Senate debates

Wednesday, 5 December 2018


Trade; Order for the Production of Documents

9:31 am

Photo of Simon BirminghamSimon Birmingham (SA, Liberal Party, Minister for Trade) Share this | | Hansard source

I dealt, at the conclusion of question time yesterday, with the substantive matters in relation to the order passed by the Senate in the motion moved by Senator Hanson. I suspect the bringing forward of the motion and the way in which it was structured were to enable a bit of grandstanding on antitrade rhetoric to occur in the chamber this morning. Sadly, that seems to be a more common occurrence from the crossbench and even from some in the opposition. I say 'sadly' because it is senators choosing to turn a blind eye to the facts, to the evidence, to the history, of the benefits that trade has provided to Australia. It's no accident that Australia has enjoyed 27 years of continuous economic growth. That growth is a function of good policy reforms, from both Liberal-National governments and Labor governments—to be fair and to give credit. We've seen governments of both persuasions open up our economy in a range of ways. Opening it up to provide greater opportunities for trade of goods, services and investment has been a key part of those reforms that have sustained our economic growth and our prosperity as a nation.

Over the past five years, in our term of government, as we have successfully negotiated successive trade agreements to create a more open environment, trade has contributed around one-quarter of the estimated economic growth that we've seen. As a nation, our economic growth leads that of the world's largest economies. It leads the G7. Trade has contributed around one-quarter of that. In 2017-18 we achieved a record level of exports of $401 billion. Importantly—and I really encourage senators to reflect on this point—Australia has achieved a trade surplus every month of this year and for 20 out of the past 23 months. It is often portrayed, by those who want to use antitrade rhetoric, that somehow Australia does poorly, when the truth is quite the opposite. These are not meaningless statistics. They are a demonstration of how it is that increased trade opportunities have contributed to Australia's prosperity and have ensured that, through that prosperity, Australia is one of the best places in the world to live, as the prosperity enables Australians to pursue their ambitions and dreams and gives government the resources to be able to provide essential services. That's why our government has been such a strong supporter and effective deliverer of free and open trade. We know that it provides opportunities that Australian businesses successfully seize and, in doing so, provides more opportunities to Australian families.

We believe in supporting and backing our farmers, our technology companies, our artist, our scientist and our small and large businesses to develop the highest-quality goods and services and to be able to sell those not only in Australia but also in our region and around the world. We don't take a 'little Australia' mentality and believe that we're only fit to be able to compete within some closed shop environment here in Australia. We believe that, as a country, we are actually capable—as we have demonstrated—of competing around the world. That's why today around one in five Australian jobs is dependent upon trade—that is, around 2.2 million Australians. And we know that businesses that export also tend to pay better. On average, wages are an estimated 11½ per cent higher—significantly more.

Australian household incomes are variously estimated to be around $8,500 higher due to trade liberalisation that's been undertaken in Australia since the 1980s. It's no accident that it's been because of our Liberal-National governments; the Howard years delivered the United States trade agreement, and our government has agreements with China, Japan and Korea and did the landmark CPTPP-11. All of them ensured we have more opportunities to sell more goods and services into the world. That's why we continue to fight at the G20, through APEC and at the World Trade Organization for effective global trade rules and we continue to pursue new trade agreements with Europe, Latin America and other regional trading blocs such as the RCEP agreement. Our government has the best, most successful track record of pursuing trade agreements and we will continue to work on doing so.

This motion was sparked by debate about the transparency of how those agreements are brought to force. We have very clear parliamentary processes to ensure thorough scrutiny of and deliberation on free trade agreements before they are ratified. As I outlined to the Senate yesterday, there was a letter that responded to this Senate order on 11 December 2013. It made very clear that the Senate can be assured that, once the text of trade agreements is agreed on between the two parties, but before they are ratified by the Australian government, they will be made public and will be subject to parliamentary scrutiny through the Joint Standing Committee on Treaties. This is consistent with our well-established treaty-making process. Each and every Australian free trade agreement that has come into force since this 2013 motion has gone through this proper parliamentary process, has been referred to JSCOT for inquiry. To ensure thorough scrutiny, agreements are tabled for 20 parliamentary joint sitting days before they're considered by the JSCOT inquiry. Let's again emphasise that point, because there seems to be some suggestions through this process that the text of agreements is withheld or not made public: the text of those agreements is tabled and sits on the table for 20 sitting days before JSCOT makes any determinations.

Of course, parliament can refer enabling legislation—or any other matter, for the point—to other committees for inquiry. By way of example, there was exceptionally broad scrutiny of the TPP. The regulatory impact statement and the accompanying national interest analysis were considered by JSCOT, as is standard practice for every one of our agreements. But they were also considered by the Senate Foreign Affairs, Defence and Trade References Committee and the Senate Standing Committee on Legal and Constitutional Affairs. All of those inquiries were thorough, were public and had the full text of the agreements available to them. Each and every one of those inquiries had that. And each of them provided for the basis upon which, ultimately, binding treaty action was taken.

Senators may also be aware that just recently we sent the Peru-Australia Free Trade Agreement back to JSCOT for a second inquiry, at the request of the Australian Labor Party. The Peru FTA was examined by JSCOT in August and in November of this year. Both times JSCOT has recommended that binding treaty action be taken, but both times JSCOT has had the opportunity with the public text, with the public national interest analysis and with the opportunity through public hearings and publicly accepted submissions to be able to get to the bottom of any issues in relation to those agreements.

Why is it that we adopt this process? We adopt it for transparency and thoroughness. But why is it that we don't say, 'We'll do all of that before the negotiations are settled'? It's because to do it all before the negotiations are settled weakens Australia's negotiating position. It weakens Australia's negotiating position to throw it all open to debate. Of course this parliament, the government, can choose to not ultimately ratify agreements. It happens at times around the world that agreements that are negotiated between two governments do not come into force; that can occur. However, we think that, to get the best possible deal, it's important to be able to conclude those negotiations up-front.

Debate about the process is really a mask or a smokescreen for those who want to debate the merits of more open trade. And we do see—

Photo of Sue LinesSue Lines (WA, Deputy-President) Share this | | Hansard source

Minister, please resume your seat. Senator Whish-Wilson.

Photo of Peter Whish-WilsonPeter Whish-Wilson (Tasmania, Australian Greens) Share this | | Hansard source

A point of order: I wonder if you could clarify what the time limits are for this debate, or is there no time limit for an individual contribution?

Photo of Sue LinesSue Lines (WA, Deputy-President) Share this | | Hansard source

There's no time limit on the statement, but it is 10 minutes on the debate—for an hour.

Photo of Peter Whish-WilsonPeter Whish-Wilson (Tasmania, Australian Greens) Share this | | Hansard source

Another point of order: I just wonder how long the minister has spoken for, because the clock is on zero.

Photo of Sue LinesSue Lines (WA, Deputy-President) Share this | | Hansard source

The minister's statement is unlimited, and then the responses are 10 minutes per senator for an hour. I'm sorry if I wasn't clear. Please continue, Minister.

Photo of Simon BirminghamSimon Birmingham (SA, Liberal Party, Minister for Trade) Share this | | Hansard source

Thanks, Deputy President. These questions around transparency are really a smokescreen for those who want to undermine and stand against a more open economy at any price. We see that in many ways from those on the 'lunar Left' and also those on what I'll politely call the 'reminiscent Right', who seem to think that somehow it was a better place decades ago, a perception which is built upon many myths and many untruths, such as the suggestion that somehow our trading relations have hurt employment. If we go back to the start of the 1980s, before Australia pursued the big waves of economic reform, the total number of employed Australians stood at around six million people. Today that's more than 12.6 million people. We've more than doubled employment over that time.

Senator Hanson interjecting

I hear one of the 'reminiscent Right' interjecting from the other end of the chamber. Indeed, yes, the population has grown, but the proportion of the working-age population in employment is higher today than it was in the 1980s, Senator Hanson. We've created jobs faster than our population has grown. So that's another of your myths knocked out along the way. And indeed the mix of full-time versus part-time jobs has, contrary to the lies that are told, remained relatively stable during that time.

Photo of Sue LinesSue Lines (WA, Deputy-President) Share this | | Hansard source

Minister, please resume your seat. Senator Gallacher.

Photo of Alex GallacherAlex Gallacher (SA, Australian Labor Party) Share this | | Hansard source

A point of order with respect to the allegation of lies: that is a generic term. I thought the President was discouraging the use of such allegations.

Photo of Sue LinesSue Lines (WA, Deputy-President) Share this | | Hansard source

Thank you, Senator Gallacher. Yes, the President has asked people to be respectful in their language. In the use of that term then, the minister wasn't referring directly to other senators. But I think it's timely to remind all of us that we do want respectful debate. Thank you, Minister.

Photo of Simon BirminghamSimon Birmingham (SA, Liberal Party, Minister for Trade) Share this | | Hansard source

Thank you for that reminder, Deputy President. As I was saying, the proportion of full-time and part-time jobs has remained largely stable. Employment growth has managed to outstrip population growth. More Australians are employed and a higher proportion of Australians are employed. Average unemployment, which has stood at around seven per cent over the last four decades, now stands at around five per cent. Some will tell us that we're poorer because of it, and yet GDP per capita, inflation adjusted, has grown significantly: it stood at around US$30,000 equivalent in 1980, it is around US$55,000 equivalent today. Those several decades of economic reform, including more open trading environments, have left us in a world where Australia has a higher proportion of the population employed, has more than doubled the number of jobs that exist across the country and has a higher average per-capita GDP rate.

It's a pity that indeed those on the fringes of politics now seem in some ways to be being joined by some from the Labor Party, because what has occurred, at least over recent decades, is we've had significant bipartisanship in many of these ventures. Bipartisanship during the Hawke and Keating years enabled many of the economic reforms to occur during that time—perhaps slightly less so during the Howard years around some economic reforms—but, ultimately we saw bipartisanship enable a number of trade agreements to come to fruition, and I thank the Labor Party for that over that time.

We do see that 89 per cent of Australian businesses that export indicate that they use our FTAs as a platform for their exports. We appreciate that the Greens have never really understood the benefits of trade, because they'll stand against anything that sounds like it might relate to opportunities for business, ignoring the fact that business creates jobs that pay taxes that sustain our services. And we know that those on the far Right have tended to take a closed-shop mentality and to adopt that little-Australia perspective. They believe that if we could just live within our own contained built-up brick walls around the margins of Australia, we would be a much better place. Instead, of course, we've benefited greatly from being more open. We see the unions seeking to push the Labor Party around. They sought to push Mr Shorten to walk away from the TPP and he said we shouldn't pursue it when Donald Trump walked away, but I thank the Labor Party for the fact that they held their nerve and they ultimately supported the TPP coming to fruition.

We need to be clear that all parts of Australia don't always benefit from every aspect of every agreement. That's why successive governments have supported transition packages industry support, but, ultimately, Australia is better as a result of the collection and the wave of economic reforms, including those trade agreements. Indeed, Senator Hanson's home state of Queensland is also a significant beneficiary. In 2017-18, Queensland's total exports of goods were valued at over $74.2 billion, a rise of 11.5 per cent over the previous year. That was driven significantly by exports of goods to FTA partner countries—those countries with which we have free trade agreements in place. Those exports were valued at $49.7 billion, which is well over half of Queensland's total exports, and the growth rate to those countries was 15.4 per cent, well in excess of the average growth rate. So Queensland exports grew, but they grew faster to countries with whom we have FTAs in place. China, Japan and Korea are critical trading partners and account for more than half of Queensland's total goods exports. Our government has negotiated trade agreements with those three significant markets that lock in exports for significant commodities like coal at zero, enabling us to ensure that we have strong growth.

But it's not just those commodities. We also see many services industries and other goods actually benefiting. Take Russell Mineral Equipment located in Toowoomba, who have benefited clearly from our policies. They design and manufacture minerals processing equipment. They're one of the great examples that show that, although Australia is strong in the mining sector, the mining services companies are also increasingly exporting their goods and skills to the rest of the world. Our FTAs with North Asia have played a key role in Russell Mining Equipment's success according to their CFO. He says:

Having them in place gives us the confidence to invest money into foreign markets and ensures we are protected against risks such as intellectual property theft and copyright.

That's an example of a Toowoomba based business creating more income for Australia and more jobs for Australians by selling their services to the world. Or how about Frosty Boy located in Yatala in Queensland, a manufacturer and distributor of powdered desserts and beverages? In the last 12 months, this Gold Coast based company has grown 30 per cent and now employs around 70 Australians. Its managing director says that exports have played a vital role in the company's growth. He says:

We have not only increased the number of product lines we export, but due to the growth in our exports, we've also invested in new dairy equipment and accessories to increase our production. Our exports now make up 70 per cent of our business. Since 2001, we have seen an average yearly growth of about 17 per cent. It is definitely our exports that have enabled us to achieve this kind of growth.

Or there's OzKleen, located on the Gold Coast. They identify FTAs with North Asia as helping them to expand their business. Their managing director says:

Thanks to the FTAs, we have been able to significantly reduce our landed costs, making our product more price competitive.

In Korea—

They highlight—

this tariff reduction combined with a positive exchange rate has seen the import price of our cleaning products come down by 10.5 per cent, which makes a big difference to the overall price of the product.

That's the point. Those Australian products are landing in Korea at a cheaper price because Korea is no longer applying, effectively, a tax to them, meaning that a Gold Coast business like that is able to better succeed into the future.

I know some will cite manufacturing jobs, which, if you look at ABS data, have been on the increase again recently. One of the reasons, there, is that you see more companies, both domestic and international, investing in Australia in higher technology spaces. Take the Peruvian manufacturing company Vistony. Vistony has indicated that the Peru-Australia agreement will be of 'great value for us as a leader of Peruvian lubricants, as lower tariffs generate greater investment'. Why is that good for Australia? Because that company has indicated that they're setting up operations here in Australia. They will create approximately 200 jobs as a result of doing so. That's another example of where an Australian trade agreement has helped to create more job opportunities.

As others contribute and follow me in this debate, I urge the Senate to be mindful of some of the real facts that sit before us. Fact 1: all our trade agreements and the text around them are published, made public, laid bare and tabled in the parliament before they are ratified and before binding treaty action is taken. Fact 2: they're all assessed by the Joint Standing Committee on Treaties and, frequently, other parliamentary committees as part of that process. Fact 3: the successive decades of economic reform we've had have got Australia to a point where we're enjoying trade surpluses, month after month. I go back to the opening point I made: a trade surplus every month this year and for 20 out of the past 23 months. That's the strength of Australia's trading situation and economic relationship. Fact 4: over those decades of reform, we've seen employment more than double in Australia and participation in the employment market grow far faster than our population has grown. Fact 5: we've seen unemployment rates come down. Fact 6: we've seen average GDP per capita go up.

Australia is better off as a result of the reforms of the last few decades. We're better off as a result of more open engagement with the rest of the world. Our businesses are successfully seizing those business opportunities, are successfully engaging. In doing so, they're creating more business opportunities in Australia, creating more jobs in Australia, creating more opportunities for Australians and their families and that's generating more revenue for our government to provide the services we rely upon, and those who want to undermine that would be undermining Australia's very prosperity.

9:53 am

Photo of Pauline HansonPauline Hanson (Queensland, Pauline Hanson's One Nation Party) Share this | | Hansard source

I move:

That the Senate take note of the explanation.

Former Liberal Prime Minister Malcolm Turnbull called the half a million Australians who voted for One Nation in the last federal election 'dumb'. This assessment of voters is one of the reasons the government ignored the requirement to consult with the Senate in advance of signing the comprehensive and progressive agreement for the Trans Pacific Partnership or TPP-11 on 8 March 2018. The facts are not in dispute. The government did not table the TPP-11 in advance of signing it. The government holds the Senate in contempt by not complying with Senate rules, which require these types of documents to be tabled at least 14 days before signing.

The failure by the Attorney-General to release the full legal advice on Brexit triggered a vote in the British parliament yesterday which found ministers in contempt of the parliament and ordered the immediate publication of the advice. The British government, after the vote, said they would publish the advice. The parallels between the failure of this government to table the TPP-11 and the failure of the British government to table the Brexit advice are obvious. The difference between the two governments is that our government think contempt is a badge of honour while the British government think it's a badge of shame.

The government have told us they will not bend to the will of the Senate and table free trade agreements in advance of signing them. They say they will continue to ignore the will of the Senate and the people of Australia and make the agreements public after they have been signed, leaving no option for those affected but to accept it. Deals done in secret always raise concerns about corruption. Instead of persuading the Senate to change the procedural order of continuing effect 20, the government prefer to treat the Senate as a rubber stamp. Although the government signed up to the TPP-11 in March, it took until October for the government to present the enabling legislation to the Senate. I did not support the TPP-11 enabling legislation in the hope that the government would be unable to complete all the applicable legal procedures necessary for entry into force of the agreement.

I am worried about the TPP-11 free trade agreement because jobs will go overseas and because landmine provisions known as investor-state dispute settlement provisions, or ISDS provisions, remain. The damage these ISDS provisions have on us is illustrated by the Philip Morris case. Philip Morris decided to sue the Australian government after the passage of the Tobacco Plain Packaging Act in 2011. The company could have sued the Australian government in an Australian court, but they thought their chances were better in an international tribunal using international law. Philip Morris looked for a suitable free trade agreement with Australia and then restructured their business to create an overseas parent company in Hong Kong. The government says it won the Philip Morris case, but in fact the case was not heard because the tribunal decided it was an abuse for them to restructure just to sue the Australian government. Challenges to Australia's tobacco packaging policy continue within the World Trade Organization. We should never have allowed the decision of a three-person tribunal operating under international laws to override the High Court of Australia.

One Nation rejects the view of globalists like Malcolm Turnbull who want us to surrender our hard-won freedom to make laws that apply to Australians and those who trade with us. The decision to sign the TPP-11 agreement without complying with Senate order of continuing effect 20 is, in my view, a serious matter. My fellow senators agree with me, because notice of motion 1295, standing in my name, was supported by the Senate yesterday. That motion brought Minister Birmingham here today to explain the government's position. I call on the government to test its public interest immunity argument, and its failure to comply with Senate procedure, before the High Court. It is just wrong that these free trade agreements are not reviewed in the Senate. Some might say it is a waste of money to go to the High Court, but we reportedly spent $50 million on the Philip Morris case, so, frankly, a few thousand dollars is money well spent if we can rid ourselves of the ISDS provisions.

The government has told the Senate the ISDS provisions represent a theoretical risk, but I know of two cases that have been brought against Australia in recent years, including the most recent case involving APR Energy. In 2016, APR Energy advised the government of a dispute under the Australia-United States Free Trade Agreement. The company is suing the Australian government because the assets it leased to an Australian company were repossessed by the ANZ Bank. An international tribunal will be asked to decide if the Australian government is liable for the company's losses pursuant to the provisions of the Personal Property Securities Act 2009. Does this mean that every overseas company that loses money can be compensated by the Australian taxpayer? I warned the parliament in 1998 about multilateral agreements on investment provisions which included the right to sue governments if legislation threatened their interest. No-one took any notice of me, and here we are with ISDS provisions in most free trade agreements acting like landmines just waiting to blow up.

These ISDS provisions expose taxpayers to staggering losses incurred by non-resident foreign-owned companies. Australia is particularly exposed to ISDS losses because of the number of multinational companies operating here. These multinationals can pick and choose from an array of free trade agreements when they want to sue the Australian government. These companies have revenues greater than most countries in the world and deep pockets to fund actions against governments. The provisions that allow foreign-owned multinational companies to sue the Australian government are not in the national interest. Their existence in many agreements, including the TPP-11, may be a factor in the government's unwillingness to reform weak laws that give us payment for our vast reserves of gas in Commonwealth waters. Are the benefits of free-trade agreements which include investor-state dispute settlement provisions worth the risk of being sued in an international tribunal? The answer to that question depends on whether you are a winner or a loser in TPP-11. In my view, the risks in the TPP-11 outweigh the benefits.

New Zealand has side letters voiding the ISDS provisions. So why don't we have the same?

The government has oversold the benefits of the TPP-11. Take for example the claim that our dairy industry will benefit by being given access to the Canadian dairy market. The claim sounds good—until you find out that the 11 Pacific rim countries will collectively be given access to just 3.5 per cent of the Canadian dairy market and that New Zealand, a lower-cost dairy country, is making heavy inroads into the Australian market.

If the government had its way, it would continue to sign free trade agreements without ever consulting the Senate. The opposition voted with the government to pass the enabling TPP-11 legislation, but now, after the horse has bolted, say they will negotiate changes when they form government next year. Labor cannot get the TPP-11 changed. It's pie-in-the-sky fantasy. The ISDS provisions will remain. Jobs will go overseas, and 5,000-plus jobs in Australia will be taken by foreign workers. Their comments are to appease the unions.

The kind of accountability small parties bring to government is a thorn in the side of the two major parties. Increasingly, Australians are voting for small parties in the Senate. This is evidenced by the fact that nearly one in four primary votes were cast for a small party in the 2016 federal election. In my view, the two-party system, where government is formed by one of the two major parties, no longer serves the national interest.

I can assure the people of Australia: I'm here because of no fear or favour. I'm here to work for the Australian people and to call for accountability from this government and from anyone who is in government.

I can see a time when government is formed by a coalition of smaller parties. It works well in Germany, where it has provided stability and prosperity for the largest economy in Europe.

I must go to some of the minister's comments. He said that unemployment is down, and he said this has happened since the 1980s. Well, I would like to refer the minister to the fact that unemployment in the 1960s was 2.6 per cent. He said that people are out there with more jobs in Australia. But more people are working because, in families, both the husband and the wife have to work to pay for the ever-increasing cost of living in this country. At one time, women were able to stay home and raise their children; now they can't have that option because they must pay the bills. So it's all pie in the sky. He's talking through his hat as far as I'm concerned.

Talking about free trade agreements, from the day that they signed the free trade agreement with America, from day one, we got rid of all of our tariffs, and America kept their tariffs on, from 11 to 18 years, on wool, wine, horticultural products, cotton and beef. So it has not been in the best interests of Australia.

I am not opposed to free trade agreements. But make sure they are in the best interests of our country. Don't hold the Senate in contempt—which you have done. Abide by the rule of order 20: lay the documents on the table 14 days beforehand.

10:03 am

Photo of Kim CarrKim Carr (Victoria, Australian Labor Party, Shadow Minister for Innovation, Industry, Science and Research) Share this | | Hansard source

I would just like to comment on the minister's 20-minute address, which fundamentally failed to explain why the government was not complying with the Senate's order for the production of documents, order of continuing effect 20, which requires that the full text of the proposed bilateral and multilateral agreements be laid on the table by the minister at least 14 days before the signing of those documents.

The minister made some feeble effort to argue that the trade processes we have at the moment are, somehow or other, transparent. Let the reality be clear: the process we have at the moment is nothing but opaque, and the minister himself says, 'We don't have to provide the documents and we won't provide the documents, because to provide the documents would weaken our negotiating position.' In fact, what occurs is that documents are provided only after those documents have been signed by the Commonwealth of Australia. The consequence of that is that then the only opportunity we have of dealing with that legislation is to change the enabling legislation; there is not a proposition put to the parliament on acceptance or rejection of that trade agreement.

Of course, this continuing order is based on the United States. Senator Wong in the Senate noted that the United States' trade representatives undertake to publish the full text of the free trade agreements negotiated on behalf of the United States well before the signing. That allows the US Congress and the US people to assess the provisions. Actually telling the people of the United States what the government of the United States is proposing to do when it engages in these foreign treaties doesn't seem to undermine its negotiating position. It doesn't seem to affect many other countries around the world that have a similar provision. That's why the Labor Party has proposed a fundamental reform of these treaty-making provisions under the A Fair Go for Australians in Trade Bill 2018, which has now received a second reading in this chamber, and we're waiting for it to come back to this chamber.

The fundamental problem we have here is that the agreements that are entered into by Australia are talked up, as we've seen here today, in a manner which does not reflect the reality of the operations of those agreements. This is not just about people who are, as the minister disparagingly said, antitrade. I can tell you now that I don't regard myself as antitrade. In introducing the A Fair Go for Australians in Trade Bill 2018 in the Senate, I made a point about the importance of trade and that Australia is a trade dependent economy. I regard myself as an internationalist. That has long been the case for those interested in social democracy. What I am interested in is the question of Australian sovereignty and the effect of these trade agreements, which, in their operation, don't bear fruit in terms of the claims and assertions made about them by the modellers and proponents of these agreements. It is not just people on the left who make this point, as the minister seemed to suggest. The Productivity Commission—that well-known left-wing organisation!—made the point again in its recent trade review:

Overall, the Commission concluded in 2010 that the economic benefits of bilateral trade agreements have generally been oversold and the risks have been understated. The Commission recommended that agreements should be reached only when they provide outcomes that are in Australia's interest and they are the most cost-effective way of achieving those outcomes. The Commission further recommended that there should be more transparent and rigorous assessments of such agreements. This should encompass two elements. To ensure agreements are in the Australia's interest, before negotiations commence, modelling should include realistic scenarios and be overseen by an independent body. After negotiations have concluded and prior to signing of the agreement, a full and public assessment should be undertaken covering all of the actual negotiated provisions. As with all areas of policy, trade agreements need to be considered on a case-by-case basis, and the balance of benefits and costs for future agreements may be different, for example because they cover a smaller share of Australian trade.

The minister makes great play about the significance of trade in terms of the changes that have occurred in Australian society over the last generation, and he places particular emphasis in saying a quarter of the growth that has occurred is due to trade. One-third of our trade is now with the People's Republic of China—our biggest single trading partner. Is there any better example of how clumsy, inept and incompetent this government has been than the treatment of our single largest trading partner, to the point that this minister, the trade minister before him and senior ministers couldn't even get an appointment!

I deal a great deal with universities. Vice-chancellors tell me about the importance of our international education system, and they constantly say to me, 'I hope they know what they're doing,' because it is not apparent to anyone else that the government know what they're doing. They're a government riven by chaos, riven by confusion. This is the proposition that we find across the Australian corporate sector. We see it not just in the corporate sector, though. Organisations representing workers, trade unions; NGOs; and the wider public are very, very concerned about the way this minister and the ministers before him have kept the public in the dark. This is a perfect example of it. They have refused to engage properly in a discussion about the future directions of this country because they have no idea what the future directions of this country are. Look at what they've done with Indonesia. They said they'd have a trade agreement signed before Christmas, except they went on this little frolic in the richest part of Sydney and said, 'Maybe we'll move our embassy in Israel to Jerusalem.' But what did they do? 'Oh, we forgot about the implications,' of that little frolic for short-term political advantage—they thought. They don't even understand what's happening within the Jewish community in this country, let alone what's happening in the largest Muslim country in the world, to our north.

This is a government that is riven by crisis and short-termism. It's a government that does not know what to do other than to desperately hang on to office, one day at a time. One day at a time—that's how this government operates. This is a government of nightwatchmen, with the blinds pulled down, hoping to Christ that nobody knocks on the door and wakes them up. The members of the government are desperate because they're so busy fighting amongst themselves that they've got no idea what the direction of this country is, no idea where to take this country, no idea what to do, no idea how to actually take this country forward. They're exhausted. They're exhausted by their own internal battles. Now they say, 'We're not going to tell you what we're up to'—frankly, because they don't know themselves. That's the real reason: they don't know themselves. They're going to assert that these great benefits have come from their actions. Well, the reality is very different when you look at it close up. It's not to weaken our negotiating position that the government want to keep the parliament in the dark. It's because the government don't know where they're going, don't know where this country is going and have no idea about how we should advance the interests of the Australian people. They are just so preoccupied now with surviving from one day to the next.

It's a simple proposition we have before us today—that we should get to see these trade agreements before they're signed, not be left in the lurch as we have been with the TPP. We should be left in a position where we can properly discuss them. This is not an outrageous proposition. This is a Senate that has many provisions whereby we provide advice on quite serious matters, and we have done so for a very long time, whether it's on shipping lists, grants to shipping companies, health funds or matters with regard to government advertising. It is not an outrageous suggestion that the government actually tell people what they're up to before they sign agreements that have such far-reaching consequences and that may well have massive implications for particular sectors and particular regions of our society. (Time expired)

10:14 am

Photo of Peter Whish-WilsonPeter Whish-Wilson (Tasmania, Australian Greens) Share this | | Hansard source

There's an old saying: 'There's nothing new under the sun.' Just to remind senators, we've had this debate—exactly the same debate—in this chamber numerous times over the last six years. I remember I put up an order for the production of documents in the early stages of the Trans-Pacific Partnership Agreement, in 2014. Although the Senate voted for that order for the production of documents, the government refused to bring in any documents at all. I remember going and speaking to the previous Clerk of the Senate, Rosemary Laing, and I said, 'What do you do when the government is not complying with an order of the Senate?'

She got out OdgersI remember the exact spot she went to in Odgersand said to me: 'All you can do is disrupt their legislative agenda. If they won't comply with the order of the Senate, then every time something comes up on trade, every time we debate some legislation, you need to basically make their life hell'—more or less; those weren't her exact words, but that's my interpretation of what she said. We're still here, six years later, talking about lack of transparency around trade deals.

If anybody wants an informed document to read about exactly what we're debating today, then I suggest they go to the Senate Foreign Affairs, Defence and Trade References Committee's report, Blind agreement: how to reform the treaty making process. I was part of that committee; in fact, I initiated that inquiry into the treaty-making process. We had a number of senators in this chamber on that committee, and it was a great piece of work. It talked about the urgent need to reform our treaty-making process—the treaty-making process that allows agreement like the Trans-Pacific Partnership and other agreements like the Chinese free trade agreement or the US free trade agreement.

This treaty-making process is hundreds of years old. It hasn't changed since we adopted the Westminster system in this country. It goes back to almost precolonial days, when governments were able to negotiate treaties with other nations following wars. It gives an executive government complete power over parliament, and that's exactly what has happened. There's nothing complicated about this. The executive can negotiate through these processes not just trade deals in the sense that we tend to think—'We're going to swap goods and commodities with other countries'; that's not what trade deals are these days—but trade deals that are a holistic set of regulations between countries. It's an attempt to synchronise regulations between countries, regulations that affect just about every aspect of our lives. The Trans-Pacific Partnership agreement had 33 chapters that covered every aspect of Australians' lives. It had very little to do with traditional trade. It had very little to do with that at all. It's about a global rules based order. And guess what? Parliament doesn't get a look-in at all.

Over the years of the Trans-Pacific Partnership agreement—negotiations started in 2010—the only information we got on the text of that agreement was from WikiLeaks. The only information we got, thank goodness, was from Julian Assange's WikiLeaks, where we had downloads of what was going on. Do you think civil society could get into any of the meetings that were occurring behind closed doors between big business and governments? No, they couldn't. This was all negotiated behind closed doors, in secret.

I want everybody to stop and think about what exactly this trade negotiation is—this trade deal that we're talking about. It's not just what you see on TV, where you see minister wearing a floral shirt in another country who is about to sign a piece of paper. It's not about governments and DFAT negotiators behind closed doors. Think about it: this is about business coming together, going to government with vested interests and saying, 'We want you to negotiate improved access in these countries for us so we can make more profit, so we can make more money.' That's where it all starts. Governments act on their behalf, and then we get these agreements that the parliament doesn't get to look at until they're signed. That point has been made very clearly by Senator Hanson this morning and by Senator Carr. It's a joke. These are signed before they come to parliament; in other words, the government, the executive, agrees to this without the Australian people, without their representatives in parliament, even having a look or a say.

The JSCOT is the committee that we set up to look into this, but the JSCOT is a rubber stamp; it is a government-dominated committee. It will never reject a trade deal—never! And, by the way, you can't change a single thing, a single word, without the entire trade agreement falling apart. You can't amend it and you can't improve it, because it's signed and sealed by the executive. It's a direct snub at the parliament of this country, as it is in other countries. It's totally unacceptable. It railroads our democratic process, and it's allowed to do this because the treaty-making process hasn't been properly reformed since its inception. The JSCOT itself was a suggested reform: an attempt to try to give some kind of semblance of democracy to the negotiation of these deals. But it has failed completely, so the whole thing needs reform. We, the Greens, put in a dissenting report to that treaty-making process committee report. Nevertheless, I think that all parties agree in here that it needs reform and that it needs reform urgently.

I have pointed out consistently that the Trans-Pacific Partnership agreement is a dangerous agreement, not just for Australia but for many countries. We can't allow our rules and regulations to be written in this country by corporations for corporations. They are the power behind the throne in terms of these agreements. Have absolutely no doubt about it, transnational or multinational corporations—whatever you want to call them—push these agreements because they have operations in all the countries associated with them. They want to synchronise rules and regulations, such as investment rules, between countries to get what they want.

The investor-state dispute settlement clauses are a classic example of that. We had a separate Senate inquiry into ISDS and it got international attention; everybody wanted to know what the Australian government was going to do around ISDS. It is totally unnecessary in countries that have good legal systems. It is designed to give corporations the chance to second-guess and to intimidate parliaments. Again, that is antidemocratic. These are Trojan Horse clauses that are totally unacceptable in a modern trade deal. There is no need for them, they are proliferating, they have a number of adverse consequences and just about everybody agreed that we shouldn't have them in our trade deals. The only reason they were kept in the trade deals was because both Labor and the Liberals felt like they didn't want to be bound by this in case it jeopardised future trade negotiations. That's not a good enough reason to have an antidemocratic, dangerous ISDS clause in a trade deal.

So we've got to this point where we're having this debate again, asking the government to provide the information to the Senate. It won't, because it doesn't want to give up its executive power. It wants, essentially, to be able to have a parallel parliament and a process that completely circumvents our democratic parliamentary process because it has the power to do this and it will not give that up. Have a think about when these proliferations of trade deals started. They started in 2013, when the Abbott government was elected. Suddenly, we had this plethora of trade deals being signed: five trade deals. They were great photo shoot opportunities. We got really crappy modelling around all of these trade deals; just about every decent economist in this country said, 'The modelling is not worth the paper it's written on,' including the TPP modelling. Even the modelling that was done showed negligible benefits. We never have an honest debate in this country around trade. All we hear about are the benefits; we never focus on the cost. That's why I applaud Senator Hanson for bringing this forward today.

With every trade deal that we sign, and they cover just about every aspect of our lives, there are costs. We can have an argument about whether there is a net cost or a net benefit, but at least be honest with the Australian people: there are costs to these deals. While we get access for our exporters, we open up our markets, as you well know, Mr Acting Deputy President O'Sullivan, to foreign companies which actually sell products and undermine our local producers as well.

The car industry is a classic example, and there are so many more. In fact, I remember that the Korean free trade deal was called by the media in this country the 'cows for cars' deal. We traded away our car industry for more access for beef farmers. Who gets to decide whether beef farmers should win over car manufacturers? We don't get to decide it as an Australian people and we don't get to decide it as an Australian parliament. Who gets to decide it? It's the executive and the ideology—I would say the blind ideology—behind the blind treaty-making process that's in this country which allows this kind of circumvention of our democracy to occur.

I applaud bringing this forward. With every opportunity we have we should put pressure on this government to show some transparency around trade.

10:24 am

Photo of Alex GallacherAlex Gallacher (SA, Australian Labor Party) Share this | | Hansard source

I too rise to take note of Minister Birmingham's response to the order.

I think it's worth putting on the record once again that in the space of the trade ministry since 7 September 2013 there have been three ministers: Minister Robb, Minister Ciobo and Minister Birmingham, assisted by assistant ministers Colbeck, Pitt, Hartsuyker and Coulton. Everywhere you look with this government, you look at a ministry and you realise that, in the short five years that they've been on the benches opposite, there's been a procession of people through the ministerial positions. Now, that could work out in the long run to be a good thing, but the evidence seems to indicate that it's not a particularly effective way of delivering successful outcomes for the country. And if you go back over the history, there were three ministers of trade in the entire Howard government period. I just put that on the table.

I get really interested when the other side keep saying, 'The Hawke-Keating period did this, that and the rest of it, and it was all great.' Well, if you glance at my bio and at Minister Birmingham's bio, you'll realise that he was in primary school when Bob Hawke was elected and probably completing studies at a university or organising a student union at a university when Keating was unelected. But I actually lived through all of that time, as a Labor Party member and a unionist, and it was a hard struggle to convince workers in all sectors that free trade agreements were useful to the country, because they certainly weren't popular, and they're not popular now. But there is no-one on that side doing the hard work of convincing people of the benefits of these free trade agreements. I can remember various Hawke-Keating ministers saying: 'Yes, there are going to be jobs lost in the economy, but we're going to replace them with better jobs. There will be better jobs. The economy is going to shift. These opportunities are good in aggregate for the country. We will make sure you're employed, and you will have better opportunities, particularly in the textile industry.' The textile industry was a classic. We then had the opportunity for families in marginal areas of the economy to purchase shoes, clothes and school uniforms at a much cheaper rate, but we lost jobs in Australia. It was a really harsh reality. But the advocacy was to take that issue head on and say, 'You're going to get better jobs.'

I, along with other senators in the chamber, have sat through all of the inquiries into the Japanese-Australia Economic Partnership Agreement, the Korea-Australia Free Trade Agreement, the China-Australia Free Trade Agreement, the TPP and the TPP-11, and I have read the submissions that have come in to all of these very useful inquiries. We put the reference in here about treaty making because of the evidence and the submissions we were getting and because there was a general agreement that treaty making needs to be more transparent. There is abundant evidence for this right around the world, outside of the Westminster systems. The Westminster system is basically: trade agreements are executive prerogative—whatever the minister wants to sign and get through cabinet is effectively what goes into the parliament. There is no say on the treaty per se; there is only a vote on the enabling regulations which give effect to tariff cuts and arrangements. That's the Westminster system, unlike the US, where people are invited into the treaty-making process—business, unions, people representing groups in the community. We've looked at all that and said, 'Why wouldn't Australia reform its treaty-making process to make it much more transparent?' Because we're not just talking about wool, sheep, iron ore, coal, zinc and aluminium; we're talking about an export of services.

I was in the United Arab Emirates. An Australian university has a campus in Dubai, and they were saying, 'This is an export of services.' I said, 'But how does it actually work?' The lecturers in Dubai are in a tax-free environment, and that's why it's attractive for them to go and work in Dubai. The university in Australia is getting government funds but making a profit in another jurisdiction, which is tax free. Where is the net benefit to Australia in all of this? The answer was that, if anything is repatriated back to the university in Australia, there will be less government funding put in. I said: 'Where's the incentive for them to do that? Why would you repatriate profits from overseas back to Australia and decrease your funding stream?'

When you look at services and education, it's extraordinarily complex. We've had three ministers in five years and four assistant ministers in five years. I would suggest that they would've had to take a little bit of time to get their head around these very complex issues. As Senator Carr says, there are many chancellors of universities who are very interested in this space who hope the government know what they're doing. We would hope that they would actually be a little bit more transparent. I don't think it's unreasonable to expect transparency on bilateral agreements about labour movement.

This morning we had a briefing from the MIKTA group, which includes Mexico. Mexico is quite a buoyant economy in a lot of ways. What I really know though is that that labour force in Mexico underpins the ninth largest economy in the world with legal and illegal labour. So those 90-odd million people in California—their agriculture and a lot of their economy would actually collapse without cheap Mexican labour. That's a fact of a Mexican-American free trade agreement.

We've got the same understanding that the TPP-11 could involve labour mobility. We can have a Peruvian electrician come over here and work in Australia, and, if they're appropriately qualified and there's a need for that, that's probably not a bad thing. But there is no transparency on this. There is a complete absence of transparency.

The ISDS provisions are only supported in the treaty-making process by the minerals lobby. The Minerals Council of Australia and their representatives are the only ones who support ISDS. There is no other support—those are the submissions to the various inquiries. They support it, quite rightly, because, if they make an investment in Indonesia or Africa or somewhere and they are at risk of losing that investment, they can take them to the international dispute-settling arena and seek redress. But there is no other person.

Agriculture doesn't support it. When we asked the people in agriculture what they thought of the ISDSs, they said: 'It doesn't matter to us. We're not interested. It doesn't apply to us.' We know that, with the case of the Hong Kong free trade agreement, it can severely impact on us. So we're of a mind to look at that issue very carefully, and we've made that very clear to the government. The government is saying: 'Trust—trust is all you need. We will do the right thing.' They don't even get out and argue. Let's not beat around the bush here: free trade agreements or trade agreements are not popular everywhere. You have to do the hard yards of going out and talking to people about it.

If we look at the China-Australia Free Trade Agreement, which is touted as the icon, we didn't need an agreement to get millions of tonnes on every tide in Western Australia to China. Their capacity to make steel drove that. We didn't need an agreement to do that. When we look at the agricultural aspects of it, particularly the phytosanitary barriers for vegetables, we can't get the best blueberries in the world from Tasmania to China because someone's written a barrier—a quarantine barrier or another barrier. These are not free trade agreements. There is no freedom about it. In a lot of cases, particularly in the area of Australian vegetables, for which exporters are seeking to get access to the Chinese market, there are enormous barriers.

If you press the department, they will always say, 'Oh, but that's Austrade.' Then, when you go to Austrade, they will say, 'That's the Department of Agriculture and Water Resources.' Then, when you get their heads together and ask, 'Why have we done an agreement that doesn't actually get us access?' they'll say, 'In aggregate, it's a good deal.' The problem is we don't get to examine it. I concur with Senator Whish-Wilson and others: transparency, disclosure and inclusion in the treaty-making process would benefit everybody in Australia. It would still be a difficult task, but it would be a lot better than the blind treaty-making process that we currently have. That's what it is; it is a blind treaty-making process.

Debate adjourned.