australia should have 90 days of fuel reserves available at all times. Australia has not had 90 days of reserves since 2012—eight long years of this government, but not once have they met the minimum benchmark. Last year the government made an announcement, as they often do, telling us that they would do something about this. 'Finally the government cares about our fuel security,' we thought. Instead, the government—comically—announced that they would purchase $94 million of fuel to be stored not in Australia but in the United States. I don't know whether the government consulted an atlas before they made that announcement, but if they had, they might have realised that storing our strategic reserve of fuel on the other side of the Pacific Ocean wasn't particularly strategic. The fuel wouldn't be accessible in a crisis. That doesn't fix the underlying problem of fuel insecurity.

Australia relies on just-in-time fuel deliveries. It's worked for us, but one day it won't. Over the past year we have seen just how quickly things can change. It isn't hard to see how 'just in time' can easily become 'far too late'. The government's job is to prepare for these occasions, to future-proof Australia from those emergencies, not to bury their heads in the sand and pretend everything is always going to be okay. What will be essential when things go wrong and when our fuel is too far away is a fleet of ships on which our nation can actually rely. An Australian flagged strategic fleet is a key plank in assuring Australia's fuel security and broader supply chain security. But this government is leaving it to languish. Over recent years Australian shipping has all but collapsed. Over the past 30 years the number of Australian flagged vessels has shrunk from 100 to barely 10. While other maritime nations support their shipping industries, this government stands idly by and has in fact introduced policies to make it worse.

Norway has 519 vessels carrying the Norwegian flag. The United Kingdom has 1,157 flagged vessels, and China has 4,608 flagged vessels. If other nations can maintain a merchant fleet, so can we. In fact, it is essential that, as an island nation, we do so. But instead of supporting Australian shipping the government continues to open Australia up to foreign flagged vessels and crew without thinking of the importance of our own capability, not only to import our vital supplies of fuels and other essentials but also to move goods around our country and for the security of this nation. They twice sought to rip up the reforms made by the Labor government that were aimed at protecting Australian shipping, under the guise of reducing costs. This parliament twice rejected those governments' so-called reforms, calling out the legislation as bad for Australian passengers and freight, bad for Australian workers and bad for Australia's national security. All the while, each and every coalition transport minister over the past eight long years has undermined the policy settings that were put in place by the former Labor government that sought to enhance and rebuild Australian shipping. In particular, the repeated misuse of temporary licences by this government has enabled foreign flagged ships with foreign crews to trade along our coastline—work that can and should be done by Australian maritime workers who are paid Australian wages at Australian conditions.

Australia relies on shipping to move 99 per cent of our imports and exports, including our fuel. It is critical that we maintain the sovereign capacity to import these supplies and transport them around the nation. Whether it be conflict, natural disaster or pandemic, history has shown us that we cannot always rely on other nations to carry our essential goods on their flagged ships. We are an island nation. We are a trading nation. We are a maritime nation. We have the fifth-largest shipping task in the world, and under this government we are increasingly dependent on imports.

In times of crisis it is essential that we have an Australian fleet that we can rely on. That is why Labor has been calling on the government to consider the establishment of a strategic fleet that would not only protect our economic interests but also provide the training opportunities that we critically need to bolster our maritime workforce. The government needs to listen. This bill might do some good to address fuel security, but without addressing Australian shipping it cannot be enough. Whenever we do talk about shipping I am reminded of the workers of the MV Portlandmen who have borne the worst of the Morrison government's shipping failures. For those that don't recall, the MV Portland worked off the coast of Australia for 27 years, hauling alumina from Western Australia to Alcoa's Portland refinery. Then at 3 am one morning they were awoken by security guards, escorted off the ship and forced to watch as a foreign crew boarded the vessel—their workplace and their home—to take it for scrapping in Singapore. They lost their jobs, like so many other Australian maritime workers, to overseas operations which pay their staff a couple of dollars an hour. The same work is still being done. It will always need to be done. But it is not being done by Australians and it's not being done by workers receiving decent wages.

The Morrison government's failures have a national security cost, but they also have an undeniable human cost. Next week, these and other maritime workers will be coming to parliament, and I encourage all members to meet them and hear the story about what happened to them and their jobs. The government needs to do more to support them and their industry, because it is in their economic interest as well as in our nation's national security interests. As an island nation in uncertain times, with only two refineries, limited onshore fuel reserves and no strategic fleet, it is simply untenable. This bill is welcome, but it does too little. Labor is committed to rebuilding our capabilities. If this pandemic has taught us anything it is that we must build back better, that we have to build resiliency into Australia's national economy and that we have to have the capabilities as an island nation to look after ourselves. If it has taught us anything it is that we have to be a nation that makes things, and part of that has to be to rebuild a strategic fleet to keep our nation secure.

The Morrison government should follow our lead and finally take some real action towards securing Australia's fuel supply and better preparing our nation to meet its future.

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