House debates

Monday, 17 September 2018


Customs Amendment (Comprehensive and Progressive Agreement for Trans-Pacific Partnership Implementation) Bill 2018, Customs Tariff Amendment (Comprehensive and Progressive Agreement for Trans-Pacific Partnership Implementation) Bill 2018; Second Reading

11:45 am

Photo of Chris HayesChris Hayes (Fowler, Australian Labor Party) Share this | | Hansard source

I seek the opportunity to make a contribution on the Customs Amendment (Comprehensive and Progressive Agreement for Trans-Pacific Partnership Implementation) Bill 2018 and the Customs Tariff Amendment (Comprehensive and Progressive Agreement for Trans-Pacific Partnership Implementation) Bill 2018 and, in doing so, indicate that Labor supports the passage of these bills. In the first instance we support the amendment moved by the shadow minister for trade. We've heard on many occasions in this place the importance of trade to this country. At the end of the day we are a trading nation, hence we are supportive of this Trans-Pacific Partnership. We on this side of the House were supportive of the last iteration of the Trans-Pacific Partnership. We saw benefits at that stage. Whilst the benefits may appear limited in the initial instance, we were attracted by the fact that the Trans-Pacific Partnership had a series of attached side agreements about matters of human rights, labour rights and the preservation of the environment. We thought it very instructive to have these things in trade agreements, hence we were supportive in the first instance.

We're pleased on this occasion that this iteration of the TPP embodies many of those aspects that were formerly in the initial Trans-Pacific Partnership. We think it is right that there be obligations in respect of not only trade but also how labour is treated, how the collectivism of negotiations is respected and how the environment is treated by each of our trading partners. There should be greater scope for the enforceability of these particular requirements, because at this stage only signatories to the Trans-Pacific Partnership have any enforcement ability in relation to those matters, and presumably much of that will get down to diplomatic consideration before any effort is taken.

We're also concerned about the investor-state provisions. Labor's concern about that is not just in relation to the TPP. The minister at the table, Mr Andrews, will recall that these matters were raised about the China-Australia Free Trade Agreement. As a matter of fact we've looked at the issue of investor-state provisions as a central theme in every free trade agreement we've had. We are not entirely comfortable with these things and would seek appropriate recourse if Labor forms the next government in this country. We have a concern that we are opening up our court systems for the enforceability of actions by foreign institutions against not only Australian companies but also the Australian government and all governments of Australia, state as well as local, simply because they're signatory countries to this Trans-Pacific Partnership—although I note that the only country to which investor-state provisions will be extended beyond those that already have them is Canada, which is probably of lesser concern to us, given the formation of their laws, being a common law country, is much the same as ours.

We collectively in this House focus on trade because we know that trade is the ability for us to create jobs in this country. There will be certain challenges in that. The transitional arrangements must be such that we limit the number of impediments to existing industries and their workers. But the simple fact is that if we are going to be a trading nation we must be able to do so on the basis of our strengths, and the strength that we have in this country is our people. That's where we excel. We need to ensure that we properly resource not only our industries but also the training of our people, including through our tertiary institutions, in many instances TAFE, to ensure that our people are on a very competitive footing so that we can trade profitably with other countries within our sphere of influence. This is something that we on our side of politics have been very clear about, including in the funding of schools, the funding of universities and in particular the funding of TAFE colleges. By the way, we think TAFE is the backbone for enhancing our ability to trade more effectively throughout the region.

I will leave my comments there at this stage. As I said, we support the amendments made by the shadow minister for trade. We think that they are sound. If these amendments are accepted they would make the TPP a better trading instrument than is currently proposed in this bill. However, I do say that it is in our interest that we facilitate free trade within our region. We will be the ultimate beneficiary of that, provided that we invest appropriately and particularly where we invest in our people.

Photo of Lisa ChestersLisa Chesters (Bendigo, Australian Labor Party, Shadow Assistant Minister for Workplace Relations) Share this | | Hansard source

I seek leave to continue my remarks.

Leave granted.

Thank you for the indulgence of the House. I do apologise for missing my call earlier, in continuation from what I started to speak about when this House last sat, last Thursday. As I said last Thursday—and over the weekend my position hasn't changed—I do remain, like many Australians, skeptical about our free trade agreements. As one person put to me, we should really call them 'trade agreements', not 'free trade agreements'. We don't have any independent economic modelling around these agreements that actually demonstrates the benefits of these agreements. Quite often with these agreements we talk only about what goes out of our country; we don't talk about what comes into our country.

I'd like to start with what goes out of our country. We always headline with Japan, with China and now with the TPP how great these agreements are for agriculture. But, as anybody who works with people in the regions and talks to our farmers knows, the people say that, while agreements are okay, what about the non-tariff barriers? With all the fanfare around the China free trade agreement, all we got in my part of the world, when they talked up wine, which is a big industry for us, was a seminar on how to maximise your opportunity into China. Small, independent boutique growers don't have the capital to start building those relationships, and a once-off seminar isn't enough. And they're not really benefiting from the last agreement that we spoke about in this place—the China-Australia Free Trade Agreement. One of the other headline areas was how this is great for rice. Let's just talk about the rice industry for a moment. In a non-drought year—and I say that because at the moment we are in a drought year—80 per cent of our rice is exported. That sounds really good until you learn that that's only two per cent of the world's entire rice market. And that rice, that two per cent, is already going into the top market in Japan and into the top markets in Asia, because our rice, our sushi rice, is the best rice. Its quality is up there.

So, is there really a new benefit in relation to this cut in tariffs for rice? What we then ask when it comes to agriculture is, what is coming into our market?

We need to look at what is coming into our market and the jobs that are being put at risk in those manufacturing sectors. There is real concern in our country about the pressure that we're putting on our local manufacturing. Those concerns are real, and we should listen to those. That is why Labor's proposal to do independent economic modelling is needed. Australians want to know that they are getting a good deal out of these agreements. We don't know that with the TPP. I would urge this government to do that economic modelling, to put this bill on hold and to do that independent economic modelling, as Labor has proposed, so Australians can know the truth about this agreement.

I also speak in favour of the amendments that have been put forward by the opposition that are saying we need to get the labour market testing right. Waiving labour market testing for contractual services for six new countries in this agreement will actually make things harder for locals seeking local jobs. It's a problem we have in our country; we have a problem with our temporary visa program in our country. Weekly, we hear of another case of worker exploitation. People who've come here in good faith to work are being exploited by dodgy labour-hire companies and by unscrupulous employers. We cannot, in good conscience, expand allowing people to come into this country, without any proper labour market testing, until we stabilise the temporary work program that we have in our country. It is, to me, alarming that we are now debating whether we should allow electricians to come into this country when they say they've got complementary skills but we don't know if those skills are up to the Australian standard.

Throughout Australia, we are meeting people, working in areas like the renewable energy industry, who are coming in on a temporary work visa—the companies are not even offering those jobs locally—and are working to build solar power plants. It's happening in the town of Tieri in Central Queensland. They have set up a camp—it is literally a camp—where workers from Eastern Europe are coming and staying. We don't even know if they're being paid in Australian currency. We suspect they're being paid in a currency from overseas; it goes into their overseas bank account. They come here, they're working, they don't associate with the town, they very rarely spend money in the town and they may or may not go home. This is happening right now. This government is completely ignoring the fact that we do have breaches, day after day, of our temporary visa program.

Last week I also highlighted—and this is an ongoing issue with Chinese plasterers—the people who are here on a temporary visa arrangement, who have gone in and in good faith done work, but are not quite aware of what their conditions are or what they should be paid. They're temporary workers, so how would they know? They have worked on the Royal Hobart Hospital and they have worked in other places in Melbourne, and they have not been paid. They weren't paid for nine weeks.

Mr Ciobo interjecting

The minister interjects and says that this has nothing to do with the TPP and the legislation before us. It actually does. If we don't have our temporary work visa program up to standard and if we don't have the safeguards in place, we shouldn't allow more workers to come in to be subjected to that level of exploitation. Let's clean up our backyard first. Let's fix our IR system. Let's fix our temporary work visa system before you invite more workers into this country who could quite possibly be exploited.

It brings me to highlight a couple of the countries that are on this list. We're talking about Vietnam; we're talking about Malaysia. In the chicken processing industry, the boning work that goes on in chicken processing is almost all Vietnamese-Australian workers and Vietnamese workers. If they are Vietnamese-Australian, they have quite possibly had 10 years of worker exploitation before they actually get their permanent residency. It's happening in chicken processing in my electorate. People are bussed up from Melbourne to work in the chicken factory. For the people who are here from Vietnam, we don't quite know all of their visa arrangements. It chops and changes. Some of them are on protection visas or bridging visas. Some of them are here on worker holiday visas. Some are here on tourist visas and shouldn't even be working. There's a real grey, hidden area with what's happening. Until we get the safeguards in place, we should delay moving forward on this legislation. We need to make sure that any guest worker who comes into our country has this support and that protection.

I just want to highlight a couple of myths about our free trade agreements. They relate not just to the Trans-Pacific Partnership Agreement but more broadly to all agreements. The government and the Liberal National Party like to really talk about the jobs and say that these agreements will be jobs boosters. They are not. The TPP, in this case, will result in more jobs being outsourced. It won't actually be a jobs booster. It's estimated that we'll lose up to 40,000 jobs by 2025. That's not a jobs booster. That's a jobs loss. Another myth is that it won't make it easier for temporary workers to come to Australia. That is not true. We know that temporary hire migrants will be able to come into our country from six additional countries.

Government members interjecting

I hear the interjections of those opposite. Again they are going to accuse us of being racist and xenophobic. We are absolutely not. I think it is outrageous that, because you come into our country as a temporary migrant worker, you're paid less. I think it's just outrageous that you have workers who come into our country who are paid less because of the country that they're from. How does that happen? How is it possible that people are paid less? There is an award minimum in a lot of these industries. These labour hire companies pay the award as a minimum. Some of the workers don't even get that. Until we fix up workplace relations and resource the Fair Work Ombudsman properly, we should not allow more and more workers to come in. We've got to get those foundations right first. We need to make sure that any jobs that we have are offered to Australian workers first. We need to make sure that, if there is a local job, it goes to a local first. We also know that there is a link: if you directly employ someone, you're more likely to get an Australian to put their hand up for that job because they know they will have job security and the right working conditions.

What's raised opposite is that we are very concerned about the ISDS clause. Labor believes that Australia should negotiate its trade agreements without these clauses. We have committed that in government we would seek to remove any ISDS provisions, and we have put that commitment in this amendment we have moved. People are concerned about this. People don't like the idea that an overseas company can sue their government for pursuing policy that is in the best interests of Australian people. We also seek in this amendment to reinstate labour market testing for contractual service suppliers in existing free trade agreements—all of them. We need to have the very basics of labour market testing. I believe we need to strengthen our labour-market-testing laws. We need to make sure that all of the labour market clauses that we have are genuine and are ensuring that we are making companies look for local workers first. Labor have also said in our amendment—this is something that the government should do immediately—that all new free trade agreements should be subject to independent national interest assessments before going any further. I urge the government to do that today. If you believe that this is a job booster, prove it. Do the independent labour market testing, because all the research we've seen is that it's actually going to cost Australian jobs.

We have also said we want to legislate to create an accredited trades advisory program where industry, unions and civil society groups would provide real-time feedback on a draft agreement during negotiations. We have also said we'd strengthen the role of parliament in trade negotiations and increase the participation of the Joint Standing Committee on Treaties. These are all practical steps that would see a better free trade agreement.

As I said, I share the concerns of most Australians, who are quite sceptical about agreements, particularly by this government. We should not be signing off on any agreement that has no labour market testing in it. We should ensure that any agreement protects local jobs, protects and enhances local industry, and doesn't trade it off in a simple transaction. We do have good industry here in this country, and we need to do our utmost to promote it and to protect it, not just in agriculture but across the board. But, most importantly, before the government goes down the path of waiving labour market testing, it needs to stop and think about the treatment of those workers in this country, fix the migration program, fix the temporary worker program and give the Fair Work Ombudsman the resources to investigate the unending reports of worker exploitation of people who have come here in good faith to work.

12:04 pm

Photo of Ross HartRoss Hart (Bass, Australian Labor Party) Share this | | Hansard source

I rise to speak on the Customs Amendment (Comprehensive and Progressive Agreement for TPP Implementation) Bill, which has the effect of implementing the comprehensive and progressive agreement for the Trans-Pacific Partnership, the TPP-11, trade agreement. This is the third occasion I've had cause to speak on the TPP-11 agreement, as I spoke on the presentation of the Joint Standing Committee on Treaties report No. 181 and, recently, on a private members' motion on this issue.

Labor supports this bill. However, the TPP-11 trade agreement is not an agreement that Labor would negotiate in government. There are serious concerns within the agreement. Those concerns have been expressed in submissions to the Joint Standing Committee on Treaties during its recent inquiry into the TPP-11. Labor members of JSCOT prepared substantial additional comments for the publication of report No. 181 of the committee. Labour understand that, on balance, liberalisation of trade benefits Australia as a trading nation. Labor has a strong and proud commitment to growing the economy through reforms on how to do trade and how to undertake business.

However, Labor's commitment to trade liberalisation is not unconditional. Labor's commitment recognises that there are winners and losers from trade liberalisation. Whilst the market reforms undertaken in the main by the Hawke and Keating governments led to significant growth within the Australian economy and the creation of significant employment, there are communities, there are industries and there are lives adversely affected by changes to the way that we address trade between nations. I've mentioned previously in this place, in connection with the presentation of the report of JSCOT, that my electorate of Bass was one of the first areas affected by the removal of tariffs in the 1970s. The immediate effect of this was massive job losses within the textile manufacturing industry centred on Launceston. It is irresponsible to overlook the fact that in this instance there were generational consequences through job losses that have not been adequately addressed in over 40 years.

As I've indicated previously, the first step in the negotiation of treaties is to ensure that the effects of treaty action are properly and adequately modelled. There were significant concerns expressed through the inquiry process as to the lack of financial modelling associated with the TPP-11. This criticism is valid. Whilst the present government might be prepared to embark upon the negotiation of trade agreements on the basis that benefits are assumed, it is vitally important that the effects of a trade agreement are properly understood so the benefits and indeed the adverse effects can be addressed. This is consistent with longstanding Labor policy. Labor also proposes that there be analysis as to the effects of trade agreements: not only economic effects but also other areas—that is, social, environmental and, indeed, strategic. These effects should be taken into account during the negotiation of trade agreements as part of a transparent process which involves greater oversight by the Joint Standing Committee on Treaties. There should also be the ability for members of civil society to receive consultation during that negotiation process.

Whilst economic modelling in this case has been undertaken by the Victorian Labor government which shows that there is indeed a net positive effect to the Australian economy, it is unacceptable that there was no independent modelling available to the parliament during negotiation and, subsequently, during the adoption of this treaty into law. Labor in government, if elected, will remedy this by the adoption of a comprehensive set of reforms which will be designed to ensure that the accredited organisations and interest groups will be able to receive briefings during the treaty negotiation process. JSCOT will also receive, at the commencement of the process, a statement as to the objectives of a particular treaty negotiation and regular reporting as to progress against those objectives.

This treaty contains investor-state dispute settlement clauses, ISDS—in this case, extending ISDS to Canada. Labor will not countenance, in government, the negotiation of treaties which extend ISDS clauses and give corporations the right to claim compensation from Australian governments for the legitimate exercise of Australian sovereignty. It is significant that the United States has indicated that it would not include ISDS in future treaties and, in particular, will remove ISDS from the NAFTA. The European Union has also criticised ISDS clauses as constituting an unreasonable fetter on state sovereignty.

It is reasonable to suggest that ISDS clauses do not add to the likelihood that favourable trade terms may be negotiated with another state. They expose Australia to the risk of significant litigation, significant cost and what is known as regulatory chill. Labor, if elected, will negotiate the removal of ISDS clauses from the TPP-11 agreement by the use of side letters, using the New Zealand experience as a precedent. Given that ISDS provisions are supposedly to the mutual benefit of two state parties, the removal of the Canadian ISDS provisions would be on the basis that both Canada and Australia would, by agreement, remove the clauses without further additional consideration.

Labor's concerns with the incorporation of ISDS clauses into the TPP-11 are real. There are many areas of legitimate legislative powers, such as health policy, environmental law, occupational health and safety, and the like. These are all areas where the general public would consider that government should be able to legislate without threat of litigation and claims for compensation from foreign corporations. There is no doubt in my mind that ISDS does represent an unreasonable limitation upon the sovereignty of Australia. Australia has a strong commitment to the rule of law. It does not need ISDS provisions in a trade treaty to give confidence to foreign investors that they'll not be subject to arbitrary or capricious legislation.

As I've said in this place previously, the other real concern expressed by Labor is that this agreement has the effect of waiving labour market testing with respect to six additional nations. This means that temporary migration from these six nations will be facilitated without labour market testing. Citizens of Canada, Peru, Mexico, Brunei, Malaysia and Vietnam will be able to enter under temporary skilled migration without any proper assessment of the market for these jobs for Australian workers. Australian workers have only their labour to offer. Workers have every right to be concerned that an Australian government is prepared to facilitate temporary skilled migration without proper assessment of the labour market for those jobs. There are concerns rightly expressed about the potential for exploitation of temporary skilled migration, in particular the exploitation of vulnerable overseas workers. That has recently been seen in Hobart on the site of the Royal Hobart Hospital redevelopment. Chinese workers have been left in the lurch, unpaid and exploited.

As has been said by my colleague the member for Shortland, the potential for exploitation is huge. Workers have effectively no rights because they have no bargaining power. They can be sacked and deported for no reason. If we are to have temporary migration to drive economic growth in this country—and there are times where temporary migration is absolutely necessary—it should be done properly. The employer must demonstrate that a position cannot be filled by an Australian worker at a market rate of pay and not just for the minimum rate of pay on an outdated award. The migrant, the visa holder, must be paid a market rate of pay, not a minimum rate of pay. Finally, an employer should invest in training so that an Australian can ultimately fill that job. Nowhere has the undermining of Australian jobs been more significant, in my view, than in the Australian maritime industry. Highly skilled jobs have been lost to temporary migrants without regard to labour market testing. I regard the treatment of our Australian shipping industry as a national disgrace. To not do these things is to undermine the training of future skilled workers, to undermine wages and to undermine conditions.

The second significant concern with respect to temporary migration is the system of skills recognition. Skills recognition may be appropriate within the domestic context so that, for example, a Victorian electrician may be recognised as having skills appropriate for the plying of a trade in Queensland or Tasmania. The effect of this agreement is that a Mexican, Canadian or Vietnamese electrician must be accepted as having the same standard of qualifications as an Australian electrician. There are vital issues of public safety and confidence involved in skills recognition. Those concerns have been expressed by the ETU. Given the public safety issues, the public interest is not served by a weak system of skills recognition. Just as Labor has indicated that it will renegotiate the ISDS provisions of this trade agreement should Labor win government, the shadow minister and the Labor Party have committed to negotiate side agreements with the six nations that have this labour market testing exemption to have these provisions removed.

Labor in government will also legislate to prohibit the inclusion in future trade agreements of waivers of labour market testing, prohibiting future governments from negotiating trade agreements that waive mandatory skills testing and prohibiting future governments from including ISDS clauses in trade agreements. We cannot again have a situation where a Liberal government negotiates a second-rate trade agreement and seeks to put the interests of some within our community above the interests of skilled workers—that is, Australian workers generally and Australian sovereignty. In contrast, Labor, under the member for Blaxland, proposes a comprehensive review of the negotiation of trade treaties if we are elected to government.

A future Labor government will update the parliament and the public after reach round of negotiations, where possible. It will commission economic modelling for all new trade agreements before they are signed and 10 years after ratification so that the full impacts of a trade agreement can be assessed. Labor will also introduce legislation that requires future trade agreements not to waive labour market testing for contractual service providers and not to include ISDS clauses. The legislation will also establish a system of accredited trade advisers from industry, unions and civil society groups to provide written feedback on draft trade agreement text during the negotiations. This is vitally important to ensure that there is community support for the objectives of a free trade agreement. Labor will legislate in government, if elected, to require an independent national interest assessment to be conducted on every new trade agreement, before it's signed, to examine the economic, strategic and social impact of any new trade agreement.

Finally, Labor will strengthen the role of parliament in trade negotiations by increasing the participation of the JSCOT committee. Labor will provide JSCOT with a statement of objectives for negotiation, consideration and feedback and will provide JSCOT with a briefing at the end of each round of negotiations. The concerns this side of politics has with this agreement are real. They are concerns that have been heard during the course of the consultation process and the evidence received by JSCOT.

Despite this government negotiating a second-rate agreement, there are risks, including strategic risks, with voting this agreement down. Labor, if elected, has committed to fixing the offensive aspects of this agreement. The very real concerns within the labour movement and elsewhere as to labour market testing, skills testing and ISDS provisions should be heard. The government should not have ignored those concerns. Labor, if elected, will address those concerns. We have a comprehensive plan, through the shadow minister for trade, to introduce reforms that will affect the future negotiation and implementation of trade agreements.

12:18 pm

Photo of Steven CioboSteven Ciobo (Moncrieff, Liberal Party, Minister for Defence Industry) Share this | | Hansard source

The Customs Amendment (Comprehensive and Progressive Agreement for Trans-Pacific Partnership Implementation) Bill 2018 amends the Customs Act 1901 to implement Australia's obligations under TPP-11. These amendments are complementary to those contained in the Customs Tariff Amendment (Comprehensive and Progressive Agreement for Trans-Pacific Partnership Implementation) Bill 2018. I'd like to take this opportunity to speak to the two bills in front of us here today, because they are very much related. I'm pleased to have this opportunity to conclude the debate on this important agreement. The TPP-11 is one of the most comprehensive trade deals ever concluded. It will eliminate more than 98 per cent of tariffs in a trade zone spanning the Americas and Asia with a combined GDP of some $13.8 trillion. Australian farmers, manufacturers and services exporters will benefit from new market access opportunities in economies with nearly 500 million consumers. It will provide better access for farm exporters, including beef and sheep meat producers, dairy producers, cane growers and sugar millers as well as cereal and grain exporters. There will be new opportunities for our rice growers, cotton and wool growers, horticultural producers and our wine exporters.

Recent modelling undertaken by economists from the Brandeis International Business School and Johns Hopkins University shows Australia is forecast to see some $15.6 billion in net annual benefit to national income by 2030. This follows earlier modelling by the respected Peterson Institute for International Economics, which found that the TPP-11 would boost Australia's national income by 0.5 per cent and boost exports by four per cent. This sort of boost to our nation's income would mean more jobs, higher wages and greater investment in further areas of business and jobs growth.

Let me provide one example of how TPP-11 will give our farm exporters an advantage over some of our toughest competitors. Within two years, Australian beef exporters will face tariffs 13 percentage points lower than their United States competitors in the multibillion dollar Japanese market. That tariff advantage will continue to widen over subsequent years. Our manufacturers will benefit from the elimination of tariffs on industrial goods. Our services exporters will have access to liberalised and improved regulatory regimes for investment, notably in mining and resources, telecommunications and financial services.

The TPP-11 is truly a next-generation trade agreement. For the first time in a trade agreement, TPP-11 countries will guarantee the free flow of data across borders for services, suppliers and investors as part of their business activity. This movement of information, or data flow, is relevant to all kinds of Australian businesses—from a hotel which relies on an international online reservation system to a telecommunications company providing data management services to businesses across a number of the TPP-11 markets. It's important to note that TPP-11 governments have retained the ability to maintain and amend regulations related to data flows but have undertaken to do so in a way that does not create barriers to trade. The TPP-11 also creates Australia's first free trade agreements with Canada and Mexico, giving Australian exporters preferential access to two of the world's top 20 economies for the first time. In 2016-17, nearly one-quarter of Australia's total exports, worth roughly $88 billion, went to TPP-11 countries.

The forthcoming entry into force of the TPP-11 is a significant moment for open markets, free trade and the rules based international system, but it is important to note that the achievement of a final TPP-11 deal was far from guaranteed. When the United States withdrew from the original TPP in early 2017, the prospects of a groundbreaking deal were far from certain. For Australia and the TPP partners, it was a test of resolve and judgement. There was no guarantee of success. One option was retreat. There would have been no new and historic access to the Canadian market for our grains, refined sugar and beef exporters and no new access to the Mexican market for our pork, wheat, sugar, barley and horticulture producers or education services providers. There would have been no improved access to the Japanese market for our beef, wheat, barley and dairy exporters and no improved access for our wine producers in the Vietnamese, Canadian, Mexican and Malaysian markets.

Thankfully, the governments of our trading partners, led by Japan, together with Australia and New Zealand, pressed ahead. As a consequence, our global trading system is stronger today because of the TPP-11. We have created a beacon for nations that want to work within a rules based framework that is complementary to the global architecture provided by the World Trade Organization. We want the TPP-11 to grow in membership. We don't want the TPP-11 to be an exclusive, inward-looking bloc. We welcome the interest in TPP-11 shown already by nations within and outside the Asia-Pacific, including the Philippines, Indonesia, Thailand and even the UK as well as Colombia.

Given the significant contribution the TPP-11 will make to our trading future, it is important Australia and its TPP partners reap the benefits of the deal as soon as possible. The TPP-11 will enter into force 60 days after the six TPP-11 member countries complete all necessary ratification procedures. To date, three countries—Mexico, Japan and Singapore—have ratified the agreement, and a number of other countries, including New Zealand, Peru and Canada, have indicated that they will ratify in the coming months. In other words, if Australia and five other countries can complete ratification before the end of October, the TPP-11 will enter into force before 31 December this year. That means there will be two opportunities for tariff reduction, the first on entry into force and the second on 1 January 2019.

On the other hand, if the TPP-11 were to enter into force this year without Australia, our exporters would be placed at a significant competitive disadvantage. For example, New Zealand and Canada would have superior access to the Japanese beef and dairy markets, better access to the Japanese cheese market and better access to wine markets in Mexico. That's the consequence if Australia is not among the first six. We will be in a significantly competitively disadvantaged position, vis-a-vis key competitors of ours, if we are not in the first six.

The deal signed on 8 March 2018 is one that fundamentally serves Australia's national interest. Its scope and level of ambition cannot be underestimated. It will create new opportunities and greater certainty for our businesses and encourage job-creating foreign investment. It will make Australian exports more competitive, so our farmers can sell more produce, our professionals can provide more services and our manufacturers can make and sell more goods.

Our involvement in the negotiation of this deal means Australia played a key role in setting 21st century rules for commerce across the world's fastest growing region. This will enable us to tackle new trade and investment barriers as they arise, helping our businesses weather the increasingly challenging global trading environment. These bills will see the elimination of 98 per cent of tariffs from TPP-11 countries in a regional free trade zone that already accounts for over one-fifth of Australia's two-way trade. The TPP-11 tariff cuts will have a cost-saving impact on imported goods for Australian households and businesses and will deliver material gains for our exports.

Here in Australia, this agreement has undergone a level of scrutiny perhaps unprecedented by any other free trade agreement. It has been subject to five parliamentary committee inquiries. After the TPP-11 was tabled in the House of Representatives on 26 March this year, it was examined by the Joint Standing Committee on Treaties. On 22 August, the committee recommended that Australia take binding treaty action in respect of the TPP-11.

I urge the parliament to support the swift passage of the TPP-11 implementing legislation, because I want Australia to remain a leader among trading nations, a country that is not afraid to show our trading partners, in concrete actions, that we are committed to a future of liberalised trade and investment. This is what these TPP-11 implementing bills represent. Our early ratification of the TPP-11 demonstrates Australia's leadership in pursuing liberalised trade globally and embodies the government's strong commitment to maximising trading opportunities for Australian businesses both large and small. The TPP-11 outcome is a feature of an ambitious and confident trade policy, one that didn't turn back at the first hurdle. It is an audacious but pragmatic approach that, in my view, has been the hallmark of this government's trade and investment policy.

I will also comment on some of the contributions that I have heard. I want to acknowledge at the outset the excellent working relationship I had with the shadow trade minister. He and I were able to speak regularly on the importance of the TPP. I recognise and respect that Labor has a different approach in a number of limited areas. I note in particular that Labor says that if they are elected to government—and certainly those on this side of the House hope that does not occur—or if they are subsequently elected, they would renegotiate the TPP-11 with respect to ISDS and with respect to the labour market tasting waiver.

I note that neither of the bills before the House today deals with those aspects of the agreement. I recognise and applaud Labor's vision about ensuring Australia continues to maintain its position globally as being the champion of liberalised and freer trade. Labor's support on this is, of course, critical. But I note some of the comments that have been made by, for example, the member for Bendigo. I heard, frankly, outrageous claims that are completely without foundation in fact whatsoever—for example, the litany of examples of workers being exploited or not paid in accordance with Australian standards, or concerns about foreign workers being paid less or not meeting Australian standards. I note that that activity is illegal. There is nothing in this agreement whatsoever that in any way, shape or form would give comfort to those businesses acting in an illegal way. So, when I heard claims by the member for Bendigo about exploitation of foreign workers, ostensibly, either directly or indirectly linking it back to the TPP—those claims are false. That activity is illegal and remains illegal.

I note that this nation's economic growth—the jobs that employ millions of people, the wealth and prosperity of regional Australia—is entirely dependent on our ability to trade. If we are truly going to be a nation that generates wealth in regional parts of Australia, if we're going to help the cane exporters, if we're going to help the beef exporters and the sheepmeat exporters, the best way we can help them is to ensure that they have access to global markets. I think back to my childhood growing up in a regional community in Far North Queensland. The best way we can help those exporters is to make sure that we give them a competitive advantage over competitor nations like the United States, and that is precisely what the TPP-11 will do. It gives our beef exporters a significant competitive advantage over direct exports that come from the United States and competitor countries like that. It ensures that our ability to tap into markets like Japan is more enhanced than it has ever been in our nation's history. That's what drives wealth and prosperity in regional Australia.

I note as well that Labor's made comments about ISDS. I respect that Labor has a different position, but Labor on every occasion talks about how ISDS is bad for Australia. And they say that multinational corporations can sue the Australian government. Well, they cannot. We can exercise public policy with the full suite of tools available to the Australian government without fear of being sued. I'll tell you what Labor always forget. They forget that ISDS is critical for Australian businesses abroad. That's when we need ISDS—not for foreign companies in Australia but for Australian businesses internationally.

So, I welcome Labor's continuation of long-held practice. We work constructively on matters of foreign policy and trade policy, and I have great pleasure in commending these bills to the House.

Photo of Tony SmithTony Smith (Speaker) Share this | | Hansard source

The original question was that this bill be now read a second time. To this the honourable member for Blaxland has moved an amendment, 'That all words after 'that' be omitted,' with a view to substituting other words, so the immediate question is that the amendment moved by the member for Blaxland be agreed to.

12:44 pm

Photo of Andrew LeighAndrew Leigh (Fenner, Australian Labor Party, Shadow Assistant Treasurer) Share this | | Hansard source

Who's running this show?

Photo of Tony SmithTony Smith (Speaker) Share this | | Hansard source

I think this part of the day is a bad time to get thrown out, Member for Fenner. As I've said before in these circumstances House of Representatives Practice outlines the principles that have been used in the exercise of the casting vote, one of which is that a casting vote on an amendment should leave a bill in its existing form. This principle has seen the casting vote used against amendments, therefore I cast my vote with the noes.