Peter Whish-Wilson (Tasmania, Australian Greens) Share this | Link to this | Hansard source

I move:

That the Senate take note of the answer given by the Minister for Human Services (Senator Payne) to a question without notice asked by Senator Whish-Wilson today relating to the China-Australia Free Trade Agreement.

In the address-in-reply of this government to the first Governor-General speech, they said that they would hang their hats on being the government of free trade deals. I will give them that much credit. Since they have come into government in the last two years, they have signed three trade agreements and are very close to signing a fourth, and there are another three, if not four, in the wings. What fascinates me is that every day over the last two weeks I see multiple articles in the Financial Review and in News Limited media that these trade deals are the signatory achievement of this government, will rescue this country and will deliver billions of dollars worth of stimulus, wealth creation, revenue and tens of thousands of jobs. For those in this chamber, you would have to be living under a rock if you have missed the 15 dorothy dixers this week just on the Chinese free trade agreement.

I thought I would do a bit of homework on this, because it fascinated me, having studied the treaty process in this country where trade deals are negotiated, that the Department of Foreign Affairs and Trade—who are the proponents of these deals—do a national interest assessment themselves. That national interest assessment comes up with a set of numbers and they are the numbers that are being bandied around by some in the media and the government in their responses to their own questions this week. The truth is that they are total BS. The reason they are total BS is that I asked Treasury if they forecasted any benefits from these trade deals into their GDP forecast. I have taught economics at university and I understand that for GDP and the way it is measured that a significant component of that is net trade. Trade is an important component of economic growth. So I presumed when we were hearing about hundreds of billions of dollars of benefits that we would have these things implicit in our forward projections for economic growth. Treasury said no, that they do not forecast these things.

So I went to the deputy head of DFAT and the head negotiator in the these deals, and I asked why. I said, 'Why don't you give this information—that is shoved in our throats by this government every chance they get—to Treasury so that they can utilise it in their forward forecasts for economic growth?' I will read you the response. The deputy head of DFAT said that while acknowledging that there are opportunities—and I acknowledge that there are opportunities in these trade deals in different industries for different businesses; there are absolutely are, but there are also costs to these deals that we do not acknowledge—overall what she talked about in terms of GDP was:

From an economy-wide GDP modelling perspective, the parameters would not be significant enough to alter Treasury forecasting.

Here we go, this is one of the key proponents of these trade deals that our government has been signing. They do a good job. That is what DFAT is supposed to do: if they get told by the government of the day to and go out and sign trade deals, that is what they do. But she was saying they were not significant enough to be incorporated in our economic growth forecasts.

Why is it that we have not heard this in this chamber this week and in these media outlets, that unquestioningly report the same numbers they are given by the government's media departments? Why is it that we do not forecast these benefits? Because there is no certainty. While trade deals might be opportunities, they get sold as being certainties in this country by the politicisation of these deals—because this government has nothing else to show for its economic management, and that really frustrates me. Then we have issues about Labor standards, we have issues about corporations having the right to sue governments.

I want to finish on quote from Nobel prize-winning economist Paul Krugman, who was here a few days ago. When he was asked about the Chinese free trade deal, he said that while he supports trade, he was sceptical of the benefits of bilateral agreements such as the one between China and Australia. He said:

They were often misleadingly pitched as something that must be done 'for the national good', he said. It isn’t really–it’s not going to have any major impact on GDP per capita.

The Productivity Commission has said the same thing about bilateral trade deals or preferential trade deals, yet it is the only thing this government is running on going into the Canning by-election—hanging its hat on trade deals that really are furphies at the end of the day. (Time expired)

Question agreed to.