The SPEAKER ( Hon. Bronwyn Bishop ) took the chair at 09:00, made an acknowledgement of country and read prayers.
COMMITTEES
Joint Select Committee on the Australia Fund Establishment
Joint Select Committee on Trade and Investment Growth
Membership
The SPEAKER (09:01): I have received a message from the Senate acquainting the House that Senator Carr has been appointed a member of the Joint Select committee on the Australia Fund Establishment and that senator Bullock has been appointed a member of the Joint Select Committee on Trade and Investment Growth.
BILLS
Automotive Transformation Scheme Amendment Bill 2014
First Reading
Bill and explanatory memorandum presented by Mr Macfarlane.
Bill read a first time.
Second Reading
Mr IAN MACFARLANE (Groom—Minister for Industry) (09:01): I move:
That this bill be now read a second time.
The Automotive Transformation Scheme (ATS) is a legislated entitlement scheme that provides assistance to registered participants for the production of motor vehicles and engines, and for investment in allowable research and development, and allowable plant and equipment. The ATS provides two types of assistance: capped assistance via a special appropriation; and uncapped assistance via annual appropriation.
This amendment bill is made to give effect to the government's 2013-14 Mid-Year Economic and Fiscal Outlook (MYEFO) and budget decisions in respect of the ATS. This bill reduces the period of the ATS by three years and the total amount of capped assistance available by $900 million.
The coalition announced it would reduce the ATS by $500 million in February 2011 and took this commitment to the election. The ATS saving measure in the MYEFO set out how we would achieve this.
In light of the decisions by the local car makers to cease manufacturing in Australia by the end of 2017, the government determined that it was appropriate to terminate the ATS on 1 January 2018, which was announced in the May 2014 budget. The three local car manufacturers, Ford, Holden and Toyota, have made it clear that the level of government support was not the reason for their decision to cease manufacturing cars in Australia.
As set out in this bill, the total amount of capped assistance for stage 1 will be reduced by $200 million to $1.3 billion (2011-2015) and stage 2 by $700 million to $300 million (2016-2018).
Despite these reductions, funding of approximately $700 million remains available under the ATS to support vehicle manufacturing and supply chain companies over the four financial years from 2014-15.
As the regulations provide that payment of assistance is made one quarter in arrears, the inclusion of the first quarter of calendar year 2018 in stage 2 allows for the final payment of assistance to be made for allowable investment and production undertaken during the final quarter of calendar year 2017.
This bill will give effect to the government's MYEFO and budget decisions on the appropriate amount of assistance available under the ATS.
Passage of this bill provides certainty for ATS participants about the level of assistance available for the final three years of the scheme, which will assist their future business planning and decision-making.
I commend the bill to the House.
Debate adjourned.
Debate adjourned.
Ordered that the second reading be made an order of the day for the next sitting day.
Private Health Insurance Amendment Bill (No. 1) 2014
First Reading
Bill and explanatory memorandum presented by Mr Dutton.
Bill read a first time.
Second Reading
Mr DUTTON (Dickson—Minister for Health and Minister for Sport) (09:06): I move:
That this bill be now read a second time.
The Private Health Insurance Amendment Bill (No. 1) 2014 implements a measure announced in the 2014-15 budget, and will pause the indexation arrangements for the income thresholds in the Private Health Insurance Act 2007for three years. The income thresholds contained in the Private Health Insurance Actare used in determining the tiers for both the Australian government rebate on private health insurance and the Medicare levy surcharge.
In this budget, the government increases overall spending and investment in health from $68 billion this year, to $71 billion next year, increasing again to $75 billion in 2016-17, and to $79 billion in 2017-18. The amount this government invests in health grows each and every year.
The changes contained within this legislation being introduced today are part of a broader pause in indexation rates across multiple portfolios announced in the 2014-15 budget in an effort to help make spending sustainable and to repair the fiscal position left by the previous Labor government.
The amendments will see the income thresholds used to determine the private health insurance rebate and Medicare levy surcharge remain unchanged for three years, paused at the 2014-15 rates in 2015-16, 2016-17 and 2017-18.
This bill preserves the explicit link between the rebate and the Medicare levy surcharge. This is important as they operate together to ensure that people whose rebates are reduced because of means testing have a strong incentive to retain their private health insurance.
It is important to note that these changes will not affect individuals with an income that remains below the 2014-15 base tier thresholds of $90,000, or couples and families with an income that remains $180,000 or below.
It is estimated that only four per cent of the 6.2 million private health insurance policies held as at December 2013 will be affected by this measure.
The coalition has inherited an enormous debt, and these measures are just a small part of the government's strategy to clean up the mess that the Labor Party has left behind and at the same time continue to increase our investment in particular in frontline health services for the future of this country.
Debate adjourned.
Ordered that the second reading be made an order of the day for the next sitting day.
Migration Amendment (Character and General Visa Cancellation) Bill 2014
First Reading
Bill and explanatory memorandum presented by Mr Morrison.
Bill read a first time.
Second Reading
Mr MORRISON (Cook—Minister for Immigration and Border Protection) (09:09): I move:
That this bill be now read a second time.
The purpose of this bill is to strengthen the character and general visa cancellation provisions in the Migration Act to ensure that non-citizens who commit crimes in Australia, pose a risk to the Australian community or represent an integrity concern are appropriately considered for visa refusal or cancellation. The bill also introduces a mandatory cancellation power for non-citizens who objectively do not pass the character test and are in prison.
The current legislative framework for the character and general visa cancellation provisions has been in place for some time. The general visa cancellation framework has been in place, without significant change, since the Migration Reform Act came into effect in 1994. Similarly, the character framework has been in place since 1999 without significant change.
Since that time, the environment in relation to the entry and stay in Australia of noncitizens has changed dramatically, with higher volumes of temporary visa holders in Australia and streamlined processes facilitating entry of temporary residents for economic and other purposes.
It is clear that facilitation of entry at the visa application stage needs to be complemented with strong visa cancellation grounds and processes at the post visa grant stage to ensure the integrity of the migration program. This includes having appropriate responses available where noncitizens in Australia do not abide by the law, including by breaching visa conditions, or engaging in criminal activity or migration fraud.
Consistent with community views and expectations, the Australian government has a low tolerance for criminal, noncompliant or fraudulent behaviour by noncitizens. Entry and stay in Australia by noncitizens is a privilege, not a right, and the Australian community expects that the Australian government can and should refuse entry to noncitizens, or cancel their visas, if they do not abide by Australian laws. Those who choose to break the law, fail to uphold the standards of behaviour expected by the Australian community or try to intentionally mislead or defraud the Australian government should expect to have that privilege removed.
To meet this expectation the government must not only have the ability to act decisively and effectively, wherever necessary, to deal with unlawful, fraudulent or criminal behaviour by noncitizens, but also have the legislative basis to effect a visa cancellation or refusal for those noncitizens. This bill seeks to enhance the government's ability to do so in three key ways:
First, by amending section 501 of the act to:
broaden the existing grounds for not passing the character test; and
allow the minister to require the head of an agency of a state or territory to disclose to the minister personal information that is relevant to whether the person passes the character test, and the possible refusal or cancellation of their visa under section 501.
The amendments proposed in this bill give the government the necessary capabilities to identify noncitizens who are liable for visa cancellation under the character provisions, or refusal under the character provisions and deal with them appropriately.
By introducing a power to obtain personal information which assists with the identification and consideration of noncitizens potentially liable for visa cancellation or refusal under section 501, the government will be able to deliver greater surety in its commitment to protecting the Australian community from harm as a result of criminal activity or other serious conduct by noncitizens including those who pose an integrity risk to the migration program.
Similarly, the broadened grounds for not passing the character test, the increased capability to deal with fraud and integrity issues, and the introduction of a lower threshold for cancellation of temporary visas will provide the government with the necessary tools to ensure that such people are subject to visa cancellation or refusal consideration under the appropriate provision of the act.
The proposed measures will amend the character test within section 501 of the act to prescribe certain cohorts of noncitizens, such as those who have a charge proven for a sexual offence against a child, and persons involved in criminal conduct or activities such as people smuggling or war crimes, as not passing the character test. Additionally, amendments will be made to ensure that any noncitizen convicted of a crime or crimes, who receives a sentence totalling twelve months, regardless of how that total is reached, will fall within the definition of having a substantial criminal record and will not pass the character test.
Changes will be made to extend the character test to include noncitizens who commit crimes, but do not receive a sentence on the basis of issues surrounding their mental health. This cohort of people is often responsible for very serious offences, but under the current provisions, ensuring they are prevented from posing a further risk to the Australian community is difficult. The measures proposed will rectify that problem.
The second key measure is to amend the general visa cancellation provisions within the act to:
enhance measures for dealing with noncitizens who present an integrity, identity or fraud risk;
introduce lower thresholds for cancelling temporary visas, reflective of the lower tolerance for behavioural concerns in the temporary visa context; and
introduce stronger personal ministerial decision making powers in relation to the general visa cancellation provisions, consistent with those in the character provisions.
Amendments proposed to section 116 of the act will provide the necessary balance between the protection of the Australian community and the facilitation of entry for temporary visa holders. This cohort of noncitizens has until now been considered against thresholds similar to those applied in section 501, which are set at a high level to reflect the potential impact of removing a person's permanent visa. The amended provision will provide that noncitizens on temporary visas, who pose even a low level of risk, will be eligible for visa cancellation. Measures will also be introduced to better manage the cancellation of visas where the circumstances applicable to the grant of the visa never existed or no longer exist.
The act will also be amended to provide that a visa may be cancelled where incorrect information was provided by or on behalf of a noncitizen either as part of a statutory process, or outside of such a process, and was relevant to the person making a valid application for a visa or a decision to grant a visa to the person.
The act will also be amended to provide the minister with the power to cancel a visa if he or she is not satisfied as to the visa holder's identity.
The measures proposed will ensure that the government can move quickly to take action against noncitizens who pose a risk to the Australian community by delivering consistency in personal ministerial decision-making powers across both the character and general visa cancellation powers. This will involve the introduction of personal ministerial powers to set aside and substitute decisions of delegates and tribunals, and to cancel a visa personally on the grounds under section 109 or section 116 with or without natural justice where it is in the public interest to do so. The latter of these amendments ensures that where a real and immediate risk is posed by a noncitizen, the government can act quickly and decisively to remove that person from the Australian community before that risk can be realised. As with the existing personal ministerial decision-making powers under the character provisions, such decisions would not be subject to merits review processes.
The third key measure this bill seeks to introduce is mandatory visa cancellation under section 501 of the act where a noncitizen is serving a full-time sentence of imprisonment in a custodial institution and they are found to objectively not pass the character test on the basis of, for example, having been convicted of an offence or offences and sentenced to a term of imprisonment of 12 months or more, or having been convicted of, or found to have been guilty of, or had a charge proved against them for a sexually based offence involving a child. Under this process, a noncitizen will have their visa mandatorily cancelled without prior notice of an intention to cancel a visa, with a notification of the cancellation decision provided after the fact. Upon notification, the noncitizen will be provided with the opportunity to seek revocation of the cancellation decision. Where a decision is taken by a delegate to not revoke the decision, the former visa holder will have access to merits review. This will be a streamlined process which will deliver the key benefit of providing a greater opportunity to ensure noncitizens who pose a risk to the community will remain in either criminal or immigration detention until they are removed or their immigration status is otherwise resolved.
These amendments are designed to strengthen and build upon the existing character and general visa cancellation framework and are consistent with the original intent of the provisions—to provide the government with sufficient capability to address character and integrity concerns. This bill addresses the significant changes in the environment relating to the entry and stay of noncitizens in Australia since mid to late 1990s and reflects this government's and the Australian community's low tolerance for criminal, non-compliant or fraudulent behaviour by those who are given the privilege of holding a visa to enter and stay in Australia. The bill demonstrates this government's clear commitment to ensuring that noncitizens do not pose a risk to the Australian community. I commend the bill to the House.
Debate adjourned.
Australian Transaction Reports and Analysis Centre Supervisory Cost Recovery Levy Amendment Bill 2014
First Reading
Bill and explanatory memorandum presented by Mr Robb.
Bill read a first time.
Second Reading
Mr ROBB (Goldstein—Minister for Trade and Investment) (09:21): I move:
That this bill be now read a second time.
The Australian Transaction Reports and Analysis Centre Cost Recovery Levy Amendment Bill 2014, in conjunction with the Australian Transaction Reports and Analysis Centre Cost Recovery Levy (Collection) Amendment Bill 2014 alter the current arrangement for industry contribution to the Australian Transaction Reports and Analysis Centre (AUSTRAC).
The bills transition AUSTRAC from its current cost-recovery arrangements, which apply only to its regulatory function, to a model that enables an industry contribution to AUSTRAC's dual role as Australia's AML/CTF regulator and financial intelligence unit.
The government recognises that money laundering and terrorism financing pose a significant threat to Australia's security and prosperity. We are determined to protect the Australian community and businesses from the economic, social and national security impacts of terrorism and organised crime.
A robust anti-money laundering and counter-terrorism financing regime is essential for Australian businesses to remain competitive in the global market and to ensure financial integrity and stability.
AUSTRAC's purpose is to protect the integrity of the financial system and contribute to the administration of justice through its expertise in countering money laundering and the financing of terrorism. This purpose is achieved through the exercise of its two interdependent functions—as a regulator and as Australia's financial intelligence unit.
As a regulator, AUSTRAC works with the businesses it regulates to enhance the level of understanding of anti-money laundering and counter-terrorism financing obligations, and supervise compliance with the requirements of the Anti-Money Laundering and Counter-Terrorism Financing Act 2006.
Regulated businesses provide services that are vulnerable to exploitation for money-laundering and terrorism-financing purposes, creating the need for regulation by AUSTRAC. It is appropriate therefore that industry meet the costs of regulatory systems that ensure the integrity of their operating environment.
As Australia's financial intelligence unit, AUSTRAC collects and analyses financial data to produce high-quality financial intelligence.
This financial intelligence is then provided to state, territory and Commonwealth law enforcement, security, social justice and revenue agencies as well as certain international counterparts. The information can assist AUSTRAC's partner agencies to investigate and prosecute criminal and terrorist enterprises in Australia and overseas. Whilst the use of the information is predominantly by partner agencies, it serves to strengthen the integrity of Australia's financial system, creating a secure and stable operating environment for Australian business to operate and thrive.
This bill, together with the Australian Transaction Reports and Analysis Centre Supervisory Cost Recovery Levy (Collection) Amendment Bill 2014, implements the new industry contribution arrangements announced by government as part of the 2014 budget.
The bills replace the existing Supervisory Cost Recovery Levy which currently funds AUSTRAC's regulatory activities. The new industry contribution model outlined in these bills will fund both the regulatory and financial intelligence unit functions of AUSTRAC.
The new industry contribution regime provides a number of efficiency and deregulatory benefits for business, particularly small businesses. The new arrangements reduce red tape as they are considerably simpler for reporting entities to understand than the complex 'cost recovery' arrangements currently in place. This in turn reduces costs as the industry contribution model is more streamlined for AUSTRAC to administer.
Approximately 3,000 reporting entities will no longer be required to pay the AUSTRAC Industry Contribution levy. The number of reporting entities required to pay the industry contribution is estimated to be less than 900 entities. This represents a meaningful step in reducing the burden on small business.
The bills also set out a number of safeguards to ensure that cost recovery does not occur. Despite the industry contribution model, AUSTRAC will not be able to determine its own budget. AUSTRAC's budgeted appropriation will continue to be set by parliament through the budget process. The contribution will then be invoiced based on AUSTRAC's budget for the upcoming financial year, as set out in the budget papers. Any subsequent government appropriation throughout the financial year will form a component of the industry contribution by way of a further instalment from reporting entities.
The bill sets out that the amount of the contribution is capped at twice the budgeted appropriation for AUSTRAC in a financial year. While the goal is to match the amount of contribution to the budgeted appropriation for each year, appropriations late in a financial year may necessitate allowing payment in the next financial year to ensure regulated business have sufficient time to pay. For this reason the statutory cap is not matched exactly to the budget appropriation.
Under the arrangements set out in the 2014 budget, the industry contribution will be calculated as a percentage of AUSTRAC's operating costs, at a rate of 70 per cent in this financial year (2014-15), moving to 90 per cent over the next two financial years (2015-16 and 2016-17), and finally reaching 100 per cent from the 2017-18 financial year onwards.
These amounts will be set each year via a ministerial determination which also sets out the calculation model. The calculation model will be set with reference to a number of businesses liable for the payment and the budget allocated by parliament to AUSTRAC.
An independent review of the calculation methodology is required after four years. The review will be conducted in close consultation with industry.
This bill will ensure that AUSTRAC continues to provide a regulatory and intelligence environment that maintains community confidence in financial flows and minimises the risk to business of exploitation for money laundering or terrorism financing.
Debate adjourned.
Australian Transaction Reports and Analysis Centre Supervisory Cost Recovery Levy (Collection) Amendment Bill 2014
First Reading
Bill and explanatory memorandum presented by Mr Robb.
Bill read a first time.
Second Reading
Mr ROBB (Goldstein—Minister for Trade and Investment) (09:28): I move:
That this bill be now read a second time.
The Australian Transaction Reports and Analysis Centre Cost Recovery Levy (Collection) Amendment Bill 2014 (the Collection Bill), in conjunction with the Australian Transaction Reports and Analysis Centre Cost Recovery Levy Amendment Bill 2014, alters the current arrangement for industry contribution to the Australian Transaction Reports and Analysis Centre (AUSTRAC).
This bill, together with the Australian Transaction Reports and Analysis Centre Supervisory Cost Recovery Levy Amendment Bill 2014, implements the new industry contribution arrangements announced by government as part of the 2014 budget. The bills transition AUSTRAC from its current cost recovery arrangements, which apply only to its regulatory function, to an industry contribution model that enables an industry contribution to AUSTRAC's dual role as Australia's AML/CTF regulator and financial intelligence unit.
The bill sets out a number of operational arrangements necessary to administer the industry contribution. This includes: creating the liability for a leviable entity for a given financial year to pay the industry contribution levy in that financial year; allowing the AUSTRAC CEO to specify the date for payment of instalments of the levy; and setting out late payment penalties.
The bill also sets out the requirement for an independent review of the operation of the levy as soon as possible after the fourth anniversary of the commencement of the Collection Act. This review, to be undertaken in close consultation with industry, will ensure that the operation of the new industry contribution, including the methodology used to calculate instalments of the levy and the impact of the levy on industry, is appropriately evaluated. It will also provide the opportunity for improvements to the arrangements, if warranted.
This bill, together with the Australian Transaction Reports and Analysis Centre Cost Recovery Levy Amendment Bill 2014, will ensure that AUSTRAC continues to provide a regulatory and intelligence environment that maintains community confidence in financial flows, and minimises the risk to business of exploitation for money laundering or terrorism financing.
Debate adjourned.
COMMITTEES
Procedure Committee
Report
Mr RANDALL (Canning) (09:31): On behalf of the Standing Committee on Procedure I present the committee's report entitled Use of electronic devices in the chamber and Federation Chamber, together with the minutes of proceedings.
In accordance with standing order 39(e) the report was made a Parliamentary Paper.
Mr RANDALL: by leave—Changes in communications, such as the increased use of smart phones and tablets and the ease of access and portability provided by wireless connectivity have been embraced wholeheartedly by members of the House. Many now use electronic devices, including through social media, to communicate from within the chamber and the Federation Chamber.
This report examines the House's current regulatory framework regarding the use of electronic devices and the way members are currently using devices. It considers issues such as the potential impact on order in the chamber, respect for the role of the chair and the likely status of comments made by members on social media.
The Procedure Committee sought members' views throughout the inquiry. It invited written submissions, held a roundtable meeting and wrote to members about the possible outcomes of the inquiry. A number of members indicated they would like to have a comprehensive and authoritative source of guidance on the use of electronic devices in the chamber and Federation Chamber. The committee has made two recommendations, which it hopes will assist members to understand their responsibilities when they use electronic devices to communicate from the chamber and Federation Chamber.
The first recommendation relates to a current publication, the Guidelines for Members on the status and handling of their records and correspondence, that our colleagues on the House of Representatives Standing Committee of Privileges and Members' Interests have published for some years now. The guidelines are helpful, and provide practical advice on the usual issues encountered by members in their correspondence and records, including their status. The report recommends that the Committee of Privileges and Members' Interests consider expanding the guidelines to address communications made by members using electronic devices.
I should add that the Procedure Committee has no wish to impinge on the remit of our colleagues on the Privileges and Members' Interests Committee and the recommendation is intended as an indication of respect for the practical and authoritative nature of the guidelines. Expanding their coverage would provide members with a single source of guidance on a wide range of their typical communications.
The second recommendation is focused entirely on the use of electronic devices by members in the chamber, Federation Chamber and committees. It proposes that the House adopt a resolution in the terms contained in the report. In his submission to the inquiry, the Clerk of the House proposed a draft resolution for the committee's consideration. The committee circulated its terms to all members for comment during the inquiry. The feedback was very positive. The proposed resolution encapsulates the present position in a concise and straightforward way.
I wish to thank all members who assisted the committee by providing submissions, attending the round table and providing informal feedback. I also wish to thank the Clerk for his submissions and briefings. I conclude by thanking my colleagues on the Procedure Committee for their work on this inquiry. I wish to also acknowledge the work of and thank the committee secretary Miss Catherine Cornish, inquiry secretary Mrs Lynne Eveston and their research officers. We have worked effectively and harmoniously on this first inquiry. On behalf of the committee, I commend the report to the House and move:
That the House take note of the report.
The DEPUTY SPEAKER ( Mr Buchholz ): The debate is adjourned and the resumption of the debate will be made an order of the day for the next sitting.
Reference to Federation Chamber
Mr RANDALL (Canning) (09:36): I move:
That the order of the day be referred to the Federation Chamber for debate.
Question agreed to.
Human Rights Committee
Report
Mr LAURIE FERGUSON (Werriwa) (09:36): On behalf of the Parliamentary Joint Committee on Human Rights, I present the committee's 12th report of the 44th Parliament entitled Examination of legislation in accordance with the Human Rights (Parliamentary Scrutiny) Act 2011: bills introduced 1-4 September 2014, legislative instruments received 2 August-5 September 2014. I ask leave of the House to make a short statement in connection with the report.
Report made a parliamentary paper in accordance with standing order 39(e).
Mr LAURIE FERGUSON: by leave—I rise to speak to the tabling of the Parliamentary Joint Committee on Human Rights's 12th report of the 44th Parliament. The committee considered 12 bills, all of which were introduced with their statement of compatibility. Of these, nine do not require further scrutiny as they do not appear to give rise to human rights concerns. The committee has decided to defer its consideration of one bill and has identified two bills that it considers require further examination and for which it will seek further information.
Of the bills considered, those which are scheduled for debate during the sitting week commencing 22 September include the Customs Amendment (Korea-Australia Free Trade Agreement Implementation) Bill 2014, the Customs Tariff Amendment (Korea-Australia Free Trade Agreement Implementation) Bill 2014, the Infrastructure Australia Amendment (Cost Benefit Analysis and Other Measures) Bill 2014, the Migration Amendment (Protection and Other Measures) Bill 2014 and the Tax and Superannuation Laws Amendment (2014 Measures No. 5) Bill 2014. The report outlines the committee's assessment of the compatibility of these bills with human rights. I encourage my fellow members to look to the committee's report to inform their deliberations on the merits of this proposed legislation.
I draw members' attention to one bill in this report that is of particular interest and relevance to the committee's task of assessing legislation for compatibility with human rights. The Social Services and Other Legislation Amendment (2014 Budget Measures No. 2) Bill 2014 seeks to amend various acts relating to social security, family assistance, veterans' entitlements and farm household support to make a number of changes to certain Australian government payments. These include measures to: pause indexation for three years of the income free areas and assets value limits for student payments; pause indexation for three years of the income and assets test free areas for all pensioners other than parenting payment single recipients and the deeming thresholds for all income support payments; provide that all pensions are indexed to the consumer price index only, by removing both benchmarking to male total average weekly earnings and indexation to the pensioner and beneficiary living cost index.
The committee previously sought the advice of the minister as to whether the measures are compatible with these rights as the statement of compatibility did not adequately identify and assess how potential limitations on the rights to social security, the right to an adequate standard of living and the rights to equality and nondiscrimination would be reasonable, necessary and proportionate in each case.
The further information provided by the minister in this case is an excellent model for the kind of detailed information and analysis required to assist the committee in its assessment. This further information has allowed the committee to conclude that the measures are largely compatible with the right to social security and the right to an adequate standard of living with identified limitations of rights being generally assessed as reasonable, necessary and proportionate in pursuit of a legitimate objective.
Significantly, of the 12 matters raised by the committee in relation to measures in the bill, the committee has concluded that 10 are compatible with human rights. I would urge ministers and officers of the departments and agencies with responsibility for the preparation of statements of compatibility to look at the committee's examination of this bill as a guide to understanding the processes and analytical framework within which the committee works.
I commend the committee's 12 report of the 44th Parliament to the chamber.
Economics Committee
Report
Ms O'DWYER (Higgins) (09:41): On behalf of the Standing Committee on Economics I present the committee's report entitled Review of the Australian Prudential Regulation Authority annual report 2013 (First Report)together with the minutes of proceedings and evidence received by the committee. I ask leave of the House to make a short statement in connection with the report.
Leave granted.
Ms O'DWYER: I am very pleased to be presenting the Economics Committee's first report of its review of the Australian Prudential Regulation Authority's 2013 annual report. This report follows a hearing with the chairman and other officials of APRA on 18 July 2014 in Canberra. APRA is the primary regulator of Australian financial institutions which currently hold $4.5 trillion in assets. APRA regulated industries include banking, insurance and superannuation. This report is timely given the changes in the financial sector since the last review of APRA's activities by this committee in 2004.
At the public hearing on 18 July the Chairman of APRA, Mr Wayne Byres, stated that the financial sector is broadly in good health. The committee notes from the APRA 2013 annual report that the Australian economy grew at a relatively steady pace over the 2013 period and that the effects of the global financial crisis have begun to lift. In the banking industry the committee has learnt that Australia is well placed to implement the global prudential reforms recommended by the Basel Committee on Banking Supervision. It is pleasing that Australia's major banks are operating well and continue to be closely supervised by APRA.
APRA has been active in monitoring and imposing capital requirements on the banks and has also reviewed these requirements for insurance companies. The committee heard from APRA that it is not the priority or first preference of the Basel reforms to impose a simple leverage ratio to determine capital requirements. Mr Byres commented at the public hearing that this leveraged ratio is included within a package of Basel committee reforms as a backstop or supplementary measure.
The Stronger Super reforms have brought the prudential standards of the banking and insurance industries to the superannuation industry and seem to have had a positive start. APRA informs the committee that the superannuation industry is making very good efforts to improve and meet these new requirements. The committee will continue to provide oversight of the impact of these changes.
APRA has noted some concerns that been raised by the committee and by others about housing lending standards. The chairman acknowledged that there is evidence of lending in this sector with higher risk characteristics but this was not a trend that APRA wished to see continue and it was being closely monitored.
The committee is pleased that APRA regulated industries are performing well and that Australia is emerging from the global financial crisis on a relatively good footing. The implementation of the Basel III international banking standards is of continuing interest and the committee will monitor the implementation of these reforms to ensure that they remain appropriate to the needs of the Australian financial sector.
The Future of Financial Advice reforms are yet to be completed but there are no concerns are present in this area.
The committee has requested that APRA appear at public hearings twice a year, similar to the committee's oversight of the Reserve Bank of Australia. The next hearing will be held in Canberra on 28 November 2014. Finally, on behalf of the committee, I would like to thank the Chairman of APRA, Mr Wayne Byres, and other representatives of APRA for appearing before the committee on 18 July 2014. I commend the report to the House and move:
That the House take note of the report.
The DEPUTY SPEAKER ( Mr Buchholz ): In accordance with standing order 39, the debate is adjourned and the resumption of the debate will be made an order of the day for the next sitting.
Reference to Federation Chamber
Ms O'DWYER (Higgins) (09:45): I move:
That the order of the day be referred to the Federation Chamber for debate.
Question agreed to.
Infrastructure Australia Amendment (Cost Benefit Analysis and Other Measures) Bill 2014
Second Reading
Debate resumed on the motion:
That this bill be now read a second time.
Mrs PRENTICE (Ryan) (09:45): It is important to develop a realistic long-term infrastructure plan exemplified by Infrastructure Australia's proposed 15-year infrastructure plan and to also increase private sector investment in infrastructure by looking at options for funding and financial mechanisms and by harmonising and standardising procurement guidelines. Efficient infrastructure provides services that improve both productivity and quality of life. However, poorly chosen infrastructure projects can reduce productivity and financially burden the community for decades with infrastructure that is inappropriate and expensive to maintain.
In Australia, there is a fundamental need for a comprehensive overhaul of the poor processes currently used in the development and assessment of infrastructure investments. All other desirable or aspirational objectives—projected pipelines, increased private financing, cost savings and even user charging and price uniform—ultimately depend, for their efficacy, on having a much strengthened and widely applied set of credible and welfare enhancing reforms.
The Productivity Commission also appeared before the committee hearing, having just released their report on public infrastructure. That report, inter alia, discussed user charging, concluding that it should be used to the fullest extent that can be economically justified. They proposed that well designed and efficient user charges are likely to be superior to taxpayer funding of infrastructure in many situations. Efficient user charges are an effective means to real willingness to pay for new infrastructure and improve the use and augmentation of existing infrastructure. User charges are already the norm for most types of economic infrastructure such as electricity, telecommunications, gas, water and many transport sectors. Concerns about market power can lead to such charges being determined or monitored by a regulator. The extent to which user charges are able to recover the full cost of supply differs across sectors and regions. As infrastructure can provide benefits over generations, user charges too can span generations if they are properly reflective of the effective life of the assets concerned.
The Productivity Commission report also discussed asset recycling, an important initiative of the coalition government's infrastructure plan. The Productivity Commission acknowledges that governments have successfully privatised airports, major ports and electricity infrastructure services. They recommend that states proceed with the sale of any remaining assets of these types, subject obviously to good sale processes including a sound regulatory framework. The priority for the sale of government-owned assets is not to secure the highest price per se but to ensure that economic efficiency is achieved, the risk to consumers and other public interests are managed, the market structure is amenable to privatisation and the sale is conducted efficiently, ethically and transparently.
When the Productivity Commission appeared before the committee, they wanted to address a number of questions and comments that had arisen after the release of their report. The report was not an inquiry into specific infrastructure projects but was rather approached by stepping back from the entire topic and saying, 'What things are going to most significantly make a difference to improving infrastructure and how, in this case, does infrastructure proceed in Australia?'
Both the committee inquiry and Productivity Commission looked quite closely at the role of Infrastructure Australia. The concept of having an overarching entity which looks at infrastructure across the economy is conceptually very appealing, as is looking at how Infrastructure Australia can play a larger part in securing the Commonwealth and state governments' interests in infrastructure projects from the very beginning, especially when dealing with public-private partnerships. The committee also heard from Engineers Australia who identified the lack of engineering input when it came to forward infrastructure planning, and that this lack of engineering expertise resulted in far greater costs down the track:
… the stripping out of the engineering and technical structures in many public service agencies. What this leads to is an inability to adequately monitor technical design, what is being delivered, and adequately oversight outsourcing arrangements.
Engineers Australia has suggested that agencies that have these technical responsibilities need to be able to understand what it is they are expected to do and what resources they require. These resources can in fact be obtained from the private sector, with suitable firewalls between those arrangements and subsequent procurements. Another point they stress is the time and investment it takes to educate and train engineers to full competence. The intermittency related to engineering is of serious concern to the industry.
The committee is looking into many different factors from a wide range of stakeholders involved in Commonwealth infrastructure planning and procurement to ensure that, as we move forward, we are getting better value for the taxpayer dollar—not just at the build stage of an infrastructure project, but throughout its lifetime as well. The inquiry is also emphasising the importance of long-term infrastructure planning and the designation of infrastructure corridors, especially for rail, to ensure that the land is available once a project becomes economically viable.
Efficient provision of infrastructure, including public infrastructure, is the hallmark of a well-functioning economy. I welcome the government's commitment to building infrastructure for the 21st century and to approaching infrastructure planning and procurement sensibly and efficiently, ensuring that Australia's infrastructure can support a growing population and future requirements. I commend the bill to the House.
Dr GILLESPIE (Lyne) (09:51): The purpose of the Infrastructure Australia Amendment (Cost Benefit Analysis and Other Measures) Bill is to amend the Infrastructure Australia Act 2008 so that it is a function of Infrastructure Australia to conduct a cost-benefit analysis of all projects of an infrastructure nature which are nationally significant and which involve Commonwealth funding of at least $100 million. Infrastructure Australia was brought in with a lot of fanfare in 2005 by the now opposition but it took until 2008 for them to enact it. That is another problem: the structural set-up of that organisation was flawed from the start. This bill also introduces sound governance principles so that the Infrastructure Australia committee is separate from the department and the politicians, so we get a truly independent analysis and cost-benefit analysis of the projects that need to be undertaken in Australia.
We all know infrastructure in Australia needs an upgrade. It is a pity that Infrastructure Australia and the previous government did not look at one of the biggest infrastructure projects that the nation is undertaking, and that is the National Broadband Network. Instead of being developed on the back of a coaster, then put onto a whiteboard and rolled out as policy by press release, it should have had a rigorous analysis. It has only been since the coalition took on the responsibility of government that Minister Malcolm Turnbull has undertaken a root-and-branch review of it and done a true cost-benefit analysis, working out the best way to deliver it with the best value for Australian taxpayers and consumers of communication technology. It is a multi-modality mix of delivering fast broadband. With the expansion of wireless capability—which should expand even with the new spectrum that is available for telecommunications—wireless will be much more widely used. That is why we are using a multi-modality mix of fibre to the premises, fibre to the node, fixed wireless and satellite.
It is a pity this analysis was not done. The NBN and its costs do not even appear on our budget figures because it was set up off-budget. As opposed to this reckless waste of money—which is now getting back on track—look at what we have achieved with the infrastructure. We are rolling out improvements to our road infrastructure. As the Prime Minister has said many times: we are building the roads of the 21st century whether you are living in Adelaide, Perth, Sydney, Melbourne, Brisbane, or in the regions.
In our region, in the electorate of Lyne, we have $1.2 billion roughly being spent on the Pacific Highway. It is vital infrastructure that was the No. 1 priority of the New South Wales government. The NRMA had it as its No. 1 infrastructure project. The New South Wales Business Chamber saw it as the No. 1 infrastructure project that needed to be rolled out, and this coalition government is actually delivering on that. $1.2 billion is being spent on the Pacific Highway from the Oxley Highway intersection up to Telegraph Point and then on to Kempsey, and over the next four or five years we will see enormous civil engineering tasks being undertaken—bridges over the Hastings River and improvements on the Pacific Highway south of that—bringing the Hastings and the Manning closer to Brisbane. So all the goods and produce that come out of the Manning and the Hastings and the hinterland will have a rapid route to the north like they have to the south, down towards Newcastle. So it is improving that interconnectedness. If only this rigour and cost-benefit analysis had been taken by the previous government they would have seen past their bias against New South Wales coalition governments and rolled this vital bit of infrastructure out a lot sooner.
As well, I am very pleased to see that we have got other infrastructure rolling out in the Lyne electorate—improvements to the Bucketts highway which connects the Gloucester Valley to the Hastings and the Manning via a rickety old route. There is $8.7 million being rolled out in this first year to Gloucester Shire Council, which is managing the project, and the Greater Taree City Council. That road which has heaps of traffic is going to be improved significantly.
A 15-year planning register is also very important, and Infrastructure Australia will develop a 15-year plan independent of the government to inform the government with some rock-solid, cold, hard light-of-day analysis of infrastructure priorities. This bill will establish an out-of-department, out-of-government, freestanding Infrastructure Australia with its own governance and its own responsibilities to make fearless and frank advice. It will allow us to develop and deliver much more infrastructure than the previous government and in a much more cost-effective manner. I commend this bill to the House.
Mr TRUSS (Wide Bay—Deputy Prime Minister and Minister for Infrastructure and Regional Development) (09:58): May I thank members from both sides for their contribution to this debate and welcome the support that has come for these amendments, which come in part from commitments that I made to the opposition spokesman that we would bring this bill into the House to tidy up some elements of the original bill which did not accurately reflect the wishes of either side or, for that matter, common sense. The government is committed to building a stronger Australia and our May budget laid out an infrastructure plan that will deliver vital transport infrastructure across Australia. It will also create thousands of jobs and increase the economic prosperity of this nation.
The building of the infrastructure of the 21st century needs to go hand in hand with reforms that will ensure we select and build the right infrastructure at the right time. The coalition government committed to and has reformed the peak industry advisory body, Infrastructure Australia. No longer is the head of IA under the direct guidance and direction of the infrastructure minister, as was the case under the previous government. No longer will IA be required to retrofit its advice to align with the election promises of any government, as was previously the case. The previous government was right to set up Infrastructure Australia; it was just wrong in the way it used it. As an independent, transparent organisation, with the CEO responsible to the board, Infrastructure Australia is now set to be fundamental to long-term infrastructure planning in this country, effectively coordinated across jurisdictions and underpinned by robust, evidence-based advice.
I am a firm believer in not putting into legislation what does not need to be there. The government is about red-tape reduction and not about red-tape creation. In fact, regulatory best practice would dictate that primary legislation not be a repository for superfluity. The government committed to have Infrastructure Australia assess projects receiving over $100 million in Commonwealth funding. That, in my view, does not need to be in legislation. The government committed to that threshold, and that is exactly what is happening without it actually being in the legislation.
However, during the debate on the Land Transport Infrastructure Amendment Bill, there were claims that the government was reneging on the election commitment to a $100 million threshold, because it was not specifically stated in the bill. So the government is now prepared to act in good faith to put the words in the legislation. We gave an undertaking during debate on the Land Transport Infrastructure Amendment Bill to introduce legislation to put the $100 million threshold in legislation, and that is exactly what we are doing here. We take our commitments seriously.
The bill amends the act to include in the functions provision the requirement that Infrastructure Australia undertake evaluations of proposals that involve Commonwealth funding of at least $100 million. This figure is to be established as a benchmark, based on 2014 dollars, and indexed every five years to ensure that this figure maintains relativity into future years. This provision is an expansion of the power given to Infrastructure Australia to evaluate projects. This means that the existing power to evaluate proposals for nationally significant infrastructure and other infrastructure determined by the minister has now been expanded to allow the evaluation of proposals for investment or enhancements to nationally significant infrastructure that are seeking Commonwealth funding of at least $100 million.
Contrary to what the member for Grayndler mentioned in his speech, there is no limitation in the new provision. That is what the words that introduce the provision, 'without limiting the function', mean. Let me make it also clear that this power to evaluate relates to proposals for investment or enhancements to nationally significant infrastructure. The reference to the word 'proposals' in 'proposals for investment in, or enhancements to, nationally significant infrastructure' makes it obvious that the consideration by IA is taking place when there is a proposal before them—that is, from a proponent seeking funding.
It is the duty of any government to make sure that Commonwealth funding is spent properly and we achieve value for money. We want to make sure that any project proposal seeking Australian taxpayer money is robust. As the opposition spokesman knows, there will also be other due diligence processes undertaken by my department before any funding decisions are made. I make this point to clearly state that this information that has been around and put forward by some speakers during the debate is wrong.
The government recognises the importance of improving Australia's processes for selecting, prioritising, financing and delivering major infrastructure projects. A robust methodology is necessary to properly inform consistent and relevant cost-benefit analyses for infrastructure projects. To this end, the government commissioned the Productivity Commission to undertake its inquiry into public infrastructure. The inquiry investigated a range of longer-term options to improve project selection and prioritisation. The government is closely considering the Productivity Commission's findings, with a view to releasing a formal response later this year, but is already undertaking reforms to improve the robustness of its project assessment and delivery mechanisms.
In line with the Productivity Commission's findings, the government recognises the importance of robust, consistent use of cost-benefit analyses in assessing projects to ensure that our limited public resources are targeted towards the productivity-enhancing public infrastructure projects which best meet Australia's needs. To this end, earlier this month the government released for public comment a proposed project appraisal framework developed, in consultation with Infrastructure Australia and state and territory governments, by the Bureau of Infrastructure, Transport and Regional Economics. The paper is the outcome of Australian state and territory governments agreeing to consult to develop a more sophisticated and consistent framework to assess and evaluate major infrastructure projects. I look forward to the outcome of that public consultation.
There has been some mention about the government's approach to public transport. Public transport needs are relevant in the delivery of Australia's infrastructure. For instance, the Asset Recycling Initiative will provide an opportunity for state governments to fund priority infrastructure which may include urban rail projects and so address public rail transport needs. Indeed, since the election of the federal coalition government, almost every state has committed to major public transport projects, and we welcome their commitment to fulfilling their responsibilities in that particular area.
The amendments in this bill build on the reforms already being implemented regarding Infrastructure Australia. This will ensure that this organisation is well placed to provide key advice to government and so inform decisions on the delivery of the infrastructure and transport that is so critical to the future needs of this nation. I commend the bill to the House.
Question agreed to.
Bill read a second time.
Consideration in Detail
Bill—by leave—taken as a whole.
Mr ALBANESE (Grayndler) (10:06): by leave—I move opposition amendments (2), (3), (6) and (7) together:
(2) Schedule 1, item 2, page 3 (lines 11 to 13), omit "for investment in, or enhancements to, nationally significant infrastructure that involve Commonwealth funding", substitute "that involve capital expenditure".
(3) Schedule 1, page 3 (after line 13), after item 2, insert:
2A At the end of section 5A
Add:
(5) The summary of a proposal evaluated during a quarter must also include:
(a) either:
(i) if the proposal involves capital expenditure of $100 million or more—a cost benefit analysis of the proposal prepared under section 5AA; or
(ii) for any other proposal—a cost benefit analysis of the proposal if one has been prepared under that section; and
(b) a summary of Infrastructure Australia's evaluation of the proposal.
(6) Schedule 1, item 7, page 4 (after line 21), after subsection 39E(1), insert:
(1A) The amount referred to in subparagraph 5A(5)(a)(i) is to be indexed at the same time, and by the same amount, as the amount referred to in subsection 5A(2).
(7) Schedule 1, item 7, page 4 (line 22), omit "is", substitute "and subparagraph 5A(5)(a)(i) are".
These amendments relate to Infrastructure Australia's evaluation of proposals. Amendment (2) relates to requiring a cost-benefit analysis of projects over $100 million. The government's wording gets the process back to front, and Labor's amendments will address that. Our amendments are consistent with the legislation adopted by the former Labor government relating to the Building Australia Fund and what Labor have moved for in recent months. It gives the $100 million commitment actual meaning.
The effect of this specific amendment is twofold. Firstly, it gets the sequencing right around project proposals by correctly defining the trigger for a cost-benefit appraisal by Infrastructure Australia. It does not make sense to trigger in-depth evaluations of projects seeking funding by selecting those that have already been funded, rather than linking the trigger to involvement of Commonwealth funding of $100 million or over. A meaningful trigger for the proposal should be capital expenditure on the project being $100 million or over. This makes sense, gets the sequencing right, progresses funding appraisal, implements the actual coalition promise and ranks projects by their actual size.
The recent debate, for example, about the East West Link has included the concern that the Commonwealth has provided funding already of $1½ billion for a project that has not commenced. This flies in the face of the commitment to proper cost-benefit analyses and also the very clear and explicit commitment from the coalition that they would make milestone payments. One billion dollars of this $1½ billion applies to stage 2 of the East West Link. This is like an episode of Utopia! The government have funded $500 million for stage 1, which might commence sometime in the coming years, but $1 billion for stage 2, which, funnily enough, comes well after stage 1—a billion dollars. It is indeed as if the scriptwriters from Utopiahave taken over the minister's office! Labor support the reverse, consistent with the legislation we put in place for the Building Australia Fund. Labor believe that potential public transport projects should also be assessed for cost benefit. Under the current government, setting a Commonwealth funding trigger for a cost-benefit analysis means that the relative merit of public transport will not be compared against a competing road project.
Labor's amendment also aligns with the coalition's actual election commitment, where the $100 million cost-benefit threshold would apply to all infrastructure projects worth more than $100 million. That was the commitment that was made. Secondly, it ensures that all infrastructure proposals nominated by the minister will also be evaluated by Infrastructure Australia, which is a reasonable proposition. The bill as proposed would have the minister nominate pet projects that would avoid a requirement for IA cost-benefit evaluation even if they were over $100 million in value. This amendment applies the same uniform process across all projects of a value of $100 million or over, regardless of what the political views are around a particular project.
Amendment (3) is about transparency. As we have moved previously and as many stakeholders, regulators and academics have called for, details of project evaluations will be made public on a regular basis. This amendment adds greater rigor to disclosure by requiring that the details of cost-benefit analyses are published on the IA website. Also included are wider elements of any IA evaluation. Items (6) and (7) are consequential amendments that are uniform with the indexation method proposed in the bill. I commend the amendments to the House.
Mr BANDT (Melbourne) (10:11): This government certainly deserves an award for irony, if not hypocrisy, when it comes to public transport and cost-benefit analyses. We heard this government, when it was in opposition, rail for three years against the NBN on the basis that there was no published cost-benefit analysis. Yet, within a nanosecond of getting elected, this Prime Minister said that he would pledge billions of dollars of Commonwealth money—ripped from the aid budget—to a project in Melbourne that will not just wreck the inner city of Melbourne; it does not even have its own independent, published cost-benefit analysis. That is $18 billion worth of development with no published cost-benefit analysis. It was not even recommended by Infrastructure Australia or in the top slot on their priority list, because they knew that there were better ways to spend the money.
But that did not stop this government or this Prime Minister. Simply because they thought it was in their electoral interest, they were prepared to throw everything they had previously said about cost-benefit analyses and the independence of Infrastructure Australia out the window and to commit several billion dollars in funding to a project that just does not stack up. In fact, as we have heard, $1½ billion of that has already been handed over.
What we also know, because we have been able to get it through the Senate and through some brave people who used to be Infrastructure Australia, is that, for every dollar that goes into this project, the taxpayer is going to get 80c back. The taxpayer is going to get 80c back. The only way that you can inflate it so that it is not a loss-making project is by saying, for the East West Link, 'We'll make some speculative assumptions about transport and public transport times,' of which every respectable commentator has said, 'They just do not stack up.' There is a very, very simple way of testing whether the Prime Minister's East West Link is worthwhile: by releasing an independent cost-benefit analysis.
So the government come in here and say, 'We're going to move amendments to require, in the future, some cost-benefit analyses,' but they ignore the fact that they are about to spend billions of dollars of taxpayers' money on a project that will be an albatross around the neck of Victorian and federal taxpayers for years to come. Stage 1 of the project—that they have already handed over some money for—will lose money, as I have already said. But the Liberals are prepared to go even further and fund stage 2 of the project even before we have actually seen the final designs or the plans—even before they have been submitted to Infrastructure Australia. The Deputy Prime Minister may not know this but the relevant planning assessment committee that looked at stage 2 recommended to the state Liberal government that stage 2 not go ahead, because there was no plan. That, however has not stopped this government from handing over the best part of a couple of billion dollars to help the Victorian Liberals until they get past the state election.
So when the government comes in here and says, 'We need some rigour and we need some transparency,' we say: 'Put your money where you mouth is. Submit the East West Link project in Victoria to the same kind of cost-benefit analysis that you are now saying is worthwhile for future projects and I will believe you are serious.' Until then, all this is is cover for yet another broken election promise. These are good amendments and they will get our support because they hold the government not only to its own promises but to basic standards that should apply before a single dollar goes out of here for a multibillion dollar project—which is: show us the cost-benefit analysis.
I think the Deputy Prime Minister knows, just as everyone else in this place knows, that the East West Link does not stack up. The only way that there can possibly be any money spent is by ignoring the fact that it is going to be a loss-making project. Melbourne is crying out for investment in public transport. Melbourne could be like one of those cities overseas that you can get around without having to use a car. We are a growing city that needs more trains, and that is something that the federal government could help with—as it has in the past and could do again. Instead, billions of dollars are being spent on a road that no-one wants. If these amendments are supported, then the government hopefully will release the cost-benefit analysis for East West Link.
Mr TRUSS (Wide Bay—Deputy Prime Minister and Minister for Infrastructure and Regional Development) (10:16): Unfortunately, these amendments are new to us, and I have not really had an opportunity to examine them in any kind of detail. For that reason alone, the government will be opposing these amendments today. I have given an undertaking to the opposition spokesman that I will have a look at them between now and when they go to the Senate to see whether they can be accommodated. There has been a degree of bipartisanship in trying to deliver elements of this reform to Infrastructure Australia and as far as I can continue in that atmosphere of bipartisanship on it I will do so. However, we cannot really support them without having examined their full implications.
I will make a couple of points in response. It is certainly the government's intention that all projects for which we are contributing funding of $100 million or more will be subject to Infrastructure Australia's approval. The exception to that list is Defence—we have made that quite clear right through the process—but the intention is that Infrastructure Australia will have the ability to make its own decisions and that every project will be submitted to it. We want that examination to be independent and thorough. Of course, no government guarantees it will always accept Infrastructure Australia's advice in the end, but the public has a right to know what the independent authority thinks about the worth of projects and their relative merits. The purpose of the changes is to make sure that Infrastructure Australia can do that in a way that they are ahead of the decision-making process.
That has not been the case in the past, largely because Infrastructure Australia is new and it has not been able to get out in front of the decision-making process in the way it ought to. Our 15-year planning program, I think, demonstrates a commitment that we want to do that. There is no question that the East West Link will be subject to IA's scrutiny. There is no question that that will happen.
Mr Perrett: Will they have to give the money back to the government?
Mr TRUSS: Absolutely. The contract makes it absolutely clear that, if the project does not proceed, the money has to be returned to the federal government—and not to Victoria, I might add. The Greens' proposal to get rid of the East West Link and replace it with a bike way will have to withstand an assessment by Infrastructure Australia as to its merits relative to other projects—not just other projects in Victoria, but other projects in the rest of Australia. As with all Commonwealth commitments to states for road or rail projects, they are for specific projects. They are not just grants of money that they can spend as they like. In this particular case, if the money is not spent on the East West project that was submitted to the government as a priority for Victoria, then the money returns to the Commonwealth.
So we have a genuine commitment to making Infrastructure Australia work. I think the bill before the House makes significant improvements, and I acknowledge the fact that it was supported in the second reading vote without dissent. I think we can make further progress. I repeat that I will look at the amendments that the opposition spokesman has moved and see whether the government is able to accommodate them between now and their introduction to the Senate. In all conscience I could not accept them without having the opportunity to examine their impact.
Mr ALBANESE (Grayndler) (10:20): I do want to make some comments about the Deputy Prime Minister's contribution. He made a number of comments that simply are not correct. One is that Infrastructure Australia was not able to get out ahead of the funding of projects. Have a look at the Majura Parkway when you are on the way to the airport—$288 million, $144 million from each level of government, recommended by Infrastructure Australia after a proper cost-benefit analysis took place. The Goodwood-to-Torrens project in South Australia was recommended after a proper cost-benefit analysis. The Gold Coast Light Rail project—which those opposite were happy to go to the opening of and to ride on the first trip, but which Steven Ciobo, as the local member, opposed—was subject to a proper cost-benefit analysis and recommendations of Infrastructure Australia. The regional rail link in Victoria, which had the largest ever Commonwealth contribution to a public transport project, was recommended by Infrastructure Australia after a proper cost-benefit analysis took place. Infrastructure Australia recommended the work on the Pacific Highway, which shows a positive cost-benefit analysis. All of the work on the Pacific Highway is a result of the former Commonwealth Labor government's investment; the new government did not put in a single new dollar. Indeed, Labor funded all 15 projects that were recommended by Infrastructure Australia.
Infrastructure Australia is a dynamic process. For example, as the Commonwealth, we put in $40 million to make sure that the Melbourne Metro project was up to speed. I see nothing wrong with small contributions for the East West Link or for WestConnex in Sydney. For example, we contributed $25 million for the WestConnex project to make sure that it got up to speed. The Commonwealth government made a $20 million contribution to Cross River Rail in Brisbane, which resulted in that project being the No. 1 project in the country in terms of its cost-benefit analysis. There was an agreement reached between the Commonwealth and the Newman government in Queensland to fund that project. The announcement was ready to go, the Commonwealth money was in the budget, and then those opposite pulled the announcement on the week that it was due to be made with Premier Newman.
Mr Perrett interjecting—
Mr ALBANESE: The press release was organised for Kangaroo Point. The member for Moreton was going to come along. People from both sides were going to be there. Scott Emerson, the Queensland transport minister, thought it was a great project. They all thought it was a great project. But Tony Abbott and the coalition were in a position whereby they were favourites to form government, so that project was skewered as a result of the short-sightedness of the coalition.
Those opposite say that there is nothing to stop the funding of public transport projects, but compare the words of the minister with the policy. The policy of the coalition was to require a cost-benefit analysis for projects worth more than $100 million, not for projects where there was a Commonwealth government contribution of more than $100 million. That distinction is important in this legislation because, by definition, public transport projects will not receive more than $100 million in funding from the Commonwealth government and therefore there will not be an analysis of them.
We go back to the extraordinary proposition of their so-called Asset Recycling Fund, so-called because 'privatisation' is not a word that they like to use, but the fund is for enhancing privatisation. There is no additional money, the legislation has not been carried, and I notice the Treasurer's comments last Friday, when he said, 'It is money that has already been appropriated'. You bet it has; it is money that was appropriated by the former Labor government and put in the Building Australia Fund and the Education Investment Fund. Those opposite have not contributed a single new dollar. I regret that we are not able to have a complete consensus on this. The position of both the major political parties and the Greens political party is that there should be proper cost-benefit analysis, but that is not what this legislation does. (Extension of time granted)
I also make the point that it is extraordinary that the Deputy Prime Minister has not addressed the proposition that $1.5 billion has already been forwarded in the last financial year to the Victorian government for the East West Link project. The cost-benefit analysis has not occurred, but they have already paid $1.5 billion, including $1 billion for stage 2. What is the possible justification for that? Contracts have not been signed, and in relation to stage 2 there is not even a clear idea of where the project will go. It is a bit like Perth Freight Link, where the spokesperson in the Western Australian government said that planning was not up to the point where they could publish any proposal in detail about where that particular project would go, and yet money is allocated for it in the budget. But at least in that case the money was not forwarded.
Those opposite have made this advance payment, and all that does is make the Commonwealth budget look worse and the Victorian coalition government look better in the lead-up to the Victorian election campaign. Then we read in the paper today that the company involved with the potential construction of stage 1 will put in the contract a huge liability for taxpayers if that project does not proceed. It is pretty simple: make sure that you get it right at the beginning before you sign a contract. Contracts for infrastructure should not be determined in terms of their date in relation to the electoral cycle. The whole point of Infrastructure Australia was to break the nexus between the political cycle of three or four years and the infrastructure investment cycle, which by definition is long term. That is what I want to see this legislation achieve.
I appreciate the fact that the minister has said that he will give consideration to the amendments before they are discussed in the other place. On behalf of Labor, I indicate that I am certainly willing to engage in those discussions. Where we can get consensus, I want to reach consensus. However, I must say that the beginning of the new form of Infrastructure Australia has not been terrific. An acting infrastructure coordinator is issuing media releases about the Victorian state election with no authority from the board. I have also asked what the process is to appoint a CEO of Infrastructure Australia. What has been the advertising process to make sure that Infrastructure Australia get the best person to get the job done rather than a crony of the Liberal or National Party? That is a critical point.
Mr Dutton: Deegan, Coutts-Trotter.
Mr ALBANESE: They are prepared to slur people across the chamber— Michael Deegan was appointed head of the National Transport Commission by the Howard government. The Deputy Prime Minister seems to think he has no influence on who is appointed head of the National Transport Commission, which is quite extraordinary. The only person with any political background who was appointed to the Infrastructure Australia council was Mark Birrell, the former minister in the Kennett government, and he was appointed on the basis of merit. There were no former Labor politicians appointed to that body. In terms of the process, we need to make sure that we get it right. This is an opportunity to get it right. I support the amendments.
Mr BANDT (Melbourne) (10:30): I have a question for the Deputy Prime Minister arising out of his contribution, where he spoke about the importance of the public having the right to know, when it comes to cost-benefit analyses. On that basis, will the government release the cost-benefit analysis for East-West Link? Previously, the government has said, 'we don't want to release it because it may jeopardise the tendering process'. Given that a preferred bidder has now been chosen—and given the Deputy Prime Minister's statements about the importance of the right to know—will the government release the cost-benefit analysis for this multibillion dollar project?
Mr TRUSS (Wide Bay—Deputy Prime Minister and Minister for Infrastructure and Regional Development) (10:31): I do not want to prolong the debate, but Infrastructure Australia is the body that will be releasing its cost-benefit analyses and, as I mentioned to the member earlier in the debate, I would expect that Infrastructure Australia will examine this project and that they will release the report.
Mr BANDT (Melbourne) (10:31): Following on from that question, can the Deputy Prime Minister then indicate when the cost-benefit analysis will be released, and whether it will be before the Victorian election?
Mr TRUSS (Wide Bay—Deputy Prime Minister and Minister for Infrastructure and Regional Development) (10:31): It will be a matter for Infrastructure Australia. I thought I had made that point clear.
The DEPUTY SPEAKER ( Mr Mitchell ): The question is that the amendments be agreed to.
The House divided. [10:36]
(Deputy Speaker—Mr Mitchell)
Mr ALBANESE (Grayndler) (10:42): by leave—I move opposition amendments (4) and (5):
(4) Schedule 1, item 3, page 3 (line 21), omit "may", substitute "must".
(5) Schedule 1, item 3, page 3 (line 26), omit "6", substitute "12".
Item 4 requires Infrastructure Australia to approve a standard method for requiring assessments of proposals. This allows for costs and benefits of competing or alternative projects to be compared. This maintains the status quo in the existing act. The government's amendment makes standardisation optional for Infrastructure Australia. Labor's amendment will make a standard method a requirement, as is currently the case, and as is critical if we are examining where taxpayer dollars should go to which project where there are multiple bids for infrastructure projects. Given that there are many more bids for projects than will ever be funded, this is an important amendment. Amendment (5) is a minor amendment providing for better spacing of the first review of Infrastructure Australia's standard assessment method. This amendment requires the first review to occur by next September rather than March. I commend the amendments to the House.
Mr TRUSS (Wide Bay—Deputy Prime Minister and Minister for Infrastructure and Regional Development) (10:44): I commented earlier that the government had not had a chance to review the amendments. A superficial examination of this couple of amendments suggests that there may well be room for us to accept them, but I would want to study that beforehand. So, we will be opposing them, but there is a degree of superficial goodwill towards those two amendments.
Mr BANDT (Melbourne) (10:44): For the reasons outlined in a previous speech, we will be supporting these amendments. If the coalition were fair dinkum about cost-benefit analyses they would have provisions in their laws saying, 'When we are going to have significant expenditure on public transport we will publish the cost-benefit analysis'. It is as simple as that.
The DEPUTY SPEAKER ( Mr Vasta ): The question is that the amendments be agreed to.
Mr ALBANESE (Grayndler) (10:45): I will indicate, for the benefit of the House, that in terms of timing we will not call a division on this, on the basis that the Deputy Prime Minister has indicated that he will give serious consideration to its support when we move these amendments through the Senate.
The DEPUTY SPEAKER ( Mr Vasta ): The question is that the amendments be agreed to.
Question negatived.
Mr ALBANESE (Grayndler) (10:46): by leave—I move amendments (1) and (8), as circulated in my name, together:
(1) Clause 2, page 1 (lines 7 to 9), omit the clause, substitute:
2 Commencement
(1) Each provision of this Act specified in column 1 of the table commences, or is taken to have commenced, in accordance with column 2 of the table. Any other statement in column 2 has effect according to its terms.
Commencement information |
||
Column 1 |
Column 2 |
Column 3 |
Provisions |
Commencement |
Date/Details |
1. Sections 1 to 3 and anything in this Act not elsewhere covered by this table |
The day this Act receives the Royal Assent. |
|
2. Schedule 1, items 1 to 7 |
The day after this Act receives the Royal Assent. |
|
3. Schedule 1, items 8 to 10 |
Immediately after the commencement of Schedule 1 to the Land Transport Infrastructure Amendment Act 2014. |
|
Note: This table relates only to the provisions of this Act as originally enacted. It will not be amended to deal with any later amendments of this Act.
(2) Any information in column 3 of the table is not part of this Act. Information may be inserted in this column, or information in it may be edited, in any published version of this Act.
(8) Page 4 (after line 23), at the end of the Bill, add:
National Land Transport Act 2014
8 Subsection 16(1)
Before "Commonwealth funding", insert "Subject to subsection (1A),".
9 After subsection 16(1)
Insert:
(1A) If an Investment Project involves capital expenditure of $100 million or more, Commonwealth funding may only be provided if the project has been evaluated by Infrastructure Australia under section 5AA of the Infrastructure Australia Act 2008.
10 After section 92
Insert:
92A Indexation
(1) The amount referred to in subsection 16(1A) of this Act is to be indexed at the same time, and by the same amount, as the amount referred to in subsection 5A(2) of the Infrastructure Australia Act 2008.
(2) Subsection 16(1A) is taken, on and from a day of indexation, to refer to the amount as indexed on that day.
Amendment (8) is an important amendment that makes Infrastructure Australia involvement integral to the approval of Commonwealth funding for major infrastructure projects. This amendment will amend the National Land Transport Act 2014, as it has been renamed. This latter act is the funding act. It is the means by which funds for major projects are authorised to be paid to state, territories and other entities for nation building projects. This amendment makes a cost-benefit analysis by Infrastructure Australia a prerequisite to funding road, rail and intermodal projects involving capital expenditure of $100 million or more. It requires Infrastructure Australia's standard method to be used and ensures transparency via publishing of cost-benefit analyses. This ensures that the Infrastructure Australia process has real meaning and sequencing in project selection. It is consistent with Labor's approach to the Building Australia Fund, where Infrastructure Australia assessment was an essential prerequisite to the funding of projects.
Amendment (1) amends the commencement provisions of the bill to include commencement of the changes made by Labor's amendments to the National Land Transport Act 2014. At the time of drafting of these amendments, recent amendments passed by the parliament to this act had not commenced, and this is reflected in the proposed schedule. I commend the amendments to the House.
Mr TRUSS (Wide Bay—Deputy Prime Minister and Minister for Infrastructure and Regional Development) (10:48): Let me repeat: I am prepared to look at the amendments, but we are less likely to be sympathetic to these two amendments. They are not even amendments to the Infrastructure Australia Bill; they are actually amendments to the land transport act, which has already been debated in the parliament. And these issues were debated at that time and rejected, so I think it is unlikely that I am going to have a rethink of amendments (1) and (8) and certainly will be opposing them today.
Mr ALBANESE (Grayndler) (10:48): Labor will be pursuing these amendments. These are absolutely critical to ensure that the circumstances that have occurred, whereby, for example, $1½ billion has already been paid for the East West project—which has not had a published cost-benefit analysis, which has not had a contract signed, and which has not had proper scrutiny—cannot occur again. The fact is that this government's rhetoric in terms of Infrastructure Australia was one thing prior to the election and has been another since. We have seen projects funded without a cost-benefit analysis—such as the Perth Freight Link project, WestConnex and the East West project—which is one thing. But what is worse is the fact that advanced payments have actually been made. This will ensure that you have to have the cost-benefit analysis in place prior to funding occurring—that is, nothing more and nothing less than what the coalition said it would do prior to the election. And it was not just prior to the election. Since the election they are saying that that would be the case. They also say that they will only make milestone payments upon construction. Well, how is it that last financial year billions of dollars had already been allocated for projects that are not even under contract, let alone under construction? We heard a lot of rhetoric from those opposite about cranes in the sky and bulldozers on projects. The bulldozers are not there—just the bulldust from those opposite in terms of their rhetoric. That is why we are moving these amendments—in order to hold the government to account. I commend the amendments to the House.
Mr BANDT (Melbourne) (10:50): We need to stop infrastructure spending being an ideologically driven roads based slush fund and put some transparency and rigour around it. This Prime Minister came and said, 'We will spend $1½ billion on a toll road through the middle of Melbourne', without even seeing a business case and without Infrastructure Australia even having recommended it as one of its priority projects. What they have recommended as being ready to proceed and being useful is Melbourne Metro. As Melbourne grows, like other cities around the country, we are going to need to expand our public transport infrastructure. As long as we have a Prime Minister who thinks the federal government does not even fund public transport—despite the fact that even in Melbourne you have the regional rail link being near completion, thanks to Commonwealth funding—then this is going to continue.
So, there is a very simple choice for the government to make at the moment. When they come in here and bluff and bluster about cost-benefit analyses and have spent the last three years saying they could not support the NBN because it did not have a cost-benefit analysis, are they prepared to do the same with an $18 billion road project through the middle of Melbourne, or are they just prepared to sign off on it without even a cost-benefit analysis?
There is a very simple option. I hear injections asking if it is $18 billion. Yes, it is, because what the members of the government may not know is that this government is in fact prepared to fund stage two of the project, despite there not even being a proposal on the table as to what it would look like. No-one knows where the road is actually going to go, but the Liberal government has been prepared to not only say they will fund it but to hand over money to the Liberal state government to buffer them before the state election.
There is a very simple way to ensure that taxpayers' money is not spent on things like the East-West link, which will turn out to be an albatross around the neck of federal and Victorian taxpayers for years to come, and that is to require transport projects to be independently assessed and have a cost-benefit analysis done, and then release it. If the government were serious, if they want us to take them seriously when they say that they are the best economic managers and everything should run through a cost-benefit analysis, then do the same for big road projects and publish the business case.
The DEPUTY SPEAKER: The question is that opposition amendments (1) and (8) be agreed to.
Bill agreed to.
The House divided. [10:58]
(The Deputy Speaker—Mr Vasta)
Third Reading
Mr TRUSS (Wide Bay—Deputy Prime Minister and Minister for Infrastructure and Regional Development) (11:03): by leave—I move:
That this bill be now read a third time.
Question agreed to.
Bill read a third time.
COMMITTEES
Treaties Committee
Report
WYATT ROY (Longman) (11:04): On behalf of the Joint Standing Committee on Treaties, I present the committee's report entitled Report 143: Treaties tabled on 17 June and 15 July 2014.
Report made a parliamentary paper in accordance with standing order 39(e).
WYATT ROY: by leave—The report I have just presented contains the committee's view on five treaties tabled on 17 June and 15 July 2014, including an economic cooperation treaty with Papua New Guinea, three treaties amending bilateral treaties for the protection of migratory waterbirds and an amendment to Australia's free trade agreement with New Zealand.
The Treaty on Economic Cooperation between the Government of Australia and the Government of the Independent State of Papua New Guinea will change the focus of Australia's relationship with Papua New Guinea from development assistance to a trade partnership. Papua New Guinea has experienced a decade of growth that is expected to continue with a significant resource project, PNG Liquefied Natural Gas Project, which is just getting underway. Two-way trade between Australia and Papua New Guinea is worth nearly $6 billion a year and Australia's investment in PNG is worth more than $19 billion a year—equal to Australia's investment in China.
Under these circumstances, it is not surprising that a recent review of the treaty's predecessor, the Treaty on Development Co-Operation between the Government of Australia and the Government of Papua New Guinea, found that our contemporary relationship would be better reflected in a treaty that emphasises economic cooperation rather than development assistance. The new treaty sets out a framework for bilateral cooperation in the areas of trade, investment, business relations and development cooperation. Significant provisions include obligations to support bilateral economic relations; undertakings to improve trade investment and business cooperation; promoting a favourable environment for trade and other economic linkages; providing protection for intellectual property rights and improving cooperation and consultation on sanitary and phytosanitary measures and technical barriers to trade; and supporting increased business links to encourage investment and private sector interaction.
While the proposed treaty changes the focus of the relationship from development to economic cooperation, it will continue to govern our development relationship and it explicitly articulates a shared commitment to the prevention and the detection of fraud. The committee supports this treaty action.
As previously indicated, the report also reviews amendments to three bilateral treaties protecting migratory waterbirds. The bilateral treaties with China, Japan and Korea are part of a network of agreements aimed at protecting wetlands used by waterbirds that migrate from as far away as arctic Siberia to Australia and New Zealand. The migratory route used by these birds is called the East Asian-Australasian Flyway. According to evidence taken by the committee during its inquiry, the flyway is generally in decline. Migratory shorebirds, in particular, are experiencing a significant decline in numbers.
The amendments to these three treaties involve the addition or removal and the amendment of species from the list of species each treaty protects. The amendments reflect improvements in the scientific knowledge about migratory species in the flyway, and species that have been found not to migrate between the treaty parties have been removed while others that have been found to migrate have been added. The remainder of cases reflect advances in the understanding of taxonomy of the species. Given the flyway's declining health, the committee hopes that the treaties will begin to fulfil their intended purpose of protecting species using the flyway. The committee supports these amended treaties.
Finally, the committee reports on a proposed amendment to the Australia-New Zealand Closer Economic Relations Trade Agreement to reflect changes to Australia's media ownership laws concerning foreign investment. The agreement is a comprehensive bilateral free trade agreement covering nearly all goods and services traded between Australia and New Zealand. Both parties to the agreement can nominate exceptions to the requirement for free trade in services by listing those exceptions in an annex to the agreement. One of the exceptions listed by Australia applies the limit on foreign ownership of television and broadcasting services set out in the Broadcasting Services Act 1992. All limits to the foreign ownership of television and broadcasting services were removed from that act in 2007, meaning the exceptions listed in the annex to the agreement do not serve a purpose. The amending treaty action will remove those listings from the agreement. The committee supports this amendment. Report 143 also contains a statement relating to minor treaty action. On behalf of the committee, I commend the report to the House.
Mr KELVIN THOMSON (Wills) (11:09): I rise to support the remarks made by the committee chair and I want to strongly endorse the conclusion in the report of the Joint Standing Committee on Treaties that the health of the East Asian-Australasian Flyway for migratory shorebirds continues to decline. I also want to endorse the committee's hope that the treaties between Australia and China, Japan, and Korea for the protection of migratory birds and their environment will, in the near future, begin to fulfil their intended purpose of protecting species using the flyway.
Migratory shorebirds are truly a miracle. They fly around the world and back each year, yet some of them are no bigger than my hand. But, in flying around the world, they depend on suitable habitat being available when they arrive and at certain feeding spots along the way. They are vulnerable to the disappearance of any of this habitat. If you remove any link in the chain, it guarantees that some will not successfully complete the journey and their numbers will decline. Unfortunately, this has been happening. Coastal development in Australia has been damaging the habitat of migratory shorebirds.
The situation is considerably worse in China and Korea where large areas of coastal land have been reclaimed for various urban developments, with catastrophic impacts on migratory shorebirds. Between 2000 and 2010, more than 40 per cent of the tidal flat area within six key habitat areas in the Yellow Sea was reclaimed. Losses of such magnitude are the key drivers of declines in biodiversity in the intertidal zone of the region. Observed rates of decline of waterbird species of five to nine per cent per year and of up to 26 per cent per year for the critically endangered spoon-billed sandpiper are among the highest of any ecological system on the planet.
I acknowledge the work of the Global Flyway Network who do field work in the Yellow Sea and in Bohai Bay, in particular. It is very distressing to read some of their work, such as their report from May. It says:
Zuidong, an area where we conducted a large proportion of our scanning during our early visits to Bohai, is now flanked by a six-lane highway and building work on reclaimed land is well underway. The small fishing village on the banks of the river is unrecognisable. To the north, birds are almost completely absent from Beipu.
They add, very poignantly, that:
The stretch of mud where we estimated 80 000 Curlew Sandpiper in 2011 no longer exists.
I want to acknowledge the work of BirdLife Australia and people like Paul Sullivan, Sean Dooley and Samantha Vine who are doing their best to save these remarkable little winged adventurers. They are working to get the eastern curlew and curlew sandpiper nominated for listing under the EPBC Act. They also did work to help BirdLife International get the Philippines government to nominate the great knot as endangered.
Reclamation and development of tidal flats in South Korea, where 25 per cent of the global population of great knots used to stop over, has led to dramatic declines. For example, there has been a loss of 90,000 great knots. The birds did not simply move to other sites. The great knots continue through South Korea to Australia's north-west coast. In Australia, there was a 24 per cent decline from 2001 to 2008 in the largest non-breeding site at Eighty Mile Beach. The species is no longer present at some sites along the south coast which it used to visit. Intertidal mud flats in the Yellow Sea have declined by 65 per cent in the last 50 years. Alarmingly, it is predicted that the global population of great knot will halve within four years.
Between 1983 and 2006 across south-eastern Australia, migratory shorebird populations plunged by 73 per cent. In July this year, I wrote to the environment minister, Mr Hunt, referring him to the Save our Shorebirds online petition and asking what the government was doing to establish a wildlife conservation plan for migratory shorebirds and develop a national wetlands policy which takes into account the cumulative effects of multiple threats to Australia's shorebirds. He recently replied to me, and I thank him for that and urge him to continue with this work, such as the draft Wildlife Conservation Plan for Migratory Shorebirds which he said will soon be out for public comment. I also urge the Chinese and Korean governments to do much more to uphold their obligations, and ensure that all remaining shorebird habitat is properly protected so that these plucky little adventurers can continue their epic journeys to the joy of many generations to come.
WYATT ROY (Longman) (11:14): I move:
That the House take note of report 143.
The DEPUTY SPEAKER ( Mr Vasta ): In accordance with standing order 39, the debate is adjourned. The resumption of the debate will be made an order of the day for the next day of sitting.
Reference to Federation Chamber
WYATT ROY (Longman) (11:14): I move:
That the order of the day be referred to the Federation Chamber for debate.
Question agreed to.
BILLS
Tax and Superannuation Laws Amendment (2014 Measures No. 4) Bill 2014
Tax and Superannuation Laws Amendment (2014 Measures No. 5) Bill 2014
Second Reading
Cognate debate.
Debate resumed on the motion:
That the bills be now read a second time.
Mr BOWEN (McMahon) (11:15): This is a debate on two pieces of government legislation—the Tax and Superannuation Laws Amendment (2014 Measures No. 4) Bill 2014 and the Tax and Superannuation Laws Amendment (2014 Measures No. 5) Bill 2014. I will deal with No. 5 first. There are some schedules here which the Labor Party support and some schedules which we will oppose in the other place. I will outline our approach on each of the schedules.
Firstly, this bill seeks to abolish the mature age tax offset, which the Labor Party will support. This was a process started by us in government. It is a sensible saving. The government have their own measures that they have put in place to replace this measure, and we will not stand in the way of the passage of this particular schedule. It represents a considerable saving, and the Labor Party are always prepared to support sensible savings put forward by the government. We see too few of those, but we will support this sensible saving.
We will also support the schedule which relates to the introduction of new deductible gift recipients. In the tradition of both Labor and Liberal governments, this is the normal process. These are worthy organisations. That schedule will attract our support.
We will not support the schedule which goes to the changes to research and development, and we will not support the schedule that goes to the seafarer tax offset. The amendments moved by the Labor Party in the other place will reflect that. I flag the Labor Party's position in the House and the approach we will take in the other place.
In relation to research and development, we see a pattern here from the government. It is a government which is prejudiced against science, research and development, and important measures to encourage innovation in the Australian economy. Almost everybody knows that innovation, science and technology are important key drivers for future economic growth. I say 'almost everybody' because it seems that everybody except the government knows that. We have a government that does not have a minister for science. It is a government which in its recent budget—the late and often lamented budget—cut research and development spending and cut science research spending quite considerably. We have seen the CSIRO cut by $115 million. We have seen the Defence Science and Technology Organisation cut. We have seen the Australian Nuclear Science and Technology Organisation, the Australian Institute of Marine Science and Geoscience Australia suffering cuts of $51.4 million. We have seen cooperative research centres, which have been so important over many years now for the Australian innovation task, have their funding slashed. We have seen important government programs when it comes to commercialisation and innovation abolished and replaced by a new program which has roughly half the amount of funding that was previously in place and has a vague and ill-defined mandate. I think it is just simply the government playing catch-up and trying to cover the fact that it is making cuts in this important area.
Why do I say this is so important? It is because these are the drivers of future economic growth. We condemn the government for their budget because it is unfair. We condemn the government for their budget because it represents prejudice against working Australians. We condemn the government for their budget because it represents fundamental breaches of promise and a web of deceit that the Liberal and National parties engaged in at the last federal election. But we also condemn this budget because it represents an attack on future sources of economic growth. It represents backward-looking policy. It represents an approach to policy which does not recognise the importance of innovation in Australia.
The fact is that high-growth technology companies currently generate less than 0.2 per cent of our GDP. But PricewaterhouseCoopers have estimated that, with the right policy environment, this sector could contribute four per cent of our GDP, generating more than half a million jobs by as early as 2033. So we need a government which embraces innovation, commercialisation, research and development, start-ups and the spirit of entrepreneurialism. The government are happy to talk about those things, but their policies, as in so many areas, go in exactly the opposite direction. We have a Prime Minister and a Treasurer who think if they say something it makes it so. But it is actually their policies that make it so—and their policies do not reflect their rhetoric.
A measure before the House here is a $620 million cut to the research and development tax concession. I will say a number of things about this. Firstly, the support given to research and development through the incentive in the tax system has been very important in Australia's research and development efforts. What the government is doing here is relinking the concession to the corporate tax rate. The previous Labor government explicitly delinked the corporate tax rate and the research and development incentive. We did that to provide certainty so that Australian companies investing in risky research and development ventures knew the sort of support they would receive from the government when they were undertaking the difficult decision about how much to invest. Some of these ventures will not pay off for the company and most of them, if they do pay off for the company, will have spillover effects for the entire economy. So that was the approach taken by the previous government.
This government has taken the approach of relinking the corporate tax rate with research and development incentives. I accept that there is a legitimate debate to be had about that and that there could be good arguments put on both sides. But the approach taken by the Labor Party in office that we continue to defend, protect and promote is that it is important that firms have certainty when it comes to investing in research and development.
But the government are so incompetent that, even if you accept their arguments, they have actually been quite tricky with the Australian business community. Firstly, this bill seeks to reduce the R&D tax incentive because the government wants to relink it with the corporate tax. The government is proposing to cut the corporate tax rate to 28.5 per cent from 1 July next year. But this change applies not from 1 July next year; it applies before then. If there is to be any justification for the government to implement this measure it should apply from the same date as the corporate tax rate which the government intends to introduce comes into effect.
Secondly, the government has forgotten about its little policy—I am sure many on the government benches would like to forget about the policy—of paid parental leave and the levy that will be applied to pay for it. The Prime Minister does not want to forget it but I think almost everybody else on that side of the parliament would like to forget it, because it is a terrible policy. It is an unfair policy. It is an extravagant entitlement scheme. The Treasurer, with his normal bluff and bluster, his chest beating and his lecturing of the Australian people about the age of entitlement, is introducing a massive entitlement scheme which will send cheques of up to $50,000 to Australians, regardless of their income, upon the birth of a baby. This will have no impact on productivity or participation in the workforce. That is what the Productivity Commission say. 'What would the Productivity Commission know about productivity?' says the government.
Mr Ewen Jones interjecting—
Mr BOWEN: They would know more than you. They say that this will have no impact on productivity or participation. Why would it? It is not linked to participation in the workforce. You just get a cheque. Of course we oppose the government's Paid Parental Leave scheme. It is being paid for by a levy on Australia's large businesses, large businesses which undertake research and development. The government is proposing to reduce the R&D tax incentive because, it says, it is reducing the corporate tax rate, but at the same time it is introducing a levy. This is one of those old pea-and-thimble tricks that the government is engaging in. It is saying, 'Isn't it wonderful! We're cutting the corporate tax rate by 1½ per cent. Oh, but we're also introducing a new levy of 1½ per cent.' So the tax burden on those large businesses will be reduced by not one cent. The government is proposing to reduce the R&D tax incentive to reflect the new corporate tax rate, ignoring the fact that it is putting a levy on Australia's largest businesses to pay for its ridiculous, extravagant and unfair Paid Parental Leave scheme at the same time that it is attacking ordinary working Australians with its cuts elsewhere. We will oppose this schedule in the other place.
The other measure that we will oppose is the government's proposed abolition of the seafarer tax offset. Maybe the government does not understand the impact of its policy here or maybe it has thought it through and it does understand the negative impact of its policy. Either way it has got it wrong. The shipping trade is important for Australia. One-tenth of the world's sea trade goes to or from Australia, and Australia has the fourth-largest shipping task in the world. It stands to reason, as we are a maritime trading nation. It is in our national and security interests to revitalise Australian shipping.
The previous government did considerable work in this regard. The former Deputy Prime Minister and Minister for Infrastructure and Transport, the member for Grayndler, has very passionate views about this and was the key reformer in this place. Part of those reforms was the introduction of this tax offset in 2012 following lengthy industry consultation. The object of the offset is to stimulate opportunities for Australian seafarers to be employed or engaged on overseas voyages and to acquire maritime skills.
There is a pretty basic principle here. Under our tax system, if you are an Australian citizen and you are working elsewhere in the world you are covered by the tax system of that country. We are not like America, under whose system an American working anywhere in the world is regarded as being subject to the revenue task of the United States government; we have a different approach. But we say that if you are working on a ship which is not in Australian waters that should apply as well. This was an offset introduced by the previous government, designed by the Treasury—not by others—to achieve that policy aim. I dare say that honourable members opposite will somehow bring into play the claim that this was some sort of sop to the union movement or something to do with the Maritime Union of Australia. That is what the government will allege, I suspect.
Mr Ewen Jones interjecting—
Mr BOWEN: What it will not tell you and what the member for Herbert in his contribution, if he makes one, will not tell you is the view of the Australian Shipowners Association, that well-known socialist organisation. The last time I checked they were not affiliated to the Australian Labor Party. I will have to check but I am pretty sure that it is the case that they are not an affiliated organisation to the Australian Labor Party. They said:
The Seafarers Tax Offset was a key element of the 2012 reforms which helped to reduce the operating costs of Australian vessels, increased the competitiveness of Australian shipping and provided significant opportunity for employment of Australians in international trades … the impact [of abolition] is severe with regard to future opportunity.
I do not think we are going to hear that quoted by members opposite. The Australian Shipowners Association have called you out. Here is a measure which will reduce the competitiveness of Australian industry—called out by the Australian Shipowners Association, who know that you have got it wrong. You have got it wrong. This measure has got it wrong. The Labor Party will defend the seafarer tax offset in the other house, because you have got it plain wrong. This is not for a large saving; we are not talking about billions of dollars. It is quite a modest measure but it is an important one. I ask the government to reflect on this measure, maybe to consider the views of the Australian Shipowners Association, and to acknowledge that it has got it wrong. If it acknowledges it has got it wrong then it will have our bipartisan support on its back down.
Mr Hunt: That's very good of you!
Mr BOWEN: Yes, it is. We are always happy to provide support when you acknowledge your error. I call on the minister and the Treasurer and the Assistant Treasurer, whoever he or she may be, to acknowledge that error. I think that if the government had a full-time Assistant Treasurer maybe these errors would not occur. I am a former Assistant Treasurer. It is an important role. If we had an Assistant Treasurer maybe these errors would not occur, because somebody would be looking at these issues full-time. It would not be an add-on. I do not like the member for Herbert's chances of being the next Assistant Treasurer. I do not have any money on him.
Let me turn to the Tax and Superannuation Laws Amendment (2014 Measures No. 4) Bill 2014. As I said earlier, we are more than happy to provide support for sensible measures, when we see them, and we will provide our support to this measure. This is a sensible measure because—guess what?—the government is implementing the former government's approach. We are more than happy to give credit where it is due and to commend the government for implementing Labor's proposals to reduce multinational tax avoidance, which are contained in this bill. I do want to say some things about multinational tax avoidance, because it is a very important issue for Australia. When we were in office, we laid out a very comprehensive plan to deal with multinational tax avoidance. It was at the end of the story and there was always more work to be done, but it was a very comprehensive plan indeed. There were measures that would have prevented $5 billion in revenue being moved offshore.
We put these measures in place because these are important principles and because, as I have said before, governments, Labor or Liberal-National, will always need to fund important government services, so there will always be a certain measure of tax which needs to be collected. If it is not collected from multinationals, then it is collected from somebody else. It will be collected from small Australian businesses, which do not have the wherewithal or the resources to engage in these elaborate and complex tax-avoidance schemes; it will be collected from Australian personal income taxpayers; or it will be collected from others through the tax system.
This is about fairness. It is also about competitive neutrality, because businesses who do pay their fair share of tax should not be disadvantaged in their competition against these multinationals who seek not to pay their fair share of tax. This is a very important principle. We put in place comprehensive measures which the Treasurer just last sitting week referred to as being robust and world class. These are the measures put in place by the previous government: addressing aggressive tax structures that seek to shift profits by artificially loading debt in Australia; better targeting resource sector concessions for depreciating assets to support genuine exploration; improving the integrity of, and ensuring better compliance with, the foreign resident capital gains tax regime; closing loopholes in the offshore banking unit regime; preventing sophisticated investors from engaging in dividend washing; and—importantly—increasing ATO compliance checks on offshore marketing hubs and business restructures. As I said, the Treasurer himself referred to the robustness of this approach.
I do want to take the opportunity again in this House to pay tribute to the former member for Lindsay, Mr David Bradbury, who as Assistant Treasurer in the previous government provided detailed leadership in implementing these changes. So good was his work that, after leaving the parliament, he was engaged by the OECD in the important role of advising the OECD on tax reform. He now resides in Paris, advising the OECD on international tax. Again, the Treasurer has referred to the work of the OECD and to the Secretary-General of the OECD, Angel Gurria, who was in Australia last week, in Cairns—well, in very large part, the work of the OECD is being led by David Bradbury, the former Assistant Treasurer. It is testament to the work that he did in his portfolio that he was recognised by this international organisation and was engaged by it.
Most of that has been kept in place by the current government, except that the current government wants to leave open tax loopholes which are worth over $1.1 billion. This is to the government's great discredit. It is to the government's great discredit that it is reversing or not implementing changes that the previous government was putting in place which further minimised international tax evasion, at a cost to the Australian taxpayer of $1.1 billion. This goes to priorities and values. This is a government that says in its budget: 'We have to make tough decisions. We have to change the way we index pensions and make it less fair. We have to make people wait half a year for important Newstart arrangements. We have to cut $80 billion out of health and education. We have to make all these unfair cuts. But, by the way, we can give $1.1 billion back to tax evaders.' That just shows the wrong priorities that this government has.
Again, if the Treasurer wants to recognise the error of his ways and reverse his reversal of the previous government's initiatives, he will have our bipartisan support. I have said before that I fully accept and recognise that there can be implementation challenges on complex law changes; and, if he has a different way of doing it, we are more than happy to look at that. If he takes advice about how it could be done better, we would be more than happy to look at that. But he does not, because he does not want to provide the leadership necessary to ensure that these changes can be made. This just goes to show that this is a Treasurer who is strong when it comes to standing up to the weak but weak when it comes to standing up to the strong. He is not prepared to take on multinational companies who are engaging in tax fraud and tax evasion. He is not prepared to take them on. He is prepared to talk about it, he is prepared to beat his chest, he is prepared to say to other countries around the world that they should be doing more; but he is not prepared to show that leadership here in Australia, and that is to his discredit. That is to the discredit of the government and of the Treasurer.
We do think that more needs to be done when it comes to international tax avoidance. It is not good enough for the Treasurer to say here at the dispatch box that he has instructed the tax commissioner to double his compliance efforts in this regard while at the same time reducing the tax office's resources. How is the tax commissioner, who has the Labor Party's support—a very good tax commissioner, he has our support in his endeavours—meant to double his compliance efforts at the same time as this government is reducing resourcing for the Australian Taxation Office, which will have a clear and definite impact on its compliance measures?
Because of this government's cuts—let us be very clear—there will be tax avoidance which is not stopped because compliance is reduced because this government is reducing resources to the Australian tax office. The Treasurer is good at rhetoric. He is good at beating his chest and saying that he has issued an instruction to the tax commissioner to double his compliance efforts. Bu at the same time the Treasurer is reducing the resources available to the tax office for compliance. Again, the government and the Treasurer are full of rhetoric, but when it comes to action they are completely lacking in that important regard.
On behalf of the opposition, I have indicated those measures which the Labor Party are prepared to support. The schedules in bill No. 5 which we are prepared to support are schedule 1 and schedule 4, I believe, but we will be opposing the other schedules in the other house. We are prepared to give our support to bill No. 4 on the basis that it is implementing measures that were contemplated and begun by the previous Labor government. We commend the government for proceeding with them. We condemn the government for handing back $1.1 billion to international tax avoiders by not proceeding with the previous, Labor government's other important changes and we will vote accordingly in the other place.
Mr EWEN JONES (Herbert) (11:37): I rise to speak on the Tax and Superannuation Laws Amendment (2014 Measures No. 4) Bill 2014. I like the member for McMahon. He is a good man. What he should do is google that limited-release DVD; I reckon it will sell more copies than his book! In all honesty, the member for McMahon is probably right: I may not be the next Assistant Treasurer over here! But I will tell you one thing, Member for McMahon; I am a damn sight closer to holding higher office at the moment than you are!
Mr Bowen: I can't see you! I can hear you but I can't see you!
Mr EWEN JONES: I may be far off, I may be out on the boundary, but I am a damn sight closer to sitting on the treasury bench than you are at the moment!
I love the Labor Party! They just spent six years in government, their credit card got so hot they had to get special gloves to handle it—that is how hot it got—and now they come in here and they have all these measures for us where we are missing out on tax revenue. They have all these ideas about where we are missing out, yet they did not implement a single one in their six years. They did nothing in six years except spend, spend, spend. But now they say we are missing opportunities and this bill does not go far enough.
This bill is dry by necessity, and therefore I want to concentrate in my contribution on what we are actually doing—not the bits and pieces that Labor think we should be doing but the bits and pieces that we are actually doing. I will concentrate on the Treasurer's second reading speech and make some personal points in conclusion.
This bill aims to improve Australian taxation laws by bringing together different taxation measures, ranging from multinationals' profit-sharing to the breakdown of everyday Australians' tax payments. The bill will assist small business. It will lead to around 1,200 taxpayers being excluded from the application of the thin capitalisation rules, out of 2,500 taxpayers currently subject to the application of the rules. I will give a more detailed definition of 'thin capitalisation' further on in this speech. We will be reducing more red tape and helping small business to get on with what small business should be doing, and that is what we as a government hold as a core belief.
This bill also delivers on the government's election commitment to introduce a tax receipt showing individual taxpayers where their tax dollars are actually spent, and continues the government's work on restoring the integrity of the taxation system, so poorly lacking under the previous government.
Soon after we were elected to government last year, we were advised that 96 tax and superannuation measures had not been legislated. We speak often about the Hawke and Keating governments in this parliament; we look back on them almost wistfully and sigh over what has gone before. I will always remember when Paul Keating stood at the dispatch box and around the country and stated that the tax cuts he had announced were 'l-a-w law'. The only problem with these 96 measures is that they were not e-n-a-c-t-e-d enacted. The previous government stand condemned for making all sorts of promises and laws and then squibbing on the task of getting them enacted—and now we find that they are actively opposing a lot of the measures that they believed in before.
The backlog created significant operational uncertainty for businesses and consumers. We acted swiftly to clean up Labor's mess and to provide certainty and reduce red tape for all taxpayers: investors, small business and corporate Australia. The government announced on 6 November 2013, just short of 12 months ago, that it would proceed with reforms to tighten up thin capitalisation limits. Schedules 1 to 3 of this bill implement measures announced but never developed or legislated by the previous government.
Labor's shadow Assistant Treasurer, Andrew Leigh, the member for Fraser, is a good man. However, his claim in The Sydney Morning Herald on 8 September 2014 that the Abbott government was not taking serious action on multinationals' taxation avoidance is wrong. The coalition has cracked down and will continue to crack down on tax evasion by multinationals. Dr Leigh has also wrongly claimed that the government walked away from closing $1.1 billion in tax loopholes relating to the taxation of multinationals. This is not reflected by the facts. Rob Heferen, Executive Director, Revenue Group, Treasury, said:
… through public consultation on that, it became apparent that the proposal that stood would not be a sensible proposal to proceed on.
The source is the Hansard of the Senate Economics Legislation Committee budget estimates hearing on Thursday, 5 June 2014. While the member for Fraser continues to get it wrong, the coalition is taking real action to crack down on tax-evading multinationals.
If Australian operations are funded by excessive debt, they are said to be thinly capitalised. Multinationals have the flexibility to determine where international financing can occur and how debt will be allocated within the group through intragroup funding arrangements. This provides them with the opportunity to influence the jurisdiction in which deductions for interest are claimed, for example, by allowing them to claim a greater proportion of debt deductions in higher-taxing jurisdictions where debt deductions are often more valuable. This can effectively reduce or negate Australian income tax while improving after-tax profits for the multinational group.
Thin capitalisation rules are designed to prevent multinationals from profit-shifting by allocating a disproportionate amount of debt in their Australian operations and claiming excessive debt deductions in Australia, thereby reducing their Australian taxable income. The current rules were introduced in 2001, following the Ralph review. It consisted of a number of debt limit tests. These tests calculate the maximum debt deductions allowed to be claimed for a multinational's Australian operations.
What this bill does follows extensive consultation with stakeholders, including business, tax practitioners and the Australian Taxation Office. The changes to the thin capitalisation statutory safe-harbour limits are in line with industry expectations following the Business Tax Working Group's consideration of this matter in 2012. We will introduce a worldwide gearing test for certain inbound investors. The legislation fixes thin capitalisation rules by making sure that repayments of interest to companies in Australia from overseas subsidiaries are subject to tax even when they are dressed up as dividends. These amendments take effect from 1 July this year. We are tightening the statutory safe-harbour limits to prevent erosion of the Australian taxation base.
The bill also seeks to reduce compliance costs for small businesses by increasing the de minimis threshold from $250,000 to $2 million in debt deductions. The main entities affected will be larger multinational enterprises with investments in Australia with business models that rely on high Australian gearing levels. The changes to the thin capitalisation rules and the exemption for foreign non-portfolio dividends are expected to provide an increase in revenue of $755 million over the forward estimates period. It is important to note that, while infrastructure projects and electricity generators generally carry high levels of debt and could fail the new statutory safe-harbour limit, they will continue to be able to access the arm's-length debt test that will allow higher levels of debt in those areas.
Other sectors likely to be affected by the reduced statutory safe-harbour limits are finance and insurance providers—those who are not in the business of on-lending—manufacturing, mining and construction. The changes will also affect Australian multinationals investing offshore with high Australian gearing levels. Small business stakeholders have welcomed the increase in the de minimis threshold, as this will reduce compliance costs for small business. The changes to the thin capitalisation rules and the exemption for foreign non-portfolio dividends—schedules 1 and 2 respectively—are expected to provide an increase in revenue of $755 million, as I said, over the forward estimates period.
This bill provides an exemption for certain foreign non-portfolio dividends—that is, holdings of more than 10 per cent paid to an Australian company. The exemption helps ensure that offshore investments by Australian companies are able to compete on an equal footing with other businesses in that foreign country. We will modernise the foreign dividend exemption so that it is available to all Australian entities which are taxed as companies and that the exemption only applies to returns on instruments treated as 'equity interests' under the debt-equity rules. This is intended to broaden the exemption to apply in respect of a broader range of equity-like interests, rather than interests that involve significant voting rights and to exclude any returns on 'debt interests' from the exemption. By excluding 'debt interests' from the exemption, it also ensures the integrity of the thin capitalisation rules. That is the core to it. Obviously, the object of the foreign resident capital-gains tax regime includes ensuring that interests in an entity remain subject to Australia's capital-gains tax laws—if the entity's underlying value is principally derived from Australian property.
This bill will amend the income tax laws to improve Australia's foreign resident CGT by stopping double counting of certain assets under the principal asset test. This test determines an entity's underlying value is derived from Australian real property. By removing this double counting of assets, we will ensure that foreign residents' interest in an entity derives its value principally from Australian real property within Australia's tax net. Under Australia's taxation laws a foreign resident is subject to CGT only where the disposed asset is either a direct or indirect interest in Australian real property or where the asset is used in carrying on business through a permanent establishment—for example a branch—in Australia.
The amendments in this bill extend the original 2013-14 budget announcement to include interests in unconsolidated groups, as well as in consolidated groups held by foreign residents, to ensure the principal asset test operates as intended. We made the election commitment that from 1 July 2014 the ATO would begin issuing tax receipts under the Tax Commissioner's existing powers. The bill amends the tax laws to provide better transparency to taxpayers about how their tax money is spent. We will ensure this government is, and future governments for that matter are, held accountable for the way they spend taxpayer contributions and the debt they maintain. The tax receipts amendments in schedule 4 are of major interest to mum and dad taxpayers. These amendments ensure that future governments are obliged to continue what we began in 2014—issuing receipts to taxpayers to show how their hard earned tax contributions have been spent.
We went to the last election with four main pillars to our commitment to the Australian people. We said we would axe the bad taxes, such as the carbon and mining taxes; we said we would stop the boats; we said we would build the roads and the infrastructure of the 21st century; and we would fix the budget mess left to us by Labor. The carbon and mining taxes are gone, and we are seeing price relief from that coming through now. We have had one successful boat this year; Minister Morrison has led a team that means business, and we are now closing detention centres across the country. We said we would build the roads and infrastructure of the 21st century and, despite the member for Grayndler telling the country that all these projects have already been delivered, he was talking in the same sense as the aforementioned Paul Keating was about the l-a-w law. He may have s-t-a-r-t-e-d some of these projects, but he has not started any; he did not fund them; and he did not get the tender organised; he just a-n-n-o-u-n-c-e-d them.
We have to follow through on what the Treasurer and the Prime Minister have said about being open for business. We have to fix the mess. If you are saddled with interest and principal repayments, your cash goes to that, and your options are reduced. We do not have the cash at home to withstand international events. We must run tight fiscal policy if we are to be the responsible leaders of our community. Above all, we must respect the tax dollar given to us by the people of this country and we must make sure we take every step to ensure we do not miss opportunities which are fair and right and just to collect that tax.
This bill does not close every international tax loophole; it does not address every single issue that those opposite suggest that we should. What it does is set out the plan that we are going about in trying to rectify the budget mess with which we were left. What it does is say to the people of Australia that we are getting on with the business of government; we are opening our doors to opportunities for people to get on with their lives and to deliver for themselves the opportunity to create wealth and employment. That is no more and no less than the people of Australia demand of us. We must make sure that we use these things to do it properly, but we cannot simply go through and cut and rape and blast the place open. We are doing the calm, methodical job that the Prime Minister and the Treasurer said we would. You have seen what happened in Cairns on the weekend: we are talking to the world on so many fronts and we are doing the right thing. This bill goes about that part of the business. I thank the House.
Ms CHESTERS (Bendigo) (11:51): I do not believe there is an area of public policy that differentiates between Labor and the coalition more starkly than that of tax and tax reform. One side believes in tax reform that benefits the most wealthy; and we have seen that not only in some of the measures in this bill but also in their budget. We have also seen it in some of the measures that they have pushed through this parliament already. The other side, the Labor side, believes in a fair, sustainable and equitable system—not just because it is fair, sustainable and supports those on the lowest incomes but because by supporting those on lower incomes we also help grow our economy. To me, that is one of the fundamental differences between our side of the House and the other side. When you give tax breaks and tax reform to those on the smallest incomes, that money goes back into the local economy. Every single dollar that is put into a low-income budget is spent, because they need to spend it to survive, to make sure that they get food on their table and to make sure that they get their kids off to school. That does not happen when you apply tax reform to those at the highest end; their extra income just goes into the bank; it is put away for a rainy day. If you are serious about growing the economy and if you are serious about creating local jobs, then tax reform that supports those on the lowest incomes helps deliver that.
In the bills before us there are some sensible reforms, which we support, some silly reforms and some reforms that only tinker with the broader tax issues. Let us be frank: in relation to multinational tax avoidance, this is just another government stunt. It is a stunt to distract from its inaction on this issue and it is a stunt to distract from its unfair budget. The government wants to blame, and continues to blame, Labor for its tax increases and its attacks on low- and middle-income Australia. It continues to say that we are in debt and deficit over and over again like a broken record, but that is just a smokescreen for its real agenda—that is, its twisted priorities in supporting those at the highest end, instead of supporting those most in need at the lowest end.
Some of the changes that we have seen include tax of up to $6,000 a year on families. The burden of this budget is not being fairly shared. It is estimated that the $6,000 a year in tax will disproportionately impact families in our regional areas—regions like my own. Research shows that these attacks on income will see a single parent in the bottom quartile of income pushed further into poverty. I have seen this when people in my local community come to see me in my office. A single parent from Castlemaine walked in with her bills and said: 'I've got $2,000 worth of bills due. It does not matter how much I save, I literally don't have the capacity in my budget to pay them. Which bill should I pay, Lisa? I am going to have to ask family to support me.' That is part of the problem with this budget; it shifts the burden back onto those who are at risk and those on the lowest incomes. Those opposite are doing that by giving tax breaks and support to those at the highest end.
Another single parent who could be hit hard by the government's proposal to hit people's income by $6,000 said that she says to her children, 'Look, we can't go to that birthday party on the weekend.' The reason for that is that they cannot afford to buy a birthday present for the child whose birthday it is. These are real stories about real people in regional communities who are struggling—struggling to pay the bills and struggling to keep their head up. These are the people who will be hit even harder by the reforms of this government in its budget and in the bills and the measures that have been introduced.
An example of how our community understands the importance of ensuring that tax reform is targeted at those most in need is Country Cob Bakery in Kyneton. They fear every time the government talks about decreasing the pension, and they fear every time the government talks about winding back tax reform that helps those on the lowest incomes, because that is their customer base. Their customer base is people on the lowest incomes, people who come in and have a cup of coffee and a cake. When we attack those on the smallest incomes, we start to slow the growth in the community and we start to hurt those local businesses that rely on families with small incomes to survive.
Low-income households tend to spend every single dollar in their income, whilst high-income households tend to save as much as $1 in every $5. That is where this government does not understand that, if you want to get the economy growing, then the more support you give to those on the lowest incomes, the more money will be spent in our local economy.
This government's budget and its tax reform agenda are built on the flawed principle of giving support to those at the high end. That does not create the growth that we need to continue to ensure that Australians remain employed and that our economy grows. The redistribution of money from the bottom to the top as a result of this government's budget is just not fair; it is also bad for our economy.
Compare the government's agenda and its plan for our tax system and our economy to Labor's approach in government. It demonstrates, again, the difference between that side of the House and this side of the House. Labor was the government that tripled the tax-free threshold from $6,000 to over $18,000. It was a reform that rewarded hard work and put back into the pockets of low-paid workers money which they then spent. At the time that this measure was introduced, more than seven million people received tax cuts, with more than six million receiving a tax cut of at least $300. That money went straight back into the local economy, because we know that when you use tax reform and tax relief to increase the income of those on the lowest incomes—as opposed to those on the highest incomes—every dollar is spent.
Another example of Labor tax reform is in the area of wealthy self-funded retirees
The reform introduced by the former government said that those self-funded retirees whose income was over $100,000 a year were to pay some tax, but the tax rate was 15 per cent. That is the same as somebody who was on an income of $68,000. This was only on the amounts that exceeded $100,000 in a tax year. There are not too many self-funded retirees in the Bendigo electorate—in fact, across regional Victoria—that receive more than $100,000 a year from their superannuation. These changes addressed an anomaly that provided open-ended tax concessions for some of our highest income earners. The plan was that from this year superannuation payments of up to $100,000 would still be tax-free but after that those who are living on the highest superannuation incomes would pay some tax.
This is one of the first changes that this government made when they came in—an example of twisted priorities, of taking away a reform that would have seen people receiving more than that $100,000 paying some form of fair tax. This is the difference between our sides. One side is really helps their own—those on the highest income; whereas the other side tries to lift everybody up. This reform alone was subsidised by people on the lowest incomes. Pick any measure, whether it be their changes to the family tax benefit, whether it be the repeal and removal of super contributions up to 12 per cent, this government funded the tax change to self-funded retirees by taking from those on the lowest incomes.
Labor is committed to a fair and sustainable tax system—a system that provides incentives for all Australians to work, to undertake productive enterprise, whilst guaranteeing adequate revenue to provide quality public services and ensuring a more equal distribution of income and wealth. There are not too many people that you meet out there in community who do not believe in good, well-funded public services. People get that, particularly in regional areas. They get and want well-funded public services. Yet in this era of, 'Lets focus on smaller and smaller government,' this government is completely ignoring the wishes of the community.
In this bill Labor does support sensible measures but not the silly ones, sensible savings they do not unfairly impact those who can least afford it. Labor does support abolishing the mature age worker tax offset. It was actually a reform that was started by the previous Labor government, who commenced the phase-out of this particular tax offset. We need to increase the workforce participation of older Australians. What we also need to do, apart from this measure, is to start talking about jobs plan for older Australians. It is not enough to have this reform and then to offer money to employers to take on older workers; we have actually got to help create the jobs—the industries that will create those jobs.
What Labor does not support is the abolition of the seafarer tax offset. The abolition of the seafarer tax offset is the start of the coalition's attempt to remove the support that Labor put in place to revitalise Australian shipping. The object of this offset was to stimulate opportunities for Australian seafarers to be employed or engaged on overseas voyages and to acquire the maritime skills. That is what I am talking about when I talk about creating jobs plan, linking it in with these kinds of reforms that actually encourage and create opportunity and employment. Even before this offset is two years old the government is moving for its abolition. It must be given the opportunity to work, to give ourselves the opportunity to create those jobs, to create the skilled workforce that we need to maintain and expand our maritime skills base. Even the Australian Shipowners Association strongly oppose the abolition of this offset. Currently, companies who are eligible to claim the seafarer tax offset are saying this creates uncertainty. This will actually challenge their ability to ensure that they give opportunities to Australians first.
Fair tax reform will boost growth and our economy. Our tax system should be fair and sustainable. It should be a system that rewards hard work but at the same time guarantees that we have the revenue to provide those quality public services. We need a progressive tax system that ensures that those who can afford to pay more, do. We need to ensure that we have a tax system that is not focused on tax incentives for those at the highest income, whether they are working or whether they are retired. Public confidence in Australia's tax system depends on a simple and transparent tax system where everybody pays their fair share of tax.
Implementing important and fair tax reforms will improve competitiveness, will boost savings through superannuation, will make superannuation fairer, will signify personal tax and reduce barriers to participation in the workforce. We need to ensure that tax reform is focused on ensuring our system is fair and sustainable. We need a fair and sustainable tax system that encourages and provides incentives for people to work and to undertake productive enterprise. We need to ensure that there is a link between our tax system, our economy and between what we are introducing in future budgets between industry. But what we have seen from this government is an endless list of stunts. What we have seen is some small sensible measures that we support, some very silly measures and then some other measures that only tinker at the edges.
Mr LAMING (Bowman) (12:06): I thank the member for Bendigo for her enlightening defence of the opposition's position! I thought she made a salient division between the silly and the sensible, only to undermine her argument by picking out what she thought was the sensible, and that was the payments to the maritime workers union as a way of retaining inflated wages for those working on Australian vessels, which in the end was futile, claimed for only about 250 workers and was done at a time when our maritime capacity actually shrunk by two-thirds. It is fascinating that she chose that as an example of sensibility while at the same time ignoring much of the bigger picture and possibly, I concede, more complex arrangements that she did not have talking points to deliver on.
Today I want to talk about two areas: thin capitalisation and foreign dividends. They are two really important areas. They will make a big difference. Let us take partisan politics out of this for a moment, despite the previous speaker, because this is an area where we fundamentally agree on making sure we have a fairer tax system. Particularly because we are a medium-sized, financially open economy we have to work assiduously to make sure that we collect the appropriate amount of tax for activities that are based here and are a result of work within Australia, but at the same time we cannot be overly draconian or we risk losing some of that highly mobile financial capital to other countries where they have more friendly tax arrangements. Walking that fine line is not easy. I concede it is quite complex. That is why we discuss these matters at the G20 and do not act unilaterally and spontaneously on some of these matters.
Both sides of politics have given this a crack and I think it is fair to say that both sides of politics could be doing more. There is more to be done but it is a technically difficult area and so I appreciate the time that is required. If you look at the heart of the effort that the Labor Party made in tax reform, you do not have to go far past Kevin Rudd's request of Ken Henry to do a review into Australia's tax system. At the time when we were seeing press releases from Kevin Rudd two or three times a day and then being reported verbatim by the press at the time, it seemed like just another gallant attempt to take on one of the great chestnuts in Australian policy by a Prime Minister who, at least in his own mind, was up to the task. When the Henry tax review was released we saw 128—if my counting is correct—recommendations to make Australia's tax system fairer and more effective. I think the Labor Party managed to respond to 1.5 of those 128 recommendations in some sort of policy action. Here was the great party of the Australian worker not just mesmerised but paralysed by the prospect and the complexity of tax reform. Yes, it was just all too much for the Labor Party.
The only thing they managed to have a red-hot go at was the mining tax. Why? Because that was a great way to target those nasty billionaires. It is always easy to hate the billionaires, isn't it? This comes back to the subtle subtext of the member for Bendigo, who when talking about the sensible and the silly was really effectively asking, 'How do I get an arrangement that allows easier transfers to the union movement?' While her speech may read well to her constituents in Bendigo, what I found most interesting was her assessment of microeconomics. The member for Bendigo said herself, 'The greater tax breaks you can give to low-income earners, the more money gets spent locally, because they spend it all locally.' I presume she was saying that poor people do not have access to the internet to do any online shopping. No. Let us get this quote right—poor people, in contrast to the wealthy, will spend it all locally. Her claim about 'wealthy' was most interesting. If you give any kind of tax break to the wealthy, that money she said 'goes away'. I am not quite sure where it goes, but she did say that it is put away for a rainy day. That was an incredibly insightful and educated explanation of what happens when high-income and low-income earners actually receive some form of tax expenditure from the government through a tax concession.
Let us go back to the bill. The bill does seek to take on a couple of the areas that will build well on reforms that were attempted by the previous government. They were in the general anti-avoidance rules, subsection 4(a). There was some concern on our side of the House about the possible retrospectivity of those, but they were passed into law. Secondly, transfer pricing was an area where the previous government focused. Today what we are looking at—and this is in addition to tax receipts, which I want to touch on briefly—are changing arrangements for profits that are brought back into Australia by Australian entities that own foreign subsidiaries and of course the thin capitalisation rules.
I will start with thin capitalisation. Increasingly over the last few years there has been an appreciation that entities are using large amounts of leverage with debt as a way of concealing the profits that they make through domestic activities. I will try to describe that. The sense was that the firms were borrowing large, funding some activity in Australia and using the costs of that borrowing as a way of hiding their domestic profits and then therefore the amount of tax that needs to be paid to Australia. By looking at what was an increasing tendency to use higher and higher amounts of debt, they have rightly used the safe harbour provisions to have the 60 to 40 ratio—that you can effectively borrow up to 1.5 times the amount of equity that you bring to an enterprise. They have also brought down the ceiling for financial entities from I think 20 to one to 15 to one. They seem perfectly reasonable because at the same time this government has acknowledged that we do not want to be interfering at the minima level for individual taxpayers who are engaging in debt related activities so we have raised the financial threshold where you activate these provisions from $1 million to $2 million. That allows individual taxpayers to be able to take out a loan without running headlong into these thin capitalisation provisions.
On another level we have the issue of foreign dividends. These are some clever arrangements where an entity purchases or moves into a foreign subsidiary and then, with these debt equity rules, by making equity look like debt they can get more friendly tax treatment at home. This is another clever way in which money can be basically repatriated to Australia as a result of your work overseas and, by making it look like debt, there is a way of disguising these dividends and making sure that you do not have to pay tax on them. Again it is not the provision of an eye surgeon, but there is an accountant down here, the member for New England, nodding his head telling me that I am not doing a bad job of explaining the challenge. In that respect also, there will be much closer scrutiny to make sure that we get what the Australian taxpayer deserves.
It is often forgotten that every time one offers a deduction that is effectively tax expenditure—it is money that you are passing up. It is often tempting when you have representations about making concessions on having to pay tax, but it is effectively tax that the nation will never see and effectively simply tax that we have to collect from somewhere else or offer fewer services. To that end, I want to finish on the general Labor Party approach to this area. Increasingly, there has been a general opacity in the way the Labor Party operate around how they collect their tax and how it is moved around to taxpayers.
The tax receipt notion of the coalition delivers on our election commitment to be transparent around not only where the money is collected but how it is spent—how it is broken down. What we are saying to a taxpayer—on this side of the chamber; you do not hear it from the other side—is: 'Thank you very much for paying tax. Thank you very much for the contribution you make. We don't hate you because you've earnt money and you are wealthy; we actually thank you for doing it.' We particularly say that to our net tax payers, who actually pay more in tax than they receive in dividends. I say to those people: I want to hug you. I want to say, 'Thank you for what you do for Australia.' What is the point of hating the very people who run the systems that make Australia such a great place to live? To those people who are net tax payers in particular, and even to low-income earners, who make their small but significant contribution, we need to be saying (a) 'Thank you,' and (b) 'This is what we are doing with your money. No, it's not our money. We know you earned it and we are giving it to someone else who didn't earn it. For that, we want to say thank you. For that, we are going to tell you how we spend it, where we are spending it, where it is going and the categories in which it is being spent. And, fundamentally, in situations where we couldn't raise it from a taxpayer because the Labor government didn't have the wit to find a way to raise it and instead took the easy option and financed these activities in debt, we will tell you how much debt was taken out and we'll tell you how much this debt costs.'
In the great, superficial world of the Labor Party, where you are simply pinching money from people when they least suspect it or borrowing it from overseas entities, in the Middle East and China, predominantly, the great day of payback will never come. Under the Labor Party's arrangements, where there were unlimited and unending budget deficits, the debt, as many up here in the gallery who have probably studied economics know, sequential deficits simply add to debt. Even at the moment, where we can bring Australia out of the spiral of increasing deficits—even at that point where we balance a budget—we have not started to pay off one cent of the debt because the debt has been racked up year after year from the moment you voted out a coalition government. It will stop being increased from when we finally can arrest the spiral, which at this point is 2017-18. That is our plan. I know there is not a lot of support on the other side of the chamber. We are intent on balancing the budget, but you need to know, from the pain of budget 2014, with everyone putting their shoulder to the wheel, and of subsequent years, we will only balance the budget, potentially, by 2017-18. Had we kept the Labor government in power, there was simply no chance of even arresting the death spiral into debt.
This brings us into the debate about whether our debt-to-GDP ratios are (a) any larger than other economies or (b) growing at a rate, which is the issue, faster than other economies. It was not that we had not racked up enough debt—no, we did not have a Labor government in there long enough to do it. That is why we do not have a lot of debt. What we did have was debt increasing at an alarming speed, and that is the underpinning of the budget emergency. It was a government where, no matter what it told you about getting into surplus, it was patently obvious to everyday Australians that that was never going to happen because it is beyond Labor's capabilities to say no to someone who holds out the hand seeking somebody else's money. For that reason, what we saw was not only consecutive budget deficits, despite the rhetoric, but no hope in the forward estimates that Labor was ever going to pull Australia as an economy out of the death spiral.
What we are talking about here are two significant measures to take Australia along the road to reducing profit shifting. It is an important step. I concede that there were steps taken by the previous government as well. Together with Australia's chairmanship of the G20, we can look to agreements being struck between major economies, which in the end is the only way that we can genuinely, without creating sovereign risk, ensure that we have profit shifting brought to an end globally.
Dr CHALMERS (Rankin) (12:18): To those who have joined us in the gallery, who have maybe come from all corners of the country and perhaps waited in line for their big chance to listen to a speech in the chamber, I apologise that you had to listen to the member for Bowman in your one visit to this place. Much of what he said was rubbish.
Like the member for Bowman, my colleague the member for Bendigo and others, I rise to speak today on the Tax and Superannuation Laws Amendment (2014 Measures No. 4) Bill and the Tax and Superannuation Laws Amendment (2014 Measures No. 5) Bill 2014. Characteristic of these kinds of pieces of legislation, they are taken together into a bit of a grab bag of measures, but together they make a number of changes to the legal framework underpinning the tax and superannuation system, including, for the sake of completeness: enacting the tightening of the thin capitalisation rules announced by the previous Labor government; enacting reforms to the exemption of foreign non-portfolio dividends, again as announced by the previous government; abolishing the mature age worker tax offset; abolishing the seafarer tax offset; reducing the research and development tax offset; and a number of other mechanical changes to the tax and super laws, including what I think is a fairly obvious stunt, which is changing the way that tax receipts are presented to individuals. I will consider these policies individually shortly, but it is first worth touching on the government's general approach to taxation and budget repair.
The May budget showed that the government have pretty twisted priorities when it comes to fixing what they call the budget emergency. That is effectively a con, but they do have a fairly unusual and unfair way of going about repairing the budget as we go forward. The biggest problem we have with the budget, as we have said in this place time and time again and as my community is certainly telling me—I am sure the member for Lingiari has had the same experience; I am sure everyone in this House has had people come up to them and tell them this—is that this budget is grossly unfair. That is why people have rejected it in such overwhelming numbers. It is unfair because it targets people on low and fixed and middle incomes. It asks the most vulnerable in our community to do the heaviest lifting, and that is why those opposite have had no success whatsoever in finding community support for it.
My community is Rankin, south of Brisbane, comprising a big chunk of Logan City and some surrounding Brisbane suburbs. The Courier-Mail did an analysis to find the hardest hit community in Queensland and, unfortunately, it is my community of Rankin. It is the hardest hit by the combination of pension cuts, cuts to family payments, cuts to tax breaks for low-income people, the GP tax, the petrol tax and more. This would be bad enough on its own, but what really rubbed salt in the wound for a lot of people in my area is that, at the same time that the government is taking money from people on low and middle and fixed incomes, it says it has enough money to give $50,000 to some of the wealthiest people in our community just to have a baby. It has found money to give superannuation tax cuts to the 20,000 wealthiest people in the superannuation system. It is also reopening $1.1 billion in tax loopholes that multinational companies rely on—and we will get into that in a bit more detail in a moment.
You can see that one of the reasons this budget is such a stinker in the community—not just in my community but right around the country—is that it asks the vulnerable to do the heavy lifting, and it gives new entitlements. We are supposed to be ending the 'age of entitlement', in the Treasurer's words. He gives new entitlements to some of the wealthiest people in our community.
We have heard a lot of bluff and bluster, by the Treasurer, out of the G20 finance ministers meeting about tackling profit shifting and base erosion. All are words, he said, we can sign up to. It is important that we tackle this issue. The Labor government—which I worked for, for a time—did take some steps. They were part of this G20 OECD agenda about base erosion and profit shifting, and we agree this is a substantial problem that needs to be tackled. The unfortunate thing is that the Treasurer's words are far from the reality of the government's actions.
The two measures introduced in this package that we are debating were announced by Labor. They are, unfortunately, a drop in the ocean compared to the full suite of measures needed to properly combat multinational profit shifting. It is a big problem. We have had numerous examples in the mainstream media of companies that are making billions of dollars here in Australia and paying a negligible amount of tax. That is as a result of some of the substantial loopholes and practices that have developed over time. What they are doing is not illegal, but it is doing real damage to our bottom line, and there are big holes in our revenue system when companies can take advantage of us in this fashion.
The previous Labor government closed-up loopholes worth about $5.3 billion. In the 2013-14 budget alone we were taking substantial steps to ensure that companies which made money here from our citizens were also paying the right amount of tax, or more tax, a just level of tax, here in Australia. There was a lot more work to do at the international level as well. Particularly disappointing was that when the Abbott government came into office one of the first things they did—at the same time as they were saying there was a budget emergency—was reopen two loopholes worth $1.1 billion to the Australian people, which allowed multinational companies to engage in the sorts of practices Labor was cracking down on.
This shows that the government is not serious about making multinationals pay their fair share of tax. We get all the flowery words and bluff and bluster from the Treasurer, all the grandstanding at the G20 level, but we do not get the action here at home. If they were serious about it, they would not have reopened those two loopholes on the biggest multinational companies in the world. The government is going ahead, thankfully, with two of Labor's profit-shifting measures in this legislation, including a change in the debt-limit settings, as they apply to the thin-capitalisation rules. Once again, this is only one aspect of Labor's intended thin-capitalisation reforms, but it is better than nothing.
Thin capitalisation, as other speakers have tried to explain, refers to a tax-minimisation strategy employed by multinational companies operating here in Australia. Under this strategy, companies allocate a disproportionately large amount of debt to their Australian operations to claim excessive debt deductions here in Australia, thereby reducing their taxable income. Because the Australian operations may be funded by excessive debt, compared to the capital raised in Australia, a company employing this strategy is said to be 'thinly capitalised'.
Multinationals have an incentive to place large amounts of debt on their Australian arms because generous deductions for interest can offset their tax in Australia, where deductions are more valuable than in low-tax jurisdictions or tax havens. Thin-capitalisation rules operate by disallowing a proportion of otherwise-deductible debt related expenses where the debt in Australia exceeds certain limits of debt as a proportion of equity.
Since these rules were introduced in 2001, during the days of the Howard-Costello government, data analysis has shown that the allowable gearing ratios were far too generous and much higher than the general gearing level of corporates with independent financing arrangements. This legislation implements Labor's recommendation in the 2013-14 budget that the maximum statutory debt limit for general entities be halved from 3:1 to 1.5:1, and from 20:1 to 15:1 for non-bank financial entities. On top of this, to reduce compliance costs for small business, this legislation implements Labor's recommendation to raise the de minimis—or minimum—threshold for thin-capitalisation limits from $250,000 to $2 million of debt deductions, ensuring that well-meaning small businesses are not caught up in the net.
These changes, along with related amendments to the exemption for foreign non-portfolio dividends as they interact with the thin-capitalisation rules, are worth more than $750 million to the budget bottom line. These still pale in comparison to the full suite of reforms that Labor would have introduced had it got up in September last year. The total cost of the squibbed multinational profit-shifting reform has been estimated at $1.1 billion, which, as the Member for Fraser has observed, is more than enough to fund a new regional hospital. We support the thin-capitalisation rules in this bill but we must observe that there is a huge lost opportunity here. This is why I support the second reading amendment moved by our side of the House.
The next issue in this package of legislation is the abolition of the mature age worker tax offset, or what people call the MAWTO. The MAWTO is a $500 concessional tax offset that is intended to provide an incentive to mature-age workers to remain in the workforce. It is a very noble objective. In principle, and given the ageing of our population and all the challenges that brings, it is crucial that we have effective measures to encourage mature-age employment. They have to be effective and they have to be cost effective.
It is something that Labor governments have a strong track record on, this idea of encouraging older Australians to stick around in the workforce, be that part-time or otherwise. We did introduce a range of measures, including the Productivity Ageing package, which provided additional training and financial incentives for employers hiring older Australians. It is also why the last Labor government funded the Blueprint for anageing Australia report, spearheaded by a really great Australian, Everald Compton. His report was unfortunately defunded by the Abbott government in November last year.
Characteristically of Everald, he found another way to provide this important advice to do this important work. He does not quit easily, Everald. He is a good friend of both sides of this parliament. I want to congratulate Per Capita, one of the progressive think tanks in Australia, for finding the opportunity to engage Everald so that he could conclude and complete his important work. Everald launched his report a few Wednesdays ago at the National Press Club.
In his report, Everald and the panel had several prescient recommendations, including having a government minister for ageing—something that Labor had throughout its most recent term in government, but which was notably excluded by the Abbott government. Everald's panel also had the right idea when it comes to engaging mature workers in employment for longer. His idea is that vocational education and training to re-skill and transition older workers is the key. We need not just wage subsidies and tax offsets like the one we are debating today, but real, genuine lifelong learning so that the skills that older Australians have in the workforce remain relevant and that the workers remain competitive, have the ability and resilience to adapt, and that we have dynamism that is necessary for the modern Australian workforce.
The MAWTO at present is not well understood and is not sufficient incentive for mature Australians to re-enter employment. That is why the former government commenced the phase-out of the MAWTO in the 2012-13 budget, limiting it to taxpayers born before 1 July 1957. The idea is that this money, worth $760-or-so million over the forward estimates period, can be better spent on targeted programs to return mature people to employment.
We also need to consider these types of measures in the context a broader suite of things. It pains me to say that we are making these decisions in the context of the retirement incomes system being attacked through the slow-down of the increase in the contribution. Other funding for seniors concessions has been scrapped and there have been pretty draconian cuts to the pension.
The next issue in this package of bills is the seafarers tax offset and the reduction of the R&D tax offset. I will be a bit briefer with these. Labor will not support the abolition of the seafarers tax offset or the reduction of the R&D tax offset. We believe in the Australian shipping industry and we want opportunities for Australian seafarers employed or engaged on overseas voyages. Australia has the fourth largest shipping task in the world, and companies in the industry are strongly supportive of this offset.
Labor will continue to advocate for the shipping industry, rather than support the coalition approach of walking away from practical action to save jobs and defend Australian skills. In a similar vein, we will not be supporting the reduction of the R&D tax offset either, which has been justified with reference to the reduction in the company tax rate. In government, Labor reformed the R&D tax incentive to make it an offset rather than a credit, for exactly this purpose—to decouple the R&D tax incentive from the corporate tax rate.
I could go on about those measures but I will not, because I want to touch briefly, in the time remaining, on what I think is a stunt over the tax receipt. It is worth mentioning this obvious distracting stunt contained in this legislation. It is something that the government announced on a slow news day when there was nothing else that they could think of. The government will require the Taxation Office to issue receipts that have been described by other speakers. Labor will always welcome genuine measures to improve transparency, but this particular measure is a partisan thing. It is something that they hoped—unsuccessfully—would distract from the rest of their budget.
Mr Joyce: Cunning!
Dr CHALMERS: It was a cunning stunt, as the member for New England said. I will get him on the Hansard record!
Labor will be voting in favour of these bills, but not without first expressing our concerns about this government's underperformance in addressing multinational profit-shifting, about their lack of support for Australia's shipping industry and about their interest in stunts, rather than real reform. For this reason, I will be supporting the amendments moved by our side and will continue to support greater action, in particular on that crucial issue of multinational profit-shifting.
Mr SUKKAR (Deakin) (12:33): I rise to speak on this package of bills. I have been listening intently to the member for Rankin's contribution. It is always easy being an armchair expert. After six years in government and delivering the five biggest deficits we have ever had, it is very easy for the member to sit back and claim that the former government had a path to eliminating multinational tax avoidance. If it was so easy, jurisdictions around the world would not be grappling with these issues, as all jurisdictions are. So it is obviously ridiculous for the member for Rankin to claim that it was stitched up, and that the package of changes that the Labor government had proposed would, for all time, end multinational tax avoidance. Somebody with such little credibility should not be listened to.
The two aspects of the No. 4 bill that I would like to talk about revolve around the proposed thin capitalisation changes and the changes to foreign dividends. I note that the member for Rankin also criticised those changes, but the opposition is going to support them. I thought that was quite interesting. It is always difficult, in a world of mobile capital, to strike the right balance between ensuring that we have an effective and efficient tax regime and ensuring that we do not disincentivise multinationals from investing in our country. In my former life as a tax lawyer, the thin capitalisation rules were something that every single multinational taxpayer had to think about. Contrary to the contributions of those opposite, the thin capitalisation rules, when they were first introduced by Treasurer Costello in 2001, were really put in place to set a cap on which a company or a multinational could be capitalised in Australia before debt deductions were denied. It is a tool that can be used to impact multinational tax avoidance but it was not necessarily the primary reason for it.
The changes in schedule 1 to the bill tighten the debt limit settings in the thin capitalisation rules to ensure that multinationals do not allocate a disproportionate amount of debt to their Australian operations. It also increases the de minimis threshold to minimise compliance costs for small businesses. This is a really positive change. Businesses that do not have a debt deduction above $2 million do not need to think about the thin capitalisation rules. That is a really outstanding measure to try and encourage small to medium offshore companies looking to set up in Australia to do so.
In schedule 1 to the bill we introduce a new worldwide gearing debt test for inbound investors. In my view, it is one of those tests in practice that have been more susceptible in the past to being abused. These measures have strong links with the government's initiative on base erosion and profit shifting. We have seen the outstanding work that the Treasurer has done with the G20. Contrary to the member for Rankin's contribution, it is tough work and it is difficult getting jurisdictions with very different tax regimes together to agree on just about anything. It is really tough. I take my hat off to the Treasurer for doing such an outstanding job thus far with respect to the G20.
In respect of these initiatives, we believe that the current thin capitalisation rules are too generous compared with the actual borrowing levels of companies with truly independent arrangements. Other speakers have, in a sense, spoken about the evolution of those debt levels that companies and multinationals have had over the last 13 years of the thin capitalisation regime. It also addresses our view that ultimately base erosion and profit shifting are eroding our corporate tax base and, therefore, penalising all other taxpayers, because for every dollar we cannot collect from a multinational is, quite frankly, a dollar that we need to collect from other taxpayers.
In our view, taxpayers who genuinely require higher borrowings will continue to have these recognised through the operation of the arms-length test. Irrespective of the safe harbour rule in the thin capitalisation rules, if there are really good commercial reasons that fit into your industry profile for a multinational, or any company, to carry debt above the thin capitalisation levels, to the extent that that can be objectively proved, a company can carry that debt. These changes are really an outstanding way to address them. I think they strike a balance.
The changes to the debt-to-equity levels that are allowable, as other speakers have mentioned, reduce the maximum statutory debt limit from three to one to 1.5 to one for general entities, general taxpayers, and from 20 to one to 15 to one for non-bank financial entities. I think these changes strike a sensible balance. Again, it is not as simple as the Labor Party would make out—that you just bash multinationals over the head and tell them that they cannot deduct any debt in Australia. That would obviously have a devastating impact on our economy. Unlike the armchair experts opposite, we actually have to come up with sensible changes.
Schedule 2 of the bill amends some aspects of section 23AJ, which is an exemption for foreign non-portfolio dividends by Australian companies. In our view, it amends the exemption to address a flaw in the system that effectively allows the exemption to apply to a debt instrument and, in effect, to ensure we have greater integrity in the thin capitalisation system. So, rather than focusing on voting interests of a particular interest that an Australian entity might hold in a foreign entity, it will look at the participation interest. I think that is sensible and I would say most corporations and tax advisers would believe that that is a very sensible change. However, at the same time we do not want to impact Australian companies expanding offshore. It is absolutely outstanding for our great Australian companies that are the best at what they do—and many of them are iconic. We want them to set up offshore and we want to ensure that we have a tax system that can appropriately cater for the fact that in many cases those Australian companies will need to raise debt in Australia in order to fund offshore expansions or acquisitions. The Labor Party in some way thinks that in a perverse way we should whack these Australian companies, but these Australian companies are a success story. So I think the changes to section 23AJ, or the non-portfolio dividend exemption, strike that sensible balance.
Schedule 3 ensures that foreign resident capital gains tax regimes operate as intended, by preventing the double counting of certain assets under the principal assets test. I will not go into that in much detail. I do not think it is controversial, but it cleans up some issues that have been really there since the foreign resident CGT regime was put in place. The foreign resident CGT regime basically tries to have the effect that a foreign entity pays tax in Australia if it is making a gain on the sale of Australian real property even though it may not have a tax presence in our country.
Schedule 4 to the bill is an outstanding piece of policy. The Labor Party have criticised it and the member for Rankin criticised tax receipts. What is wrong with telling the Australian people and outlining to them in a transparent way where their tax dollars go? I think it probably highlights the divide between both sides of the House. I believe that government expenditure is ultimately taxpayers' money that they have entrusted us with that we have spent. I get the impression that many people on the left of the Labor Party think that is the government's money. But if you come at it from where I believe is a sensible starting point, which is we are spending taxpayers' money on their behalf, it absolutely makes sense for us to be extraordinarily transparent with those taxpayers on where their money is going. I heard the member for Rankin criticising this policy. Taxpayers would be wise to be quite suspicious of anybody that criticises this form of transparency. What is wrong with this parliament, in a very clear way, letting Australian people know where their money goes?
The tax receipt will include a notional breakdown of the taxpayer's personal assessment into various categories of government expenditure, and those will be decided by the government of the day. But those categories and those breakdowns will be things that the Australian public, and Australian taxpayers, will be entitled to scrutinise. Approximately 10 million taxpayers will receive a tax receipt for the 2013-14 financial year. Like the member for Bowman, I think it is a nice way of saying thank you—thank you to those 10 million taxpayers for everything they do in funding all of the necessary aspects of government activities and, in an egalitarian society, helping people who are less fortunate and who need that support; in many cases, only for short period of time. Most of those taxpayers will have received some help in their life from other taxpayers, and then they get to a point where they start giving back and providing help to others. I think that saying thank you, in the form of a tax receipt and transparency, is a good way to go.
In respect of the other bill in this cognate debate, the Tax and Superannuation Laws Amendment (2014 Measures No. 5) Bill 2014, I will, just quickly in the remaining time, touch on three aspects of this bill. And again, I think this is sensible tax policy. Schedule 1 of the bill abolishes the mature age worker tax offset from 1 July 2014. As members opposite have noted, the Labor government started to phase out the offset by restricting access to it for taxpayers born before 1 July 1957. We have accepted that the mature age worker tax offset is complicated. It is not really well understood and, in our view, it is not a cost-effective way of encouraging continuing engagement in the workforce by mature age workers. Importantly though, savings from abolishing this offset will be redirected to the government's new seniors employment incentive payment, called Restart. This payment will provide a clear, long-term incentive for employers to hire and retain mature age Australians, and to help them overcome discrimination. In this sense, Restart is a subsidy of up to $10,000 and it will be available to employers who hire a mature age job seeker aged 50 years or over who has been receiving income support for a minimum of six months. The Restart program will help mature age Australians to re-enter the workforce. Around 32,000 mature age job seekers per year are expected to benefit from the subsidy. I think that redirecting the lost revenue from the mature age tax offset to the Restart program is an outstanding policy, and will ultimately help us reach the objective of more senior Australians in work.
Schedule 2 has been spoken about. It is abolishing the seafarer tax offset, which provided a refundable tax offset to Australian shipping companies for certain salary and wages of seafarers. I think it benefited a couple of hundred seafarers. This really was just a part of Labor's shipping reforms—which were really just a sop to the Maritime Workers Union. And that is why, ultimately, this is bad policy and needs to be abolished.
Finally, schedule 3 to the bill amends the Income Tax Assessment Act, to reduce the rates of tax offsets available under the R and D tax incentive. The refundable and non-refundable tax offset rates will be reduced by one-and-a-half percentage points: from 45 per cent to 43½ per cent, and from 40 per cent to 38½ per cent, respectively. These changes are really just consistent with the government's commitment to cut the company tax rate.
This is ultimately a broad package of changes in the bills before us today. It cleans up a lot of the issues that are legacy problems which were not dealt with by the former Labor government, and I think it is good tax policy for the country.
Mr STEPHEN JONES (Throsby) (12:49): I rise to speak on the Tax and Superannuation Laws Amendment (2014 Measures No. 4) Bill 2014. There are four parts to this bill which is before the House today; two of which Labor supports, and two of which we cannot support. This is in complete contrast to the member for Deakin—who has spent, out of 15 minutes, the best part of 30 seconds talking about what is probably the most important part of this bill: the abolition of the seafarers offset, which he sought to dismiss because somehow it provided a benefit to workers who also happened to be union members. It just goes to show how far members of the government will go to drive jobs offshore, but it also shows what a very clouded view members of the government caucus have not only of economic policy but also of how to introduce policy for the betterment of ordinary Australian workers.
There are four parts to the bill. We will support two of them. We will support the mature age worker tax offset; in fact, in office we started the process of abolishing this, by a number of measures. In our view, it is a high-cost method of boosting older workforce participation, and can be done more effectively through other means. We will also support, obviously, the updating of the conditions relating to deductible gift recipients. These updates by way of legislation are generally bipartisan propositions, and I see no reason to depart from that today. Those will have our support as well.
We will not be supporting the changes to the R and D offset, because we do not think they are in the public interest. We certainly will not be supporting the changes to the seafarer tax offset, and I would like to put a bit of context around that. The bill seeks to abolish the offset, and it does this as a bloody-minded attempt to pull apart the previous Labor government's shipping policy reforms which were contained in the Stronger Shipping for a Stronger Economy package of measures. It is the start of the coalition's systematic attempt to dismantle historic reforms that were put in place to strengthen and revitalise the Australian shipping industry. It has probably been the most significant overhaul of the Australian shipping industry in over 100 years—so it beggars belief that those opposite are coming in here today and advocating the dismantling of these important reforms. In 2012, a bloke who spent most of his life at sea and knows a fair bit about the Australian industry, Paddy Crumlin, had this to say: 'This, without doubt, is one of the most important days in Australian maritime history. It marks the day that Australian shipping was saved from near death.' He was referring to the stronger shipping reforms, the package of bills introduced into this House by the member for Grayndler and former minister for transport and infrastructure—a package of bills that was welcomed by industry and literally gave us the chance to save our maritime industry.
It is worth reminding the House that at that time we were in a position where over the past decade the Australian shipping fleet had gone from 55 ships to 21, with only four operating on international routes. Today there are only four ships operating on international routes, principally in the LNG trade. In a country where 99.9 per cent of our trade is moved by ships, without any action we were going to be left without an international shipping fleet and we were going to be at the mercy of the rest of the world. You have to ask yourself, when we put so much effort into negotiating new trade agreements with other countries, why we would be neglecting the essential link in that chain—our own domestic shipping industry.
Labor wanted to see a bright and prosperous future for shipping in Australia, and the coalition wants to walk away from that. That is entirely consistent with about 80 years of coalition history. The one constant from that spat-wearing Londoner, Stanley Melbourne Bruce, as a former Liberal prime minister of Australia, right through the generations of conservative prime ministers to John Howard and the reign of his minister who did a lot of interfering in this area, Peter Reith, to Tony Abbott, the Prime Minister today, is an absolute hostility to Australians working on the ships that move in and out of Australian ports. The one thing they have been absolutely consistent with is their hostility to a domestic maritime workforce. The policies you see before you today are a reflection of that hostility. We saw it just now in the brilliant contribution from the member for Deakin, who dismissed this important piece of economic policy merely because it provided a benefit—a job—to an employee who happened to be a member of a union. For that reason and that reason alone, those opposite seek to dismiss it as having no benefit to the Australian economy and as something that warrants dismissal and removal.
Let us have a look at the cost of this seafarer tax offset. The seafarer tax offset is absolutely critical to the maintenance of the international register—it is the critical link in the chain. For this offset to occupy so much time here in parliament, and for it to enjoy the hostility it has received from members opposite, you would expect it to be a massive drain on the public purse over the forward estimates years. The cost of the measure which is going to decimate the capacity of Australian workers to work on ships sailing in and out of our ports is $8 million over the forward estimates. When you understand that, you understand that it is nothing short of ideology and utter contempt for Australians working on the ships that ply our coast that has led to this measure before the House today. We oppose it—we will oppose it here and we will oppose it in the Senate, and we will do that because that is in the interests of Australian workers.
Mr Joyce: Deputy Speaker, I rise on a point of order. For the record, Stanley Melbourne Bruce was not in the Liberal Party. He was a Nationalist, and he was in the United Australia Party.
The DEPUTY SPEAKER ( Mr Craig Kelly ): I thank the minister. The member for Throsby has the call.
Mr STEPHEN JONES: I am pleased to see that the member opposite who has made the interjection and then walked out of the chamber has access to Google. It took him all of about five minutes to be able to access Google and work out that Stanley Melbourne Bruce was indeed a member of the United Australia Party, the progenitor of the Liberal Party of today. But the point remains the same—the absolute hostility of conservative members of this parliament from the 1930s to today to Australians working on ships that come in and out of our ports.
The object of the seafarer tax offset was to stimulate opportunities for Australian seafarers to be employed or engaged on overseas voyages and to acquire maritime skills. Now, even before the offset initiative is two years old, when it has hardly had the opportunity to stretch its legs, they are moving to scrap it because of a massive $8 million drag on the budget over the forward estimates! You have to ask yourself where the priorities are. It is going to have a devastating impact on the electorates that have ports and are reliant on maritime trade, particularly international maritime trade. I represent such an electorate. The port of Port Kembla directly employs more than 3,500 people and contributes around $418 million to the Illawarra economy every year. Make no mistake about it—this will have an impact. We need a vibrant shipping industry, and we need it in my electorate and in places like the Illawarra, whose economies are going through a transition. We are going to be relying on a viable maritime sector and a viable port sector to regenerate the Australian economy. But we want to ensure that as the port expands there are Australians working on the ships that come in and out of those ports.
The seafarer tax offset has already helped to reduce the operating costs of Australian vessels; we know that. It has increased the competitiveness of Australian shipping and has provided significant opportunities for the employment of Australians in international trades. The Australian Shipowners Association—and I had the pleasure of meeting with Teresa Lloyd, their executive director, earlier today—are pulling their hair out over this. They cannot see the sense of it. And they have been very critical over the years of a number of initiatives of members of this side of the House, but they are absolutely in lock step with us in opposing this proposition, because they can see the fact that this is going to decimate the capacity of Australian workers to compete and to work on those international voyages. The shipowners association has come out strongly against it. They are saying that it is reckless, that it is needless, and that without the offset it is significantly more expensive to employ Australians overseas. They know what is going to happen: jobs are going to be lost. It is as simple as that.
In the time I have left I want to make a few points about the importance of ensuring that we maintain a vibrant shipping industry in this country. Anybody who knows anything about the shipping workforce knows it is an ageing workforce. If we do not move now to ensure that there are replacement workers who are going to be regenerating the maritime industry workforce and if we do not move now to ensure that we maintain the skills, not only for domestic voyages but international voyages, then we will lose those skills forever. These are not things that you can turn on and off like a tap. So, in a country with over 99 per cent of its trade coming in and out of our ports—and in a parliament that gives bipartisan support to the importance of free trade agreements, international trade and ensuring that we are connected to the world—why on earth would any member stand in this place and vote for a proposition that is going to undermine that most important link in the chain: the capacity for Australians to be working on ships that ply our coasts and ply the international trade routes and to ensure that we have a skilled workforce, that we have an experienced workforce, that we have a vibrant Australian maritime workforce? This is one of many measures put in place as part of the maritime reform package. It is reckless. It has no drag weight on the budget whatsoever. All right-thinking members of the House should reject it, and I call upon the government MPs to do exactly that.
Mr THISTLETHWAITE (Kingsford Smith) (13:03): I support the reforms contained within the Tax and Superannuation Laws Amendment (2014 Measures No. 4) Bill 2014 relating to the tightening of debt limits in the thin capitalisation rules to ensure that multinationals do not allocate a disproportionate amount of debt to their Australian operations. But in terms of the cognate bill—the No. 5 bill—we in the Labor Party are opposed to the abolition of the seafarer offset—for reasons I will outline in a moment—but also the research and development tax incentive change and the decoupling of the link with the reduction in the company tax rate.
The government has shown a significant gap between its rhetoric and its actions when it comes to ensuring that multinationals pay their fair share of tax within Australia. I had to laugh when I read in the papers that at the first meeting of the G20 some months ago Australia's focus was going to be on ensuring that multinationals were not corporate profit shifting—that companies that are based in Australia and other nations throughout the world should pay their tax in the source country where the income is derived. I laughed because of course when Labor was in government, going back to 2012, Labor sought to introduce a number of reforms that would have added revenue to the Australian budget to the tune of $1.1 billion and were aimed at cracking down on this exact issue of multinational corporate profit shifting. The Tax Laws Amendment (Countering Tax Avoidance and Multinational Profit Shifting) Bill 2013, introduced by the then Assistant Treasurer, David Bradbury, went to that precise issue. It contained amendments to the general anti-avoidance rule, known as part IVA, and the transfer pricing regime. The reforms were two key weapons in the fight against base erosion and profit shifting, and they would have helped protect the integrity of Australia's income tax system and made sure that large-tax payers—multinational corporations—paid their fair share of tax right here in Australia, where they derived those profits, rather than shifting some of that profit to other nations where there were tax havens.
One would have expected that the opposition at the time would have supported a positive reform like that—one that adds $1 billion to the bottom line in Australia. But my staff and I had a good chuckle when we had a look at the result of the division on the Tax Laws Amendment (Countering Tax Avoidance and Multinational Profit Shifting) Bill 2013 in the House of Representatives. We were rather surprised to find out that those who now occupy the government benches at the time voted against this particular reform, for no apparent reason other than it was the ethos of the then opposition to simply vote against everything the Labor government put before the House. As a result, the bottom line in the Australian budget has suffered to the tune of $1.1 billion in forgone revenue, which is now being made up by cuts to other services, to education, to health, and to the ABC and SBS, and in changes to the pension. So Australia is paying in other ways for the significant gap between the rhetoric and the actions of this government.
Every dollar that is avoided by multinational companies must be paid for by Australian taxpayers and businesses, or by cutting services. With this budget we have seen which side the government is on. It is on the side of the big companies. When you look at some of their budget outcomes you can see that they are certainly not on the side of the battlers.
Labor supports sensible savings measures that do not unfairly impact on those who can afford it the least. Labor will be supporting the abolition of the mature age worker tax offset. Labor has a strong record of increasing workforce participation for older Australians. While in government, Labor introduced a number of measures, including the Productivity Ageing Package, which provided additional training and financial incentives for employers hiring older Australians. It was actually the previous Labor government, in its 2012-13 budget, that began the process of the phase-out of the mature age worker tax offset, limiting it to taxpayers born before 1 July 1957. That measure had an estimated $255 million gain in revenue over the forward estimates period. This is a reform that Labor is happy to support, given that we began the process when we were in government. Also, we are committed to measures that support older Australians who wish to work.
But wage subsidies, which this government is offering in the form of a $10,000 payment, are not enough. Labor knows that a comprehensive mature age employment agenda needs a comprehensive suite of measures. That is why we established the seniors work bonus, increased the superannuation guarantee, established an age discrimination commissioner, reformed the age pension to make it strong and sustainable, and set up the advisory panel on positive ageing.
I respect of the research and development tax incentive and reducing the rates of the refundable and non-refundable tax offsets, Labor has a strong history of supporting research and development in Australia. This stands in contrast to the government's attacks on science and research with their cuts to the CSIRO and to university funding associated with research. And, quite simply, this government does not even have a science minister, which clearly demonstrates their lack of support for research and development and an emphasis on scientific research in this country. In respect of the changes to the offset, Labor has some concerns in that the level of the R&D tax incentive is determined by the R&D rate and the company tax rate, together. As company tax is being reduced to 28.5 per cent, maintaining the current R&D rate would effectively increase the subsidy. Companies will already receive a benefit from the reduction in company tax, so this reduction should not reduce overall R&D expenditure, as the size of the subsidy is maintained.
But there is a potential timing issue with the R&D tax incentive reduction occurring one year earlier than the cut in the company tax rate. When Labor in government changed the R&D tax incentive arrangement from a tax credit to a tax offset, one of the reasons we did that was to increase the certainty by uncoupling the level of R&D support from the corporate tax rate. This proposed change undermines that uncoupling and raises an expectation that every time there is a change in the corporate tax rate we would see the incentive adjusted accordingly. Labor has concerns with the manner in which this particular element of the reform has been introduced.
The No. 5 bill also seeks to abolish the seafarers tax offset. The objective of this offset is to stimulate opportunities for Australian seafarers to be employed or engaged on overseas voyages and to acquire maritime skills. Even before this offset is two years old—it has only been in existence for close to two years—the government is moving for its abolition. We believe it must be given an opportunity to work, because Australia needs to maintain and expand its maritime skills base. Labor will oppose this measure on that basis. The tax incentive was one of several that arose from a lengthy industry consultation that led to Labor's shipping reform package. This package commenced in July 2012 and has been operational for just two years. After 100 years of interactive change, this major reform should be allowed to work. The current government should promote the reforms, which, of course, it is not doing. Australia is an island nation. One-tenth of the world's trade goes to or from Australia, and Australia has the fourth largest shipping task in the world. So we need to be supporting jobs for Australian seafarers and maritime workers. That is exactly what this particular tax offset did.
We know that the coalition is soon going to try walking away from supporting Australian coastal shipping, opening up the coast to an increasing number of foreign vessels and to Third World wages. It is bad for safety, it is bad for our sensitive maritime environment, it deprives us of the skills needed to maintain security in our ports and harbours and it makes related activities, like shipbuilding and ship maintenance, less viable, and weakens our long-term naval capacity.
The Australian Shipowners Association, the industry body for this sector, strongly opposes the abolition of the seafarer tax offset. They say that the offset was a key element of the 2012 reforms, that it helped to reduce operating costs on Australian vessels, that it increased the competitiveness of Australian shipping and that it provided significant opportunities for employment of Australians in international trade. The impact of the abolition on future opportunities will be severe. It again demonstrates this government's lack of commitment to building a sustainable and strong domestic shipping capacity in Australia. On that basis, as I mentioned earlier, Labor will be opposing this element of the No. 5 bill.
Labor is committed to finding savings within the budget. We demonstrated that during our period in government. We have demonstrated that in putting before this parliament specific reforms aimed at improving the bottom line of the budget. One area of reform we put forward was in the area of corporate profit shifting—something, again, that was opposed by the current government when in opposition. We are pleased to see some of the reforms that Labor commenced in government forming part of this bill, but we do not support the changes to research and development and the changes to the seafarer offset.
Mr BANDT (Melbourne) (13:16): The government, in its zeal to balance the budget, never looks to those who are most able to afford it. The top end of town, the wealthy miners, the resource companies, the banks—we never see them being asked to pay a bit more to help balance the budget. It is always everyone else who is asked to share the burden. In this legislation we see measures that, even while only offering very small savings, are going to affect people's livelihoods and jobs—and that are going to affect the future growth of industries that will sustain this country when the mining boom is over and the rest of the world tells us to stop digging.
One of the measures contained in the Tax and Superannuation Laws Amendment (2014 Measures No. 5) Bill 2014 is the abolition of the seafarer tax offset. This offset provides a rebate to an employer of Australian seafarers for withholding tax paid on the wages and salaries of those seafarers while on overseas voyages. The object of the offset is essentially to encourage a domestic shipping industry—and employment in that industry—by making the employment of Australian staff on ships no more burdensome than employing someone from another country. The seafarer tax offset goes some way towards stimulating employment of locals in the sector. The offset for the employers who do the right thing and employ locals is significant for them. It might mean the difference between employing a local or employing someone from another country, perhaps a country that does not have the same standards of employment that we enjoy in Australia—our minimum wages or our safety standards.
The cost of the seafarer tax offset to the government, on the other hand, is small. Even though the benefit of the offset is large and helps employment, the cost to the government is small. We are looking at a cost of $8 million over the forward estimates. The budget papers state that the government will achieve savings of $12 million over three years but that in underlying cash terms the saving is $8 million over the forward estimates period. For the sake of $8 million, why is this government prepared to make it more difficult for people who operate ships in and around Australia to employ Australian crew? It is an ideological tack—nothing else. For the sake of $8 million, which is less than a rounding error in the context of four years of the budget, they are prepared to threaten the ability of companies to employ local labour at a rate that is competitive with overseas labour.
Also in this bill is another attack by the government on research and development. Our Prime Minister's views on science—and in particular his view that the science of climate change is 'crap'—are well known. It seems that this attitude to science is to be demonstrated yet again through a reduction in the research and development tax incentive. The countries that are going to do well in the 21st century are those that invest in innovation and research and development. Australian is never going to be able to compete with China or India on wages. It is a losing game for us to try to do that. What we can compete on is our brains and our innovation. What we need to do is not only properly fund research at our universities and through our research councils—something that the government is intent on attacking—but encourage the private sector to invest in research and development as well. On the whole, Australian does poorly when it comes to involving people with PhDs in private sector research and development. We rank quite low. There is also the perennial complaint from companies that good ideas get developed in Australia and then they feel that they need to move overseas because other countries will provide a much more supportive ecosystem for their research and development.
One of the good things that we have in this country is the R&D tax incentive which encourages companies to direct money that they might otherwise spend elsewhere into research and development. What the government wants to do in this bill is reduce the rate of the tax offset that is available under the research and develop tax incentive by 1½ percentage points from 1 July 2014. The government's justification for it is that it is okay because at some later stage it is going to reduce the company tax rate by 1½ per cent as well. I disagree with that. But if that is what the government wants to do, isn't it incredible that it is prepared to say it will cut your tax rate at some time in the future but it is going to cut your benefits now?
For the sake of $620 million, the government is prepared to diminish this country's investment in research and development. When you put this side by side with $111 million in cuts to CSIRO and the 20 per cent cuts to university funding, you can see why, under this government, 'science is crap' has become a mantra. It has become their guiding principle that underlies this budget and this legislation. This is the most antiscience government we have seen for a while, and now we are seeing it flow through to a tax on research and development.
One of the other elements of this bill that would not be supported, from our perspective, is the mature age worker tax offset. This is a measure that, at the moment, provides an incentive for workers to stay in the workforce. This was introduced in 2004-05 and it is worth up to $500 a year for individual mature age workers. The government says we can do this because we are now providing an incentive to employers to continue to employ people. But there is a difference because that money that they are providing to employers is not necessarily going to find its way into the pockets of these people who stay in the workforce—that is, it will go to the employers but not necessarily to the employees. So, yet again, we have the prospect—it is a bit like the R&D tax cut—of, 'Trust us, we might give you some benefit in the future, but we are going to take away the benefit you have got now.'
That is not the way to balance the budget. If the government were serious about balancing the budget, it would look to those who can afford it the most and ask them to pay their fair share. As it is, we know that this government is turning its sights on the young, the old, the sick and the poor. We are now finding it turning its sights on companies that invest in R&D and companies that try and do the right thing by employing local workers to work on ships surrounding Australia. For those reasons we are not in a position to support the bill.
Mr RIPOLL (Oxley) (13:25): It is a pleasure to have a few minutes to make some comments on the Tax and Superannuation Laws Amendment Bill 2014. In particular, this bill has five schedules which tighten the debt limits settings in the thin capitalisation rules to ensure that multinationals do not allocate a disproportionate amount of debt to their Australian operations. There is a range of other reforms, including reforms exempting foreign non-portfolio dividends, amendments to the Income Tax Assessment Act to ensure that foreign resident capital gains tax operates as intended and a number of other miscellaneous amendments to the taxation and superannuation laws.
The good thing about these is that they were done under Labor. It is Labor that did the work, and there was a whole package of measures on multinational tax avoidance, in particular. It is work that was done by former Assistant Treasurer David Bradbury when we were in government which is exceptionally important not only to the tax revenue base for Australia but also the way that our tax system operates fairly for all Australians. While it is good to see that the government is taking up some of these measures, you would have to say that it has been late in coming. We are more than 12 months into this new government and it is work that was already done, work that had taken some time to develop. But it is good to see that the government is now bringing that forward.
Unfortunately, the government is not fully implementing these measures. As such, this is costing the budget over $1.1 billion over the forward estimates. That is a substantial amount of money. That is a huge loss to the Australian taxpayer and something that should not be lost. We think that the government has got this wrong. The government should be going further. There are no excuses not to follow through on the good work that was done by Labor when it was in government. Labor always welcomes genuine measures to improve transparency, but we should see things as they are in what is being put forward. Some of the measures being put forward here are a stunt, pure and simple. The timing of some of these things and what the government is doing are certainly part of a distraction from the government's very unfair budget. It is a budget that decreases the tax intake that you might have had in revenues if it had followed through fully on Labor's multinational international tax avoidance measures that we were putting in place. It also disadvantages lower and middle income Australians, particularly when it comes to superannuation and a range of other measures.
It has been said—and I have spoken on these matters many times—that the people that are hurt most by the government's budget are the lowest income workers, particularly women, who will not benefit from, for example, the low income superannuation contribution. This includes around 2.1 million working women in the country, all of whom are low income earners but would benefit the most. In this place, you often hear people talking about the ageing population and talking about how we have got to look forward and how we have got a look to the future so we can support more people to be independent in their retirement. Labor had those policies and measures in place. So it is not as if we are talking about something that was not done. It was something that was already there. But we see a government that has come in and has taken those measures away.
The other bill has four components to it: abolishing the mature age worker tax offset, abolishing the seafarer tax offset, reducing the R&D tax offset and updating the listing of deductible gift recipients. Some of these Labor will support, but there are some things that we think that, again, the government have got completely wrong and we will not be supporting them.
The DEPUTY SPEAKER ( Hon. BC Scott ): Order! The debate is interrupted in accordance with standing order 43. The debate may be resumed at a later hour. The member for Oxley will have leave to continue his remarks when the debate is continued.
STATEMENTS BY MEMBERS
Community Television
Ms PARKE (Fremantle) (13:30): I am sure that I am one of many people in this place who has been hearing from their constituents about the importance of community television and their disappointment at the government's decision to force community TV out of the free-to-air spectrum. As David Green, a Melbourne comedian and community TV presenter, wrote in TheSydney Morning Herald a few days ago:
Community television became the latest target for nation un-building recently when Communications Minister Malcolm Turnbull announced TV signals would be switched off at the end of 2015.
In forcing community TV out of television, it is no answer to say that the internet represents the future for such broadcasting, especially not from the coalition, which, during a former stint in government, bequeathed to Australia the parlous state of broadband infrastructure that followed the privatisation of Telstra and which is now working to dismantle the NBN. As the community TV sector has been saying loudly and clearly, the shift to the internet is already underway, but it is a shift that will take time for community and commercial operators alike. So on what basis should the community sector access to spectrum be pushed off a cliff?
Like many Western Australians I enjoy West TV, and I have been fortunate enough to participate in some of its local programming, including current affairs shows like Undercurrent. The community TV sector is an important part of diversity and local character in Australia's media and an important incubator of ideas and talent. Silencing community TV is yet another sad example of this government's nation unbuilding.
Georges River
Mr CRAIG KELLY (Hughes) (13:31): Two hundred and eighteen years and 11 months ago, George Bass and Matthew Flinders were the first non-Aboriginals to sail up and explore the breaches of the Georges River. They sailed up to Bankstown over a nine-day trip. Since that time, we have seen an enormous increase in our prosperity. But one thing on which we have gone backwards is the quality of the environment of the Georges River. I have lived within a stone's throw of the Georges River tributaries all my life, and I recall stories my grandfather told me about how he used to swim in those tributaries when the water was crystal clear and clean. That is something we cannot do today. I would hope that sometime in the future my grandchildren and great-grandchildren will be able to swim in that river the way my grandfather was able to.
Therefore, as a member of this federal coalition government, I am very proud that we are investing $4.4 million in improving the environment of the Georges River through a number of Green Army projects and also through a project known as Building Indigenous Knowledge and Skills to Restore Urban Waterways. Last week I was very proud to be at the launch of the Georges River Combined Councils Committee's Aboriginal Riverkeeper Team, a team that will undertake bush regeneration across the river catchment and improve the natural and cultural heritage of the river. I am very proud that this is being done by a coalition government. (Time expired)
McEwen Electorate: Debutante Ball for All
Mr MITCHELL (McEwen—Second Deputy Speaker) (13:33): I recently had the honour of attending the Nexus Primary Health and Mitchell Community Resources and Advocacy Group Debutante Ball for All 2014. The Debutante Ball for All is an inclusive event for people who have not previously been able to participate in a debutante ball as a result of various barriers to participation, such as impaired ability or social disadvantage.
All of the debutantes looked magnificent and beautiful, and their partners were very dapper in their tuxedos. The debutantes were officially presented to me, the state member and the Mitchell Shire mayor, Councillor Rodney Parker. Our flower girl for the evening was Kirsten, a bright and bubbly young lady who, with her mum, Catherine, worked with us a couple of years ago to help establish the NDIS in Mitchell Shire.
The large crowd of family members and friends were beaming with pride as the debutantes lit up the dance floor throughout the evening, led by the effervescent Rupert, who certainly knows how to cut a rug. He could give a few of those on Dancing with the Stars a run for their money! The event was a roaring success and allowed members of our community to partake in all the glitz, glamour and excitement of a deb ball and enjoy their time with family and friends.
The hall at St Mary's College in Seymour was a wonderful setting for the event, and I wish to thank St Mary's for helping put on such a great party. I would like to congratulate and thank everyone involved in organising the event, especially Wendy Kelly and Jacqui Simms, who did a magnificent job.
Anzac Day Schools Awards
Dr SOUTHCOTT (Boothby) (13:34): I am very pleased to rise to congratulate the staff and students of Urrbrae Agricultural High School in my electorate for their recent winning entries in the Anzac Day Schools' Awards. Urrbrae is unique in South Australia and is recognised as a centre of excellence in agriculture, technology and the environment. The school has ongoing partnerships with TAFE and the University of Adelaide, and I cannot speak highly enough about the fantastic learning opportunities they give their students.
In this instance, the school has been recognised for its efforts to ensure the Anzac legacy lives on. Mr David Kempe and his Year 10 students recently conducted a project to research the history of Urrbrae students who lost their lives in the Second World War and Vietnam War and to restore the school's Anzac Memorial Grove. This project was not only a wonderful learning experience for those students; it will benefit all those who come after them. They will now be able to hear the stories of the Urrbrae alumni who made the ultimate sacrifice for their country.
In recognition of their efforts, I recently visited the school to speak to the students and present them with awards, plaques and a cheque for $1,500, as the runner-up secondary school in South Australia and the national winner in the best local history research category in the Anzac Day Schools' Awards. I also visited the grove, which stretches across the entire length of the school oval. My congratulations again to Urrbrae. The staff and students should be very proud of their school's efforts and of their hard work and dedication to learning about and honouring our Anzacs.
St Michael's Catholic Primary School Centenary
Mr THISTLETHWAITE (Kingsford Smith) (13:36): This year marks the centenary of my former primary school, St Michael's Catholic Primary School in Daceyville in my community. I wish to congratulate all the staff, students and parents for a wonderful year of centenary celebrations. Catholic education began in Daceyville on 18 May in 1914 when three sisters, daughters of Our Lady of the Sacred Heart, set out on foot from the convent in Kensington. They walked a couple of kilometres to establish the first classroom in Daceyville. They began the school that morning with 42 boys and girls from just two ethnic backgrounds. Today, the school has 204 students from close to 50 multicultural backgrounds and has earned a reputation as a place full of friendship, joy, discovery and challenge and as a place for children to dream of new possibilities.
To celebrate their centenary the school organised a calendar of events, including a walk in the footsteps of the school's founders, a wonderful performance at South Sydney Juniors, entitled The Power of a Dream, which I was fortunate to attend, and a celebratory mass earlier in the year. They also undertook special activities involving the number 100, such as good old-fashioned maths games, musical games, crafts and letter writing. I congratulate St Michael's Catholic Primary School, its students and faculty and the broader school community on reaching this milestone and wish them all the very best for the future.
Employment
Migration
Mr PITT (Hinkler) (13:37): At their recent federal council meeting the Nationals voted unanimously in favour of a motion I moved, seeking a multijurisdictional taskforce to address exploitation of foreign workers in the horticulture sector. I moved:
… that: "the Federal Council recognises the existence of labour hire contractors who are not paying employees correctly, and calls on the Government to form a multi-jurisdictional, multi-portfolio task force to advise enforcement agencies".
The motion was seconded by former police detective Senator Barry O'Sullivan. Allegations and complaints made to my office range from the underpayment and exploitation of workers to tax evasion, visa breaches, racial discrimination, intimidation of farmers and overcrowding in private residential dwellings.
Earlier this year, Senator O'Sullivan and I hosted a stakeholder forum in Brisbane. The very clear message we received from that meeting was that new legislation and further inquiries are not the answer. Stakeholders want real action. They say there needs to be greater enforcement of existing laws and greater cooperation between the many relevant agencies, across all three levels of government. I have briefed the relevant ministers' offices on the issue and the outcomes of the forum, and look forward to working with them to address this very serious issue.
The majority of businesses do the right thing, but it is imperative that we ensure our seasonal workers are protected, businesses have a level playing field and Australia remains a destination of choice for overseas students and holiday makers. Seasonal workers are vital to Queensland's agriculture and tourism industries and the Australian economy more broadly. Action is needed and it is needed now. The time for inquiries is at an end. (Time expired)
Griffith University REACH Awards
Dr CHALMERS (Rankin) (13:39): I rise to congratulate the winners of the Griffith University REACH Awards, which I presented during Adult Learners' Week earlier this month. I pay tribute to Griffith University Logan for the excellent job it does in opening up further education to a wider range of people, including adult learners. A vast majority of the 2,500 students at Griffith Logan are adult learners from a range of cultures, which reflects the diverse community. Griffith is supported by a range of community organisations, high schools and TAFEs, who were also in attendance on the night. I thank them for their contributions as well.
There were inspirational stories told at the REACH Awards, including that of Kathleen McGrath who went back to high school at Kingston College after a long time out of formal education and despite substantial financial hardship while she brought up a family. Kathleen was a very enthusiastic winner of a REACH award and is hoping to go on to study pathology at university. I recognise the other winners as well. They were Alison Duncan, Daniel Gaijang Dudi, Amani Allouche, Uncle Noel Summers, Aunty Freda Mitchell, Keiron Smith and Brooke Casey for their fantastic achievements.
I would really like to thank Di Mahoney for organising the event, Professor Lesley Chenoweth for hosting the event at the tremendous Logan campus of Griffith University and Angelique and Cameron for sharing their inspiring adult learner stories on the night.
Forde Electorate: Tourism
Mr VAN MANEN (Forde) (13:40): I associate myself with the remarks of the member for Rankin about Griffith University, which is a common university on the edge of both our electorates. The electorate of Forde is also blessed by the fact that it covers part of two local government areas, the tourist mecca of the Gold Coast and the rising tourism destination of Logan City with its wide variety of activities from shopping and dining to adventure based activities and ecotourism.
It is an exciting time for Logan as it has recently been identified by Queensland tourism as an untapped resource in Queensland's tourism market. Forecasts by Tourism and Events Queensland predict growth of 4.5 per cent per year to 2021 for the Greater Brisbane and Gold Coast areas, which includes Logan. At present, tourism represents only two per cent of the Logan economy, however there are a number of big-ticket items on the horizon. Recently, Logan City has taken the innovative approach of showcasing tourism offerings in the city by launching a new website. The site features categories such as attractions, dining, entertainment, shopping and many others.
In addition to the efforts by the efforts of Logan City Council, I would also like to recognise the efforts of the Logan Tourism Association. This year, its chairman, Terry Skene, organised 100,000 individual maps aimed at highlighting local attractions for visitors to the region. I congratulate all involved in this tourism activity. (Time expired)
Hotham Electorate: Clayton South Primary School
Ms O'NEIL (Hotham) (13:42): I rise to thank Clayton South Primary School to having me to visit recently. In my first year as the member for Hotham I promised I would visit all the schools in my electorate. Clayton South was one of the last visits and it was definitely one of the most fun. Eleven student leaders took me on a whirlwind tour of their school, of which they are most proud. They showed me around the playground, the classrooms and their senior school room, where we sat down for a good chat about a few important issues.
They gave me some insight into bullying and cyber safety. Thankfully, neither is a major problem at the school due to lots of dialogue and good policies. We talked about the nerves and excitement they feel about going into year 7 next year. They also explained their deep disappointment and frustration about the state of their school buildings. When Labor was in government in Victoria, Clayton South was funded for a rebuild of its entire school. It was about to call for tenders when the coalition were elected. Since then, nothing has progressed in four years. I will be fighting, with state MPs, to have this school urgently funded for capital works which are very much needed for this school. In the meantime, I thank Andrew Leap, Margaret Derzotis, Katie Webb, Natasha Theodoris, Matthew Tyson, Antony Jones-Wilson, Asli Demirbas, Mikara Roi, Isabella Seitanidis, James Nimorakiotakis and Emily Liong. These are great school leaders at Clayton South Primary School and great kids. Thanks for having me.
Murray-Darling Basin
Mr BROAD (Mallee) (13:43): Today I have written to Senator Simon Birmingham, the Parliamentary Secretary to the Minister for the Environment, requesting that the Murray-Darling Basin Authority relocate itself to where the Murray and the Darling actually junction, which is in the Mildura-Wentworth region. The great member for Hinkler once said, 'If you can't look out the window and see an asset you are responsible for you should question your location.'
I believe that when people in the Public Service interact with communities they get an organic knowledge of that community. They realise that if the Murray is in trouble they are interacting with a community that also feels that the Murray is in trouble. They realise that if the Darling system needs more water or does not need more water they are living it every day with people who care about and live amongst that environment.
The Mildura-Wentworth region has many of the things they need to be based there. They have national peak bodies, like the Australian Table Grape Association right through to Citrus Australia and the Almond Board of Australia. There are also flights to Sydney, Melbourne, Adelaide and Broken Hill. Also, can I point out that the first barista outside of Melbourne was based in Mildura. I know the public service needs good coffee! If we locate public servants like Murray-Darling Basin Authority amongst those they seek to serve, I am confident that Australians will gain even more value out of our hard-working public service sector.
Newcastle Electorate: Islamic Centre of Newcastle
Ms CLAYDON (Newcastle) (13:45): I rise to condemn an attack by vandals on the Islamic Centre of Newcastle. Last Thursday night, eggs were thrown at the Islamic centre in suburban Mayfield. While no major damage occurred, gratuitous attacks such as this are a disgrace.
The Islamic Centre of Newcastle is very much valued within the Mayfield and broader Newcastle community. The mosque has an open-door policy and does not entertain reformist political or ideological agendas. They openly work with the Australian Federal Police and other authorities to try and stop the radicalisation of youths within the Newcastle and Hunter community. Just last weekend, the centre celebrated the United Nations International Day of Peace with theologians, representatives from the Christian and Buddhist communities, academics and members of the NSW Police.
Multiculturalism is one of our nation's greatest gifts. One of the markers of a free and democratic society is tolerance, understanding and acceptance of one another. Any actions or activities that derogate from those liberties, freedom of association and freedom to worship in ways we want are a tragedy and a disgrace. We will not overcome hatred with hatred; we will not overcome intolerance by being intolerant.
Ill-informed and inflammatory comments about Islam and criminal actions such as those at the Mayfield mosque are as unhelpful as they are unfair. Muslim Australians should not be stigmatised for the crimes of ISIL, as ISIL's twisted ideology bears no relation to a faith of peace and tolerance which is followed by millions of people worldwide and thousands of Australians and Novocastrians.
Fox, Ms Jessica
Ms SCOTT (Lindsay) (13:47): Today I rise to congratulate Penrith's own Jessica Fox. On Monday, Jessica made history with her double victory at the Canoe Slalom World Championships in Maryland, USA. It was only April this year where Jess took out both the C-l and K-1 titles at the under-23 world championships in Penrith. She has now backed up that incredible feat to also achieve that at the senior level.
The result comes exactly 25 years after her parents won their world titles, also in the USA, and they were on hand to celebrate with Jess when she screamed for joy after crossing the finish line. I know Richard and Myriam, the entire Penrith community and the nation are immensely proud of Jessica and her achievements. Jessica is a wonderful ambassador for the Nepean Valley. She is a fabulous local hero and the wonderful role model for so many young people.
To achieve such an extraordinary result at such a young age is a credit to Jess's determination and dedication to her sport and also the contribution that her entire family has made to canoeing internationally. The canoeing sport is made so much better by the work of the Fox family. I would like to congratulate Jess for this outstanding result and for continuing to be such a wonderful ambassador for our region. I would also like to thank the Fox family for all that they have done. I look forward to seeing Naomi Fox also hit the international stage and win at a senior level. Congratulations.
Future of Financial Advice
Mr STEPHEN JONES (Throsby) (13:48): The collapse of Trio Capital was the largest superannuation fraud in Australia's history. Around about $176 million of investor funds were lost and sent overseas. Hundreds of these victims came from my electorate of Throsby and throughout the Irrewarra. It was in part response to the Trio Capital fraud that Labor introduced the financial advice reforms to the last parliament.
In the lead up to the 2013 election, the Trio Capital victims' circumstances were hotly contested in my electorate. Indeed, the Liberal minister responsible, Senator Cormann, said that there was a series of unique circumstances in Trio Capital and there would be some justification for a level of compensation. I am told that it has been 382 days since that commitment was given to the Trio Capital victims and still there has been no honouring of that commitment. What is more, the FOFA laws are being wound backwards.
I today standard parliament and demand that the Liberal minister honour the commitment that he gave to electors in my electorate, which was that he would pay the compensation and do what he said he would do. I call on the government to listen to the advice of the experts in the industry who are saying, 'Ditch your FOFA reforms.'
Penny, Mr Geoffrey (Ted)
Mr WYATT (Hasluck) (13:50): I rise today to pay tribute to the late Mr Geoffrey Penny or 'Ted', as he was commonly known. Ted passed away earlier this month and his funeral service is this Friday. Ted, a Noongar elder in Western Australia, was a role model and leader in Indigenous education. Living in my electorate of Hasluck in Gosnells, Ted founded the Moorditj Noongar Community College in Middle Swan, which is also in my electorate.
Ted spent over two decades as a teacher before moving into executive roles within the education department of Western Australia. Aboriginal people and non-Aboriginal people across Western Australia benefitted from his mentorship, guidance and wisdom. Ted was a humble man and in my opinion he was a guiding and powerful force within the field of Aboriginal education within Western Australia. Ted believed that education was the pathway to success and advocated for strong parental involvement in children's learning journeys.
I hope that this legacy of his continues on, as many continue to be impacted by his positive contribution to the education of Aboriginal children and education more broadly. His sense of humour, his passion for life and his wit will be missed by all of those who knew him and who considered him to be a close friend and colleague. He leaves an incredible gap in the leadership within the Noongar community.
Renewable Energy
Ms CHESTERS (Bendigo) (13:51): I rise today to acknowledge the many central Victorians who rallied on the weekend on Sunday in support of a call to action on climate change. Eight hundred people rallied in Kyneton and marched through the main street, 400 people rallied in Castlemaine and too marched through the streets, and an extra 300 people gathered in Bendigo in Rosalind Park to stand up and call on this government and call on the community to rally to save the RET.
I support the renewable energy target. It has created countless jobs in my own electorate. Solar companies continue to talk to me about the need to maintain the RET in its current form to ensure that their industry continues to grow. Bendigo is connecting to solar power from across the electorate—in their homes, in their businesses and even in their community. People solar projects are popping up everywhere. I support their work, and it is time that our government supported their work.
These rallies were among many that were held across Australia and across the globe to coincide with the Climate Summit for world leaders in New York at the invitation of the UN Secretary-General, Ban Ki-moon. It is just so disappointing for this nation, whose people believe in climate change, that its leader, its Prime Minister, is not at this important forum discussing this very important issue.
East West Link
Mr SUKKAR (Deakin) (13:52): I want to draw to the attention of this House the recent announcement by the Labor opposition in my home state of Victoria of their intention to rip up contracts to build the East West Link. The East West Link is a crucial piece of infrastructure for Deakin residents which will ease traffic congestion on the Eastern Freeway and bottlenecks at Hoddle Street and Alexandra Parade. It will also create 6,200 jobs during the construction phase.
For these reasons, the federal coalition government has committed $3 billion of funding towards stages 1 and 2 of the East West Link project. However, recent statements from Labor opposing this project highlight more than ever that the Labor Party are so preoccupied with appeasing a small handful of inner-city Greens voters that they refuse to accept the necessity of this project for those living in the outer eastern suburbs of Melbourne.
In my own electorate of Deakin, the East West Link understandably enjoys enthusiastic support. I have therefore welcomed the comments by the President of the Ringwood Chamber of Commerce and Industry, who recently emphasised the importance of the East West Link to residents and small businesses in the outer east of Melbourne. As he said, at a time when central Ringwood is undergoing a massive transformation 'now is the time to build the East West Link'.
It is clear that only the coalition will deliver the East West Link, and I will continue my fight for the delivery of this project for the electors of Deakin.
Melbourne Electorate: Farnham Street Neighbourhood Learning Centre
Mr BANDT (Melbourne) (13:54): I rise to bring the attention of the parliament to the outstanding achievements of the Farnham Street Neighbourhood Learning Centre, located within my electorate of Melbourne. The Farnham Street Neighbourhood Learning Centre has been operating for 35 years, having first opened in 1979 as the Flemington Neighbourhood House. The centre arose as an initiative of the women of Flemington as a means of providing courses and activities for the local community. Over the last 35 years, Farnham Street has provided a range of community activities, programs and courses promoting inclusion, participation and educational opportunities for the diverse Flemington community.
Many people have contributed to the success of Farnham Street, and I acknowledge the work of the centre's staff, committee members, volunteers, students and local residents without whom Farnham Street would not be possible. In particular, I would like to recognise the outstanding contribution of Cathy Connop, the manager of Farnham Street Neighbourhood Learning Centre. This year marks 25 years of outstanding service by Cathy to the community through the Farnham Street centre. The centre has become the vibrant and important community institution that it is because of Cathy's work. Cathy's service reflects the important values of community connection, participation and lifelong learning.
As the federal member for Melbourne, it is with great pleasure that I acknowledge Cathy's tireless work and the difference that it has made to so many people in my electorate. Cathy and her team have always made me feel welcome, every time I have visited, and I have seen firsthand just how she and her team make people in our diverse community feel included.
I extend my congratulations to the Farnham Street community and look forward to many more years of successful community service.
Lyons Electorate: Business
Mr HUTCHINSON (Lyons) (13:56): Prime Minister Tony Abbott visited my Tasmanian electorate of Lyons a couple of weeks ago. Northern Tasmanian furniture maker Mark Turner is a fine example of a small business owner in Lyons prepared to have a go and produce quality goods. Mark introduced Mr Abbott to his wife, Vicki; his sister Helen, who runs the office at Turners Blackwood Furniture at Western Junction; and his skilled team of tradesmen and apprentices. The second-generation furniture maker runs an old-style workshop where apprentices get the best training on the job, assigned one-on-one to a master tradesman.
Mr Abbott was perhaps the first prime minister since Joseph Lyons to visit Tunbridge, meeting farmers Richard and Emily Gardner, who are making significant investments in dairy off the back of the Midlands irrigation scheme. Seven hundred and fifty cows are now being milked on land that has been traditional dryland grazing country. Nine new jobs have been created directly on the farm, along with others in service industries, transport and processing.
My thanks also to Michael, Carina and Precious Bock, and to Joel Hazelwood, Peter Johansen, Craig Roberts, Jaydon Crawford and Emily Pennicott.
Many other farmers will be closely watching this new business and I believe will be motivated to also diversify into dairy production to help fix the shortfall that exists between the milk production and processing capabilities in Tasmania.
I thank the Prime Minister for taking time to visit my electorate to see the jobs and economic activity being created off the back of such investment. Lyons, after many years of being ignored and taken for granted as a safe Labor seat, at last is back on the radar.
War Memorials
Mr BURKE (Watson—Manager of Opposition Business) (13:57): I returned to Australia a few hours ago, to be told that during my absence a protest was held within my electorate, in the suburb of Lakemba. The group that organised that, I understand, is a group which I have a long history of having differences of opinion with and often quite heated arguments with. I do not want to go to that in the time available; I want to go to the location of the protest. The location chosen for conducting the protest was a war memorial within the suburb of Lakemba. I want to take this opportunity, at the first available instance, to say how unacceptable that is. For generations of people, war memorials in suburban areas are the same as cemeteries to families and relatives and communities. The people of Lakemba are a fine community, a great, strong, multicultural community. The people who organised that particular protest, many of whom had travelled some distance to be there, should never again consider using a war memorial site for any form of political activity.
Macarthur Electorate: Relay for Life
Mr MATHESON (Macarthur) (13:58): I rise today to congratulate the Camden and District Rotary Clubs on hosting a very successful Relay for Life event last weekend. More than 1,000 residents from all over Macarthur took part in the relay at Onslow Park to raise awareness and funds for the Cancer Council. More than $130,000 was raised before the event even began, and organisers are confident of reaching the $250,000 target in the coming weeks.
So far, the event has raised $782,000 over the past six years, with a goal of making it to $1 million this year. Organising committee chairman Rowan Moore was confident the club would reach its goal once all the funding came in. Camden Rotary Club did a fantastic job in organising this year's event. The huge turnout each year is a testament to their hard work and shows how kind and caring the people of Macarthur are; they come together for a great cause. The relay included a survivors' and carers' walk on Saturday morning and a walk of remembrance on Saturday evening in memory of those who have lost their battle with the disease. It was nice to see the Macarthur community supporting those who live with cancer, whilst also celebrating survivors and carers who take care of friends and family members battling the disease. I would like to commend the Camden district's Rotary Club and its volunteer committee for organising this fantastic event.
The SPEAKER: It being 2 o'clock, the honourable member is interrupted. In accordance with standing order 43, the time for members' statements has concluded. Before we move to questions without notice, I give the call to the Acting Prime Minister.
STATEMENTS ON INDULGENCE
National Security
Mr TRUSS (Wide Bay—Deputy Prime Minister and Minister for Infrastructure and Regional Development) (14:00): I seek leave to make a short statement.
Leave granted.
Mr TRUSS: Madam Speaker, it is appropriate that I should make a statement to the House regarding the incident at Endeavour Hills police station yesterday. At approximately 7.45 pm last night, one Australian Federal Police officer and one Victorian police officer were subject to an unprovoked attack from an 18-year-old man armed with a knife. The two officers were wounded in the attack; one received multiple wounds and was seriously injured. During the conflict, one officer fired upon the attacker and killed him.
The attacker was a known terrorist suspect, who was a person of interest to our law enforcement and intelligence agencies. He had presented to the Endeavour Hills police station voluntarily. Other officers from the Joint Counter Terrorism Team discussed concerns regarding some of his recent actions. While the matter will be subject to a formal investigation, it appears that the officer who fired upon the suspect saved his own life and also the life of his colleague.
The officers involved are at the front line of protecting the community from the very real threat from people who wish to engage in terrorist activities here in Australia. They regularly put personal safety at risk in order to keep us safe. It is at times such as these that we realise the risk and the personal sacrifice that they and their families endure. The seriously injured Australian Federal Police officer is 43 years of age and has a wife and two children. He is a member of the Joint Counter Terrorism Team in Melbourne and has been with the AFP since June 2012. He is in a serious but stable condition. I understand that the Victorian police officer is a Senior Constable and he is undergoing surgery today, but is in a stable condition. Earlier today the Prime Minister, Mr Abbott, spoke to the wives of both injured officers, and the thoughts of the Australian Parliament go out to these officers and their families. We wish them a full and speedy recovery and commend them on the bravery of their actions.
Violence against police in any form will never be tolerated. However, it is vital that the community remains calm and allows our law enforcement and security agencies to conduct this investigation thoroughly. Authorities are also engaging with the local affected communities on the ground. Continued community engagement is critically important at this time. Officials across the country will ensure that the lines of communication and dialogue remain open with our communities so that we can work together to counter the threat from a small number of criminals.
We are an inclusive and tolerant society. The actions of violent criminals do not represent the views or the attitudes of the overwhelming majority of Australians regardless of their faith or ethnicity. I urge the Australian public to remember that violence against anyone based on the religion or their beliefs or race is never acceptable. To turn on each other on the basis of religion or race would just give in to the terrorism groups and what they want. As is normal after events like this, Commonwealth, state and territory counter-terrorism officials will be reviewing the incident to ensure our public security arrangements remain appropriate across the country. I can assure all Australians the law enforcement and security agencies and governments, in partnership with all our communities, will take every action we can to keep them safe.
I reiterate that Australians should remain calm and carry on with the normal lives, confident that our law enforcement and security agencies will do everything humanly they can to keep all members of the Australian community safe so that all Australians can enjoy the freedom and the lifestyle we prize as our birthright.
Mr SHORTEN (Maribyrnong—Leader of the Opposition) (14:05): At times like this the words we say in this place are not as important as the thoughts and prayers that we send. Today our thoughts are with the Australian Federal Police officer and the Victorian police officer who are both still in hospital. Our thoughts are with their families and their colleagues who have spent a sleepless night, anxiously wondering and watching over the ones they love and respect. Our thoughts are with the people of Endeavour Hills who have woken to see their local streets and shops on the national news and their peaceful community dragged to the centre of a national story. Our thoughts are with the family of a young man who may be asking themselves more questions than there are answers.
The events of last night remind us of the bravery and the quality of all who serve in our police and security agencies. They underscore the unpredictable dangers of the work they do in keeping our community safe. Next Monday, 29 September, is National Police Remembrance Day. We will commemorate all those officers who have lost their lives in the line of duty and salute the courage of all those who wear a police uniform. Earlier this morning Chief Commissioner Ken Lay told me that these officers who were injured are doing as well as can be expected. Today I join with the Acting Prime Minister to wish these two brave people are speedy recovery.
Madam Speaker, last night the young man who died, Numan Haider, had a family too. In their grief they will be asking themselves, 'How did it come to this?' What drove the boy they loved to this desperate end? As difficult as it may be, I suspect many Australians will be asking themselves this same question. We must ask ourselves why a very small number of people raised in Australia would be attracted to the cause of ISIL and the like. The answer is not clear. Perhaps part of the answer is this: in a complicated and uncertain world, fundamentalist extremism gives the illusion of certainty and simplicity. This is the poison of sectarianism and extremism. It offers a sense of power to people who may feel powerless, an outlet for the bottled-up rage and hatred of the isolated or the unwell, but this is only ever a harmful mirage. There is no glory in murder, no honour in crime and no power in death.
We have a responsibility to send a clear message to those drawn to this conflict: whatever problems you may perceive that you have, violence is never the solution. Whatever you think is wrong with the world, extremism and fanaticism will never make it right.
We are a country of 23 million individual souls, but today we are one people. We are a nation of over 200 languages, but today we speak with one voice. We are a nation of many faiths, but today we rededicate ourselves to one belief—the belief that everyone is equal and everyone is welcome. Since mass postwar migration, Australia has gained and grown by including people of every culture and nation. We cannot, we must not and we will not allow a tiny minority to divide our generous, inclusive society. On behalf of our wounded police officers, we cannot allow this country to become polarised. Let us all vow to meet this moment with understanding and tolerance, not division and violence, with compassion and comprehension, not prejudice and exclusion.
We live in a challenging time. We have lived in challenging times before and we shall face challenging times in the future. We understand in this parliament that what Australia needs now is wisdom and understanding to guide us sensibly and safely through the days ahead.
MINISTERIAL ARRANGEMENTS
Mr TRUSS (Wide Bay—Deputy Prime Minister and Minister for Infrastructure and Regional Development) (14:09): I inform the House that the Prime Minister will be absent from question time today and tomorrow as he participates in a high-level meeting of the United Nations Security Council convened by US President Obama to address the threat posed by foreign terrorist fighters. I will answer questions on his behalf.
SHADOW MINISTERIAL ARRANGEMENTS
Mr SHORTEN (Maribyrnong—Leader of the Opposition) (14:10): For the information of the House, I present a revised list of the shadow ministry.
QUESTIONS WITHOUT NOTICE
Higher Education
Mr SHORTEN (Maribyrnong—Leader of the Opposition) (14:10): My question is to the Minister for Education. It has been reported today that Monash University economics professor and competition expert, Stephen King, says that fee deregulation of universities is a recipe for disaster, suggesting that fees will creep up until Australian students pay about the same as full-fee-paying foreign students. Why is the Abbott government putting the cost of university out of the reach of young Australians?
Mr PYNE (Sturt—Leader of the House and Minister for Education) (14:11): I thank the Leader of the Opposition for his question. To answer his final question first, students who go to university in Australia can borrow every single dollar from the Australian taxpayer. So no university course is out of reach to any Australian young or mature age student who wants to go to university, because every single dollar of the fees that they may be charged—or that they are being charged now, for that matter—can be borrowed through the most generous higher education loan program in the world, one that is the envy of the entire world.
Let me explain one thing to the opposition, which they do not understand: in Great Britain, where there are fees in England and there is a so-called free education paid for by the taxpayer in Scotland, the rate of low-socioeconomic status students going to university has increased in England and has dropped in Scotland, so the supposed evidence from the opposition that fees will lead to people of low-SES backgrounds not going to university has been utterly exploded by the evidence of what has occurred in Great Britain. So that is the answer to the final question in his question to me. The fact is that no university degree will be out of reach to anyone, because they will be able to borrow money from the Australian taxpayer.
The first part of the member's question was a quote from one academic. I welcome that, because I would like to quote from a few people as well. The Labor Party are desperately clinging to one academic's comment about our higher education reforms—a small sapling floating past that, like a drowning sailor, they have reached out to grasp. This gives me the opportunity to tell the opposition: ask the Group of Eight, ask the Australian Technology Network of universities, ask the Regional Universities Network, ask Innovative Research Universities, ask Universities Australia, which represents 39 universities.
Opposition members interjecting—
Mr PYNE: Ask business leaders like David Gonski—they have gone quiet again—and like Michael Chaney. Ask individual vice chancellors from across Australia like John Dewar from La Trobe, Annabelle Duncan from the University of New England, Warren Bebbington from the University of Adelaide.
Mr Snowdon interjecting—
The SPEAKER: The member for Lingiari will desist.
Mr PYNE: All of these people and all of these organisations are saying that there must be reform to universities in Australia, otherwise we will fall behind our Asian competitors and decline into mediocrity.
This side of the House is prepared to make the real, microeconomic reform that Labor squibbed for six years in government. This reform will transform our universities and provide more opportunities for students.
National Security
Ms LANDRY (Capricornia) (14:14): My question is to the Acting Prime Minister. Will the Acting Prime Minister update the House on the steps the government is taking to ensure Australia's security?
Mr TRUSS (Wide Bay—Deputy Prime Minister and Minister for Infrastructure and Regional Development) (14:14): I thank the honourable member for her question. The highest priority that any government can have for its people is the safety of our communities. This government has three key messages that we want to make clear to all Australians. Firstly, that this government will do all we possibly can to keep our people safe. Secondly, our security measures both at home and abroad are directed against terrorism, not religion. And thirdly, Australians should always live normally, because the terrorists' goal is to scare us from that lifestyle.
The Australian government is naturally deeply concerned about the fact that Australians are involved in Syria and Iraq, and the domestic ramifications of that involvement. Our intelligence agencies estimate that there are at least another 100 Australians providing support roles in Australia for those who are already overseas. And the shocking incident in Melbourne last night, on top of the police raids in Sydney and Brisbane—involving something like 800 police and 30 search warrants—just serve as reminders of the enormous challenges that are ahead of us.
The government has committed another $630 million over the next four years to give our security agencies the resources, the technical skills, and the legislative powers they need to combat home-grown terrorism, and to prevent Australians from committing terrorism acts overseas. The funding will boost our counter-terrorism capacity, particularly in the Australian Federal Police, ASIO and ASIS; Customs and Border Protection; and other agencies. But we are also systematically updating counter-terrorism legislation to strengthen our agencies' capacity to prevent and disrupt security threats.
The first tranche of legislation to make Australia safer will modernise and improve the legislative framework under which our intelligence agencies operate. Today, the Attorney-General will introduce the second tranche of those new laws, to give our agencies the powers they need to make it easier to arrest and return foreign fighters; to prevent those who want to be foreign fighters from leaving our country; and to disrupt terrorist attacks on our own soil. These laws are strongly supported by our policing agencies and by ASIO. The new powers will be balanced with proper oversight. We are determined to ensure that our country is ready and prepared, and takes whatever action it needs to keep Australians safe and to make sure, as much as we can, that Australians are not the perpetrators of violence in other parts of the world.
DISTINGUISHED VISITORS
The SPEAKER (14:18): Before I call the honourable member for Kingston, I would like to advise the House that we have with us in the distinguished visitors gallery, from the House of Representatives of the Autonomous Region of Bougainville, the Minister for Health, the Hon. Rose Pihei MP, the Hon. Joan Jerome MP and the Hon. Elizabeth Burain MP, who are visiting the parliament as part of the Pacific Women's Parliamentary Partnership project. We make them very welcome.
Honourable members: Hear, hear!
QUESTIONS WITHOUT NOTICE
Higher Education
Ms RISHWORTH (Kingston) (14:18): Thank you, Madam Speaker. My question is to the Minister for Education. Yesterday in question time, the Prime Minister said the Commonwealth taxpayer will continue to cover 50 per cent of people's university education. But the University of Western Australia's fee schedule released yesterday shows that the Commonwealth will cover only 10 per cent for commerce students and 43 per cent for science students. Minister, isn't the Prime Minister's 50 per cent claim just another sham that will massively increase the cost of university for young Australians?
Opposition members interjecting—
Mr PYNE (Sturt—Leader of the House and Minister for Education) (14:19): It never rains but it pours!
Mr Conroy interjecting—
The SPEAKER: We will have some silence on my left, including the member for Charlton.
Mr PYNE: Having had very few questions from the opposition about education for 12 months, it is now a welter of questions on education! And I am very glad to get them, Madam Speaker, because the point is—
Opposition members interjecting—
The SPEAKER: There will be silence on my left! The member for Moreton.
Mr PYNE: that the opposition can spin their wheels as much as they like about the higher education reforms. The simple fact is, they are out of step with the rest of Australia.
Opposition members interjecting—
Mr PYNE: They are out of step with all the sensible economic commentators in the country who recognise the need for reform. For example, Paul Kelly, writing in The Weekend Australian—
Opposition members interjecting—
Mr PYNE: Oh, you laugh at Paul Kelly do you? One of the most eminent journalists in Australia. Have a good old laugh; no wonder you are so out of touch with reality over there!
Ms MacTiernan interjecting—
The SPEAKER: The member for Perth will desist!
Mr PYNE: Paul Kelly, writing in The Weekend Australian—
Opposition members interjecting—
The SPEAKER: The minister will resume his seat. The Manager of Opposition Business on a point of order.
Mr Burke: Madam Speaker, to be directly relevant the minister needs to refer to the 50 per cent claim made by the Prime Minister.
The SPEAKER: The call goes to the Minister for Education.
Mr PYNE: Madam Speaker, before I quote from Paul Kelly I will answer that specific question, since I am perfectly happy to do so. The Labor Party can fabricate figures as much as they like—
Opposition members interjecting—
Mr PYNE: and they can make up quotations as much they like. They can pick out and parse—
Mr Dreyfus interjecting—
The SPEAKER: The member for Isaacs.
Mr PYNE: sentences and tables. The reality is, our reforms will mean that that students will be required to pay 50 per cent of the cost of their education, across the university sector, and they are currently on average paying 40 per cent.
Opposition members interjecting—
Mr PYNE: They are currently paying 40 per cent of the cost of their education. That is what the student cohort is paying. And they are getting the lowest unemployment rates of anybody in our community, long life expectancy, better health outcomes—and they will earn 75 per cent more, on average—
Mr Albanese: What's the percentage?
The SPEAKER: The member for Grayndler.
Mr PYNE: than people who did not go to university. And more than 60 per cent of Australians do not have a university degree. So rather than complaining about being asked to pay 50 per cent of the cost of their education rather than 40 per cent, they should actually be buying a bunch of flowers and knocking on the door of a neighbour who does not have a university degree and saying: 'Thank you for paying 50 per cent of the cost of my education.'
Ms Owens interjecting—
The SPEAKER: The member for Parramatta.
Mr PYNE: That is what they should be doing. Because they are going to get a much better opportunity in life than those people who do not get the chance to go to university. Now, returning to Paul Kelly—who those over that side of the House think is an absolute riot, but most of us see him as a very serious person; I certainly do—
Opposition members interjecting—
The SPEAKER: There will be silence on my left!
Mr PYNE: He was quoting Mike Gallagher, the executive director of the Group of Eight. Mike Gallagher says: 'It is outrageous that the Labor Party have washed their hands of responsibility for the mess they created'—the mess you on that side created—that we are prepared to fix up, because we are an adult, responsible government getting on with the job—methodically, calmly and carefully—of fixing this country after the six years—the six Rip Van Winkle years—of the Labor government.
Opposition members interjecting—
The SPEAKER: There will be silence on my left.
Ms Macklin interjecting—
The SPEAKER: That includes the member for Jagajaga. I call the honourable member for Mitchell.
Terrorism
Mr HAWKE (Mitchell) (14:22): My question is to the Minister for Justice, and I want to thank the minister for the outstanding work he is doing with, and on behalf of, the Australian Federal Police to keep our nation safe. Will the minister inform the House of the action the government is taking to ensure federal law enforcement agencies have the resources that they need to tackle the threat of terrorism?
Mr KEENAN (Stirling—Minister for Justice) (14:23): I thank the member for Mitchell for his question. The events of last night are a reminder of the harm that our police can face on the front line. Our thoughts are with the families of those officers who were injured, and also with the family of the deceased. As the Acting Prime Minister has said, law enforcement and security agencies are taking all necessary steps to keep Australians safe and secure. I reiterate that everyone should remain calm, continue to go about their business and allow our law enforcement and security agencies to conduct a full investigation into this incident. Keeping Australians safe requires a coordinated national response, and we have seen last week, and again last night, how federal authorities work in conjunction with state police to disrupt and detect suspected terrorist activity intended to cause harm to members of our community. This collaboration is important in bringing together our law enforcement and intelligence agencies, and to enable them to utilise all of the resources that are at their disposal.
Furthermore, the government is investing $630 million in a counter-terrorism package—$64 million will be for federal law enforcement, $32 million of which will go to the Australian Federal Police to run a multi-agency national disruption group; more than $13 million will go to strengthening community engagement programs across Australia; $24 million will go to the Australian Crime Commission, which will deliver 22 investigators and analysts so the ACC can form a foreign fighters task force; and $22 million will go to AUSTRAC. As I indicated in the House yesterday, AUSTRAC will use this money to detect and stop terrorism financing. The Abbott government will continue to do all it can, very importantly, to support community leaders who play a critical role in persuading young Australians from inflicting harm on home soil and from travelling into the conflict zone to fight.
Very soon today we will also be introducing legislation into the Senate which gives our law enforcement and intelligence agencies powers that are flexible enough to deal with the different contingencies they now face. The work the government is doing with our agencies is not about targeting any particular community, and it is not about religion. It is about dealing with extremists who would seek to do Australia harm, and I want to assure everyone in Australia that our law enforcement community, our intelligence agencies and our government are doing everything we can to keep our country safe.
Higher Education
Ms RYAN (Lalor—Opposition Whip) (14:26): My question is to the Minister for Education. I refer to Michelle Smith, a mother from Geelong in Victoria. While studying she is working as a nurse to support her family. She is very concerned about being left with a massive debt as a result of the Minister for Education's changes to university fees. She describes them as 'absolutely heartbreaking'. Why is the government so determined to Americanise our universities, leaving people like Michelle with a debt sentence?
Mr PYNE (Sturt—Leader of the House and Minister for Education) (14:26): It is sad that it was not enough for the Leader of the Opposition to go to Adelaide a couple of weeks ago and give a xenophobic speech about the Japanese; we now have the member for Lalor giving a xenophobic speech about the United States. How low has the Labor Party sunk?
Mr Dreyfus interjecting—
The SPEAKER: The member for Isaacs will desist.
Mr PYNE: I am very happy to answer the member for Lalor's question, because it is very disappointing that, as a former school principal, she does not know how the education system in Australia works. The United States does not have a higher education loan program, so their system bears very little resemblance at all to the Australian education system. The member's constituent will be able to borrow every single dollar for her education from the Australian taxpayer and pay it back at the best loan rates she could ever receive from any bank or any institution in her life.
Mr Brendan O'Connor interjecting—
The SPEAKER: The member for Gorton is trying my patience.
Mr PYNE: She will not be asked to pay it back until she earns over $50,000 a year, and then she will be asked to pay two per cent of her income. If it rises to more than $100,000 a year—
Mr Dreyfus: Madam Speaker, I rise on a point of order. What is the minister's answer to Michelle Smith?
The SPEAKER: There is no point of order. The member for Isaacs knows that is an abuse of the standing orders, and he will not repeat it.
Mr PYNE: I thank the member for Isaacs for being able to remind me of the name of Michelle Smith, because I can tell Michelle Smith that she will not have to pay back her loan until she earns more than $50,000—and even then she will pay it back at two per cent of her income. Even if her income rises to over $100,000 a year—I think the threshold is about $108,000; do not hold me to that as it is from memory, but it is certainly over $100,000 a year—she will be asked to pay eight per cent of her income. That is the maximum she could ever be asked to pay of her income. It is a very generous scheme. But, as the Treasurer reminds me, there is absolutely no reason to believe that Ms Smith might not get a scholarship to go to university, because we will have the biggest Commonwealth scholarships fund in Australia's history. And people like Ms Smith, if she is from a low-socioeconomic-status background, if she is a first-generation university goer, has every reason to believe that she will attract a scholarship, because they will be merit and disadvantaged based. And she will get to go to university, potentially, for absolutely nothing, and the university will give her a scholarship from the Australian taxpayer. So, it is all good news. Rather than trying to scare her constituents, the member for Lalor should actually be telling them the truth.
DISTINGUISHED VISITORS
The SPEAKER (14:30): Order! I advise the chamber that we have with us Dr Souvanpheng, the chair of the Economic Planning and Finance Committee, from Laos. We make him most welcome.
Honourable members: Hear, hear!
QUESTIONS WITHOUT NOTICE
Broadband
Ms McGOWAN (Indi) (14:30): My question is to the Minister for Communications. The NBN rollout is beginning in my electorate, for which I am very grateful. It will bring improved internet and mobile phone coverage to many households and businesses. The broadband quality and availability survey has been done to gather information on the success of this rollout. Can the minister please tell the House how my electorate of Indi rated? And will the government commit to prioritising the worst areas identified in the survey?
Mr TURNBULL (Wentworth—Minister for Communications) (14:31): I thank the honourable member for her question. The broadband quality survey that the government undertook shortly after the election was the first of its kind. It was the first time any government actually sought to find out where broadband was good, bad or indifferent across Australia. We surveyed 78,000 distribution areas across Australia, of which 832 are in the honourable member's electorate. Of those distribution areas, 71 per cent have access to ADSL, which is below the national average, although six per cent of those DAs that have access to ADSL have access to very poor service. In common with many regional electorates, most of the residents in the honourable member's electorate live in large centres—in Wodonga, in Wangaratta—where broadband access is generally good at the moment, although it will become a lot better. But of course the residents who live outside those towns—in the country, in smaller communities and of course a long way from exchanges—typically have very poor broadband.
What we are doing is building a massive fixed-wireless network across Australia. Already in the electorate of Indi there are four fixed-wireless towers active, with 1,271 premises covered, and construction is underway on another seven. Across the country the fixed-wireless network is active or under construction in 50 electorates. We have increased its reach from 38,000 premises to 127,000 premises, and construction is currently underway on 82,000 premises. In other words, there are more than 700 fixed-wireless towers that are either active or under construction. This is a really transformative technology, because typically it is addressing areas that have virtually no broadband access at all, and once the fixed wireless is turned on they have access to 25 megabits per second, which is better than most people in the big cities have. This fixed-wireless rollout was colossally bungled by the Labor Party. Not only did Labor not have the spectrum but they did not even own the spectrum that was required to do the job, so we have had to go to great lengths to secure that additional spectrum, something Labor had no plan for. But, incredibly, the Labor Party estimated that there would be only 230,000 users of the fixed-wireless network by 2021. It turns out that there is going to be somewhere between a minimum of 440,000 and 620,000. How could you get something so wrong? Only the Labor Party could do that.
National Security
Mr LAUNDY (Reid) (14:34): My question is to the Minister for Immigration and Border Protection. Will the minister outline how the government is working with Australia's diverse communities to ensure the security of all Australians? Why is strong leadership across all—I repeat: all—sections of our community so very important?
Mr MORRISON (Cook—Minister for Immigration and Border Protection) (14:34): I thank the member for Reid for his question. But, more importantly, I thank the member for Reid for the strong leadership he is showing in his community at present and assisting his constituents who are dealing with very difficult issues at this present time, and he is providing that leadership. There are many engagements that are being undertaken by the government to engage with communities regarding the various measures that are being introduced, and they are of both a formal and an informal nature. I referred in the House yesterday to the engagements being undertaken by the Australian Customs and Border Protection Service and my own department with the National Imams Council and the Grand Mufti and the Attorney-General and the Minister for Justice and law enforcement agencies, who are doing all these things. It is about creating an open dialogue. It is about adding to understanding. It is not a transactional discussion that is seeking to have people sign up. It is about creating the space for communities to work together with government and with their own communities directly to ensure that we can move forward at this very difficult time.
This is important, but what is more important is the community leadership that is required—not just from this place, not just from the government, not just from those who sit in this place but from communities right across the country, from all ethnicities, from all faiths, from all nationalities, and leadership from the media as well—to ensure that we focus on what is uniting us and the Australian values we share and not seek to amplify the divisions or to amplify the grievances that may exist at any one particular time. In this place today I particularly want to acknowledge and affirm the strong community leadership provided by Dr Jamal Rifi and Mr Mamdouh Elomar, well known to members on both sides of this House. They are brave and courageous men who are standing up as strong and passionate Australians. Several weeks ago I had the opportunity to join Jamal and Mamdouh in Lakemba at a community barbecue proclaiming their passion for this wonderful nation. Person after person came up to me, from young children to older people to mothers and others, just expressing their passion for this country and the support for having a cohesive society at this time. With people like Jamal and Mamdouh, let's not forget that Mamdouh's brother and son have both become those who have fallen into the terrorists' snare and have advocated those horrible things. Mamdouh, in his own family, has had to stand up to that. That takes enormous courage and sacrifice. Jamal has done exactly the same in his community. We need to affirm these leaders, and people from across the country in the media from other faiths, religions and communities. We need to stand with them.
Higher Education
Mr PERRETT (Moreton) (14:37): My question is to the Minister for Education. Cheryl Hatzidellis is a 48-year-old mother of two studying law at university in Brisbane. Cheryl has been a working mum for most of her adult life and is worried that she does not have enough super on which to retire. Cheryl is concerned that she may never be able to pay off her university debt, because of the government's unfair university changes. Minister, why is the government so determined to Americanise our universities, leaving people like Cheryl with a debt sentence?
Mr PYNE (Sturt—Leader of the House and Minister for Education) (14:38): That question bears a remarkable similarity to the question from the member for Lalor. The only difference is that the person being quoted is Cheryl, and not Michele.
Opposition members interjecting—
The SPEAKER: There will be silence from the member for Kingsford Smith.
Mr PYNE: Therefore, I did answer the question that was put to me before by the member for Lalor, and that answer remains extant, which is that Cheryl might well attract a Commonwealth scholarship, which would be a terrific outcome.
Opposition members interjecting—
The SPEAKER: The member for Wakefield.
Mr PYNE: If she never earns $50,000 a year she will never have a call on the contribution that has been made to her by the taxpayer and for which she will bear part of the burden by paying it back. She will not have to pay it back if she does not earn over $50,000 a year. If she does earn over $50,000 a year, she will be asked to pay it back at the lowest interest rate she will ever receive for any loan in her life. Even then she will be asked to pay back only two per cent of the cost of that debt, until she starts earning a greater income. So the government has put in place something that previous governments did—the Hawke, Keating and Howard governments, which started the higher education loan program, HECS—because they could see that there was no such thing as free education, that somebody had to pay for it, and, without the students making a contribution, the taxpayer pays the entire burden of the cost, yet there is a major private benefit. I take my hat off to Cheryl for going to university, for taking the chance to improve her skills base.
Opposition members interjecting—
The SPEAKER: The Leader of the Opposition will desist. The member for Gorton is warned.
Mr PYNE: We are helping her by giving her the opportunity to borrow every single dollar of her share of the cost of her education from the Australian taxpayer.
Mr Dutton interjecting—
Mr PYNE: That is a very good point from the Minister for Health: is Labor now promising free education for every student? Is that what Labor is promising? Are they now promising to remove the higher education loan program?
Honourable members interjecting—
The SPEAKER: The Treasurer will desist and there will be silence on my left.
Mr PYNE: Is that their latest multibillion dollar promise to the Australian taxpayer that they will have to explain at the next election. I do not think so.
Opposition members interjecting—
The SPEAKER: The member for Chifley.
Mr PYNE: So stop being such a pack of hypocrites. Only today University Australia, which represents 39 public universities, has released a press release.
Honourable members interjecting—
The SPEAKER: The Minister for Agriculture will desist.
Mr PYNE: The press release said:
The quality, performance, competitiveness and reputation of Australia's higher education sector will be condemned to a path of inevitable decline if, in the absence of increased public investment, the Government's higher education proposals are discarded in their entirety, according to peak university body, Universities Australia.
Opposition members interjecting—
The SPEAKER: The member for Isaacs is warned.
Mr PYNE: So the opposition is completely out of step with the university sector. They are the only ones who believe that there needs to be no reform to universities in Australia.
National Security
Mr CRAIG KELLY (Hughes) (14:41): My question is to the Assistant Minister for Defence. Will the minister update the House on the measures taken to secure defence force members and their families?
Mr ROBERT (Fadden—Assistant Minister for Defence) (14:41): I thank the member for Hughes for his question and his ever-present interest in the welfare of our fighting men and women. I also note the significance of this question to the 105 members of the House of Representatives whose electorates are home to Defence men and women and their respective families.
I want to reassure all of our people, whether they are members of the military or those serving as civilian employees, or their families, that they should have complete confidence as they go about their daily lives. The government is taking its security responsibilities seriously. As the Prime Minister has stated previously, we are doing whatever is possible to keep them safe. As the House would be aware, Defence has raised the alert level at our defence bases and establishments to Safe Base Charlie. This is the third of five graduated levels, and it is consistent with the change to the national terrorism public alert level.
Measures undertaken in response to the increase in the safe base alert level to Charlie are location-specific and base-specific across the country. The CDF, using all available channels, has already communicated to every one of our Defence members and their families what these changes entail, and the need to remain vigilant in the current security environment. We are being prudent and responsible, with well-established measures and protocols, in response to a very fluid security environment.
I want to reassure Defence members and their families of the government's commitment to their safety. I ask that our people go about their daily lives as normally as possible, but with prudence and responsibility, and, if in doubt, as the CDF has communicated contact the National Security Hotline or call the police. I have personally spoken to our acting Australian Federal Police commissioner, the New South Wales police commissioner and the head of the Defence Security Agency to ensure the continued safety of our people remains top of mind. The current circumstances and the safety of our people are receiving the highest ministerial priorities, and I thank the various agencies we are working with for their professionalism and their speed.
For our Defence members and their families, please continue to familiarise yourself with the CDF's online messages, which contain important information and contact details for relevant authorities. Information will be updated as regularly as required. Please also keep an update on the CDF's Facebook page, if you have not done so already. I encourage you to 'like' his page as it will contain the most up-to-date and current information and news.
I appreciate that the operational tempo of our forces may well increase in the coming weeks, and I thank our men and women for the speed and the professionalism of their response to the government's requirements. The nation is extraordinarily proud of all of them. I also appreciate that there is a toll on families. I again reassure you that the government and the Defence leadership will do everything possible to ensure your safety—as those of you who serve ensure ours.
Higher Education
Mr FITZGIBBON (Hunter) (14:45): My question is to the Minister for Agriculture. Minister, the chair of the Regional Universities Network says the Abbott government's university changes:
… will have a disproportionate impact on the regional and disadvantaged students who study at RUN universities, as well as the communities from which they come.
Further, he said the changes were:
… likely to exacerbate the divide between the city and rural and regional Australia …
Minister, how can you stand by and watch agriculture and veterinary science students and their communities—including Armidale—pay the price for the Americanisation of our universities?
Mr JOYCE (New England—Minister for Agriculture and Deputy Leader of The Nationals) (14:46): It is amazing. I have received two questions in this place now. The first question was from the member for Sydney. Now I have a question from the shadow minister for agriculture—on education. But I guess you have to take small graces when they come! Two people have asked questions: you and the member for Sydney. You are the only two.
The organisation that the shadow minister refers to, the Regional Universities Network, actually supports the changes we are making—yes, with amendments, but they support the changes. I can also tell the member for Hunter that, in discussions with Annabelle Duncan of the University of New England, they said, 'The status quo is unacceptable.' Where did the status quo that is unacceptable come from, Member for Hunter? It came from your side! I am looking forward to the progression of the scholarships so that people from towns such as Brewarrina, Quilpie and other towns out west get their chance to go to university, get their chance to participate in the future of our nation. I would welcome, at some stage—maybe in the next year or two—a question from the shadow minister for agriculture about agriculture!
Opposition members interjecting—
The SPEAKER: Order! There will be silence. The member for Isaacs has been warned—once more and he will leave us.
Employment
Ms HENDERSON (Corangamite) (14:48): My question is to the Treasurer. Will the Treasurer outline the steps the government is taking to build a strong economy that ensures more and better jobs for my constituents in Corangamite?
Mr HOCKEY (North Sydney—The Treasurer) (14:48): I really do thank the honourable member for Corangamite for that surprise question! As the member for Corangamite knows, we have rolled out our Economic Action Strategy and we have laid down a plan to help to build more jobs through stronger economic growth right across the Australian economy. We are seeing some positive signs in the Australian economy. Just today we saw a survey of almost 4,000 Australian employers by Hudson, the recruitment firm, that revealed hiring intentions are at an 18-month high. One in four employers are looking to increase their headcount in 2014. That is a good sign and follows on from the fact that under the coalition so far this year, on a monthly basis, the number of new jobs created in Australia is nearly six times higher than were being created under Labor last year. Under Labor last year, around 5,000 jobs per month were being created in Australia. Under the coalition this year, we are seeing nearly 30,000 jobs per month created. That is encouraging. Even after what was a rather extraordinary number last month, it is quite clear that this year jobs are being created in Australia at at least three times the rate they were being created under the former Minister for Workplace Relations. Who was that?
Mr Shorten interjecting—
Mr HOCKEY: It was you! You were the guy—5,000 jobs a month. It was 5,000 jobs a month under the Leader of the Opposition. It is 15,000 to 30,000 jobs a month under the coalition. We see that as great.
The way to do it is to roll out key infrastructure—and the coalition is absolutely determined to deliver the new east-west tunnel for the people of Corangamite, which will save 3½ hours every week for commuters from Geelong to the middle of Melbourne. That project will be delivered because this government, through its budget, is putting $3 billion into the East West Link. But there is a problem. Daniel Andrews, the Leader of the Labor Party in Victoria—
An honourable member: It is 'Dan'. He has a problem with 'Daniel'.
Mr HOCKEY: Dan Andrews? Oh my Lord! The man formerly known as Daniel Andrews is the Leader of the Opposition in Victoria. He said, 'Only Labor can stop the East West Link.' He wants to tear up the contract for the East West Link. But that seems a bit odd. It is at odds with the member for McMahon, who said:
Labor honours contracts entered into by previous governments, even if we don’t like them. For issues of sovereign risk, Labor honours contracts when in office
Who are the hypocrites?
Mr Albanese: On a point of order, Madam Speaker: I ask the Treasurer to table the contract. There isn't one!
DISTINGUISHED VISITORS
The SPEAKER (14:51): I advise the chamber that we have with us in the distinguished visitors gallery a delegation from Turkey led by the Speaker of the Grand National Assembly of Turkey, His Excellency Mr Cemil Cicek, together with His Excellency the Ambassador. On behalf of the House, I wish you a warm welcome.
Honourable members: Hear, hear!
DOCUMENTS
East West Link
Presentation
Mr BURKE (Watson—Manager of Opposition Business) (14:52): Madam Speaker, I rise on a point of order. There was a request for the tabling of a document that the Treasurer referred to which we do not believe actually exists. He referred to the document in his answer and we would seek for him to table it.
The SPEAKER: The Manager of Opposition Business will resume his seat. The member who rose on the point of order asking for the tabling of a document did seem to be asking a rhetorical question.
Mr Hockey places document on table.
The SPEAKER: I take it that was the Treasurer tabling the document that was requested.
Mr Hockey: No. They have referred to a document and I have tabled it.
The SPEAKER: Resume your seat. What occurred is that the member for Grayndler asked for the tabling of a document that was not referred to in answering the question. The Treasurer did not have in his possession a document which was meant to be a contract which was referred to in his answer, to which the member for Grayndler then said, 'It does not exist,' and appeared to answer his own question. Now, I will ask the Treasurer—
Opposition members interjecting—
The SPEAKER: You are sounding like a rabble. Do not prove it. Now, I will ask the Treasurer: do you have such a document in your possession?
Mr Hockey: I do not carry the contract for the East West Link tunnel around with me. But I just tabled the details for the East West Link tunnel that were in our budget. It is only the Labor Party that wants to tear up a contract.
The SPEAKER: Enough is enough. I give the call to the member for McMahon.
QUESTIONS WITHOUT NOTICE
Financial Services
Mr BOWEN (McMahon) (14:54): My question is to the Treasurer. It has been reported today that the CEO of the Financial Services Council, John Brogden, has said in relation to financial advice:
The level of trust as at an all-time low. We need a circuit breaker. Self-regulation is not enough.
Treasurer, why is the government so determined to rely on self-regulation when the savings of millions of Australians are at risk?
Mr HOCKEY (North Sydney—The Treasurer) (14:55): Labor set up the system. Now Labor is criticising the system they set up. Don't you guys have any consistent principles? Is there anything you are consistent about in your lives? The system was established under the FOFA laws that were set up by the man who asked the question. Not once, not twice, not three times but on five separate occasions he came into this parliament and tabled the new information memorandum to the legislation. He was in here amending his own amendments in relation to financial advice. He did not understand his own laws when he was the minister. The Leader of the Opposition is critical of his own laws now that he is in opposition. I mean, cut us a break here! Really, you cannot be that stupid. It is a new benchmark for the Labor Party to be this insultingly stupid.
Infrastructure
Mr COLEMAN (Banks) (14:56): My question is to the Assistant Minister for Infrastructure and Regional Development. Will the minister update the House on the status of WestConnex in Sydney? What benefits will this vital infrastructure project delivered to people in my community?
Mr BRIGGS (Mayo—Assistant Minister for Infrastructure and Regional Development) (14:56): Thank you to the member of Banks for such an important question. It is a project which will help transform his electorate and those of many of the members from Sydney and Western Sydney in this place. Last week there were two major announcements in respect of the WestConnex project in Sydney. There was the WestConnex stage 2—
Mr Albanese interjecting—
Mr BRIGGS: Don't worry, I am coming to you, son.
The SPEAKER: The member for Grayndler will desist.
Mr BRIGGS: The Treasurer was out with the geotechnical drilling equipment in Sydney last Tuesday.
Mr Brendan O'Connor interjecting—
Mr BRIGGS: He focused on getting on with delivering WestConnex stage 2, a project we are delivering because of the budget announcement of the $2 billion concessional loan we are giving to the New South Wales government and the WestConnex authority.
The SPEAKER: The member for Gorton may leave under 94(a).
Mr BRIGGS: Last Friday, the Treasurer was with the member for Reid with WestConnex stage 1, to which we are contributing $1½ billion dollars with the geotechnical work. It is a project that the coalition is committed to delivering, and we are getting on with it as quickly as possible to ensure that we have got this city-building infrastructure.
Mr BRIGGS: It will ensure that between Parramatta Road and Sydney airport—
Mr Thistlethwaite interjecting—
The SPEAKER: The member for Kingsford Smith is warned.
Mr BRIGGS: there are reductions in traffic times of 40 minutes, halving bus travel times between inner west and the city, bypassing 52 sets of traffic lights, removing 3,000 trucks a day from Parramatta Road and creating some 10,000 jobs during construction. This is in addition to the $3½ billion package of roads that we have announced in respect of the Western Sydney airport about which we have got on and made a decision about after 40 years. I appreciate the fact that the member for Grayndler congratulated us on that today and supported the project. The member for Chifley remains quiet. It is a $3½ billion project that we are committed to, and we are committed to getting on with the second Sydney Airport as quickly as possible.
There was today a new announcement from the Leader of the Opposition, and we congratulate the member for Grayndler on his new position. Congratulations! It is not the job you want from the Leader of the Opposition, but it is a new job nonetheless. He made a couple of announcements today. He made one announcement which the Guardian has talked about. The Guardian, on its website, has an opinion editorial from the shadow minister, the member for Grayndler, entitled 'Scooters: the way forward for Australia's traffic congestion problem'. Scooters! Member for Banks, what would you like: WestConnex or scooters? WestConnex—funny that!
Mr Albanese: Madam Speaker, I rise on a point of order. The assistant to the minister was asked about WestConnex. He could answer by saying where it will come up in the city and how it will get to the port. That is what—
The SPEAKER: There is no point of order.
Government members interjecting—
Mr Ciobo interjecting—
The SPEAKER: There will be silence on my right! That includes the Parliamentary Secretary to the Treasurer. The assistant minister—not the 'assistant to the minister'—has the call.
Mr BRIGGS: In fact, on TheGuardian website one of its contributors says that, 'This, in my opinion, is the dumbest idea I have ever heard from an Australian politician.' That is unusual, of course—I would thought that bringing Kevin Rudd back to the prime ministership was! Finally, the other announcement he made was on bringing back the high-speed rail, but we will come back to that at some other time.
Future of Financial Advice
Mr RIPOLL (Oxley) (15:00): My question is to the Treasurer. I refer specifically to the case of Mr Bernie Kelly from Melbourne who lost $150,000 from the collapse of Timbercorp and who will, in all likelihood, lose his home as well. Given the Financial Services Council now says more, not less, regulation is required for financial advice and professional standards, why has the government decided to dismantle Labor's FoFA reforms and put even more pressure and risk on millions of Australian investors?
Mr HOCKEY (North Sydney—The Treasurer) (15:01): The honourable member knows a lot better than that, because he chaired the initial review on financial advice. I actually pay tribute to him for the work he did in that review. The work he did on the Ripoll report formed the basis for the existing laws. Now the Labor Party is complaining about its own laws. That is very interesting. The tragedy of the Ripoll report was that it was not implemented in full by the then Minister for Financial Services and Superannuation. The then minister for financial services was too busy engaging in unfair dismissal activity against his own leader to focus on his portfolio at the time. So we had this great sense of embarrassment when the now Leader of the Opposition introduced the Corporations Amendment (Future of Financial Advice) Bill 2012 because he came into this place with a bill that was meant to lay down the future of financial advice in Australia and we kept pointing out that there were some fundamental problems in that bill. When he introduced the bill, even when he had the numbers in this place and the Senate to pass it, he was so embarrassed about the state of it that he had to introduce 16 amendments on the floor of the House to his own financial advice legislation. Because he made such a mess of the entire process of financial advice, he had an original explanatory—
Mr Burke: Madam Speaker, I rise on a point of order on direct relevance. Occasionally we have questions in this parliament that refer to particular individuals. Here we have an individual who has suffered significant loss. I would ask the Treasurer to be directly relevant.
The SPEAKER: There is no point of order.
Mr HOCKEY: The now Leader of the Opposition was so embarrassed about his own laws in relation to financial advice that he introduced an original explanatory memorandum and then he introduced a replacement explanatory memorandum and then he introduced a revised explanatory memorandum and then he introduced a supplementary revised explanatory memorandum—and then he introduced yet another supplementary explanatory memorandum for a bill he did not understand, even though he is called 'Bill'. We are the people who have taken action to empower ASIC by simplifying laws and ensuring we go after criminals who engage in this sort of activity.
Education Funding
Mr SUKKAR (Deakin) (15:04): My question is to the Assistant Minister for Education. Will the minister inform the House of the actions the government is taking to ensure children will have access to 15 hours of preschool a week in the year before they start school?
Ms Kate Ellis: For one year!
Ms LEY (Farrer—Assistant Minister for Education) (15:05): It is a pleasure to take a question from the member for Deakin. I visited him recently and I am pleased to report that, after six years of neglect, he is continuing the great work of Phil Barresi, the previous coalition member for Deakin.
The Abbott government will commit $406 million to ensure that Australian families continue to access up to 15 hours of preschool per week in 2015.
Ms Kate Ellis: For one year—and then what?
The SPEAKER: The member for Adelaide will desist!
Ms LEY: The most important feature of this announcement was that we gave families, preschools and school communities certainty. Under Labor there was no certainty. But now they have certainty that they can plan their programs for 2015. The government's absolute commitment to early education in the preschool year will provide them with that certainty.
As we know, the Productivity Commission is looking at preschool. Its final report, due in October, will have more to say about the funding arrangements between the Commonwealth and the states when it comes to preschool. I reiterate that this is a very common-sense approach and $406 million has been allocated for the 2015 year. It gives us time to carefully consider future policy.
The member for Adelaide was screeching something about 'one more year' as I walked up to the dispatch box. I know 'breathtaking hypocrisy' is a bit of a cliche, but this really is breathtaking hypocrisy because if she had read the national partnership that she was the minister in charge of—she obviously never read it; I do not know how many of her briefs she did read—she would have seen that Labor committed not one dollar of funding post the end of 2014. So to criticise the government and ask what we are doing in 2016 when Labor was doing nothing in 2015 under its arrangements is, as I said, absolute, breathtaking hypocrisy. You see, Madam Speaker, Labor cannot accept the reality—
Ms Owens interjecting—
The SPEAKER: The member for Parramatta will desist.
Ms LEY: which is that it is the Abbott government, not Labor, that committed the money to make sure that parents and preschools can plan with certainty for next year. It really is time that Labor stopped this nonsense of putting politics before parents, politics before preschools and politics before the national interest.
Abbott Government
Mr SHORTEN (Maribyrnong—Leader of the Opposition) (15:08): My question is to the Treasurer. Treasurer, given that the government is undermining the retirement savings of millions of Australians by watering down consumer protection, given that the government is Americanising universities and condemning students to a debt sentence and with Australian families already struggling to make ends meet, isn't it clear that the government is part of the problem, not the solution?
The SPEAKER: I would advise the Leader of the Opposition that that question is not in order, the way it is phrased, but as the Treasurer is anxious to respond to it I am going to give him the call.
Mr HOCKEY (North Sydney—The Treasurer) (15:08): In response to the Leader of the Opposition, the government was the problem and that is why they got rid of you. The government was the problem and that is why they got rid of the Leader of the Opposition and the entire Labor Party mob. They were an insultingly bad government for Australia on every front. They did nothing about higher education and the challenges facing students in Australia. They come in here as hypocrites lecturing us about debt for degrees. They invented debt for degrees. They were the masterclass of debt for degrees. They were the ones who started the HECS plan. They were the ones who introduced university fees. Labor never let us down when it comes to hypocrisy. When it comes to superannuation the Labor Party are writ large as hypocrites. They come in and cry crocodile tears about changes to the increasing compulsory super, but it was in fact the Leader of the Opposition, on 3AW with me, who said that ultimately superannuation—
Mr Shorten: You've never backed superannuation
The SPEAKER: The Leader of the Opposition will desist.
Mr HOCKEY: At least they are unhappy about this. He is a little anxious about this. He was on 3AW with me. I remember it quite vividly. He said, 'You know what? Superannuation comes out of the pockets of workers.'
A government member: No.
Mr HOCKEY: He did say that! Now he is crying crocodile tears. The workers are getting the money instead of the increase in superannuation.
Ms Chesters interjecting—
Mr Giles interjecting—
The SPEAKER: The member for Bendigo and the member for Scullin will desist.
Mr HOCKEY: I do not understand what has happened to you since you have gone into opposition. The Leader of the Opposition that we knew when he was in government was preoccupied with the battles within the Labor Party.
Mr Shorten: You're a windbag!
The SPEAKER: The Leader of the Opposition will desist.
Mr HOCKEY: he was preoccupied—
Mr Shorten interjecting—
Mr HOCKEY: You are going into a bit of psychobabble, mate. Are you okay? Not okay?
The SPEAKER: I said the Leader of the Opposition will desist.
Mr Pyne interjecting—
The SPEAKER: And so will the Leader of the House.
Mr HOCKEY: We are going to get hysterical laughter—psychobabble followed by hysterical laughter.
Dr Chalmers interjecting—
The SPEAKER: The member for Rankin will leave under 94 (a).
The member for Rankin then left the chamber.
Mr HOCKEY: What we have seen from the opposition today is simply pure hypocrisy. We had the member for McMahon ask a question that fundamentally embarrasses the Leader of the Opposition. Then the member for Oxley asked a question about Timbercorp. Who was the minister for Timbercorp at the time of its collapse? The member for McMahon. They are doing in each other with the question time pack. I will tell you what. If I were Bill I would have a closer look at the question time pack tomorrow.
Carbon Pricing
Mrs GRIGGS (Solomon) (15:11): My question is to the Minister for the Environment. I refer to Darwin City Council's statement that all Darwin ratepayers will see a refund of $29.67 by means of a grant in their rates notice later this month. Will the minister inform the House of the benefits to local government, families and businesses of the repeal of the carbon tax? Are there any threats to these savings?
Mr HUNT (Flinders—Minister for the Environment) (15:12): I thank the member for Solomon. It is true that in addition to the $234 which families will receive from Power and Water Corporation in Darwin following the abolition of the carbon tax and the average $761 which, according to Power and Water Corporation, small businesses owners in Darwin will receive following the abolition of the carbon tax, there are also benefits to council ratepayers not just in Darwin but around Australia. In Darwin, though, there is an immediate $29 benefit, which is being paid back. Beyond that, Darwin City Council has said there will be a reduction in landfill charges of $20 a tonne going forward for every deposit made.
It is more than just Darwin. Remember, these are reductions which the ALP wants to reverse at the next election. In the electorate of Bowman, the Redland City Council landfill charge has already been reduced by $15.85 per tonne and there has been a refund to every ratepayer of $38.48. Labor wants to take those charges away and add them at the next election. In Logan, in the electorate of the member for Forde, we are seeing a refund of $800,000 to ratepayers. It is not just in coalition electorates that this is happening. Maitland council, in the electorate of the member for Hunter, has already provided a $29.45 domestic waste rebate to residents and a $38.50 per tonne landfill charge reduction. In the City of Glen Eira, the member for Hotham may be interested to know, there is a $37 rebate to residents of her electorate. The member for Melbourne Ports also has constituents within Glen Eira. Those opposite all want to reverse these rebates. Every one of them wants to reverse the savings. We have been talking about the electricity and gas savings that have gone to consumers. The Leader of the Opposition told us none of these rebates would occur. They have all occurred. We see that in councils now, right around the country, the reductions which they said would never occur are occurring.
Ms Collins interjecting—
The SPEAKER: The member for Franklin will desist.
Mr HUNT: What we see when we go to the Wyong Shire Council is $27.60 per tonne for landfill and $22 for a domestic waste. What is the answer here? There is a threat to each and every one of these savings and that is the re-election of an ALP government. We stand for lower electricity, gas and waste charges. They want higher charges.
Mr FITZGIBBON (Hunter) (15:15): Madam Speaker, you have been very kind to me and I thank you for that as well! I wish to make a personal explanation.
The SPEAKER: Does the honourable member claim to have been misrepresented?
Mr FITZGIBBON: I do, indeed.
The SPEAKER: Please proceed.
Mr FITZGIBBON: During question time, the Minister for Agriculture claimed that I had only asked him one question in the 44th parliament and that the opposition has only asked him two questions. In this parliament, there has been six questions to the minister from the non-government benches, including three from me. Unfortunately, not one of them has been answered adequately.
The SPEAKER: The last bit is not part of the personal explanation, but he got away with it anyway. I call the Minister for Agriculture.
Mr JOYCE (New England—Minister for Agriculture and Deputy Leader of The Nationals) (15:16): None of them made any sense!
Mr Fitzgibbon: Madam Speaker, I rise on a point of order. On what basis was the Minister for Agriculture given the call? Was that or was that not an entire abuse of the parliamentary process? It is far worse than my send off yesterday!
The SPEAKER: I am afraid that the words muttered by the Minister for Agriculture matched the last words of your personal explanation, which up until that point was perfect.
Mr Truss: I ask that further questions be placed on the Notice Paper.
AUDITOR-GENERAL'S REPORTS
The SPEAKER (15:17): I present the annual report of the Australian National Audit Office for 2013-14.
Ordered that the report be made a parliamentary paper.
DOCUMENTS
Presentation
Mr PYNE (Sturt—Leader of the House and Minister for Education) (15:17): Documents are presented as listed in the schedule circulated to honourable members. Details of the documents will be recorded in the Votes and Proceedings.
COMMITTEES
Infrastructure and Communications Committee
Membership
The SPEAKER (15:17): I have received advice from the chief government whip that he has nominated Mr van Manen to be a member of the Standing Committee on Infrastructure and Communications in place of Mr Brough.
Mr PYNE (Sturt—Leader of the House and Minister for Education) (15:17): by leave—I move:
That Mr Brough be discharged from the Standing Committee on Infrastructure and Communications and that, in his place, Mr van Manen be appointed a member of the committee.
Question agreed to.
MATTERS OF PUBLIC IMPORTANCE
Climate Change
The SPEAKER (15:18): I have received a letter from the honourable member for Port Adelaide proposing that a definite matter of public importance be submitted to the House for discussion, namely:
The g overnment’s failure to take climate change seriously.
I call upon those members who approve of the proposed discussion to rise in their places.
More than the number of members required by the standing orders having risen in their places—
Mr BUTLER (Port Adelaide) (15:18): It is good to see the member for Herbert staying here. I am sure he is on the speaking list with the opposition! On Sunday, which was a beautiful day in Melbourne following a rather tragic preliminary final the day before, I had the pleasure of attending a rally that I am told had up to 30,000 people present. It was the flagship event for Australia of the People's Climate March. It was the first of a series of literally hundreds of thousands of events that spread from Melbourne—following the sun—to New York 14 hours later, where the largest march in history against climate change took place in New York City.
There were up other marches around Australia. There were marches in my city of Adelaide; there were events in pretty much every other capital city and in some regional centres. Effectively, what was seen in that outpouring of hope and expectation was really a great sense that the New York City summit—convened by the UN secretary-general, Ban Ki-Moon—would start to galvanise and catalyse action in the lead-in to some very important negotiations next year.
There were more than 120 leaders at the climate summit that was held on Tuesday, in New York time, this week. President Obama attended, obviously. There has been a great deal of media coverage of the President's speech at the UN General Assembly during the summit. Prime Minister David Cameron from the United Kingdom, President Yudhoyono from Indonesia and countless other world leaders were there.
The Australian Prime Minister did not attend the climate summit in New York on Tuesday. He is not the only world leader who did not attend the summit, but I am not aware of another world leader who arrived in New York within hours of the summit. He could have quite easily rearranged his diary to be there. The Prime Minister said that he was busy and that he wanted to attend parliament instead. I am sure that had this clashed with Monday's sitting day, where the Prime Minister had to make a very important statement on national security, everyone would have perhaps forgiven him for not attending the summit on Tuesday in New York time—which is effectively Wednesday.
But it was quite clear that if the Prime Minister had attached any sense of priority to the climate summit being attended—as it was by some other very busy world leaders as well, including the President of the United States and Prime Minister Cameron, who has been fairly busy over the last couple of weeks—then rearranging his diary to arrive in New York City a few hours earlier might have given some sense to the rest of the globe that this Prime Minister takes climate change seriously.
The Prime Minister has form in this area. Only a matter of weeks ago, when the Prime Minister was in Canada with his soul mate, the Prime Minister of Canada, Stephen Harper, he very bravely announced the creation of a coalition of the unwilling, of like-minded states, who would band together and fight against this progress, this sense of momentum leading up to the Paris conference next year. The Prime Minister announced that Prime Minister John Key of New Zealand would be a member of this coalition and that Prime Minister Cameron from the United Kingdom would also be a member. Of course, as we know, it took both of those prime ministers only a matter of hours to rush to a press conference to disassociate themselves entirely from the Australian Prime Minister's attitude to global climate talks and to reinforce their countries' commitment, their Tory governments' commitment, to domestic action on climate change and to the international momentum building towards the Paris conference next year.
There could not be a greater contrast between the Australian Prime Minister's regular public utterances about climate change and the speech that was given by the US president, President Obama, in the last day or two of the UN General Assembly, where he said that the 'urgent and growing threat of climate change' was an issue that would 'define the contours of this century more dramatically than any other'. It is utterly impossible to imagine the Australian Prime Minister talking about climate change as a threat or something in any way close to it.
Even if the Prime Minister had been able to rearrange his diary for Tuesday, one can imagine why he would not have wanted to attend the Climate Summit. He set the Minister for Foreign Affairs, who has performed very admirably on the world stage over recent weeks and months, a very, very difficult task: to front up to the rest of the world and explain what this government has done on climate change in its first 12 months. And what did the foreign minister have to say to the rest of the world? She had to say, as the Prime Minister would have had to say, had he turned up: 'We've abolished the cap on carbon pollution; there is now no restriction on the amount of carbon pollution that can be produced here. Also, we've abolished any legislative targets to reduce carbon pollution either in the short term, for the 2020 target, or in the long term, by 2050.' The foreign minister professed to reaffirm the five per cent reduction by 2020, but we know from the Prime Minister's appearance at the Press Club during the election campaign that, at best, this is a very soft target for this Prime Minister.
We know the Prime Minister has not mentioned once the conditional targets that were supposed to be bipartisan, the 15 per cent and the 25 per cent targets, either. He would have had to front up there, as well as at CHOGM, and say, 'I and the Canadian Prime Minister decided to withdraw from the Green Climate Fund,' apparently associating it with the ideas of the Clean Energy Finance Corporation here. The Green Climate Fund is a fund set up to assist the poorest countries, including nations in own region, adapt to the impacts of climate change—a very proud act by the Australian Prime Minister!
Mr Hunt interjecting—
Mr BUTLER: The Minister for the Environment, who is going to speak in this debate, I imagine, intends to convene a rainforest summit later this year. This is a worthy idea, and I look forward to some details about that summit, because we know the impact that deforestation in our own region, including in Australia, can have on a range of things—on biodiversity and conservation but also, obviously, on climate.
We know that pretty much all of the heavy lifting in Australia during the Kyoto protocol period was done by changes to deforestation in Queensland, particularly the land-clearing laws put in place by the Beattie government which are now in the process of being reversed by the Newman government in Queensland.
Government members interjecting—
Mr BUTLER: Some of the Tory MPs are saying, 'Hear, hear!' We would like to know, if the minister is convening a rainforest summit to talk to other parts of the Asia-Pacific region about deforestation, what he is saying to the Newman government about the deforestation underway in the Gulf Country there.
The Prime Minister could also tell the rest of the world about the ambush on the renewable energy target that was put in place earlier this year. We have had lots of opportunities to talk about the renewable energy target. I am hopeful that media reports that the Minister for Industry and the Minister for the Environment have been brought back in from the cold and given some authority to try and get this thing back on the rails, because, frankly, what has happened over the last several months is an utter atrocity, an utter atrocity, in a sector that had attracted billions of dollars of investment. I am quoting from the Warburton review here. The RET had created billions of dollars of investment, created thousands of jobs, driven down carbon pollution, would help to keep power prices lower over the next 15 years—Dick Warburton's own findings—and had been a bipartisan policy for four election campaigns, including 2013, when the minister sent his parliamentary secretary to the Clean Energy Council conference and reaffirmed the Liberal Party's commitment to the 41,000 gigawatt hour target. They then tried to junk it by setting up this ridiculous review.
We know what that has done to the sector. Over the first six months of 2014, only $40 million has been invested in large-scale renewable energy, because of the massive blow to investor confidence from this Prime Minister's reckless attitude towards renewable energy. This is the wonderful story the Australian Prime Minister could have told to the rest of the world, had he bothered to turn up in New York just 24 hours earlier!
The Prime Minister has described himself as a weathervane on this issue. He has famously described himself as a weathervane. He probably pats himself on the back for having won an election about the dreaded carbon tax. This is a serious issue, though. This is a serious challenge for Australia and for our partners in the region and the rest of the world. It is time for the Prime Minister to reflect on his attitude to the challenge of climate change and to get with the rest of the world, who are moving forward to an ambitious global agreement in Paris next year.
Mr HUNT (Flinders—Minister for the Environment) (15:29): I congratulate the shadow minister for the environment! For him to appear at the dispatch box and talk about the environment is something of an achievement, because, after 500 questions, 12½ months and numerous question times, he is yet to ask his opposite number a single question on the environment—not one, not ever
I think he is quite a nice guy, but when he took on the title of 'shadow minister' I suspect he took the shadow part of it a bit too seriously.
This is a question about the seriousness of climate policy. Let me remind the House of a few words: 'pink batts', 'green loans', 'cash for clunkers', 'citizens assembly' and 'carbon tax'—which they were never going to have. These are the realities and legacies of what they did in the name of climate policy. Let me run through these things in order. Let's remember what a tremendous success the pink batts scheme was. We have recently had findings from Commissioner Ian Hanger, and what did he find? He found:
The reality is that the Australian Government conceived of, devised, designed and implemented a program that enabled very large numbers of inexperienced workers—often engaged by unscrupulous and avaricious employers or head contractors who were themselves inexperienced in insulation installation—to undertake potentially dangerous work.
He went on to find, sadly, in relation to the tragedies:
… each death would, and should, not have occurred had the HIP been properly designed and implemented.
He went on to find that:
… despite electrical safety issues being raised squarely as an issue after the death of Mr Fuller, insufficient action was taken to prevent further tragedies—had it been, I am satisfied that Rueben Barnes' death could have been avoided.
There are numerous findings—findings that go on for page after page—and I am happy to table them for members of the opposition to read. This was a program done, inspired and delivered in the name of climate change, but it was a singular failure. It was a catastrophic failure and it was done in the characteristic style of chaotic management which embodied the way in which the previous government went across not just climate policy but almost all areas of policy.
I mentioned the Green Loans scheme as well. It was a $100 million farce: on average it worked out at $100,000 per loan for each loan that was actually delivered. It was an incredible failure which resulted in business destruction, confusion in the sector and virtually no change in emissions whatsoever. Cash for Clunkers—you only have to say the name, 'Cash for Clunkers', it says everything—was a policy which was so bad that they never got it off the ground. I should ask the member for Charlton: were you the designer of that? Are you going to put your hand up? Was this your baby? Or are you going to handball it to somebody else?
Mr Conroy interjecting—
Mr HUNT: In other words, not even the member for Charlton will own up to Cash for Clunkers. Then we go to the citizens' assembly—that was another beauty. You will remember that they went to the election in 2010, saying: 'There will be no carbon tax under a government I lead, but there will be a citizens' assembly.' Their entire policy was going to be a citizens' assembly—this was the grand, majestic belief that the Labor Party had. But after the election, of course, everything changed. I will say something on this front: I was reading the Australian today and there were two articles jumped out at me. The first one says:
Gillard on Kevin Rudd: a man desperate for applause.
There are no great surprises in that, but almost entirely opposite that story was a come back article, ' Rudd on Gillard: a coup plotter and a backstabber'. What is interesting in this renewed battle is that Mr Rudd is reported as saying of his nemesis:
"(Gillard) sent me a written communication saying that under no circumstances could she, or would she, support an emissions trading scheme going to the next election," Mr Rudd wrote.
… … …
While recognising "the postponement" of the CPRS was "wrong", Mr Rudd said it was necessary to "prevent a total split in the government in an election year led by (Gillard's) implacable hostility to the ETS."
They were so serious about climate change—it was such a fundamental issue—that the government of the day was entirely split. He goes on to say that Ms Gillard and '"the faceless men" who supported her, including Bill Shorten,' should be absolutely chastised 'for ripping the party apart'.
This issue about which they huff and puff and provide a great degree ad hominem commentary today was one which was of such fundamental importance that they were in complete denial of it at the 2010 election. Then, three years later, what was their policy going into the 2013 election? It was 'to terminate the carbon tax'. So, their policy in 2010 was not to have a carbon tax under a government they led; their policy in 2013 was to terminate that same carbon tax. Except for the fact that when they lost the election and when the vote came up, they did not vote against it once or twice; they voted against the repeal of the carbon tax six times. So it is a system that Gillard did not believe in, that most of her supporters—I am happy to say, 'G'day' to the member for Port Adelaide—did not believe in when she was campaigning for the leadership and it was a system they were happy to abandon in name prior to the last election. What we see is a degree of farce and a degree of pomposity, which accompanies everything they say.
When you go to what they did—they terminated the solar rebate. They talk about renewables but they terminated the solar rebate—they terminated the solar hot water rebate. They created a phantom credits program which to this day has left a catastrophic flaw in the renewable energy target. I have mentioned pink batts, green loans, cash for clunkers, citizens' assembly—this is a record not of proud success, but one about which you may feel a little disappointed and a little embarrassed.
What have we done by comparison? We are doing practical and real things. On the international front, we have recommitted to our targets and we are committed to a solid, real and ambitious post-2020 agreement and just today we announced that Australia will be hosting an Asia-Pacific Rainforest Summit in the coming months in Sydney. This is a chance to do something real and profound in terms of protecting the forests of the world, to enhance the reductions of emissions, to ensure that both biodiversity and climate change are addressed in a real and significant way on a grand global scale.
Domestically, instead of a system which costs $7½ billion a year and which largely failed to have any significant impact on emissions, we are going to ensure that there is an emissions reductions fund and a carbon purchasing fund which uses the existing Carbon Farming Initiative, which cleans up waste coal mine gas, cleans up power stations and cleans up waste landfill gas—real things which actually reduce emissions. This will engage in energy efficiency on a large, significant and broad scale. It will engage in the regeneration of our farmlands through work which improves soil carbon, which reduces deforestation and which reduces land clearance. These are actual incentives to do real things to reduce emissions on the land and in our cities. Add to that the regeneration of urban forests through the 20 Million Trees Program, and add to that what we are doing with the Green Army, which will allow for riparian recovery, the stabilisation of riverbanks, the replanting of mangroves and the recovery of threatened species. These are things which improve the environment in a real way, as opposed to extraordinary programs. Is there one person on that side of the chamber who will put their hand up and proudly say, 'I was responsible for the home insulation program'? Not an author. Is there a single person who will at least say, 'I was responsible for the Green Loans Program'?
Mr Conroy interjecting—
Mr HUNT: Who came up with the cash-for-clunkers program? Member for Charlton, you were playing a significant role. You are a great climate change warrior. Not yours? What about the citizens assembly? Any responsibility for the citizens assembly? Is there one of you who will claim responsibility for these programs?
I will claim responsibility for the Emissions Reductions Fund, for the Asia-Pacific rainforest recovery plan, for the 20 Million Trees plan, for the Green Army plan. These are real things that do real things. (Time expired)
Mr WATTS (Gellibrand) (15:39): What a pathetic effort from a minister without a shred of credibility left. It is like being flogged with a wet thesis. I will spare the minister a recounting of the numerous times that he has been rolled by his own cabinet on environmental issues: the solar roofs plan and the RET. Instead, I will go back a bit further to Australia's history as a middle power, which is an area where we have a significant record of international leadership and influence. From Billy Hughes at the Paris conference in World War I, to Doc Evatt at the San Francisco conference establishing the United Nations, to Bob Hawke's leadership in the creation of the Cairns Group in the Uruguay Round of the GATT, to Paul Keating's advocacy for the creation of an APEC heads of government meeting, we have long punched above our weight in international debates on the global issues that will shape our domestic security and prosperity. But today, the pugilist in chief, Prime Minister Tony Abbott, refuses to even get in the ring in the global fight against climate change. It is the biggest international fight for our nation's economic security, and the Prime Minister is missing in action.
The Prime Minister has refused to attend this week's UN Climate Summit, a summit attended by President Obama of the US and Prime Minister Cameron of the UK—members of the Prime Minister's beloved Anglosphere—as well as more than 100 other world leaders who will outline their nation's commitments to taking climate change seriously. The Prime Minister would rather live in a state of denial than confront the real challenges of our nation's future. Our Prime Minister would rather live in a fantasy world constructed by the undergraduate culture warriors opposite than face up to the challenges identified by the careful and diligent work of scientists from around the world.
As the Member for Wentworth so aptly said:
The fact is that Tony and the people who put him in his job do not want to do anything about climate change. They do not believe in human-caused global warming. As Tony observed on one occasion 'climate change is crap' … Any policy that is announced will simply be a con, an environmental figleaf to cover a determination to do nothing.
The extent to which this is a crank position that isolates the Prime Minister from the rest of the world is truly extraordinary.
While our Prime Minister dissembles about wanting to wait for the international community to move on this issue before Australia acts, our international peers and major trading partners are already making major strides. South Korea, with whom Australia recently concluded a trade agreement, and China with whom negotiations for such an agreement are ongoing, are both moving towards emissions trading schemes. Countries representing half the world's population now support a carbon pricing mechanism.
Lord Deben, the former chair of the UK Conservative Party and a cabinet minister for Margaret Thatcher, has noted:
Australia’s actions are appalling. While the 66 countries that account for 88 per cent of global emissions have passed laws to address global warming, Australia is repealing them.
Even Thatcherite Tories think our Prime Minister is an extremist kook on climate change! The Iron Lady might not have been for turning, but the weathervane sitting in the Prime Minister's office just keeps spinning in whatever direction the winds of short-term political advantage are blowing.
This is a Prime Minister who has at various times advocated blocking the Rudd government's emissions trading scheme, passing the Rudd government's emissions trading scheme, passing it subject to amendments and then blocking it again. This is a Prime Minister who told Australia:
If you want to put a price on carbon, why not just do it with a simple tax?
He said that in 2009, and then between 2010 and 2013 he ran around Australia promising to 'axe the tax'. This is a Prime Minister who purports to believe in free markets and then proposes a 'direct action' climate change policy straight from Soviet Central casting. This is a Prime Minister who told voters before the last election that he supported Australia's renewable energy target, and then, after the election, appointed a well-known climate change sceptic to undertake a review of the scheme.
In contrast, Labor's position on climate change is clear. We accept the science of climate change and we believe we need to do something about it. We do not run away from our nation's challenges and we do not shirk the big issues. We get in the ring and we fight for our nation's interests. We do not think our nation's future economic security and prosperity is something that is worth sacrificing in the name of pathetic political point-scoring in the culture wars. We do not care about their student politics; we care about our nation's future economic prosperity.
It is worth returning at this point to the insightful comments of the member for Wentworth on this issue in the time remaining to me. The member for Wentworth noted:
Now politics is about conviction and a commitment to carry out those convictions.
The member for Wentworth is right. Unfortunately, our country is currently governed by a Prime Minister whose only conviction on climate change is short-term political gain. So long as the Prime Minister thinks there are votes to be won from acting as though climate change is 'crap' he will continue to sacrifice our nation's economic future to do so. We on this side of the House take a bigger picture approach to Australia's future, and we will fight in international forums from here and into the future to secure our nation's prosperity.
Mr TAYLOR (Hume) (15:44): It is a great pleasure to speak on this matter of public importance because I have had a deep concern about climate change for over 30 years. I have watched the snowline rise south of here, and it is something that I have thought hard about for over 30 years. That has meant that I have come to the conclusion that there are three things that taking climate change seriously really means. The first is effective and consistent policies that actually contain global atmospheric concentrations. Secondly, that you bring the Australian people along with you. Thirdly, you protect the Australian economy so that we can pay for all of this. Let me tell you what I believe it does not mean. It does not mean throwing lots of money at the problem for the sake of it. It does not mean passing encyclopedias of legislation. It does not mean putting endless programs in place. It does not mean establishing a cavalry of so-called independent advisers and advisory boards. It does not mean turning up at lots of global meetings.
Let us look at how the ALP did on the things taking change seriously do not mean. First of all they supported a carbon tax costing $15.4 billion over two years and which, if it had stayed in place, would have cost $1 trillion by 2050. It cost $700 million across 75,000 businesses and $550 per household. They created encyclopedias of legislation and we heard from the Minister for the Environment about the endless programs they put in place: pink batts, cash for clunkers, the citizens assembly. They established reams of authorities and independent advisers—CEFC, ARENA, CCA. God knows how many of their lapdogs were on the payroll telling them what they wanted to hear. And, of course, they turned up at endless global meetings, including the former Prime Minister at Copenhagen, and achieved absolutely nothing with it.
Let us look at how they actually performed on the things that matter. How did they contribute to reducing global atmospheric concentrations of carbon dioxide? Their own Climate Change Authority told us that emissions went up under their policies and were going to continue to go up from 590 million tonnes per annum in 2010 to 620 million tonnes per annum by the end of the decade. Perhaps even more frighteningly, they pushed carbon emissions offshore. We know from studies done across the world that putting a domestic price on local carbon production just outsources carbon emissions. Since 1990 the production of carbon in Europe has dropped but consumption of carbon has gone up by something like four times more than they have been able to reduce. So what have they achieved? They have simply outsourced their carbon emissions to China, India and the developing world. We see this pattern repeated many times across the developing world. In fact, The Economist tells us that across the developing world in fact all carbon policies have simply pushed carbon emissions into China and India and achieved absolutely nothing in the process.
In my own electorate I have seen this in action. One of the biggest employers in my electorate, the Tahmoor colliery, by its own admission, in all likelihood would have shut down if the carbon tax had stayed in place. What we would have seen if it had shut down was that coal production replaced by coal production in Indonesia or in China. We would have lost the jobs for absolutely no gain. It gets worse, because the Indonesian and Chinese coal produces more carbon than we would have from the coal coming out of the Tahmoor colliery—destroying jobs and not reducing global carbon emissions. Not making any difference at all.
Their position was never coherent. Worse, it cost the Australian economy. Outsourcing emissions meant outsourcing jobs, mining and manufacturing. Of course, we know that their carbon price, their carbon tax, was the highest in the world. That, of course, was having a dramatic impact on the Australian economy. In contrast, our policies are about incentives, not penalties; they are broad based, not narrow; and we are bringing the Australian people along with us. Labor has only ever pretended to take climate change seriously, because they mistook bureaucracy, consultants and spending for outcomes. We will never make that mistake.
Ms PARKE (Fremantle) (15:49): All governments bring different priorities and different focuses to the task of setting and pursuing a national agenda, but there is always a set of core issues whose immediate and long-term significance demands the attention and application of any responsible government. Here, now, in 2014 climate change has to be at the very top of that list. Some would say that national security is at the very top, but let us remember that, according to the US defense department's Quadrennial Defense Review this year and Australia's current National Security Strategy, climate change will create grave and complicated security challenges, including a number that are specific to our region. Some would say that the economy is second only to national security—and that is a point many would accept. But, again, climate change represents a severe future cost and risk to our economy. I know a lot of people who would say health is the greatest priority, and it was heartening to hear from Professor Fiona Stanley at the climate change day of action rally in Perth that I attended on Sunday, when she spoke about the severe health impacts of climate change, especially for vulnerable members of the community, including the elderly and children.
Remember that in 2009, The Lancet and University College of London issued a statement that said:
Climate change is the biggest global health threat of the 21st Century. Effects of climate change on health will affect most populations in the next decades and put the lives and wellbeing of billions of people at increased risk.
The reality is that action on climate change is action to improve security, to strengthen a sustainable economy and to protect the health and wellbeing of Australia's and the world's people and the environment. Indeed, climate change remains the greatest moral, economic and environmental challenge of our generation. It is a known existential threat to all life on this planet, but it is particularly serious for small island states, such as our friends and neighbours in the Indo-Pacific region, who are already facing increased cyclonic, drought and storm surge events, and sea level rise eroding precious land and polluting crops and freshwater with salt. There is nowhere for them to go.
That is why this government's approach to climate change is its greatest flaw. It is why the coalition's abandonment of the bipartisan commitment to addressing climate change that emerged between 2007 and 2009, and that was sacrificed on the altar of political ambition, is the most damaging political development of this century to date. If this government's only failure was to not take climate change seriously—to perhaps look in other policy directions while nevertheless leaving the Clean Energy Future reforms of the Labor government to proceed on track—then you might accept their preference for sticking to their knitting, as the PM would have it, in terms of a conservative wind-back of progressive social reforms and the promotion of an anything-goes, free-market, big-business oriented program.
Instead, unfortunately, it has made the dismantling and destruction of Australia's carefully established and effective climate change action architecture a key part of its general program of nation un-building. In the first twelve months of government it has: removed the price on carbon; defunded the Climate Change Authority and a range of renewable energy and energy efficiency programs; and indicated its intent to undermine the Renewable Energy Target. An article in Crikey this week by Paddy Manning responded to a sobering report from the Climate Institute on the extent of effective subsidies to our hydrocarbon-dominated energy sector by noting:
Putting a price on carbon—the most efficient way to tackle climate change—was an attempt to "internalise" these costs so that purchasing decisions would forever more take into account the impact on the climate. Energy from fossil fuels would get more expensive; renewable energy wouldn't. That's not a subsidy. That's a level playing field.
… ……
Now the carbon price is gone, the government is proposing to pay polluters from a taxpayer-funded Emissions Reduction Fund as part of its Direct Action plan, and the public also have to pay for the damage done by climate change.
As he says, the level playing field is being torn up. Our economy is being returned to an artificial state of affairs where emission-heavy energy production and other industries operate on a cushion of direct and indirect subsidies, shifting the economic health and environmental costs to the Australian public, the Australian taxpayer, to the future generations of Australian people.
As I have mentioned, last Sunday I attended a rally in Perth as part of a global initiative to mark a day of action on climate change. Tens of thousands of people around Australia joined this effort as did hundreds of thousands of people around the world including the UN Secretary-General himself. The Prime Minister, by contrast, chose to convey an opposite message. He chose to abdicate his responsibility when it comes to one of the most important policy issues facing this country and the planet by refusing to attend the United Nations Climate Summit in which President Obama and Prime Minister Cameron participated among more than 100 other world leaders.
The failure of this government to take climate change seriously is a failure to take science seriously; it is a failure to take economics seriously; and it is a failure to accept the responsibility for the health, security and wellbeing of Australians and our living natural environment now and in the future.
Mr COULTON (Parkes—The Nationals Chief Whip) (15:54): Does anyone else get a feeling of déjà vu, the feeling that we have had this debate before over and over again? My colleague here, the shadow minister for the environment made some comment about the Prime Minister being a weather vane. I have just got a few quotes here and we might guess where they came from. 'There will be no carbon tax under a government I lead.'
We will go a little bit more current. How about this: Mr Albanese told Labor MPs on Thursday at an ALP caucus meeting that Labor should offer the Abbott government a deal to reduce carbon tax to zero immediately if the coalition would agree to introducing an emissions trading scheme. And here we have the member for Port Adelaide saying that Labor supports terminating the carbon tax. It is all well and good to say that you want to terminate the carbon tax, the relatively high price on carbon, immediately—on that we agree, member for Adelaide.
I have got a few more here, Mr Deputy Speaker Scott. We had the member for Fremantle speaking about the victims of climate change. I can tell you who the victims of climate change policy have been. They have been the people in my electorate. They have been the farmers. It was costing them a bomb to keep their milk refrigerated and to irrigate their crops. It has been the pensioners that sit under a doona all winter because they are not game to turn on the heater because of the cost of electricity.
And what about the cement workers at Kandos who no longer have a job, because on the very week that the carbon tax was introduced it closed down. Are we using less cement? Indeed the wind turbines now in the same area are being secured to the ground by cement that comes through Sydney Heads from Asia. The member for Hume in his usual eloquent manner mentioned the fact that we have shifted these emissions offshore, and that is exactly what has happened. We have outsourced to the poorer countries.
The thing that really frustrates me is that when we look at who is going to pay the price for putting a price on carbon and saving the planet, it is always people that I represent. We have the member for Melbourne—and it is a pity that he is not in here—and the people who live in the most concreted and altered environments in the country who take great joy in putting in policies that affect the people they do not represent. That is why we had such a focus on land clearing. Somewhere along the line in the 1990s there was a decision made that this environment had to look exactly the same now and for evermore. So we have an expanding global population and we have got places like the Walgett Shire that are 20 per cent developed and are frozen at a point in time.
But we would wear the pain. Professor Garnaut said that regional Australia would wear double the cost of introducing a price on carbon of their city counterparts. The people in my electorate would accept that as fair enough and wear that pain if it was going to make some difference. But it was making no difference. I think that it would be much easier if we decided that maybe we would paint our front doors blue, because the answer we get from the Labor Party when we talk about the carbon tax or the emissions trading scheme or whatever, is that they say, 'At least we are doing something.' That is the idiot's excuse for putting petrol on a fire—'At least I am doing something!' If we want to do something, just paint your door blue—or green—because it would have just as much effect as this carbon tax. We saw the bizarre schemes of the pink batts and other such government policies from the previous government that cost Australians billions of dollars and made no difference.
The member for Makin is sitting down there. He was responsible for one of my favourite speeches in this place. In 2008 we were debating the original emissions trading scheme and he said, 'It's 43 degrees in Adelaide. We need to pass this bill today. It is 43 degrees in Adelaide and we have got no time to waste.' I presume that he had a barbecue planned for Sunday and he thought we could get the policy through on Thursday and cool things down for when he got home! It is one of my favourite times, when a member of the Labor Party has confused the climate with the weather and has got it all wrong. (Time expired)
Mr CONROY (Charlton) (15:59): What a bizarre effort. You know they are in trouble when they get the National Party to talk about economics. This is an economic issue and they have the cockies talking about economics, which is indeed troubling. Let's apply some facts to this debate, because the other sad and troubling part of the previous member's contribution is that he did not spend a single second talking about what they would do to help combat climate change. I do not know whether it is because they do not know what to do or he is ashamed of his own policy, or whether, like many on that side, he does not actually accept the science of climate change. He thinks he knows more than 97 per cent of climate change scientists around the world. What a pathetic effort.
Let's look at the facts. What happened after we introduced the fixed price emissions trading scheme? We heard lots of doom and gloom on that side about what happened. What did happen? In the first year alone, 160,000 jobs were created. The stock market went up 33 per cent. National emissions were 40 million tonnes lower than they would have been otherwise. The Department of the Environment, under the current government, says that, due to the emissions trading scheme, emissions in this economy are 40 million tonnes lower than they would otherwise be. We saw renewable energy production of 37 per cent and, most impressive of all, we saw emissions from the national electricity market, our single biggest polluting sector of the economy, fall by 17.2 million tonnes, a 10 per cent fall. This was all concrete action in the first two years of the scheme alone, and it would have been more efficient if we were successful in shifting it towards a flexible price emissions trading scheme, which was our plan.
This was all based on us acting in concert with the rest of the world. Those on the other side like to spread another myth, another untruth, that we are somehow leading the world in this area. Nothing could be further from the truth. By 2016, three billion people around the world will live in countries or regions where there is an emissions trading scheme. Two hundred million Chinese live right now under emissions trading schemes. By 2016, China plans to have a national emissions trading scheme. What we saw in the last three years was the most mendacious and disgraceful scare campaign ever pursued by a desperate, hypocritical opposition leader in the current Prime Minister. We had the $100 leg of lamb. We were told that Whyalla would be wiped out. We had the wrecking ball, the cobra strike and the python squeeze. We had the weather vane. We had, 'Climate change is crap.' We had, 'Carbon dioxide is weightless.' He discovered a gas that had no physical properties—it was remarkable. And he made ridiculous claims that global warming had stopped. This effort would not have been good enough for a humble opposition backbencher, let alone the alternative Prime Minister.
Yet again, we see those on the other side debasing themselves with empty rhetoric instead of talking about the real issues. I did a count. In the 20 minutes of their contributions to this debate so far, we have heard 30 seconds on Direct Action. The member for Wentworth is entering the chamber. He has spent more than 30 seconds on Direct Action in his political career—he said it was a fig leaf and various other things. He was a remarkable truth teller in that period. We have heard 30 seconds on Direct Action from those opposite during this debate, and the truth is that it is the most fundamental rejection of markets we have ever seen, led by a Prime Minister who is not a Liberal; he is not even a conservative; he is a DLP reactionary, an acolyte of BA Santamaria who rejects the notion of markets—and Direct Action reflects that philosophy. It is the worst aspect of a command-and-control economy. It would make Comrade Lenin proud to see Comrade Abbott introducing a command-and-control method to try and reduce emissions.
The sad thing is that they cannot even name a single economist they are not paying to support their policy. Not a single independent economist says that Direct Action is a reputable policy. The Grattan Institute has said it will cost $100 billion to reach the five per cent target. Treasury's own costings of their policy said it will cost $48 billion to hit their target. Not one single economist will support it.
On this side of parliament, we have introduced a policy. Our policy for 2016, a flexible price emissions trading scheme, is a recommendation of pre-eminent economists. The entire Treasury is in favour of an emissions trading scheme. Professor Paul Krugman, Ross Garnaut and Lord Nicholas Stern—the most pre-eminent economists in the world—when they look at the problem of climate change, say, 'Let the market solve it. Use a flexible price emissions trading scheme to target it.' That is Labor's policy. Those on the other side are divided between those who do not want to do anything because they do not accept climate change is real and the other half, who just see a political opportunity. They are failing not only future generations but this generation as well. I am confident they will stand condemned by history for their horrible, horrible work. (Time expired)
Mrs PRENTICE (Ryan) (16:04): It is truly mystifying how, in a modern society, with all of human history and knowledge accessible through a device in our pockets, those opposite still believe that a tax is going to magically affect climate change. Those opposite must be deluded to believe that to take climate change seriously you need to tax people—families, community groups, single parents and pensioners—and somehow emissions will be reduced. The previous Labor-Greens government tried to incubate this insane, irrational and irresponsible notion, hoping it would grow in popularity with the Australian people. But this is not the first time that Labor and the Greens have underestimated the intelligence and common sense of the Australian people. Australians know that the rate of emissions continued to increase under Labor and, along with it, the cost of living. The Labor-Greens coalition government misled the Australian people when they said that the world's largest economy-wide carbon tax would not affect the cost of living.
This is evidenced by the fact that, now that this toxic tax has been repealed, costs are coming down. The Brisbane City Council is responding to the removal of the carbon tax by refunding the carbon tax element of this year's rates and removing existing carbon tax related fees and charges, while still leading the nation with its environmental initiatives. Brisbane City Council will provide a one-off refund to all ratepayers to cover the $17 million of carbon tax costs in the 2014-15 budget as well as the $7.1 million collected for future emission costs. That is right: with the removal of the carbon tax we are actually seeing the cost of living go down. Now that the carbon tax has been removed, the cost of power has decreased by nine per cent. Now that the carbon tax has been removed, the cost of gas has decreased by seven per cent. Now that the carbon tax has been removed, council rates have decreased and been refunded. Now that the carbon tax has been removed, public transport costs across Queensland have been reduced. Now that the carbon tax has been removed, unnecessary pressures placed on small businesses will be released, meaning savings can be passed on to consumers. Now that the carbon tax has been removed, Australians are all better off.
Yet those opposite still insist on re-introducing this toxic tax. The blind faith of those opposite in a policy which still resulted in emissions increasing, obviously not tackling climate change and instead placing a whole-of-economy burden on Australians, is horrifying.
On this side of the chamber we have taken a realistic approach to tackling climate change. We are committed to our target of reducing emissions by five per cent below 2000 levels by 2020. This is expected to be 22 per cent lower than if we had not taken action. The coalition government has committed $2.55 billion to the Emissions Reduction Fund, which supports Australian businesses to improve their productivity and reduce their energy costs rather than taxing them and making their operations more difficult—which would force them to lay-off staff—and somehow expecting them to reduce their emissions.
Australia is committed to a new global agreement that establishes a common playing field, for all countries, to take action from 2020. Australia has joined the summit declaration on the phase down of hydrofluorocarbons. The coalition's approach to climate change is about practical action, actually getting in there and helping large emissions contributors change their practices, to see a positive environmental impact. It is not about imposing a tax that increases the cost of living. It is not about spending billions of dollars on 'renewable-energy' facilities that are not yet economically or environmentally viable and indeed are incredibly damaging to the environment, and are inefficient and unreliable sources of power so that coal-burning power plants must always be on standby to account for drops in energy output. This means that fossil fuels are being burnt anyway. It is not about announcing renewable-energy schemes that sound exciting yet take 20 years to break even for the fossil fuel and environmental cost of building them.
Unlike those opposite, the coalition believes in taking real action, not participating in marches protesting against the use of fossil fuels while setting up nylon tents made from petroleum derivatives, or writing on signs with pens using ink derived from petroleum, or marching in shoes derived from petroleum, or selling climate-action tee-shirts printed with petroleum based plastic paint or shouting into megaphones made from petroleum based plastics and powered by fossil fuels. The irony is astounding.
Unlike Labor and the Greens, the coalition is not about screaming and shouting. We are not about announcing scientifically baseless policies. We are about action. The coalition stands for reducing emissions in a way that will not hurt everyday Australians already doing it tough.
Mrs ELLIOT (Richmond) (16:09): I am pleased to be speaking on this MPI, as the matter of climate change is an issue of grave concern to people in my electorate of Richmond, and I am proud that Labor's position on climate change is very clear. We accept the science of climate change and believe we need to do something about it.
Over this past weekend we saw globally more than 600,000 people take to the streets demanding action on climate change. We saw thousands of people at these rallies throughout Australia. Despite this, the Prime Minister and the Liberal-National parties will not act. The fact is, they are climate-change deniers, as we heard today. Their record and lack of action on climate change is reflected in their abysmal record on all issues related to the environment.
This is particularly true on the North Coast of NSW where we see the National Party not only denying climate change every chance they get but also destroying our important marine parks, allowing shooting in national parks and expanding harmful coal seam gas mining in our region. Locally there is grave concern about the government's plan to destroy the renewable-energy target. The fact is that the science on climate change is very clear, with over 97 per cent of published climate scientists agreeing that climate change is real and driven by man-made greenhouse gas emissions.
We all have a responsibility to act on this advice. Climate change will not go away by simply pretending it is not happening. It is in Australia's national interest to reduce its greenhouse gas emissions and work with international partners to cut global carbon pollution. The Prime Minister refuses to accept the need for urgent and serious climate action, but this is not the view held by the rest of the world's leaders. It is very disappointing that the PM refused to attend this week's UN climate summit, where President Obama and Prime Minister Cameron, along with more than 100 other world leaders, outlined their countries' commitments to serious climate action. We see world leaders make strong commitments, yet our PM insists Australia should not play a role in global climate action.
Some of the actions include China and South Korea moving to emissions-trading schemes—the very system this government set about dismantling here in Australia. Emissions-trading schemes are being adopted in many other countries too, including the UK, France, Germany, Canada and parts of the United States. But this government's policy allows the big polluters open slather. Instead of polluters paying, this government is setting up a slush fund of billions of taxpayer dollars to hand to polluters. Make no mistake about it: this will cost households more, while failing to cut pollution. We need to move towards a clean-energy future and Labor is committed to renewable energy, serious investment in the industry and creating jobs.
The renewable energy target was an important part of the former Labor government's policy approach to clean energy. The renewable-energy target is driving investment in the sector, creating jobs and reducing Australia's carbon pollution. Under Labor, the number of Australian households with solar power increased from 7,400 to over 1.1 million. Jobs in the renewable-energy sector tripled, providing a significant economic boost. In fact, in my electorate we have one of the highest take-up rates of solar panels, and there is a strong commitment and investment in renewable energy. The industry currently attracts around $18 billion of investment and is expected to see another $18 billion through the life of the RET. I strongly support the retention of the RET and have been approached by many businesses, locally, that are very concerned about this government's reckless actions in this area.
We know the Liberal-National government is made up of climate sceptics, and they do not believe in renewable energy. The vandalism that has been done to the renewable-energy industry in Australia by this government is, quite frankly, disgraceful and appalling. They are putting in jeopardy thousands of jobs and billions of dollars of investment. They are nothing more than a pack of climate sceptics, vandalising the renewable-energy industry. When it comes to regional and rural areas, people know that the National Party is to blame for these reckless actions on the RET. Rural communities will hold them to account and punish them for this. Regional areas are very reliant on jobs and economic growth from the renewable sector.
Recently, the report by the Abbott's government's hand-picked Renewable Energy Target review panel was released. The review paves the way for the government to break yet another promise, this time in relation to renewable energy. The panel recommended either scrapping or cutting the RET. The recommendations of the review panel will decimate the renewable-energy sector and associated jobs and investments.
The panel's report is just a political document, not an independent review. The climate-change-denial endemic in the coalition is written throughout this document. This is a report written by climate-change deniers for climate-change deniers, and it shows. If the government implements these retrograde recommendations it will be breaking another promise and killing off billions of dollars of investment in Australia. The government needs to disown the report. I am dubious about this, because we know this government does not accept the science of climate change.
The Prime Minister has previously described climate science as 'absolute crap'. I hear National Party members in my electorate saying the same thing, all the time. This government is out of step with the rest of the world by refusing to accept the need for urgent and serious climate-change action. It is environmentally and economically reckless to not take action on climate change, and this government is condemned for its inaction.
Mr HAWKE (Mitchell) (16:14): If anybody can tell me what the member for Richmond said, I will give you 50 bucks right now! You might think that because someone speaks really fast they have a lot to say but I am certain that, listening to the Labor Party's back bench over several years on this debate—
Mr Fitzgibbon: I rise on a point of order. I would be happy to take up the member's offer. The member for Richmond said that the Nats have gone missing in representing their constituents in the bush.
The DEPUTY SPEAKER: That is an abuse of the standing orders. The member for Hunter should know better.
Mr HAWKE: Over several years we have heard this kind of drivel that passes for debate on climate change in this chamber. I will make another bet with the member for Hunter. I will give him 100 bucks if any member of the Labor back bench can name five elements of the periodic table right now. Of course they cannot, but they are quasi scientists. We are supposed to listen to them on the science of climate change. If they could name one climate scientist—any climate scientist—right now other than an activist, I would give them 150 bucks.
They do not know any climate science. These scientific debates are, in fact, completely non-scientific. And that is the criticism that most people have about the standard of climate science debate in politics today. It is pure political activism and not science based on factual evidence.
What is the record of governments in this country in relation to climate based policy? We have seen graphic failures at state and federal level. They have made a real hash of climate change. That is why people used to rate the environment as one of their top five priorities and today they do not rate it within the top 10. Governments have really made a hash in leveraging political activism and have not used real science about what is going on on our planet.
It was never better expressed than by the man who they dare not speak the name of—the Gillard government's handpicked appointee on climate change. Who was that? It was Tim Flannery. He was paid $180,000 by the taxpayer to make pronouncements. Is there one member of the opposition who has mentioned their former government's handpicked expert, climate change commissioner Tim Flannery. There has been not one mention.
We heard from the member for Fremantle. Her authority—her bible on climate change—was Crikey. Her one quote was from the Crikey website. I have no doubt that those on the other side of the chamber are experts on what is on Facebook and twitter and that they are experts on what was said at the local rally of ALP branch members. They are experts about what Tim Flannery or Al Gore might say but they know nothing about climate sciences. They know nothing. And for them to say that the government knows nothing and has a set against science is completely wrong.
Mr Conroy: What does Lord Monckton say?
Mr HAWKE: Member for Charlton, I would not be spruiking your scientific credentials in this chamber. You are no rocket scientist. I will put it this way, member for Charlton: you are no rocket scientist. I just want to make that clear.
But this is a serious issue that deserves attention, and the government came to office on a pledge to remove the carbon tax because, as my colleagues and the government has pointed out, the Australian taxation system is not going to solve climate change. I know that the Labor Party believes in taxing and spending, and that that is the solution to all problems in life. Those opposite believe that if you have a problem the government has a taxation and spending plan to solve your life story. But taxation cannot and will not solve climate change.
It is a real problem and it deserves real scientific solutions—real evidence based solutions. We have seen state Labor governments do the same as the last federal Labor government. They have made a hash of climate change policy. We have seen them introduce solar bonus schemes that pay such a whacked out price that people who sign up to them make a hell of a lot of money and these schemes have to be abandoned, giving renewables a bad name.
We have seen Bob Carr in New South Wales—who described desalination as 'bottled electricity'—build a desalination plan on the advice of people like Tim Flannery, who said that all dams in capital cities would be dry within five or 10 years. He said that the rivers would not run and that the dams would be dry. Now, everybody in Sydney is paying a premium on every electricity bill, for a desalination plant that produces no water ever and has no benefit to anybody but uses a lot of people's capital. That is the bad name that the Labor Party, state and federal, has given to climate policy in Australia. They have made a real hash of it.
And the public are not mugs. They are more scientific than members of the opposition back bench, I can assure you. Scientifically, they have looked at it. They have looked at the rhetoric and the in-fighting and squabbling. They have listened very carefully to people like Tim Flannery, who said that even if every country in the world stops emitting carbon today it would take almost a thousand years before we saw any temperature difference.
I ask the member for Charlton: does he believe that? His government paid this person $180,000 a year to tell us that there is nothing we can do on climate change. I do not believe that there is nothing we can do on climate change; I believe there are scientific responses we can make. (Time expired)
The DEPUTY SPEAKER: Order! The discussion has concluded.
BILLS
Tax and Superannuation Laws Amendment (2014 Measures No. 4) Bill 2014
Tax and Superannuation Laws Amendment (2014 Measures No. 5) Bill 2014
Second Reading
Cognate debate.
Debate resumed on the motion:
That this bill be now read a second time.
Mr TONY SMITH (Casey) (16:20): After the excitement of the debate on the MPI it is rather fitting that we move to the tax law amendment bills that need further discussion here in the House. As you pointed out, Deputy Speaker, we are dealing with two of them: Nos 4 and 5. Tax and Superannuation Laws Amendment (2014 Measures No. 4) Bill 2014 has five schedules. Tax and Superannuation Laws Amendment (2014 Measures No. 5) Bill 2014 has four schedules covering a range of matters. In the time available I will confine my remarks to some of the schedules in Tax and Superannuation Laws Amendment (2014 Measures No. 4) Bill.
As the Parliamentary Secretary to the Treasurer outlined when he introduced this bill, it amends various taxation laws. In particular, schedules 1 to 3 legislate announcements made by the previous government—in many cases, years ago. In fact, if my memory serves me correctly, I spoke on the matter in schedule 1 dealing with thin capitalisation, in a tax law amendment bill about five years ago. It was one of many items that had not been legislated by the time of the last election. As the Treasurer identified last year, they were matters that we said we would deal with, and we are dealing with those matters in the course of this debate
Through legislating the integrity measures in schedules 1 and 2—and schedule 2 deals with foreign resident CGT integrity measures—there will be an increase in revenue of about $755 million over the four years of the forward estimates.
I do want to focus my remarks on schedule 4 of this bill because I think it is important from not only a transparency point of view but also a taxpayer's confidence point of view. This is the schedule that deals with tax receipts. Deputy Speaker, you and other members of the House will recall that the Treasurer announced when he was in opposition the policy that the Commissioner of Taxation would issue tax receipts to individuals following their income tax assessment. We made this commitment before the election and it was announced as part of the budget earlier this year.
This is an important transparency measure. Australian taxpayers deserve to know what their taxes are being spent on without having to sift through the copious budget documents that come out in the second week of May each year. This tax receipt will be a concise one-page personalised and itemised receipt. It will almost always accompany the taxpayer's notice of assessment. Taxpayers will be able to see proportionally the areas of government where their tax dollars are spent.
Those opposite are not in favour of this measure. They are not in favour of taxpayers seeing exactly where their tax dollars are spent. We suspect that is because they will see the proportion that is being spent on debt. But it is that very issue that is so central to our budget approach. When this government took office it inherited a debt and deficit situation very similar in story to the debt and deficit situation that the Howard government inherited back in 1996. Both the Treasurer and the parliamentary secretary have spoken about the projected budget deficits, about the debt road we were on and about the necessity for this government to take action to change direction. In the time available I want to talk a little bit about this because it is very important for every taxpayer. The receipt that they will get will give them a snapshot of the budget priorities and it will highlight the fact that, while governments make decisions, they spend money from taxpayers or money that is borrowed on behalf of those taxpayers that must be repaid by those very taxpayers.
As we know, all of the net government debt inherited by the Howard government was repaid after many long years and difficult budgets. In fact, it took about a decade—'debt-free day' for Australia was back in April 2006. But, of course, with the election of the Rudd government and with the appointment of Mr Swan as Treasurer, Australia very quickly got back on the debt road. While the Treasurer has spoken many times, quite rightly, in terms of the gross debt for comparative purposes with the $96 billion of net debt inherited by the Howard government, by the time this government was elected the situation was very much the same story.
Let us not forget that the former Rudd government back in 2007 did not just inherit no debt; they inherited $45 billion in the bank. By the end of their term that position was a net debt position of about $200 billion—basically, $¼ trillion deterioration. It meant that the road we were on, with that debt increasing with each budget deficit each year, had to be turned around. That is precisely the task and the responsibility of this government. That is why this budget is taking the tough and difficult steps necessary.
It is often said that you cannot live beyond your means. Of course, the truth is that, whilst that is ultimately true, you can live beyond your means for a period of time. There is quite a bit of hang time. In family budgets you can live beyond your means for a while but ultimately the costs of servicing that debt mount up and difficult choices confront you. In the case of governments it is much the same. We will not begin to reduce our debt until we have the first budget surplus. At that point we will begin to pay it down. But what this government has done is ensured that we will not stay on that debt trajectory, escalating at the rate it was destined to if we took no action and on a road that would lead to more difficult choices in the years ahead.
The tax receipt that is part of this schedule is a transparent measure to report annually to taxpayers—shareholders in so many respects—so they can see precisely what government is spending their money on and why. I am very confident that in the years ahead, as these receipts come out, taxpayers will see the benefits of the government's budget policies—policies that will deliver a more responsible outcome and, importantly, a better future for taxpayers.
I will confine my remarks to those matters in the Tax and Superannuation Laws Amendment (2014 Measures No. 4) Bill 2014. I commend this bill and the related bill to the House.
Mr ALBANESE (Grayndler) (16:30): I rise to speak on one aspect of the Tax and Superannuation Laws Amendment (2014 Measures No. 5) Bill 2014, the second of the two bills that are currently before the House.
My colleague, the shadow treasurer, has already foreshadowed that the opposition will not support the government-proposed abolition of the seafarers tax offset. When clicking through the second reading speech of the Parliamentary Secretary to the Treasurer, I was taken by his claim that the abolition of the seafarers tax offset was part of the government's attempt to reduce costs of business. Given that this offset is actually a rebate for business, I am not sure that the parliamentary secretary has any idea what he is talking about. No wonder they do not have an Assistant Treasurer sitting opposite; it is because they do not have anyone—certainly not the Parliamentary Secretary to the Treasurer—who actually understands the tax system. This is a tax offset, designed to level the playing field between the Australian shipping industry and the foreign shipping industry. But this ignorance of the fine detail does not really surprise me.
The bill is the latest manifestation of this government's ideologically driven campaign to take on anything to do with the former government's shipping reform. The extraordinary thing is that this is a government which is out there talking about costs to the Australian shipping industry, but which is now proposing to gain savings by taking a rebate away from businesses here in Australia. There has been no consideration of the costs against the benefits of this proposition. Its lack of balanced consideration means that it opposes any of the reforms that were done as part of reforming and revitalising the Australian maritime sector during the last term of parliament—even though these changes were done completely in consultation with Australian industry: we established a group that included players in Australian industry, such as Rio Tinto and the big players in Australian shipping; and in relation to taxation, it was chaired by the Department of Treasury. And they came up with this proposal. In relation to an Australian who is working on an Australian-registered vessel: if that Australian is in the harbour at Southampton, they of course, currently, would have to pay Australian taxation rates. However, if that person is working in the pub at the port of Southampton, they of course would not be paying Australian taxation rates. So it is an extraordinary proposition that they have come up with. It was also recognised in their analysis that, for seafarers with our competitors for our Australian shipping, such as Singapore and other countries, they do not pay rates of their domestic taxation. So it was about having a level playing field for Australian shipping—as simple as that.
The former government introduced the offset in 2012, as part of a package designed to assist Australian shipping companies to compete against their international rivals; not through a protectionist measure, but through having a genuinely level playing field. The package included the creation the Australian International Shipping Register, which was designed to improve the competitiveness of Australian-operated ships. The seafarers tax offset provides a rebate to employers of Australian staff for part of the income tax withheld while those staff work on international voyages. In other words, it offers a tax break for companies which hire Australian seafarers to work on international voyages. It is payable for each employee a shipper hires, for at least 91 days in a year, on voyages to and from places outside of Australia—that is the important point here. The amount of tax offset is equivalent to 30 per cent of the seafarer's pay. The whole point of the rebate is to help strengthen the Australian shipping industry—a worthy aim, particularly given that Australia is an island continent, and that 99 per cent of our exports and imports are moved by sea.
According to the Australian Shipowners Association—which strongly supports the offset—there were only four Australian flagships involved in our international maritime trade. The association says this is equivalent to only 0.5 per cent of the total freight task. That is simply not good enough. Surely our country can do better, not just to help Australian shipping companies but also to create jobs for young Australians—jobs that would provide skills that could then be used in the maritime sector across the board, whether it be people who work in our ports, or people who work in the Navy. There is a real correlation between the maritime defence industry and the maritime sector.
Mr Ciobo interjecting—
Mr ALBANESE: The idiot opposite speaks about this policy because of—
Mr Ciobo: Mr Deputy Speaker—
Mr ALBANESE: I withdraw. The ignorant parliamentary secretary opposite—
Mr Ciobo: Mr Deputy Speaker, I rise on a point of order. I ask that the member for Grayndler withdraw his unparliamentary language.
Mr ALBANESE: No. I took offence to a range of things the member for Moncrieff said across the chamber. 'Ignorant' is not unparliamentary. What is ignorant is when a member says a rebate to a company is about a union, which is what he said across the chamber. The Australian Shipowners Association is an employer body. I will explain it to him really slowly, so that he gets it. It is an employer body, and it is a tax offset to a company. It does not provide money or income to a union member or a worker. That is the problem of those opposite—they are so ideological that anything to do with the Australian shipping industry becomes about their anti-union crusade. In undertaking this crusade they are attacking Australian industry; the Australian Shipowners Association. They are attacking the groups that sat down and worked this out as a policy for industry—a policy that is not protectionist, but a policy that is about growing Australian industry and growing Australian jobs. Those opposite do not seem to understand that.
We want to see Australian shipping companies that are successful. But if you have an Australian shipping company and a foreign shipping company attempting to ply the same route and the foreign shipping company can do it cheaper because of the policies put in place by this government, then we have to address that and try to get a genuinely level playing field. That is what this policy did. I want to see Australia, an island continent, as a shipping nation with a thriving local maritime industry. Those opposite see that as a provocative statement that is about trade unionism. It is an extraordinary position that they have. The long-term effect of these sorts of changes and the failure to defend Australia's maritime industry will mean a loss of jobs. They want to talk a lot about borders and security and boats, but they do not want to talk about the Australian flag being on the back of Australian ships with Australian seafarers. If some of those opposite think that the maritime sector has no relationship at all with Australia's national security or with protection of the Australian environment, depending upon which ships go through the Great Barrier Reef, then I am afraid that does show their ignorance about what is good policy.
The 2012 reforms had the backing of industry, and they followed more than a year of careful consultation with industry. Immediately those opposite came to office they indicated that they would be winding it all back, therefore ensuring that you did not get that investment that was envisaged. The parliamentary secretary said in his speech that the reforms had failed, but they had not been given a chance to operate. Those opposite have said that the reforms will be wound back immediately. You should go and talk to people like the Ascianos and the big players in the industry that employ Australians. Many of these companies would agree with you about a whole range of issues, but I will tell you what: they do not agree with you on putting up the white flag and saying there is no role for Australian ships. If an island continent such as Australia has no shipping industry, there will be real long-term consequences in terms of the loss of that skills base.
We want reform in the national interest. This reform that they are attempting to wind back here is a saving—and that is the point. It is a saving to the government from removing a rebate for business. By all means, argue that business should not deserve that rebate, but do it on the basis of the reality, not on the basis of this nonsense that somehow it is not a rebate for business. At least understand the legislation that is before the parliament in terms of the changes that are being put forward. This is very disappointing indeed for Australian industry. I spoke to the head of the Australian Shipowners Association today, and there is a great deal of disappointment about the fact that the coalition has made no attempt to have proper policy development and process on this. We did. We made no apologies for the fact that we did negotiate and had input from and consultation with unions as well as employers and others in the sector. Everyone from the National Farmers' Federation to Rio Tinto and the Business Council were all involved and were able to participate in that process. I commend the amendment to this legislation that will be moved by the shadow Treasurer. He is doing that because of the flawed proposition being put forward by the government to run what is a very narrow, ideological and misguided agenda.
Mr ZAPPIA (Makin) (16:43): I endorse the comments of the member for Grayndler. This debate deals with two bills—the Taxation and Superannuation Laws Amendment (2014 Measures No. 4) Bill 2014 and the Taxation and Superannuation Laws Amendment (2014 Measures No. 5) Bill 2014. In combination, these bills deal with nine specific matters—all of which could have been, and should have been, the subject of individual debate, because they are each important in their own right. Yet the government has chosen to lump them all in together, and by doing so it hopes to take the spotlight off those measures which it knows are not popular or knows are not smart.
Time will not enable me to speak to each of the nine effects of these two bills. I will confine my remarks to the matters of multinational tax arrangements and the reduction of research and development tax offset provisions. I recently spoke in the Federation Chamber about the growing tax avoidance industry around the world and the billions of dollars of tax revenue that is being lost to governments as a result of tax avoidance techniques implemented by multinational entities using smart accountants, lawyers and tax haven countries where it is estimated that trillions of dollars are being stashed away. However, it is not even necessary to use tax haven countries to avoid tax in Australia, because it can be done by using other tax avoidance techniques. Prior to the 2013 federal election, the Labor government had proposed measures that would have closed the loophole to about $1.1 billion of tax that was being avoided by taxpayers in this country. The Abbott government, on coming to power, has decided to do away with all those measures Labor had proposed that would have closed those loopholes. That becomes, in turn, a $1.1 billion burden that the Abbott government will now have to impose on other taxpayers or else increase taxation or reduce government services. In other words, the rest of the community pays because the Abbott government did not follow through with that $1.1 billion of measures the previous Labor government had proposed.
The second matter I want to refer to is the reductions to research and development tax offsets. It is becoming very clear that the Abbott government simply does not understand the importance of research and development to Australia's future. First, it cuts about $300 million of funding from Australia's leading research institutions, including $146 million from the CSIRO, ANSTO and others; $80 million from the Cooperative Research Centres; and $75 million from the Australian Research Council. The work of these organisations is internationally valued and contributes immensely to Australia's productivity and security. So much of the research results in innovation that in turn is transferred to other sectors, from medicine to defence to industry and agriculture and through to the environment. Indeed, much of the private sector benefits from the work of these organisations and in turn depends on that work, but the government funding to them is being cut. When the research and development tax offset is then reduced, the problem is compounded, because the result is less research and development from government and less research and development from the private sector. On top of that, we have the Minister for Education threatening to cut research funding to the universities if he does not get his way with respect to the higher education funding cuts that he is proposing. On one hand the government is saying, 'We're not proposing any cuts to the higher education sector' and on the other it is saying, 'But if we don't get what we want, we're going to cut the research dollars to them.' In other words, it is an admission that cuts are proposed to the higher education sector throughout the country. It would be particularly shameful if the cuts impacted in any way on the research work done by the universities, because they in turn work in partnership with the other government departments and with the private sector.
The issue of private sector research and development will further deteriorate, because a major contributor to research and development in Australia for decades has been the automotive sector. And the facts will show that billions of dollars have been invested by the automotive sector in this country into research and development. The fact is also that the Abbott government has turned its back on tens of thousands of Australian car workers and their families. Simultaneously, it has turned its back on hundreds of small and medium-size enterprises that also depend on the auto industry in this country. But it is now also turning its back on research and development dollars that car makers were putting into this country. And many of the research and development dollars from the care makers in turn were in turn flowing on to other industry sectors that benefited from that investment.
We are going to lose all that, because the government has no interest in car makers in this country. We saw that only too clearly this morning, when legislation was introduced into this House by the Minister for Industry with respect to cutting another $500 million of funding from the Automotive Transformation Scheme between now and 2017—another clear signal from this government that it is not interested in car makers in this country and it is not prepared to do anything to assist them and not prepared to do anything to assist those support-component manufacturers who also invest in research and development. Some of them, with some government support and some supportive government policies, may well be able to continue after the car makers have ended. But it seems that this government is not prepared to give them the support they need and indeed is cutting funding that was previously allocated to that sector by the Labor government so as to help that industry remain competitive.
Other Western countries, including the USA and the UK, have in recent years turned their manufacturing sectors right around. A decade or two ago, they too were becoming non-competitive with countries with low labour costs. But in the last few years, and in particular in more recent years, both of those countries have redeveloped their manufacturing sectors and are now extremely competitive with low-labour-cost countries. Indeed, I understand from a report from the Boston Consulting Group that US manufacturers are today more competitive than their counterparts in China. That is not surprising, because we are seeing manufacturers transfer their operations back to the USA from China and we are seeing manufacturers transfer their operations from several countries to which they had previously located, back to what I call advanced First World countries.
The point I make about that is that manufacturing can be competitive if governments are prepared to back it and invest in it. If governments are prepared to give to the manufacturing sector the right kind of policies and financial support, then it makes a difference.
But there is one other critical element to all of this, and it comes back to the issue of research and development. If a company is going to be competitive then it needs to invest in research and development. If a country is going to be competitive it needs to invest in research and development. The research and development that companies and countries invest in not only benefits particular organisations, but the country as a whole. It seems to me that the Abbott government does not seem to get that any investments made in research and development are actually a good investment in the country. The return for the dollars invested is worth making. If in the future we are going to be a competitive country, then we need to be innovative, and if we are going to be innovative, that comes from research and development. Yet we are seeing the exact opposite being done here in Australia by this government, and that is a shame.
There is a snowballing effect with respect to not investing in research and development. The tax measures that take away one of the incentives for companies to invest in research and development simply compound and add to all of the other cuts I referred to earlier.
There is another matter that flows from all of this, which is what we call the brain drain from our country—the loss of scientists and researchers to other countries. That will happen once the dollars dry up in research and development in this country. Recently I spoke with a young man in Adelaide who is a graduate of medical science at Adelaide University. Based on his study results, he is clearly an outstanding graduate with an extremely bright future, so much so that he has already been offered a job in the USA by one of the medical research institutions, yet he cannot get a job here in Australia. The loss of people like that will ultimately be a loss to Australia's competitiveness, to our innovation and to our ability to do things and be a forward-looking, advanced country. We will lose people like that and we will lose people with specialist skills who are already in the sector, because we dry up the funding to research and development. Again, that will be to the detriment of this country in years to come.
Taken individually, each of the hits to research and development in Australia may be absorbed. But, collectively, the impacts will have devastating consequences for years and years to come. Diminishing the research and development tax incentives, cutting funding to government research and development organisations, the loss of the automotive manufacturing research and development dollars that we have benefited from, and the loss of intellectual capital—that is, the loss of scientists and researchers—will cost Australia dearly in the years to come. It is ignorant policy by a government that knows it will not be here when the damage is realised in years to come.
Mr CIOBO (Moncrieff—Parliamentary Secretary to the Treasurer) (16:56): I thank all members who have contributed to this debate. The two bills before the House today, the Tax and Superannuation Laws Amendment (2014 Measures No. 4) Bill 2014 and the cognate bill, represent another important step in the government's economic action strategy. Our economic action strategy focuses on economic activity that will boost productivity and growth in employment. Our strategy is also about repairing the budget, putting it back into surplus so that we as a nation can start living within our means once again. Failure to fix the budget and take steps towards improving our economy now will materially impact on our living standards in the future.
There is no alterative to the budget repair task and therefore there is no alternative to the government's economic action strategy. We need to get on with the job of paying off the $123 billion of deficits that we inherited from the previous government. The bills before the House today will go part of the way towards doing exactly that.
The bills also continue the government's work in restoring the integrity of the Australian tax system. A backlog of 96 tax and superannuation measures announced but not legislated created significant operational uncertainty for businesses and consumers. We acted swiftly to clean up Labor's mess and to provide certainty and to reduce red tape for all taxpayers.
The first bill that was considered in the cognate debate was the Tax and Superannuation Laws Amendment (2014 Measures No. 4) Bill 2014. During the debate, Labor members have said that the government was not doing enough about taxing large companies, including multinationals. This is plainly wrong. Schedules 1 to 3 of this bill show this. Like much of the actions of the former Labor government, announcements were made without ever following through with the relevant legislation. Some of the measures Labor announced were unimplementable, undeliverable or would have caused severe disruption to Australian businesses. The multiple-entry consolidated-groups measure, for example, was found to be unimplementable, according to the findings of a tripartite review by the ATO, Treasury and the private sector. The offshore banking units measure, also announced by Labor, has not seen any revenue realised or delivered. In Senate estimates, Treasury further confirmed that Labor's proposed section 25-90 change, proposing to target multinationals, would have instead severely damaged Australian businesses looking to grow offshore. It noted that it was not a sensible proposal to proceed with.
Schedule 1 of this bill amends the income tax laws to protect Australia's tax base by tightening and improving thin-capitalisation rules. This bill amends the thin-capitalisation statutory debt limits to bring them more closely into line with commercial debt levels or to regulatory requirements, in the case of banks and non-bank financial entities. It provides additional flexibility with the introduction of a new test for inbound investors to allow gearing of the Australian operations up to the level of gearing of the worldwide group. In line with the government's commitment to reduce compliance costs for business, this bill increases the de minimis threshold from $250,000 to $2 million of debt deductions. Taxpayers below this threshold will not be required to comply with the thin-capitalisation regime.
Schedule 2 contains improvements to the tax exemption available to Australian companies for their foreign non-portfolio dividend income. This allows broader access to the exemption and allows it to flow through interposed trusts and partnerships. The change also improves the integrity of the tax system by ensuring the exemption only applies to returns on instruments treated as equity for tax purposes.
Schedule 3 to this bill amends the taxation laws to improve the integrity of the foreign resident capital gains tax regime by preventing the double counting of certain assets under the regime's principal asset test. Schedule 3 also makes technical amendments to the regime's reference to 'a permanent establishment' to ensure the regime applies where assets are used in carrying on a business through a permanent establishment in Australia.
Schedule 4 to this bill amends the income tax laws to require the Australian Taxation Office to send Australian taxpayers a tax receipt, a commitment this government made at the last election. This tax receipt will detail for each taxpayer how we as the Commonwealth government are spending their money and how much the government has borrowed on their behalf. Schedule 5 corrects minor technical or drafting defects, removes anomalies and addresses unintended outcomes in the law.
The second bill considered today was the Tax and Superannuation Laws Amendment (2014 Measures No. 5) Bill 2014. This bill amends the Income Tax Assessment Act 1997 to implement a range of changes to Australia's tax laws. These changes will return around $1.4 billion to the budget over the forward estimates. Schedule 1 of the bill abolishes the mature age worker tax offset. The mature age worker tax offset reduces by up to $500 the amount of tax payable for those who are already working. It does not help to reduce labour market disadvantage. Older Australians want to work. We need them to work. A prosperous Australia depends on everyone contributing to a strong and sustainable economy, and older Australians just need to be given this opportunity to contribute. Abolishing the mature age worker tax offset will save Australian taxpayers around $760 million over the forward estimates period, which the government is redirecting to a new wage subsidy called Restart.
Schedule 2 abolishes the seafarer tax offset. Put simply, the seafarer tax offset does not work. The seafarer tax offset is a 30 per cent refundable tax offset provided to companies for salary, wages and allowances paid to Australian resident seafarers who are employed to undertake overseas voyages on certified vessels. The offset was supposed to increase employment in the shipping industry, but no noticeable increase in employment of Australian seafarers occurred. The offset was supposed to result in significant new investment in the shipping industry, but no noticeable increase in investment occurred. The repeal of the seafarer tax offset will save Australian taxpayers $12 million over the forward estimates. I noted the contribution from the member for Grayndler earlier in the debate. Through all the huffing and puffing he seemed to be saying that this was a measure that would yield great results if only it were given more time. The fact that there are only some 20 shipping companies, with only approximately 250 employees, affected by this measure just indicates what a failure this policy was. I personally found it most interesting that once again we had a Labor MP standing in this chamber lecturing the coalition about how Labor understood what was good for business—despite the fact that, when you actually look at the impact of the measure, it was indiscernible. It was simply costing money and was, in reality, delivering nothing—hence my comments that the member for Grayndler was more concerned about stitching up MUA support bloc for his preselection than he was about doing something for Australian industry.
Schedule 3 reduces the tax offset available under the research and development tax incentive by 1.5 percentage points for income years commencing on or after 1 July 2014. The decision to reduce the offset rates provided by the R&D tax incentive was difficult, but repairing the budget must be done as fairly and equitably as possible. The R&D tax incentive will continue to support thousands of eligible companies in all sectors of the Australian economy in conducting research and development through the provision of a generous, easy-to-access program. This measure of course applies only to the very largest companies, those having an assessable income of $20 billion or more. This measure will provide a gain to revenue of around $620 million over the forward estimates period.
The fourth measure in this bill is about deductions for gifts to benevolent not-for-profit bodies. Schedule 4 adds three new deductible gift recipients. This will allow Australian Schools Plus; the East African Fund, which operates the School of St Jude; and the Minderoo Foundation Trust to receive tax-deductible donations. Australian Schools Plus is a vehicle to collect donations from the public for disadvantaged schools. This will actively address the perception that these schools find it relatively difficult to attract donations. The School of St Jude provides free high-quality education to children in Tanzania who would otherwise be unlikely to complete their schooling. St Jude's has over 2,000 students from various religions and 35 different tribal backgrounds. The Minderoo Foundation Trust operates a range of programs, including the Walk Free Foundation, GenerationOne and Hope for Children.
These bills will improve the integrity of Australia's tax system and return over $2 billion to the budget over the forward estimates. These measures represent another chapter in our Economic Action Strategy and our drive to provide certainty for all taxpayers. This in turn will build a stronger, more sustainable economy and a more prosperous Australia. I commend these bills to the House.
Question agreed to.
Bill read a second time.
Third Reading
Mr CIOBO (Moncrieff—Parliamentary Secretary to the Treasurer) (17:06): by leave—I move:
That this bill be now read a third time.
Question agreed to.
Bill read a third time.
Tax and Superannuation Laws Amendment (2014 Measures No. 5) Bill 2014
Second Reading
Debate resumed on the motion:
That this bill be now read a second time.
The DEPUTY SPEAKER ( Mr Craig Kelly ) (17:11): The question is that this bill be now read a second time.
A division having been called and the bells having been rung—
The DEPUTY SPEAKER: As there are fewer than five members on the side for the noes, I declare the question resolved in the affirmative in accordance with standing order 127. The names of those members who are in the minority will be recorded in the Votes and Proceedings.
Question agreed to, Mr Bandt and Mr Wilkie voting no.
Bill read a second time.
Third Reading
Mr CIOBO (Moncrieff—Parliamentary Secretary to the Treasurer) (17:12): by leave—I move:
That this bill be now read a third time.
Question agreed to.
Bill read a third time.
Crimes Legislation Amendment (Unexplained Wealth and Other Measures) Bill 2014
Second Reading
Debate resumed on the motion:
That this bill be now read a second time.
Mr PERRETT (Moreton) (17:12): As I was just saying, the opposition folded like Superman on washing day when it came to making a promise before the election and then flipping straight after. That hypocrisy was highlighted by the justice minister, Michael Keenan, who is now responsible for a budget that has diminished Australia's top law enforcement agency. To make matters worse, the Abbott government has cancelled $42.5 million of funding allocated by the former Labor government for additional sworn officers and $22 million across four years from the AFP's aviation operations in Hobart airport. Perhaps that has placed Tasmanians in danger. We will see.
With the May budget's exposures, I hope that Minister Keenan is able to realise that his overblown political rhetoric from opposition rings particularly hollow now that he sits on the Treasury benches. Perhaps in his summing up of this legislation he could be a bit apologetic. I remember his crocodile tears after he spoke at this very dispatch box in this spot about our proposed Malaysian solution. I am still waiting for an apology on some of the hypocrisy in that vote.
In terms of working towards a national unexplained wealth scheme, this bill will implement several of the PJC early report recommendations. It will not address a more fundamental problem with the Commonwealth unexplained wealth laws on which the PJC made recommendations for significant reform. As noted above, unexplained wealth laws are particularly valuable in the context of organised crime, where those who derive the greatest profits are not directly involved in the commission of the offences. They are the gutless ones who are a few rungs back from those out front committing the crime. So the unexplained wealth laws are a good thing. They provide an alternative avenue where senior figures cannot be pursued effectively through prosecution or traditional confiscation actions, and they are having some success. Unlike existing confiscation orders, unexplained wealth orders will not require proof of a link to a commission of a specific offence and, in that sense, they represent a quantum leap forward in law enforcement strategy.
However, due to the need for a connection with a constitutional head of power, the application of the Commonwealth unexplained wealth regime is limited to instances where a court is satisfied that there are reasonable grounds to suspect the person has committed an offence against a law of the Commonwealth, a foreign indictable offence or a state offence that has a federal aspect or that part of the person's wealth was derived from an offence against a law of the Commonwealth, a foreign indictable offence or a state offence that has a federal aspect. This undermines the key advantage of unexplained wealth laws over prosecution or traditional confiscation as, in practice, a connection must be made to a specific offence or a fairly specific type of offence in order to satisfy the jurisdictional requirement.
Whilst the founding fathers saw good sense in having those protections, in this instance the constitutional drafting would prevent us from going after these criminals. In order to remedy this, the PJCLE recommended that the Commonwealth lead the development of a nationally consistent unexplained wealth regime. Further, it accepted the view of the Attorney-General's Department on the best way to achieve that aim, recommending:
That the Australian Government seek a referral of powers from the states and territories for the purpose of legislating for a national unexplained wealth scheme, where unexplained wealth provisions are not limited by having to prove a predicate offence.
Despite assurances they would still retain proceeds seized under their own laws, the states and territories rejected such a proposal on several occasions. In June 2013, former police commissioners Mick Palmer and Ken Moroney were appointed to negotiate with jurisdictions and break this deadlock. I would suggest that some of that deadlock was due to political posturing, but perhaps that is unfair commentary.
The Australian Federal Police Commissioner told the PJCLE on 26 February 2014 that there were some 'very encouraging signs' from the states and territories and that a report from Mr Palmer and Mr Moroney was 'either with the Minister for Justice or very close to being with him'. The Minister for Justice stated on 5 March 2014 that the government was 'continuing to pursue a national scheme with our state and territory colleagues to crackdown on criminals flaunting illegitimate wealth'.
The Abbott government has not made any progress in negotiating with the states and territories, sadly. Prime Minister Abbott and Minister Keenan lack the will to persuade their state counterparts into joining a stronger national approach to unexplained wealth laws. In opposition, Minister Keenan defended the stance taken by the states and territories, asserting on Tuesday, 5 February last year, that:
If the Minister for Home Affairs and the Labor Party were serious about stopping organised crime, the first thing they would do is not lecture the states about what the states should be doing.
This vacuous contribution reveals how the crucial need for a national unexplained wealth scheme is not understood by the Abbott government and, despite the urgent need for one, is not a priority for Minister Keenan—although, I guess he has been a little bit busy of late.
Unexplained wealth laws need a champion. The former Labor government understood this and the effort of Labor's former home affairs minister, Jason Clare, to produce a nationally harmonised unexplained wealth regime is testament to this. Labor will continue to urge the Abbott government and the states and territories to build a stronger national set of laws that attack criminal kingpins and take the profit out of crime. A national stance is the only combatant against organised crime. Targeting the assets and money of criminals will undermine the power and influence of criminals in our communities. Giving law enforcement agencies more power to seize the assets of criminals will be a heavy blow to what seems to be the ever-increasing power and reach of organised crime.
Similar to the Abbott government's minimalist understanding of nationally harmonised unexplained wealth laws is this government's approach to crime prevention. The Abbott government, sadly, has axed Labor's National Crime Prevention Fund in favour of its own Safer Streets Program. However, Minister Keenan is yet to explain the selection and eligibility process for organisations to apply for funding under the government's Safer Streets Program. The National Crime Prevention Fund was a $40 million component of the former Labor government's package of measures to address gang violence and street crime in the community. I can personally attest to the efficacy of this program, having seen it rolled out in Sunnybank. Working with the police, the community, the neighbourhood watch and some of the storekeepers in the Sunnybank area, we have seen changes that make the area safer.
The NCPF was to support initiatives in high crime areas that address societal disconnection of at-risk young people and provide diversionary and educational activities to reintegrate them into society. The NCPF also supported the installation of CCTV systems in established trouble spots and other security infrastructure measures to improve community safety.
The Abbott government have replaced the National Crime Prevention Fund with an election commitment known as the Safer Streets Program. The Safer Streets Program is a $50 million crime prevention initiative. To date, no money has been allocated to youth mentoring and outreach programs. I will repeat that: no money has been allocated to youth mentoring and outreach programs at a time when they are surely crucial. Funding is only to be provided under the Safer Streets Program for security related infrastructure, including CCTV, mobile CCTV and better lighting. They have their place, but this is all sizzle and no sausage. The best way to spend money to prevent crime is on people who have not moved into crime. It costs so much more money to deal with the after-effects of crime, keeping people in prisons and the like, when perhaps a dollar could be spent early on to divert those people and help them become taxpayers and good citizens.
The target group for funding under the first funding round under the Safer Streets Program are organisations that were identified before—guess which date?—October 2013. The Auditor-General has announced a lengthy investigation into the program, particularly the eligibility criteria and the selection process used to award millions of dollars worth of public, hard-earned taxpayers' dollars. In the first round of funding, $19.3 million of taxpayer money—your money, people of Australia—was allocated to organisations that were hand-picked by the Liberal Party in the lead-up to the 2013 election. The guidelines for funding round 1 of the Safer Streets Program states that:
The target group for funding under the first funding round under the Safer Streets Programme is organisations that were identified before October 2013 …
This parliament should make decisions only in the national interest, not just in the interests of the Nationals—and the Liberals, I should clarify, as they are a coalition government.
The Auditor-General has advised that there are serious questions to answer about the Safer Streets Program, including about the eligibility criteria and selection process used to award funding, whether the funds spent under the program have been properly targeted at projects to prevent, detect and deter crime, whether this represents value for money for the taxpayer and whether the distribution of funding has been included in electorate terms rather than in the national interest and community interest.
Minister Keenan is yet to explain who identified successful and unsuitable organisations and what selection criteria were used. Minister Keenan needs to explain how he ensured an unbiased selection process and how political neutrality—always crucial in a democracy like Australia—was ensured when identifying successful organisations on the eve of the election one long year ago.
It is not unrealistic to presume that applicants were pre-selected by a Liberal Party process without any consideration made for worthy organisations that had been approved for funding under the former Labor government's National Crime Prevention Fund. The Abbott government talks big on crime and crime prevention, but funnelling funds into Liberal-friendly councils on the eve of an election borders on deception and deceit. I look forward to seeing how the Auditor-General responds.
There are heightened circumstances in Australia at the moment. Obviously, how we respond to security, make our streets safer and make our community feel safer is important. The legislation before the House goes some way but falls way short of the Labor Party's expectations.
Mr LAUNDY (Reid) (17:24): I rise to speak in support of the Crimes Legislation Amendment (Unexplained Wealth and Other Measures) Bill 2014 and to applaud the minister for it. The member for Moreton wanted a champion for this cause. I will take some time this afternoon to speak in support of the bill, to explain that I understand what organised crime looks like on the front lines. I note with interest that I am listed to be followed by the member for Fowler, Chris Hayes, who is a former policeman, as are the member for Macarthur, Russell Matheson, and the member for La Trobe, Jason Wood, on my side of the chamber. If there are any other former police officers in this place I apologise for not knowing. Mr Hayes is entering the chamber as we speak.
I have said a number of times that my background is different. At 21 years of age I became a western suburbs publican, the third generation of my family to do that. I think my father, who is as hard as nails—Chris Hayes knows him well—wanted to check out whether I had the DNA to do the work. So at 21 I started work at the Granville Hotel. On one side of me was a brothel and over the road was a methadone clinic. It was an early opener; it would open at 5 am. The number of times that I would have to call the local police to come and help me, because of the methadone clinic; at 21 years of age I kicked in my first toilet door. I pulled out a young man who had a needle hanging out of his arm and who had no pulse. I attempted to revive him but failed. That was the first of 29 times that that has happened in my life. I have seen on the front line the harm that drugs do. I have been held up at gunpoint and at knifepoint. I have attended more armed hold-ups than I care to remember, like my colleagues in the police. The only drama is that I do not have a gun at my side. The police would always respond in a timely fashion and help us out. We have had people shot and killed in the beer gardens of our hotels. My family hotel, the Twin Willows at Bass Hill, is only five minutes from where the Milperra massacre occurred. I do not have to tell anyone here about that.
It is all well and good to attack the problem we are dealing with on the front lines, which we must. It is a dual approach. The reason I am such a strong supporter of this bill is—and it is sad to say it—the people engaged in organised crime are some of the best business minds we have in this country. Every other business in this country that operates on a cash flow basis has the option of putting the money in the bank, and that is what they do. I know, because I have done it. The people engaged in organised crime do not have that option. They have to launder the money, and that is complicated. It requires skill. I have watched media and politicians dance around the outside and come up with pieces of the puzzle my entire life. But standing on the front lines, standing toe to toe with a bikie, as I know the member for Fowler has done, and telling him to leave your place of business because he has his colours on, knowing that he is there to sell drugs but not whether he has a gun on his hip, is a daunting thing to do. It is why I am so passionate and determined to be a champion, as the member for Moreton asked.
They have to launder the money and they do it in certain ways. There are some great stories doing the rounds. It reaches far and wide. Take the union royal commission. There has been a lot of press about organised crime getting involved on union sites. They launder the money on those union sites. The part that everyone has missed so far is that they launder it in two ways. They use cash to pay bribes, which gets them access and is a way for them to get rid of the cash without having to put it in the bank. They then run the business, be it scaffolding or labour hire, which are the two you most commonly see. They operate the businesses at a loss, which allows them to hide the cash they funnelled through a legitimate business. They are very, very good at it. We need to attack them in the back end with accountants, which is what this bill does.
The drama in Western Sydney and the reason this is such a strong issue is that organised crime deals in drugs and guns. In the last six years we have seen through Western Sydney—it is something else that has been missed—an unintended consequence of the global financial crisis. Our economy has stayed strong. Our currency has appreciated in value. At the same time, our country has become a mecca for drug lords from around the world to replace markets they had elsewhere pre-GFC and that have crumbled. This is an effect that no one has picked up on. You do not have to read too far. In the Daily Telegraph two days ago there was a headline 'Violent Mexican cartels reached Australia'. The Australian Crime Commission has worked out that they are here and are setting up. Why? Because the market has collapsed where they were selling their drugs. The profits that come from the drugs here are far, far superior because of the strength of our economy and the strength of our currency. It is happening day by day.
But what did we see? At the same time we had the GFC occurring, we saw some disturbing trends on the front-lines at our borders. From 2007 to 2012-13, our air cargo screenings decreased by 25 per cent, our sea cargo screenings decreased by 25 per cent and our mail inspections decreased by 30 per cent. The results are that the drugs seized in the last six years have decreased by 28 per cent and the guns seized in the last six years have decreased by 33 per cent. Where are they? They are in seats like Reid, they are in seats like Fowler and they are in seats like Chifley. They are in Western Sydney. Whilst I have read you an article from the Daily Telegraph about drug cartels, you do not have to pick up a paper. Every two or three days you see drive by shootings occurring, which is on the other side of the fence.
As the member for Moreton mentioned, we had the absurdity of the job that the former minister, the member for Blaxland, did. In October 2012, and it remains a record today, in Regents Park—about 500 metres from my electorate boundary—585 kilograms of ice was picked up at a street value of $430 million. Ice is a major issue. You once again just have to pick up a paper. But the result was in our own minister's backyard and in my backyard. We have this result. Scott Morrison, the Minister for Immigration and Border Protection, whilst in opposition had 30 Glock pistols mailed to a mailbox at a post office in his electorate within 30 days of their manufacture. They are the weapons that are being used. They are the product that is being sold and the weapons that are being used to generate the profits that this bill aims to attack.
We need to be smart with how we attack it. It is bills like this that will enable us to do that. I say this all the time: if anyone in this chamber, whether you are staff or parliamentarians, if you ask the question of how you bought your home, how you bought your car or how you paid for the what you have on your wrist, you would have an answer. They are the questions we need to ask the crooks. That is reality of what this bill does. This bill gives us a framework to work with our state colleagues.
The member for Moreton claims that it does not go far enough. That is fine. As the champions of this, we need to keep pushing on that front. It is not policeman standing in the front-line who will be the silver bullet or the panacea for this. Forensic accountants are as important as front-line police officers to attack the networks sitting behind the cash-flow businesses, which are distributing this cash flow in ways that have—up to this point in time—been far smarter than we have been able to catch.
The people of Reid and Western Sydney have put up with this problem on an increasing scale. It has been frustrating in my path to this place to have stood for last 23 years on the front-lines; to have kicked in those doors and to pull to young people out, dead, and be unable to revive them; to have been a victim of crime; to have seen drugs distributed and to have worked with our local policeman and women, who do such an amazing job. But I knew at the same time, because I have been raised in business myself, that we are only attacking in earnest the front two-thirds of the problem: the border and the enforcement. It is the proceeds we need to attack; it is the missing piece of the puzzle. It has been for a long, long time.
It frustrated me when I was standing in Western Sydney behind a bar pulling beers, which is where I will go back to when I leave this place. I just hope that the minister, with the passage of this bill does, not stop here. As the member for Moreton said, I will champion this cause. That is because it is so important to not only the people of Reid and to the people of Western Sydney and Australia but it is also important to our kids, who ultimately pay the price. This ice epidemic is something to behold.
I do not know if the member for Fowler was still in the force when ice first hit our streets, but I can tell you that it turns 75 kilogram weaklings into blokes who can throw me around like a rag doll. It is an epidemic, it is highly addictive, it alters personality and it creates its own self-inflicted vicious crime circle. That is the unintended consequence. That is what this bill needs to attack. That is the reality and the human face of what this looks like on the front-lines. That is, to look at the damage that all of this causes.
I cannot commend this bill highly enough. I challenge the minister to not stop on this front. The member for Moreton, in his opening line, said that he supports the bill and that this should always be an avenue a bipartisan support. I concur with those words, because for the sake of our kids in our grandkids we must attack this problem. Historically, we have done it from the front end, but just as important—and I hope I have explained that today—is the back end. If we do not make this profitable and if we make it place where people cannot launder their money and it is not worth doing, perhaps the Mexican drug cartels that were reported in the last couple of days as arriving here will choose some place other than my electorate in Western Sydney and our country to be home. I commend the bill to the House.
Mr HAYES (Fowler—Chief Opposition Whip) (17:36): I congratulate the member for Reid on his contribution, but I will correct him on one thing. I was never a police officer, although I was engaged to represent police officers. I will certainly pass your comments on to many of my esteemed former clients.
I am really happy that this bill is finally being debated. Unexplained wealth has had a very long and torturous history. This is an attempt to ensure that our law-enforcement agencies have access to the contemporary tools they need for combatting serious and organised crime.
Regrettably, in 2009—obviously before the time of the member for Reid—the current Attorney-General, Senator George Brandis, was at the vanguard of watering down the then unexplained wealth legislation, all in the name of civil liberties. Ironically, this protected the liberties of those who were commissioning or participating in criminal enterprise—the very people who were inflicting harm on our community. I do not want to be overly legalistic about it but those were the liberties that were being protected by the watering down of the unexplained wealth legislation. As a consequence, the legislation became unworkable and, after 12 months of operation, not a single proceeding was commenced under that legislation.
The member for Cowan, who is sitting over there, is a former police officer. He will recall the efforts of the then Parliamentary Joint Committee on Law Enforcement to review the shortcomings of that legislation. I am happy that what we have in front of us now is the government's response to the committee's unanimous report and recommendations on amendments to the Proceeds of Crimes Act—and I will go through some of the particular recommendations, and the impact, as I go on.
In 1997, Interpol recommended that its member countries give effect to laws to give police and law enforcement agencies powers to combat money laundering both domestically and internationally, including reversing the onus of proof in respect of the confiscation of alleged proceeds of crime. The legislation that we have before us moves well beyond the proceeds of crime. The unexplained wealth provisions go to the heart of a person who is engaged in serious crime, requiring them to explain how part or all of their assets were acquired by legal means. If they cannot, they risk forfeiting them.
In a law enforcement sense, unexplained wealth laws represent a relatively new form of criminal asset confiscation whereby serious and organised crime groups who cannot account for their wealth may be subject to civil forfeiture proceedings. The value of unexplained wealth as a law enforcement tool lies in its ability to undermine the business model of crime itself. The incentive behind most organised crime is to make money; organised crime is a profit-making venture. So removing wealth from organised criminal networks and associated individuals diminishes the incentive to participate in criminal enterprise.
Unexplained wealth legislation puts at risk not only the proceeds of a particular crime but all assets which cannot be properly accounted for. Furthermore, the confiscation of criminal profits removes funds that may otherwise be reinvested in future criminal endeavours. Whatever that endeavour might be—for example, funding another drug run or commissioning another rebirthing operation—removing those funds removes the incentive to reinvest. That is very good for the community because it plays a significant role in disrupting the operations of criminal networks.
The Australian Crime Commission estimates that the cost of organised crime in this country is somewhere between $10 billion and $15 billion a year, of which around $6 billion goes offshore annually. It is important that we give to our police and the people we charge with the responsibility of protecting our community the powers they need to combat crime. This is not simply the power to arrest people after a criminal event and bring them to trial and seek a prosecution—the traditional notion of policing, I suppose; or, at least, that would have been the case in my father's day—but to use all the appropriate provisions to deter and disrupt criminal enterprise.
One thing I have always said is that, for every crime, there is a victim of crime. Therefore, if you prevent a crime or deter the commissioning of a crime, there is one less victim. This is what our community needs. I believe that the efforts of the previous Labor government in the area of law enforcement have already put us on a strong footing—and certainly a lot stronger than most law enforcement jurisdictions internationally. I am firmly of the view that unexplained wealth represents one of the key measures in the fight against organised crime.
The Proceeds of Crime Act amendments before us will broaden search and seizure provisions to enable material relevant to unexplained wealth proceedings to be seized by officers executing a search warrant. It will also allow the courts extended time for the serving of notice of unexplained wealth orders. And importantly, because these are increased powers, this bill will also strengthen the scrutiny by the Parliamentary Joint Committee on Law Enforcement of those bodies exercising powers under this act—principally, the Australian Federal Police and the Australian Crime Commission.
But what must come with increasing powers—whether it be search and seizure powers or increased policing powers generally—is greater accountability. And I think the bill gets that right. Specifically, schedule 1 of the bill will, among other things, amend the Proceeds of Crime Act to implement the Parliamentary Joint Committee on Law Enforcement's recommendation to include a statement in the objects clause about undermining the profitability of criminal enterprise. This has been included to provide a measure by which courts can interpret unexplained wealth but also to ensure that evidence related to unexplained wealth proceedings can be seized under search warrant. There are recommendations to ensure evidence relevant to unexplained wealth proceedings can be seized under a search warrant; to streamline affidavit requirements; and to allow the time limit for serving notice of applications for certain unexplained wealth orders to be extended by a court in appropriate circumstances.
One very important recommendation of the committee is to harmonise the legal expense and the legal aid provisions of unexplained wealth cases to those that already apply under the Proceeds of Crime Act. I do not know if people appreciate it, but at the moment, if you are defending against unexplained wealth proceedings, you can use all those assets, financial and otherwise, to go to your legal defence, even though they may eventually be seized as unexplained wealth. This bill will not allow those assets and resources to be used in defence of someone trying to defend against unexplained wealth proceedings.
In addition to Schedule 1, this bill amends Purposes of Crimes Act to extend the purposes under section 266A for which information obtained under the coercive powers can be shared with states, territories or foreign authorities to include proceeds of crime purposes. Whilst there is no doubt that this legislation will impinge on people's liberties—particularly, in my humble submission, those who are engaged in criminal enterprise—clearly the objective of these provisions is about deterring and disrupting crime itself.
I take this opportunity to acknowledge Vince Kelly APM, President of the Police Federation of Australia, and the leaders of each of the state and territory police associations and the Australian Federal Police Association. I acknowledge them because they were the very first to raise the issue of unexplained wealth and to place it on the national agenda back in 2007. We owe them a great debt of gratitude. Their contribution came at a time when the parliamentary joint committee was frustrated by what we saw as the competing strategies and interests being adopted by the various police jurisdictions when it came to addressing serious and organised crime. Vince Kelly was able to assemble representatives of the nation's—at that stage—55,000 serving police officers and in a very clear and concise way to articulate the views of police officers about their needs in fighting contemporary organised crime.
I have recently been advised that Vince Kelly will soon step down from the Northern Territory Police Service; ending his 27 years as a police officer, 14 of which he led the NT Police Association and for seven years he has been at the helm as President of the Police Federation of Australia. To Vince Kelly APM, on behalf of all members involved with the Parliamentary Joint Committee on Law Enforcement as well as those members who participate in the Parliamentary Friends of Police, I thank him for his service, his contribution and certainly his leadership in advancing policing and law enforcement related issues on the national agenda.
In making his contribution the member for Moreton indicated that this legislation does not go far enough, and I am sure the member for Cowan would probably agree with that, as I do. One thing that is certain in combatting serious crime is that we can never be static. We can never stand still and expect that we are going to defeat serious and organised criminal networks. We must ensure that our police have the most contemporary tools necessary to fight crime and protect our community. Unexplained wealth is certainly an issue that I strongly support. As a number of my police colleagues have always said: when chasing down a criminal, follow the money. I commend this bill to the House.
Mr SIMPKINS (Cowan) (17:49): It is good to be able to make a contribution this evening on the Crimes Legislation Amendment (Unexplained Wealth and Other Measures) Bill 2014. The member for Fowler always makes a good contribution on these matters, as does the member for Reid, Mr Laundy. I too have a police background. I spent a couple of years in the Australian Federal Police, predominantly in Sydney. I certainly enjoyed those couple of years. I would say that there was plenty of action—plenty of surveillance, following people, searches, raids—but it was never exactly on the big scale. I remember going through front doors and occasionally through windows and searching people's bins out in streets in the middle of the night. I was not exactly the big fish, but I do recall people often saying, 'Well, up there in that big house in Elizabeth Bay is where the big people are.' At least at my level—and the AFP was trying to pursue people on all levels—but at my level it was just up there, but we were dealing with people down on the ground.
Whilst people on the ground need to be dealt with, the reality is that, as the member for Fowler said, you have to go in pursuit of the money. Self-interest always reigns supreme, and so if you attack what people are really after and take it away, then you are doing good work and attacking at all levels. I utterly support this, but it is interesting to note that, when we talk about unexplained wealth, our first foray into the area was via proceeds of crime, which legislatively began in 2002.
One of my favourite movies is The Untouchables, which is a Hollywood dramatisation of the US Treasury's fight against Al Capone and organised crime in Chicago in the 1930s. Ultimately, as I think many of us would recall, Al Capone eventually went to jail not for murders, kidnappings or bootlegging but for tax evasion. So the history of the pursuit of money or of attacking criminals through money goes back further than we in this place might think.
The Proceeds of Crime Act 2002, enacted in 2003, and the attempts by successive governments to pursue unexplained wealth, as through this bill, are exactly the right way to go. As the member for Fowler said, we should continue to look for the newest opportunities to make sure that we are tackling these problems and tackling these criminals at the right level and as hard and as harshly as possible. There is always room to go a little bit harder. As a more conservative member of this place, and a former police officer and Army officer, I say let's keep going in looking at what else we can achieve here. I certainly support this bill.
We should remember that the Proceeds of Crime Act 2002 allows for the tracing, restraining and confiscation of the proceeds of crime against Commonwealth law and, in some cases, the proceeds of crime against state and even overseas laws as well. Once confiscated, the act allows for the funds to be given back to the community for combating crime in Australia. This act exists to effectively deal with cases where money and assets have been acquired by a person that does not have the legitimate means or circumstances to acquire those funds and assets. Indeed, these laws look at those that appear to have no or limited financial means yet still have big houses, boats, flash cars or significant money. There is, of course, more to it than that, but that is the point of the existing laws and these amendments, which are designed to target organised crime networks and the people who create assets and money through crime and then conceal where that money came from. Just because the origins of these assets and money have been concealed by these criminals, that does not mean that it is untouchable.
It is through the Proceeds of Crime Act 2002 and with the aid of these amendments we are debating today that these trappings of wealth can be addressed. By 'addressed', I mean that these laws will facilitate the means by which to deprive persons of the proceeds of offences and to also deprive persons of literary proceeds derived from the commercial exploitation of their notoriety.
Taking away the proceeds of crime really undermines the reasons for crime—that is, to exact a profit and derive benefits. That is why this bill gives effect to our policy to tackle crime, a policy to ensure that we have every opportunity and means to target the profits of crime. Of course, our policy in general, and this bill in particular, especially addresses the recommendations of the joint committee. These were recommendations that came from wide consultation with police, the Australian Taxation Office and other agencies in order to ensure that the committee understood the issues.
I will not speak to every recommendation; rather, I will confine my comments to specific parts of the bill. Before I begin, I will clarify a few key terms. Firstly, under the current law, there are unexplained wealth restraining orders available, which effectively preserve the subject's property and ensure that property and assets cannot be disposed of before a matter is concluded in the courts. Next, there are preliminary unexplained wealth orders. They require a person to attend court to explain how their property and assets were lawfully obtained. This occurs under the evidentiary burden of the balance of probability, thereby requiring the person to prove that the property and assets were not obtained from an offence or criminal activity. I make the point that currently the court has a discretion whether to make the order if there are not reasonable grounds to suspect that the amount of the unexplained wealth is more than $100,000 or where it is not in the public interest to do so. Unexplained wealth orders are the final orders, where the court orders that the difference between a person's actual wealth and the amount determined to have been legitimately obtained be surrendered to the Commonwealth. This bill will change the existing law, where the court currently has the discretion to refuse to make unexplained wealth orders for suspected wealth of $100,000 or more. That is good because it gives certainty to the parties involved.
I reiterate the point that was previously made about one of the loopholes that will be closed in the Proceeds of Crime Act, where the proceeds of crime can currently be used by the person involved to pay legal fees. When that loophole is closed, the person in question can access legal aid but cannot use the subject money that we are talking about to pay a lawyer. In some ways, that seems a bit like money laundering through a lawyer. I do not wish to suggest that that could or would ever happen, but, in any case, it is good to close these sorts of loopholes.
From my time in the Federal Police, and even now as the member for Cowan, so often we look around in the suburbs of our cities and see houses that are almost unusual in their location, with walls unlike others, strong solid gates at the front of the house and innumerable CCTV cameras down the side of the building. When we examine the electoral roll, so often we find that there is no-one listed at that address. It is almost as though the premises have a suspicious look about them, a look that suggests there are things to be protected or views to be obscured by the infrastructure of sturdy walls and CCTV. This may be akin to the bikie fortresses that we had problems with in all the cities right the way around the country; people that just do not look like they have got a reason to have such assets—such a grand house, such security—it seems all so out of touch. In those cases, yes: we should be little bit suspicious. We should examine, and think to examine, how this has come to pass. Too often, it has been the case that those who have not worked an honest day to obtain what they have do still have those assets. We should be looking at that.
The way to do this is through this sort of legislation—the Proceeds of Crime Act, as amended by the Crimes Legislation Amendment (Unexplained Wealth and Other Measures) Bill 2014, if passed. Again, I go back to where I started, along with the member for Fowler and, before him, other members that have spoken in this debate: this is the way to really engage and disrupt this criminal activity: to be prepared to go in hard; to be prepared to use these sorts of laws to target where these people are most vulnerable; to be able to look at what they have got and the differences between what they could legitimately expect to achieve, with whatever work or lack of work they have, and the assets or the funds that they actually have. This is exactly the way that we should be going.
Whilst I endorse this bill completely, I will certainly also keep my eyes open, and keep thinking about ways that this can be further enhanced in the future, and further strengthened—because this is the right way to go. We need to tackle crime. We need to tackle those people that have derived their assets not out of thin air but at the cost of people on the ground in this country, people that have been taken advantage of by the drug importers, and by these high-level criminals; they have been taken advantage of, and they have had their lives wrecked and their families' lives wrecked. They are the victims. We must hold to account those that are responsible at every level. And if it cannot be through jail and actual prosecution for their terrible offences, such as drug trafficking et cetera, then it should be through this means. It should be to take away as much of what they have—and basically leave them with nothing—to ensure that the proceeds from the crimes that they have committed will amount to no benefit for them. Obviously, in the end, you always hope that such people will go to jail, and truly atone for their crimes. But in any case, to take away the high-end assets, the money, and the other trappings of their criminality is exactly the right way to go. I commend this bill to the House.
Mrs ELLIOT (Richmond) (18:03): I too rise to speak on the Crimes Legislation Amendment (Unexplained Wealth and Other Measures) Bill 2014. And I too, as a former police officer, am very pleased to be speaking on this bill. I know how welcome these reforms are. May I echo the words of the previous speaker, the member for Cowan, who is also a former police officer: I understand some of the sentiments that he expressed about how welcome these improvements are.
Can I also take this opportunity to commend our police forces, not only our federal but also our state and territory police forces right across the country. I acknowledge the remarkable work that they do in often very difficult and challenging situations. I remind the House that next Monday is National Police Remembrance Day, and an opportunity to remember those police officers who have lost their lives in serving our community. I want to take this opportunity to acknowledge them and to commend our forces for the remarkable work that they do.
Investigating unexplained wealth is a very powerful tool against organised crime. We have heard many speakers in this debate detail reasons for that. For far too long, we have all seen the devastating effects that organised crime and criminals can have upon our communities right throughout this country. I know there is frustration felt by police officers if they do not have the powers or resources to effectively investigate, particularly in the case of those who have profited from criminal activities. That is why legislation like this is incredibly important in disrupting or stopping organised crime. It is a very vital asset to have this legislation in place. That is why it was that, in 2013, the Labor government initially moved to tackle criminals where it really hurts: the proceeds of their crimes. It really goes to the heart of their criminal activities because, of course, it is money that keeps their business model operational. It is very appropriate that the coalition has wisely adopted this proposed legislation that we are debating before the House today.
This bill, the Crimes Legislation Amendment (Unexplained Wealth and Other Measures) Bill 2014, is to specifically to amend the Proceeds Of Crime Act to strengthen the Commonwealth regulation of unexplained wealth, and to improve the investigation and litigation of unexplained wealth matters. Indeed, it reflects the recommendations made by the parliamentary Joint Committee on Law Enforcement. Schedule 1 of this bill contains amendments that will amend the Proceeds Of Crime Act, and implement eight of the 18 recommendations set down by the parliamentary Joint Committee On Law Enforcement. These relate, firstly, to including a statement in the objects clause about undermining the profitability of criminal enterprises, and ensuring that evidence that is relevant to unexplained wealth proceedings can in fact be seized under a search warrant—a very important part of this. It will also streamline affidavit requirements for preliminary unexplained wealth orders. And this will also act to allow the time limit for serving notices of application for certain unexplained wealth orders to be extended by a court, in appropriate circumstances. It will also harmonise legal expenses and legal aid for unexplained wealth cases for other Proceeds Of Crime Act proceedings, so as to prevent restrained assets being used to meet legal expenses, which I think is a particularly good move—that those assets cannot be used to pay for legal fees on those occasions. The changes that are put forward in this bill will also allow charges to be created over restrained property to secure payment of unexplained wealth orders, as can occur with other types of proceeds of crime orders. It will also remove a court's discretion to make unexplained wealth restraining orders, preliminary unexplained wealth orders, and unexplained wealth orders, once relevant criteria are satisfied.
Finally, the bill will require the AFP Commissioner to provide a report annually to the parliamentary Joint Committee on Law Enforcement on unexplained wealth matters and litigation, and will also empower the committee to seek further information from federal agencies in relation to such a report. In addition, schedule 1 of the bill will amend the Proceeds of Crime Act, for which information obtained under the act can be shared with a state, territory or foreign authority to include proceeds of crime purpose. I believe this is a very important element of this bill. The purpose of these amendments is to enhance information sharing with appropriate state, territory and indeed foreign authorities. Proceeds of crime investigations and litigations increasingly involve transnational elements, due to the very international nature of serious and organised crime. In order to effectively pursue the proceeds of crime offshore and to assist our foreign counterparts in doing so, it is essential that the AFP has the ability to share information for such purposes. This is especially so due to the increasingly complex and growing nature of serious and organised crime across borders and across countries, so it is very important to have that element of being able to share that information.
As a former police officer I definitely know how welcome these reforms are. Investigating unexplained wealth is a really powerful tool that can be used against organised crime. Laws regulating what is known as unexplained wealth allow the courts to issue an order to compel individuals to attend court and to demonstrate that, on the balance of probability, their wealth was lawfully obtained—so the onus is upon them. They are designed to zero in on the wealth of usually senior organised crime figures who tend to profit from crime without actually being directly involved—they are beneficiaries of illegal activities. This bill will make it harder for criminals to profit from their illegal activities—make no mistake about it, it will definitely do that. It will be effective in that sense. The bill will also assist in ensuring the safety of so many people and so many communities right across the country. I know that in my electorate of Richmond on the north coast of New South Wales, like in other areas, people are genuinely concerned about organised crime elements. They are very keen to see any effective measures that would act to stop any growth in organised crime and would help with any policing resources and investigative tools that are in place.
With these welcome reforms it is important to note that it was the previous Labor government that led the way on prosecuting unexplained wealth and on tackling the scourge of organised crime. In fact, it was the Labor government in 2010 who first recognised that our law enforcement agencies required additional tools to really disrupt and unsettle the organised crime syndicates and their illegal and widespread operations. This action was achieved through the Crimes Legislation Amendment (Serious and Organised Crime) Act 2010, which introduced provisions for the making of unexplained wealth orders into the Proceeds of Crime Act 2002. However, due to the need for a connection with a constitutional head of power, the wealth order's applicability was limited to circumstances where a connection could be established to a Commonwealth or a foreign offence, or a state offence with a Commonwealth aspect.
This constitutional limitation hampered the effectiveness of the proceeds of crime provisions, and in March 2012 it was recommended that the Commonwealth seek a referral of powers from state governments in order to legislate for a broader-based, national unexplained wealth scheme. Back in June 2013, former police commissioners Mick Palmer and Ken Moroney were appointed by the previous justice minister when Labor was in government, the member for Blaxland, to negotiate with the states, territories and other authorities to have them involved. Although it was reported by the ABC in October 2013 that Mr Palmer and Mr Moroney were due to report to the government within weeks, we are not quite certain what recommendations they have made and what the exact status of that report is. We certainly strongly encourage some good outcomes there, and encourage them to work closely with the Commonwealth as well, because it is only by working together on these particular aspects that we can be successful in pursuing these investigations.
Given the statutory limitations, the Parliamentary Joint Committee on Law Enforcement decided in 2012 to reassess the effectiveness of the bill, and initiated an inquiry to explore a number of changes that were needed to strengthen the legislation. As mentioned earlier, in 2013 18 recommendations were handed down by the Parliamentary Joint Committee on Law Enforcement—eight of which were adopted. From these recommendations came Labor's Crime Legislation Amendment (Organised Crime and Other Measures) Bill 2012, which passed through this House in February 2013 but lapsed in the Senate at the end of the last parliament. The Crimes Legislation Amendment (Unexplained Wealth and Other Measures) Bill 2014 is essentially identical in nature to Labor's lapsed legislation and implements Labor's commitments of February 2013 in the government response to the Parliamentary Joint Committee on Law Enforcement, which of course is why we are so supportive of this legislation.
You can see that it was the Labor government's initiative to really come down hard on criminals and their organisations and the profits that they make illegally. It is unfortunate, when we look at the history of this, that, when we put this first round of legislation there, there was some criticism from the coalition at the time. I know that the now Minister for Justice, Minister Keenan, who was on the opposition benches at the time, made remarks about Labor not embracing the recommendations of the committee which involved the Australian Crime Commission pursuing unexplained wealth orders. It was unfortunate there was some criticism then. However, in opposition Labor continues to uphold our commitments to a very bipartisan approach to this, and believe that we have to be working together to put pressure on organised crime and the unexplained proceeds of their activities. That is why we offer our full support for this bill—after all, we essentially wrote it, and it is identical to legislation put before the House in the previous parliament. I certainly look forward to this government working effectively with the states and territories to make sure we can implement concrete laws to combat organised crime and its illegal proceeds.
It is for all of those reasons that Labor supports this bill and supports moves to effectively tackle organised crime syndicates and to work effectively in terms of sharing that information. That is vitally important with the very complex, changing and involved nature of organised crime, and it is measures such as this that will effectively make major differences. I commend the bill to the House.
The DEPUTY SPEAKER ( Mr Broadbent ): It seems there is a breakout of bipartisanship in the House.
Mr CRAIG KELLY (Hughes) (18:14): Thank you, Mr Deputy Speaker, and you are right—it is good to hear that spirit of bipartisanship. The purpose of the Crime Legislation Amendment (Unexplained Wealth and Other Measures) Bill 2014 is to amend the act to revise the procedures and requirements relating to unexplained wealth, and to allow information obtained using coercive powers under the act to be shared with state and foreign authorities for the purposes of proceeds of crime investigation and litigation.
By way of background, a definition of unexplained wealth by the former Attorney-General is as follows:
'Unexplained wealth' laws enable a court to issue an order unless the subject of proceedings can establish, on the balance of probabilities, that his or her wealth was lawfully acquired. An assessment is made of the quantum of unexplained wealth (the difference between the person's total wealth and that shown to be derived lawfully), and the subject of the order must pay the amount to the relevant jurisdiction.
Unexplained wealth laws are designed to target the wealth of senior organised crime figures, …
The libertarian streak in me, at first blush, gives me some concern that private citizens might have to explain to a government bureaucrat how they obtained their assets. However, the first order of any government is to preserve the public order, and in this environment such laws are not only necessary; they are essential. For there is a clear link between terrorism and terrorist activities and their funding through illegal and illicit activities. That is why, if we are able to disrupt that business model—if we are able to use these laws such that people know that if they attempt to engage in an illegal activity they will have no financial benefit—then that will also help us defeat terrorism. These laws turn the tables on those who seek to live off the benefits of their illegal activities. In doing so, they are living off the benefits of other, hardworking Australians.
The connection, as I said, between terrorist activities and their funding through illicit activities has been well documented and well detailed. First, we have seen that many of the people who have been recruited to fight in Syria and in northern Iraq and recruited for ISIS are actually former criminals themselves. Many of them have been involved in drug trade and drug trafficking and have been taking drugs themselves—and that perhaps explains the damage to their brains. We have also seen a recent case of a business in Lakemba—an old stomping ground of mine—which this year has transferred $21.3 million to the Middle East but is able to account for only $12.3 million. So, there is a $9 million discrepancy—$9 million has come out of the Australian community, from hardworking Australians, and has been inexplicably transferred across to the Middle East, from a firm with links through their relatives to known terrorists. That is why this bill has bipartisan support, and I am glad to hear that from both sides and the many speakers who have spoken on this bill.
I will not take too much of the House's time, but I would like to quickly go through the three specific measures of the bill, which are to ensure the most effective framework for law enforcement to investigate and take action to target unexplained wealth; to streamline the processes for obtaining unexplained wealth orders while ensuring appropriate safeguards—and those safeguards are important; and, finally, to close loopholes in the Proceeds of Crime Act that potentially make it easier to escape unexplained-wealth actions and frustrate court processes. I am glad this bill has bipartisan support, and I commend it to the House.
Mr THISTLETHWAITE (Kingsford Smith) (18:19): I am pleased to support the Crimes Legislation Amendment (Unexplained Wealth and Other Measures) Bill 2014, because organised crime casts a vast shadow over our economy and our society. It has proved quite difficult to tackle and stamp out. It is also a very big handbrake on our nation's economic development. Transnational organised crime is big business. In 2009 it was estimated to have generated US$870 billion, an amount equal to 1.5 per cent of global GDP at the time. Unsurprisingly, those who are involved in organised crime—energetically, aggressively and innovatively—compete for their share of illicit markets.
The sad thing about organised crime is that many of the people who are involved in it are quite intelligent, and they employ and undertake very sophisticated operations, basically to make profits. They are profit driven and employ increasingly complex networks and structures and ways of concealing their activities and their identities. Organised crime is now, unfortunately, a part of the lives of Australians in an unprecedented way. Once encounters with organised crime were largely restricted to those who sought out illicit commodities or sought out illegal activities. Today, any Australian can be affected by organised crime. Some of the more obvious examples in our society are Australians being defrauded in investment scams, theft of credit card and bank account data through online attacks or by means of skimming through ATMs and point-of-sale devices; the discovery of dangerous and volatile clandestine laboratories used to produce drugs in suburban areas; and violence between organised crime groups that, increasingly, in many of the big cities in Australia is on the rise.
The Australian Crime Commission conservatively estimates that organised crime costs the Australian economy about $15 billion annually. And with the country's largest airport and second-largest port in my community, it has unfortunately become a target for many organised crime syndicates and operations. Just yesterday the news broke that a 38-year-old maintenance worker based at Sydney airport was arrested and charged with attempting to import 99 kilograms of heroin worth $19 million into Australia.
As shadow parliamentary secretary for immigration, with responsibility for customs, I have often been shocked to hear the details of weapons and the interceptions of the border protection authority in the course of their regular duties. In the four months from February through to May, the Australian Customs and Border Protection Service seized 1,339 firearms, 14,460 non-firearm weapons, which included 7,729 bladed weapons, 2,522 martial arts weapons, 190 antipersonnel chemicals and 149 items of warfare, the Customs definition of which includes grenades, bombs, projectiles and associated parts and accessories. That is just a snapshot of a couple of months of some of evil activities and illicit and illegal weapons that are being brought into Australia. Our authority is doing a marvellous job in detecting and shutting down these operations, and they deserve our support.
Money is one of the main drivers of these criminals, which is why this bill aims to boost the capabilities of authorities so that they are better able to hit the lawbreakers where it hurts them the most. The purpose of this bill is to revise the procedures and requirements for making orders relating to unexplained wealth and to allow information obtained using coercive powers to be shared with state and foreign authorities for the purposes of proceeds of crime investigations and litigation. Hopefully, this will lead to an increase in the number of prosecutions and confiscations of proceeds of crime in Australia, which, unfortunately, has in some respects been low to date.
Unexplained wealth laws are a powerful tool against organised crime. They enable authorities to seize assets that exceed a person's legitimate wealth. This enables the targeting of criminal kingpins who profit from crime without being directly involved in the commission of an offence. The majority of amendments contained in the bill were introduced into the House in 2012 by the former Labor government before that bill lapsed at the end of the 43rd Parliament. This bill is fundamentally the same as the lapsed legislation. It implements Labor's commitments of February 2013 in the previous government's response to the inquiry of the Parliamentary Joint Committee on Law Enforcement into commonwealth unexplained wealth legislation and arrangements. The bill implements eight of the 18 recommendations handed down in that inquiry, such as: to include a statement in the objects clause of the law about undermining the profitability of criminal enterprises; ensuring evidence relevant to unexplained wealth proceedings can be seized under a search warrant; streamlining affidavit requirements for preliminary unexplained wealth orders; allowing the time limit for serving notice of applications for certain unexplained wealth orders to be extended by a court in appropriate circumstances; harmonising legal expense and legal aid provisions for unexplained wealth cases to those for other act proceedings, so as to prevent restrained assets being used to meet legal expenses; allowing charges to be created over restrained property, to secure payment of unexplained wealth orders, as can occur with other types of proceeds of crime orders; removing a court's discretion to make unexplained wealth restraining orders, preliminary unexplained wealth orders and unexplained wealth orders, once relevant criteria are satisfied, and requiring the AFP commissioner to provide a report to the parliamentary joint committee annually on unexplained wealth matters and litigation, and to empower the committee to seek further information from federal agencies in relation to such a report.
There are other amendments in the bill, which Labor supports. They include: inserting an additional object of undermining the profitability of criminal enterprises into the Proceeds of Crime Act 2002; removal of the requirement for authorised officers to meet an evidence threshold test for a preliminary unexplained wealth order where the evidence threshold test for a restraining order has already been met; clarifying that a court may make an unexplained wealth order even if the person to whom the order relates failed to appear as required by a preliminary unexplained wealth order; and, allowing information obtained using coercive powers under the act to be shared with state and foreign authorities for the purposes of proceeds of crime investigations and litigation.
Unexplained wealth laws enable a court to issue an order unless the subject of proceedings can establish on the balance of probabilities that his or her wealth was lawfully acquired. An assessment is made of the quantum of unexplained wealth, being the difference between the person's total wealth and that shown to be derived lawfully, and the subject of the order must pay the amount to the relevant jurisdiction.
Labor led the way in implementing unexplained wealth laws. Commonwealth unexplained wealth laws have been in place since 2010. Minister Keenan, in opposition, unfortunately made remarks about Labor not embracing the recommendations of the committee that involved the Australian Crime Commission pursuing unexplained wealth orders. In government, however, Minister Keenan has failed to keep faith with his rhetoric in opposition. Once again, the coalition said one thing in opposition and have done the opposite in government.
Nevertheless this is a reform that I am pleased to support and that Labor supports. Hopefully, we will see an increase in the number of successful prosecutions in this country for unexplained wealth, successful prosecutions of people in Australia who are benefitting from crime.
Mr VAN MANEN (Forde) (18:28): I rise to speak on the Crimes Legislation Amendment (Unexplained Wealth and Other Measures) Bill 2014. As a number of speakers in the House have already mentioned, unexplained wealth generally results from financial crimes and misappropriation of monies in a variety of manners. In its facts sheet, the Australian Crime Commission lists some of these. They include tax evasion; embezzlement; various ranges of fraud, including securities fraud, bank fraud and identity fraud; insider trading; illicit drug trafficking; organised theft and cybercrime.
The Australian Crime Commission conservatively estimates that serious and organised crime costs Australia $15 billion every year. This cost comprises loss of business and taxation revenues, expenditure on law enforcement and regulatory efforts, and the social and community impacts of crime. This bill is directly aimed at seeking to curtail the activities of those who are seeking to undertake criminal activity. At the end of the day, if you remove the financial incentives or you remove the access to finances, those criminal enterprises will dissipate.
This bill seeks to implement the recommendations made by the Parliamentary Joint Committee on Law Enforcement in the final report of its inquiry into Commonwealth unexplained wealth legislation and associated arrangements. Criminals who live off the benefits of their illegal activities at the expense of hardworking Australians will be required to comply with additional strengthening mechanisms implemented by this bill. The effect will be to make it tougher for senior organised crime kingpins to conduct their illegal business in our country. More often than not, they are the ones who enjoy those proceeds but they are not the ones directly committing the crimes.
In 2011-12, the Parliamentary Joint Committee on Law Enforcement conducted an inquiry into the Commonwealth's unexplained wealth legislation and associated arrangements. Its final report was handed down in March 2012. The inquiry examined the effectiveness of Commonwealth laws and took evidence from the Attorney-General's Department, the Australian Crime Commission, the Australian Federal Police, the ATO and a number of other government and non-government organisations. The inquiry found that unexplained wealth provisions had not been operating as intended. As a result, the Parliamentary Joint Committee on Law Enforcement made 18 recommendations for improvement. These recommendations were aimed at improving the investigation and litigation of Commonwealth unexplained wealth matters. Recommendations 1, 5 and 8 through 13 were for specific amendments to the act; recommendations 2, 3 and 4 concerned the Australian Crime Commission's potential role in supporting unexplained wealth proceedings; and recommendations 6 and 7 related to improving information sharing between law enforcement agencies and the ATO. The remaining recommendations, 14 to 18, related to the development of a national unexplained wealth scheme and international agreements relating to unexplained wealth.
This bill will implement eight of those recommendations aimed at strengthening the Commonwealth's unexplained wealth legislation and arrangements. The bill amends the Proceeds of Crime Act to strengthen the unexplained wealth regime. Schedule 1 of the bill contains amendments to the Proceeds of Crime Act that will implement the committee's recommendations to include a statement in the objects clause about undermining the profitability of criminal enterprises. Turning off the financial tap, as I said earlier, is one of the most effective ways to shut down criminal organisations. Schedule 1 also contains amendments to the Proceeds of Crimes Act to ensure evidence relevant to unexplained wealth proceedings can be seized under a search warrant, which was recommendation 5 of the committee's report; streamline affidavit requirements for preliminary unexplained wealth orders, which was recommendation 8; allow the time limit for serving notice of applications for certain unexplained wealth orders to be extended by a court in appropriate circumstances; harmonise legal expense and legal aid provisions for unexplained wealth cases with those for other Proceeds of Crime Act proceedings so as to prevent restrained assets being used to meet legal expenses; allow charges to be created over restrained property to secure payment of an unexplained wealth order, as can occur with other types of proceeds of crime orders; remove a court's discretion to make unexplained wealth restraining orders, preliminary unexplained wealth orders and unexplained wealth orders once relevant criteria are satisfied; require the AFP Commissioner to provide a report to the Parliamentary Joint Committee on Law Enforcement annually on unexplained wealth matters and litigation; and empower the committee to seek further information from federal agencies in relation to such a report. On that matter, as chair of that particular committee, I will say that our law enforcement agencies—in particular the AFP and the ACC—do a wonderful job in this area. They are also very forthcoming and ready to discuss any issues we put before them.
Schedule 1 of the bill also contains amendments to the Proceeds of Crime Act that do not relate to specific recommendations of the parliamentary joint committee's report but have been identified as necessary to support the amendments outlined earlier and to address inefficiencies in the act. The first is to clarify that unexplained wealth orders may be made where a person who is subject to the order fails to appear at an unexplained wealth proceeding. The purpose of this amendment, which will give effect to the original intent of the unexplained wealth scheme in the Proceeds of Crime Act, is to ensure that persons cannot frustrate unexplained wealth proceedings by simply failing to appear when required to do so. Another amendment will ensure that provisions in the Proceeds of Crime Act that determine when restraining orders cease to have effect take account of, firstly, the new provisions allowing charges to be created and registered over restrained property to secure the payment of unexplained wealth amounts and, secondly, the fact that unexplained wealth restraining orders may sometimes be made after an unexplained wealth order—not only before.
Also, consequential amendments are proposed to ensure that provisions allowing a court to order costs in certain situations where a restraining order has ceased take these amendments into account. We are also seeking to further streamline the making of preliminary unexplained wealth orders where an unexplained wealth restraining order is in place or has been revoked under section 44 of the Proceeds of Crime Act. We are also seeking to remove redundant and unnecessary affidavit requirements in support of applications for preliminary unexplained wealth orders and, in light of changes to the affidavit requirements for preliminary unexplained wealth orders as outlined above, to ensure that a copy of the affidavit relied upon when a preliminary unexplained wealth order was made is provided to the person who is subject to the order.
In addition, schedule 1 of the bill will amend section 266A of the Proceeds of Crime Act to extend the purposes for which information can be obtained under the coercive powers of the Proceeds of Crime Act and can be shared with state, territory or foreign authorities to include a proceeds of crime purpose. I think this is particularly important, given the transnational nature of much criminal activity in today's world, particularly in relation to terrorist financing, which the member for Hughes touched on earlier. The purpose of these amendments is to enhance information sharing across appropriate state, territory and foreign authorities. Proceeds of crime investigation and litigation increasingly involves transnational elements, due to the international nature of serious and organised crime. To effectively pursue the proceeds of crime offshore and to assist our foreign counterparts in doing so, it is essential that the AFP has the ability to share information for such purposes.
Schedule 2 of the bill corrects some minor drafting errors in the Proceeds of Crime Act that were identified during the drafting of the bill. The amendments made by the bill will ensure that the government has strong laws to target the substantial profits made by serious and organised crime. These bills deliver on our commitments made during the election where we said we would strengthen unexplained wealth legislation to strike at the heart of organised crime by taking away the profits and assets of criminal syndicates and thereby undermine their business model. We said we would ensure the Australian Crime Commission and other relevant law enforcement agencies would have appropriate powers to investigate unexplained wealth.
We also pledged that the coalition would immediately move to implement the recommendations in the parliamentary joint committee's report. I thank those opposite for their comments indicating they are in full support, and I note the work that was done in relation to this in the last parliament. I also note that the Police Federation of Australia and the Australian Federal Police Association, in their joint submission to the Australian Crime Commission, and Australian Customs and Border Protection Service were supportive of the unexplained wealth amendments in the 2012 bill. As I have said, we are honouring another election commitment where we promised to strengthen these laws and deliver a safer, more secure Australia for everybody in our community.
Mr HUSIC (Chifley) (18:41): It gives me pleasure to talk on this bill because it has been something that respective governments, Labor and Liberal, have attempted to tackle at the federal level. When we were in government, we attempted a number of times to get coordination through the attorneys-general at the state, territory and Commonwealth level to deal with the issue of unexplained wealth. There are people that, for whatever reason, have accrued vast amounts of wealth and it is very difficult to determine how that wealth has been accrued. There are clearly enough reasons for us to pursue or to inquire into the sources of that wealth which, in many instances, has been acquired in an illegal way, and we need to be able to home in on that and tackle it.
The problem has been that the states and territories have been reluctant to confer the powers on the Commonwealth. Even though former home affairs minister, Jason Clare, the member for Blaxland, had given assurances that the states would still be able to retain the revenue and that the proceeds that had been secured by the Commonwealth would be available for states, there has been a high degree of resistance. This remains a national priority, given the fact that a lot of the people that are suspected of having unexplained wealth or assets that we believe have been obtained or funded improperly cross borders. They cross territories and states, and they do need to have a national focus. So the ability to get those levels of government working together is very important.
Being able to make headway on this is critical, and we have indicated our support for this bill because, in large part, it reflects the bulk of the work that we had undertaken when in government. In fact, I understand it is almost word for word identical to the previous Crimes Legislation Amendment (Organised Crime and Other Measures) Bill 2012 which was introduced in this place in November 2012, and passed in February 2013. While the bill was introduced in the Senate on 6 February 2013, it lapsed with the end of the 43rd Parliament in September 2013. We certainly welcome the fact that this is being brought back into the House so that it may become law.
Just by way of clarification, the laws themselves enable a court to issue a declaration that unless the subject of proceedings can establish that his or her wealth was lawfully acquired, an assessment will be made on the quantum of unexplained wealth and the subject of the declaration will have to pay the relevant jurisdiction. They are a powerful tool. They are a very important tool in the fight against organised crime. They allow authorities to be able to gain and seize assets that exceed a person's legitimate wealth. From the opposition's perspective— particularly from our time in government—it enables the targeting of those criminal elements who are profiting from crime without being directly involved in the commission of an offence. As I said before, this was something that had been the focus for quite some time of Labor in government, and it is important that this work continue.
We had also, when in government, secured the support of former police commissioners Nick Palmer and Ken Moroney. They were appointed by then Minister Clare to negotiate with the jurisdictions to overcome those problems that I indicated earlier where the states and territories were reluctant to confer power to the federal level. It is understood that in October last year their report was handed up to the government. The government were supposed to report back in a matter of weeks. That has not occurred. It is of concern that this has not been the case. Again, if this work has been done, it is puzzling why it has been held back and why it has not been released in the public space or any kind of government response to it delivered.
It does not surprise me, though, because in many instances Minister Keenan said one thing in opposition and has said another thing now that he is on the government side of the House. He had previously, for example, been very eager to condemn the former Labor government on issues such as the level of resourcing enjoyed by agencies such as the ACC, Customs and Border Protection, and the AFP. In fact, while he may have spoken very strongly in opposition about resourcing for those agencies, it is clear from the first Hockey budget that the strength of his conviction was unable to prevent the cuts to them that have gone through. In actual fact, for instance, during a press conference last year now Minister Keenan was quoted as saying, in criticising cuts to the AFP budget, that Australia's national security had become weaker. What happened in this May's budget? $11.7 million was axed from the Federal Police. So his strength of conviction in opposition, as I said, failed to shield the AFP when in government. That will have a direct impact on the AFP's ability to protect the community. We believe around 300 AFP jobs are at risk because of these cuts. Again, those opposite are prepared to say one thing in opposition and do another thing in government.
I will mention another example that has been highlighted by the shadow minister. The Abbott government has cancelled $42.5 million in funding that had been allocated by the former government for additional sworn officers and $22 million across four years for the AFP's aviation operations at Hobart airport. Again, they said one thing in opposition, making the criticism, but they are not able to deliver in government. Certainly I think there is an appreciation that the rhetoric in opposition has not been able to sustain commitment or intention in government. That is an issue. Hopefully, the severity of that rhetoric will be wound back in years to come.
I turn to the other issue that it is important to discuss today. That is the whole issue of the National Crime Prevention Fund. That is a fund that was important for communities across the country. It had about $40 million. It was a component of the former government's package of measures to address gang violence and street crime within the community. It is certainly something that I felt strongly about in my part of Western Sydney because we had groups and local area commands in Western Sydney able to work together on antisocial behaviour that was affecting the quality of life of the people I represent in this place. The National Crime Prevention Fund was designed to support initiatives in high crime areas and to address the disconnection of young people that might be a trigger for antisocial behaviour. It also provided for diversionary and educational activities to help reintegrate young people into society. It also supported, for instance, the installation of closed circuit TV in areas that were known to be prone to antisocial behaviour, such as the damage of property and businesses in areas where there are major thoroughfares but problems with lighting and people taking advantage of those spaces to impact on local residents.
In my part of the world out in Doonside in Rooty Hill they have some of the few shopping strip areas outside of major shopping centres. These places have started to disappear as most commercial activity get centralised within shopping centres. But when theses shops are out in the open, particularly late at night, they are more vulnerable to antisocial behaviour—in particular, for example, graffiti and vandalism. In our part of the world, for quite some time I have been trying to marshal effort between police, business and community groups to try to work out short-term, medium-term and longer term strategies to deal with the issue. The short-term ones involved the use of CCTV to be able to quickly target those people who are undertaking this type of behaviour. The medium-term ones were the diversionary types of activities that were funded under the National Crime Prevention Fund. That would have involved community groups like the Blacktown Youth Services Association and Eagle Raps in Doonside getting offenders to find another outlet for their energies and ensure they were not engaging in antisocial behaviour. The longer term strategy was an innovative pilot program undertaken by Blacktown council, working with primary and secondary schools to tackle those behaviours that might lead to antisocial behaviour down the track. Blacktown council is to be commended for thinking longer term on this and getting young people to minimise the risk of them engaging in this behaviour.
Another activity that was really important, too, under the former local area commander for Blacktown, Mark Wright, who I have spoken about here previously, and Marist Youth Care, was a really great initiative called Com4unity. This dealt with antisocial behaviour within Westpoint in Blacktown where young kids were engaging in brawls and fighting. They had a very good pilot program that had seen a massive drop in that antisocial behaviour. They then formed a proposal under the National Crime Prevention Fund to be able to work together to extend that program. I was exceptionally pleased that they secured funding for the things I have talked about for Doonside and Rooty Hill, also for the work with Marist Youth Care and the police, through the PCYC that was involved. They were ready to receive those funds. They had received the letters indicating that they had got those funds. And what happened? The incoming government ripped all of the funds away.
I was grateful for the motion moved by the member for Kingston this week in which we talked about $800,000 of funds being ripped away from Marist Youth Care's Youth Connections. On top of that, they lost access to the funds that were given to them under the National Crime Prevention Fund. That is probably close to $1 million that would have been dedicated to improving antisocial behaviour in our area or to find employment outlets for young people in our area that was gone. It was ripped completely away. This government, which makes a big deal in question time about the funding of the East West Link and the tearing up of contracts, and which manages to bring Victorian state politics into this place, did a whole stack of that with community groups in this portfolio area. Ripping out that funding has impacted our ability to tackle antisocial behaviour in local areas.
What did they do with the money instead? They introduced the Safer Streets Program, a $50 million crime prevention initiative. From what I understand, even though we had groups ready to start the work—it takes a lot of long-term commitment to be able to break down these issues in local communities—this money was torn away. Everything has pretty much screeched to a halt, and we have a new program in place. No money has been allocated to youth mentoring or outreach programs, based on what we have been able to see. The only funding that has been provided is for projects that relate to CCTV, mobile CCTV and better lighting. That is all that has been done. But for the stuff that needs a longer term commitment and investment nothing has been done.
The target group of funding under the first funding round of the Abbott government's Safer Streets Program is organisations that were identified before October 2013. The Auditor-General has announced a lengthy investigation into this program, particularly into the eligibility criteria and the selection process used to award millions of dollars' worth of grants. In the first round of funding $19.3 million of taxpayers' money has been allocated to organisations hand-picked by the Liberal Party in the lead up to the 2013 election. It is simply shameful that we went through a selection process with public criteria, selected the groups and had them ready only to have the funding stopped. It was an arms-length process that was undertaken by the Attorney-General's Department. That was stopped and in its place this sham program that basically targets hand-picked organisations in a way that lacks transparency and is unable to demonstrate whether value for money will be delivered or not. More importantly, nothing is happening in the areas we represent. We cannot afford for this work not to go ahead.
Again, I raise the point that the Abbott government has affected our ability to deal with antisocial behaviour in our area. It has stalled action in other areas. We should not be paying a price for the inability of this government to follow proper process and honour previous commitments to good community groups that were going to do great work.
Mr COLEMAN (Banks) (18:56): It is good to be able to speak on this very important piece of legislation addressing, as it does, the critical issue of tackling organised crime, because there is no influence in our society which is more destructive or pernicious than organised crime. In the context of the Crimes Legislation Amendment (Unexplained Wealth and Other Measures) Bill 2014, I will speak for a moment about the initiatives of the government in the crime area generally. In my community of Banks crime is an issue that concerns a great many people. This government is absolutely determined at the federal level in concert with state and local authorities to sensibly do everything we can to address crime. We have had a number of local initiatives that have been very important in this area.
We have announced that CCTV cameras will be deployed in my electorate, in the suburbs of Narwee, Penshurst, Mortdale and Riverwood. They have been federally funded. It was terrific to have the Minister for Justice make the time to come and visit me and some members of my community in Riverwood just a few weeks ago. We talked about the importance of the CCTV program. Working closely with Hurstville council, those cameras will be rolled out very shortly. That will mean that should an incident occur in any of those locations the local police will be able to call upon the council, who will have custody of the hard drive where the imagery is stored, and call up the tape, so to speak. If an incident occurs on a Saturday night we will be able to access the footage from that Saturday night, which is a very good thing. There are two key benefits. Firstly, CCTV cameras should reduce the incidence of crime because if criminals know that they are there, and we will ensure that they do, they should be less likely to commit a crime. Secondly, if unfortunately, nonetheless, they do persist we will potentially have the opportunity of identifying who did it. That is why it is important. I am very proud of this initiative of this government.
At the more-national level, we have made some other important initiatives in crime prevention. One of the worst examples of crime that has afflicted our nation in recent years is the evil trade of people smuggling. We have addressed that very, very firmly. I saw today that in the eight months since the implementation of Operation Sovereign Borders we have had one unlawful boat arrival. In the comparable period under the previous government there were over 250 boats. We know the human cost and we know the financial cost only too well, but it certainly demonstrates the very firm desire of this government to show strength on our borders.
The same applies in Customs, because we have got to make sure that illegal goods do not get into this country. We do not want illegal firearms getting into this country; we do not want drugs getting into this country. We need a very, very strong hand in the Customs area. We did allocate an additional $88 million earlier in the year to confront problems in the Customs area, including $30 million to increase inspections of international mail, which unfortunately can be the source of illegal goods. That is going to mean 50 million mail inspections per year. We have seen illegal guns arrive through the conventional mail and we have seen drugs arrive through the mail. It is very, very important that we take a firm hand in that area.
It is also important that we address organised crime and specifically this issue of unexplained wealth. The situation that confronts us under current legislation is that there are frankly people in the community who have acquired vast amounts of unexplained wealth. It is absolutely not apparent from any legitimate source how they could have done so, but under the way the current law works it is often very difficult to establish that they have in fact acquired that wealth illegally. That is what this bill focuses on and I will come to its specific provisions in a moment. The reach of organised crime in our society is unfortunately very broad. I would commend you a report by the Australian Crime Commission or entitled The organised crime in Australia. It looks at the issue of organised crime in significant detail and it makes for some very sobering reading. It really emphasises why we need to act in this unexplained wealth space.
We are seeing changing technology and improved modes of transport. Whilst those things are great in many respects, they also unfortunately create opportunities for organised crime. We are seeing that in different areas. Identity theft is a growing problem in our society. We also have a rising tide of extortion committed online. Effectively, you might be familiar with denial-of-service attacks. This is basically where organised criminals hack into the severs of Australian companies, create all sorts of havoc and make it impossible to do business. Then they basically turn around and say, 'If you want this to be sorted out, you are going to need to deposit X dollars into Y bank account.' That is a very concerning aspect of organised crime.
Piracy is another area. Piracy is an issue that I have some understanding of from my previous career in the television and internet industry. Again, the rise of technology is a great thing because it means that we can communicate better, we can do more things and we can have a more diverse experience as consumers. But piracy is a substantial problem and we see that illegal download sites are often located in nations with minimal legal infrastructure. Those operations are having a material impact on the capacity of tax-paying, law-abiding companies to provide the entertainment services that people want to consume. That is another concerning trend.
The other horrendous impact of organised crime, or one of its most odious aspects, is the drug trade. The member for Reid spoke very powerfully earlier today about the impact of drugs that he has seen firsthand in his previous career. We need to absolutely err on the side of doing everything we can to go after the very evil people who peddle this product to young Australians. In the drug area, as the Australian Crime Commission report points out, the drugs that perhaps were the traditional, so to speak, causes of substantial social problems—like heroin, cocaine and others—are still unfortunately present and have been added to in recent years. We have a huge epidemic in ice, or crystal meth as it is known overseas. There is this concerning trade in the manufacture of synthetic drugs, where organised crime basically goes to scientific manuals and works out what generally legal chemical substances are likely to have a drug-like impact and then they manufacture that. We, as a society, have got to keep up with that and make sure that we outlaw that wherever we see it.
We also see issues in credit card fraud. Again, technology is fantastic and enables us to do so much more, but it also has opened up some opportunities for organised crime. One of the issues that we have seen in recent times is the concept of credit card skimming at ATMs. These are crimes that your average single criminal could not commit. They require infrastructure, they require training and they require resources. Frankly, they require the ability to be able to operate successfully outside of the law. Because these crimes are often complex in nature and difficult to track, it is often very difficult to catch the perpetrator and to prove that their wealth is in fact the ill-gotten product of their activities.
So it is entirely appropriate that we move to reverse, in a sense, the onus in this space. We do not want people in our community bringing in illegal drugs or illegal tobacco. We do not want people benefiting from piracy, intellectual property theft, and so on. And also we do not want people to be able to set up complex structures. Of course, the sad reality is that there are people out there who are expert in creating very, very complex legal structures similar to what were known as bottom of the harbour schemes and other similar things in another era. They create quasi-legal structures with the impact of creating a legal framework in which organised crime can prosper. We must crack down on that wherever we can.
The key provision of the bill is that, if you have unexplained wealth and the prosecution is able to put before the court that you have acquired it in a way which is illegal, the onus is on you to demonstrate that you have acquired that wealth through legitimate means. As I said, because of the complexity of tracking down organised crime it is particularly important that we make this change. I am pleased to see that we have bipartisan support for this measure—perhaps not on CCTV cameras. The member for Chifley would appear not to support the rollout of CCTV cameras in my electorate, which is very important for our local community. But in terms of the specific provisions of this legislation it is good to see that there is a degree of bipartisanship support.
Extending search and seizure powers is another important aspect of this bill to allow more material to be seized in the context of the investigation of unexplained wealth. At the moment, the requirements for obtaining a warrant and proving that a crime has been committed are so high that, quite often, the search and seizure of those items does not happen at all. That is a big problem.
The Crime Commission, in its report, estimates that the cost of organised crime is $15 billion a year. And other reports estimate that the cost of crime generally is equivalent to about four per cent of GDP. We can never completely eliminate crime, we can never completely eliminate organised crime, but we must do everything we can to address it, and that is certainly what this bill does.
Civil liberties are very important. Whilst this bill does enable more successful prosecutions in unexplained wealth cases, it also requires the Australian Federal Police to report annually to the Joint Parliamentary Committee on Law Enforcement in regard to unexplained wealth prosecutions. That will allow the parliament to keep a watchful eye on this area and ensure that it is operating for its intended purpose.
This is a very important piece of legislation. This is a government that is very focused on community safety and reducing crime. I am very supportive of this bill.
Dr GILLESPIE (Lyne) (19:11): This legislation is well overdue. This legislation I fully support. It is here because the Parliamentary Joint Committee on Law Enforcement made recommendations that are embodied in the legislation back in 2012 after considering the implications for over a year. Not only are we committed to building a safe, secure Australia and economy; we are committed to effective law enforcement. This bit of legislation improves the administration of investigating unexplained wealth. This legislation will dovetail with the Proceeds of Crime legislation to facilitating the proceeds of crime being put to good community use.
Mr Deputy Speaker, as you are no doubt aware, the Proceeds of Crime legislation has funded a lot of crime preventing and crime tackling programs such as our closed circuit TV initiative which has been rolled out across a lot of electorates around the country. In my electorate of Lyne the Taree Rotary group got together of their own volition, before our policy was announced, and identified closed circuit TV as a way of identifying local crime in the CBD as well as recording crime for subsequent use in prosecutions. CCTV has been very successful in reducing crime in a lot of areas around the country—in violent hotspots in the after-hours period around alcohol venues. This legislation will help the Commonwealth to capture more proceeds of crime.
Recently in Taree there was property damage in the car park area adjacent to the main road through the CBD. A lot of wheelie bins were put up against a property and set fire to. A lot of goods inside the property were damaged and the structure of the building was put at risk. In the same area, there was a run of cars that had all their tyres slashed by vandals. If there had been CCTV there already, the police could have gone to the digital recording to see who it was. So this will not only prevent crime in these areas; it will help the police prosecute and capture the villains of violent crime, property crime, vandalism and similar things. At the other end of my electorate, unfortunately and with great shock, we woke a few mornings ago to violent crime in the main street of Port Macquarie. There was a fatal stabbing at about 2am outside one of the newsagents just down from a late-night entertainment quarter. I reflected on how helpful CCTV would have been in a crime situation like that.
Returning to this legislation, the amendments to the crimes legislation will facilitate the capture of the proceeds of crime, because much of it manifests as unexplained wealth out of the blue. And it is not a trivial amount of money. Organised crime in this country has billions of dollars running through it. Major crime, drug crime, money laundering—all these sorts of issues will be much more easily captured and effective litigation will ensue as a result of these amendments through, for example, streamlining the affidavit process or prolonging the orders of explanation so that the actual litigation can occur. Another example is allowing search warrants to seize the evidence to prove that the proceeds of crime are unexplained. It prevents people, who receive an order to come and make an explanation of their unexplained wealth, getting out of it by simply not turning up. They seem like simple, commonsense responses to a legal situation that has arisen. I support them, because it will make the work of our law courts and the AFP and the Australian Crime Commission much more effective. I cannot see why anyone would have a concern about the welfare of the victims of organised crime and money laundering from major enterprises through to local and regional crime syndicates.
Another benefit of some of these amendments is that the information can be shared so that the legal institutions and the enforcement bodies, such as the AFP and state police, can share information. It is another practical initiative that should facilitate effective prosecution. The fact that it has taken all this time to get this legislation is an indictment on the previous government. As I have mentioned, we do want to build a safe and secure society for Australia. You only have to look at what has been happening lately to know that our law enforcement bodies are doing a great job. Anything that this House can do to make their job more effective, I fully support. Closed circuit TV would be a great initiative and I am looking forward to it being rolled out in the city of Taree. I have been approached by businessmen in other commercial centres like Port Macquarie, even before this most shocking crime occurred, to have it. I think it is a great initiative and I would like to support it in other areas. If these amendments result in much more effective prosecution, I fully support the legislation. I commend this bill to the House.
Mr WOOD (La Trobe) (19:19): First of all, as a former Victorian police officer I would like to pass on my best wishes to the Australian Federal Police officer who was stabbed in Endeavour Hills overnight and to the Victorian police officer who was also stabbed. I know that there will be a lot of concern among police officers right across the country arising from the events that have taken place.
In talking on the Crimes Legislation Amendment (Unexplained Wealth and Other Measures) Bill 2014, I want to make it clear that I am speaking on the amendment. This all started back in 2009, when unexplained wealth was first introduced to the parliament. The incredible thing about organised crime is the amount of money taken away from the public and used by organised crime syndicates. It is estimated by the Australian Crime Commission at $15 billion per year. Most people are not aware of why we need unexplained wealth legislation. The simple reason is that the higher you go up the ladder of a criminal syndicate—and a good example is outlawed motor cycle gangs—you then get others to do what we call 'the dirty work'. They are the ones who do the drug deals and they bring the money back to the big guys. It is all about power and it is all about acquiring wealth. Once you have the money, you can use it to get other people to do your dirty work—for example, standing over the local real estate agent or car dealer to extort money from them. Organised crime syndicates also wash their money through legitimate businesses. They may, for example, buy a petrol station, while bikies like tattoo parlours. It is then very difficult for police to work out what are legitimate proceeds from the business and what is from organised crime.
In 2009, I participated in a bipartisan Australian parliamentary delegation to Canada, the United States, Italy, Austria, the United Kingdom and the Netherlands. In conjunction with the Australian Crime Commission, the delegation examined serious and organised crime to see what we could learn to mitigate similar organised crime here in Australia. As I said, it was a bipartisan committee. The now President of the Senate, Senator Parry, former Senator Steve Hutchins and Chris Hayes, who is the opposition whip, were all on that committee. The committee learnt a lot. The big thing that we learnt from all these authorities around the world was: go after the money. If you go after the money, you can bring down organised crime. As I said before, crime is all about creating wealth and creating power. In the world of criminals, power will not come without great wealth. If you take the money away, you take the power away. It is as simple as that.
As I said, in every country we visited they said, 'Go after the money'. One of the best examples of this was in Italy, where the anti-mafia police made it clear to us how they would use restraining orders. The situation that I recall was one where they had a person who owned a number of supermarkets. They had a turnover in the vicinity of 800 million euro, so he was an exceptionally wealthy man. The police determined that he was meeting up with mafia contacts, so they were able to use provisions similar to our unexplained wealth provisions on him, and they were able to seize all of his assets. I give a lot of credit to the Northern Territory government and police because they were the trailblazers in regard to bringing in unexplained wealth laws here in Australia. The Northern Territory had great success, in particular, in going after the outlaw motorcycle gangs.
The existing Proceeds of Crime Act does not go far enough in terms of unexplained wealth. When I first spoke about this issue in the House, I was not happy. I was not happy, because the legislation did not go far enough. Sadly, it went before the senators, and, as much as I love the senators, they did everything they could in their committee to water down the intention of the legislation. It has taken a number of years to get back to where we were. I am talking about a bipartisan effort here. When it comes to the Australian Crime Commission, both sides of that committee were determined to get the best outcome for police. The sad reality is that in the time this has taken we could have raised hundreds of millions more dollars to go back into local community groups to assist with crime prevention. The beautiful thing about this unexplained wealth legislation is that all of proceeds go back into the local community to help fight crime, whether it be through closed-circuit television cameras, supporting youth clubs, suicide prevention et cetera.
The bill contains eight amendments to the Proceed of Crime Act. To me, the most significant amendment is that seized proceeds can no longer be used to fund a defendant's legal case. When I lost my seat back in 2010, I went back to Victoria Police and I worked with Taskforce Echo, who are the guys who look at the bikies. They really tried to use the existing Commonwealth legislation, but they just could not. There were two areas which greatly concerned them, and one is definitely addressed in this bill—that the proceeds of crime could initially be used by the defendant to mount a legal defence. So you had the situation where proceeds—be they cash, property or whatever—had been seized by the police, yet the defendant could use those proceeds to fund their legal campaign. There was no incentive for legal counsel to say to the client, 'Listen, my advice is we are not going to win this. Let us determine what should be confiscated or seized by police.' Instead, they would say, 'No, we need to fight,' because they could say to the client, 'Don't worry about this, we are going to lose these assets anyway, so we'll keep fighting and fighting.'
This bill makes a number of good amendments, and I note that members from both sides have spoken about streamlining the affidavit requirements, allowing time limits for serving notices et cetera. The other issue of concern, which I am not completely sure has been addressed, is the ability for the defendant to get hold of certain documentation which may have been used by police in their proceedings. There maybe a situation where police are relying on confidential sources and those details are made available in their application to the court and subsequently provided to the defendant. That is an issue that I am greatly concerned about when people are providing information against serious and organised crime figures. It comes under the disclosure rules. I would like to be satisfied by police that this area has been addressed because, again, if it has not, in some ways that makes the legislation very hard to use, especially where you have informers. From my police force days, I can say that in most of the circumstances where people give information to police they are very concerned and they always want their identity to be protected. We need to ensure that it is.
In closing, I congratulate the Minister for Justice, Michael Keenan. He has done a fantastic job, especially in recent days with what has happened around Melbourne and interstate. I congratulate both sides of this House, because everyone has been very focused. It has been a pleasure to be here when everyone is working together on a cause—that is, to protect Australians and make Australia a better place to live. It is great when we see that happen. Sometimes it can seem that it seldom happens—but it makes you want to be a member of parliament when everyone works together.
ADJOURNMENT
The SPEAKER: It being 7.30pm, I propose the question:
That the House do now adjourn.
I call the honourable member for Kingston.
South Australia: Manufacturing
Ms RISHWORTH (Kingston) (19:30): Thank you Madam Speaker. I rise tonight to call upon the Prime Minister—to plead with the Prime Minister, in fact—not to break another promise: the promise that he made to build 12 new submarines in my home state of South Australia. If the Prime Minister breaks yet another election promise, we will see critical skills, innovation and research, along with thousands of South Australian jobs, sent overseas. This would be a devastating blow to our economy and to our domestic shipbuilding capability.
Before the election, the now Minister for Defence, Senator David Johnston, promised that submarines would be built in Adelaide. At a press conference in May last year, he said: 'We will deliver those submarines from right here at ASC in South Australia. The coalition today is committed to building 12 new submarines here in Adelaide.' But the Prime Minister and his government are now refusing to re-commit to their promise to build the submarines in Adelaide, and they are refusing to rule out buying submarines from overseas. When it was recently revealed that Japanese submarine experts visited ASC in a secret meeting in Adelaide, defence minister Senator David Johnston, in question time in the Senate, continued to refuse to recommit to his election promise to build 12 new submarines in South Australia.
South Australia's defence industry currently contributes $1.8 billion per annum and 27,000 jobs to our state's economy. If all planned projects go ahead, Defence is projected to contribute $2.5 billion and employ over 38,000 people by 2020. Madam Speaker, you can see just how important this is to our local economy. South Australia proudly currently holds about 25 per cent of the nation's defence projects, and the ASC has provided jobs to the South Australian economy for many years. The ASC completed the Collins class submarine program in 2005, and then became home to the Australian air warfare destroyers, the largest defence project on record, employing more than 1,500 skilled workers. There will be naysayers, who will complain about these projects, but these projects were delivered well, with highly skilled workers that contributed significantly. So far, the Collins class submarines have served our country very well.
Building new submarines in Adelaide will greatly increase Australia's defence capability—not only in terms of the submarines themselves but also by developing the skills, the research, and the people power that we need in South Australia. But it is an uncertain future, and this government is making it very concerning, on the ground, for so many businesses that were gearing up—because they had a bipartisan commitment. They were ready to gear up for this project, only now to be thrown into complete uncertainty. The government also seems to be ignoring the fact that the Future Submarine project told the Senate in 2011 that Japanese submarines do not meet Australia's strategic needs. This is not only an issue of jobs but also an issue of ensuring that we get the right submarines, that can do their job in defending Australia. Buying foreign-made submarines instead of building them here in South Australia will have a devastating impact on our maritime and shipbuilding industries. Quite frankly, I think that the government has shown a real short-sightedness when it comes to this quick fix of buying submarines off-the-shelf, and not thinking of our long-term strategic importance, as well as not thinking about the economic impact that will have.
The South Australian economy needs a government that will help to create jobs, not send them overseas. So far, we have seen nothing from this government that supports jobs in South Australia or, indeed, across the rest of Australia. In fact, we have seen them scare Holden and other car companies out of this country. They have ensured that the demise of Holden, Ford and Toyota was almost a fait accompli. Unfortunately, if the government continue this attitude of not actually having a policy to create jobs, then South Australia will be in trouble. My electorate of Kingston, which is home to a lot of small manufacturers, is already feeling and will continue to feel the brunt of this. This is an ill-informed decision that will have a devastating blow for South Australia. It is time to listen, not just to Labor but also to the South Australian Minister for Defence Industries and former Liberal, Martin Hamilton-Smith, who has called upon the government to defend South Australian jobs.
Brisbane Electorate: Riverwalk
Ms GAMBARO (Brisbane) (19:35): I am absolutely honoured to have attended the reopening of the Riverwalk replacement project in New Farm in my electorate of Brisbane, just last weekend on 21 September. The Riverwalk was officially opened by the Lord Mayor of Brisbane, Graham Quirk; state member for Brisbane Central, Robert Cavallucci; and myself; with more than 2,000 Brisbane residents keen to descend on and explore the new and upgraded Riverwalk. The crowd was entertained by roving performers and face painters, with an all-important sausage sizzle to feed the crowds. It was really clear to me that everyone else was just as excited as I was about the Riverwalk returning to Brisbane. It has been three years since we experienced its devastation. Along with so many other Brisbane residents, I witnessed the devastating damage caused by the 2011 floods, and I watched the original Riverwalk break away and float dangerously down the Brisbane River at 2am, on the morning of the worst heights of the floods. It was absolutely devastating to me. It is an image that I am sure is still in the memories of many of the people of Brisbane, and of many people around Australia—particularly the image of the tugboat, doing its best to stop the broken concrete pieces of the old Riverwalk from doing even more damage down the river.
The popularity and frequent use of the Riverwalk is why the Australian government provided $54 million to replace this popular connection between New Farm and the Brisbane city centre. It was and now again will be a beloved Brisbane icon. Prior to the devastating 2011 Brisbane floods, the Riverwalk was used by more than 3,000 pedestrians and cyclists each day. This funding was provided through the Australian federal government Natural Disaster Relief and Recovery Arrangements, and the Riverwalk was one of 5,000 projects which were undertaken throughout Queensland. I would like to acknowledge the valuable support provided by the Queensland government—they contributed some $18 million towards the project.
I am very pleased to say that the new Riverwalk is even better than the old one. A key component of the Riverwalk's resilience will be the 37 concrete piles which will anchor the walkway into the riverbed. It will not ever wash away. The 870-metre long thoroughfare will be separated for cyclists and pedestrians so there will be an even split between fast and slow traffic, especially during the peak commuting times. It is absolutely essential that all of those who use Riverwalk have room to safely enjoy all of the facilities. The new Riverwalk has also been equipped with new lighting and shaded rest areas, so if you are getting a bit tired you can enjoy a beautiful vista of the river. It will also be a wonderful platform for tourists to observe our wonderful river life from. We have replaced the old floating walkway with modern structures that will have much better resilience. These improvements have been made largely through the work of the planners and designers, and I want to thank the Brisbane City Council.
This has been a challenging project, and I know that the strength of the new Riverwalk is a terrific design feature. Another feature that is very interesting this time is the rotating opening span that will allow for the passage of vessels to and from moorings. This key feature will allow much easier transport to and from those moorings. The implementation of the new alignment will also take cyclists and pedestrians further out into the river for the majority of the walkway. This will greatly improve the river experience, but particularly it is very important that residents who live on the river will enjoy additional privacy by having the walkway further out from the back of their homes.
This is a $72 million project which; as I said, has been delivered under the Natural Disaster Relief and Recovery Arrangements, and is a true testament to what can be done when the three levels of government work together. I am really pleased to say that it is a wonderful structure that will be there for the benefit of Brisbane residents and visitors. I am delighted that all Brisbane residents and tourists are now able to enjoy the new, restored and even better Riverwalk. I cannot wait to get back to my electorate to walk the whole length, as I was not able to do that the other day. We now have our beloved icon, our connection between New Farm and the Brisbane city CBD, returned to us.
Technology
Ms VAMVAKINOU (Calwell) (19:40): Tonight I want to speak about two very important events that I have been involved in, which are of particular benefit for young people—not only in my own electorate but to young people across the country and indeed around the world. This afternoon I had the great pleasure as the co-convenor of the parliamentary friendship group for raising breast cancer awareness amongst young adults to help launch a mobile phone app designed to encourage and help young people to conduct and manage their monthly breast examinations. The Young Adult program, or YAP App, as it is known, has the backing of Google and is the brainchild of the late Peter Hill, the wonderful son of a very dear friend of mine, Roz Hill, who is herself the founder and CEO of YAP. Roz is a breast cancer survivor and has been a tireless advocate for raising breast cancer awareness amongst men and women. She is an amazing inspiration, a woman who is a no-nonsense advocate who quietly goes about her work in a very low-key but very effective manner. I first met Roz some 10 years ago when she embarked on a campaign up here in this place to have breast prosthetics put on the Medicare rebate for those women who had to have mastectomies. Some 10 years later Roz is still advocating the vital importance of early detection. The friendship group, which I co-convene with the member for Longman—and I acknowledge his presence in the House this evening—and the Google app, both launched today, are important additions to raising awareness about breast cancer, in this case among young adults.
Since Yapstuff.com was founded in 2004 by Roz and Peter Hill, the website has received some 80,000 to 100,000 hits a week. It connects with youth from many cultures around the world. YAP spreads its message through various social media, but most importantly through its youth ambassador program. Today we had the pleasure of hearing from YAP ambassadors Sebastian Cook and Grace Keen as they guided us through the YAP App. Technology has changed the world as we know it, and apps have become an integral part of our lives, especially the lives of young people. The app we launched today makes breast cancer awareness information easy and accessible and very technologically contemporary, if I may say that. It has a step-by-step program for conducting self-examinations, as well as provision for keeping a record of the results, making it an important addition to the many other medical apps that are currently available.
I congratulate all involved in making this app a reality, and in particular I thank the Minister for Health, the Hon. Peter Dutton, for officially launching the app. I would also like to thank the shadow minister for health, the Hon. Catherine King, for being a part of this very important event—and I acknowledge the shadow minister's presence in the chamber this evening. I also wish my friend Roz Hill and her team at YAP all the very best for the future, and I look forward to being a part of spreading the YAP message in the battle against breast cancer.
On another important matter, last Friday I had the great pleasure of attending the launch of eSmart in my electorate of Calwell. The Global Learning Centre in Craigieburn became the first library to achieve eSmart status in Australia. We celebrated this milestone with a wonderful community event that involved students from Craigieburn Primary School. This important event was run in partnership with The Alannah and Madeline Foundation, which has created the eSmart concept, and the Telstra Foundation, which was kind enough to provide $6 million dollars for the program to be actualised. This is a program which showcases how libraries can help all members of the community to embrace technology in a smart, safe and responsible way. eSmart is a world-leading system designed to help communities manage cybersafety and deal with cyberbullying and bullying in general. Since its launch in 2011, one-third of all Australian public libraries and more than 2,000 schools nationwide have registered to become involved in eSmart. As the local member, I am extremely proud of the achievement of Hume Libraries in becoming our first eSmart library, and of the significant impact eSmart is making on improving cybersafety in places of community learning.
The Alannah and Madeline Foundation is a national charity working to keep children safe from violence. The foundation believes that protecting Australia's children is protecting the future of Australia, and its vision is that every child should live in a safe and supportive environment. A key focus for the Alannah and Madeline Foundation is to reduce the incidences and terrible effects of bullying, cyber bullying and other cyber risks that Australian children experience. I want to thank Michael Carr-Gregg, Professor Judith Slocombe and John Bertrand from the Alannah and Madeline Foundation for making last Friday's event a possibility.
Federation White Paper
Dr GILLESPIE (Lyne) (19:45): In the last 24 hours there has been an announcement about the federation white paper and its terms of reference, and it is a very welcome development. If you recall, I spoke about this very issue in my maiden speech, and I have discussed it with the Prime Minister in many venues over many years. And I am pleased to see that this coalition government has recognised that we do have major problems with the way our federation is working. It is so timely that it has been announced so recently, just after the issues of the Scottish referendum, the issues with a state's—or, in this case Scotland's—level of governance and income. It is a very topical issue. It is a barbecue stopper. How many times have you been at an event where people say, 'This level of government is a waste of space; we should get rid of it'? Whether it is state, local or federal, it is an issue that reverberates around the country—the cost shifting, the blame shifting, the confusion and the duplication of services are very frequent and very well known issues for anyone who has been involved in local government, state government or federal government.
There are labels bandied around of 'vertical fiscal imbalance' and 'horizontal fiscal equalisation'. They are all fancy terms that refer to the fiscal dominance of the Commonwealth. When the emergency of World War II was upon us, we were a nation. The Commonwealth had to fund the war effort, so we made changes. The Constitution was set up, and there were only so many sections that decided who got the taxing powers. But it has gone beyond that, because when the Constitution was founded we did not have things like the welfare state, we did not have things like Medicare and we did not have unemployment benefits. We did not have half the things that the Commonwealth has assumed. So, we need to get together with the states and discuss the best way to work out the finances that the states run on and the way the Commonwealth runs. And we can have three levels of government. You do not need the barbecue's simplistic response that 'This is a waste of space; we should get rid of local government'.
As Bob Hawke alluded: what do the states do? Should we get rid of them? That comes up every now and then, but this is a golden opportunity for us to get together and define who is responsible for what. That in itself will save the nation billions and billions of dollars every year. Why is it that at COAG we have this argy-bargy every year over who gets what? We should be able to get together and work out who is responsible for health. Historically, the states have run hospitals, they have run ports, they have run roads, they have run railways. That is because they were doing it for 50 or 60 or 70 years before Federation. But, since Federation happened, a lot has developed in the country that has not been easy to define by the Constitution, which is the reference document, and section 51, I think it is—I am no constitutional expert—has guiding principles. But life has become much more complex.
This is a very welcome initiative. I think the important thing is to deliver the funds or come up with a formula that delivers funds so that local governments are sustainable, state governments are sustainable and the federal government's responsibilities as a nation can all be exercised. Unfortunately, in the Constitution we as a federal government do not have primary responsibility for local government. It is being created by the states. But it is part of Australia, and we cannot ignore that fact, so we have to have, in this white paper, a clear delineation of who is responsible for what—who runs the schools, who runs hospitals, who is in charge of roads. And a central collection of taxes is essentially a very logical principle. When people talk about states that are failing, generally they are not referring to Australia, but some of them cannot meet their obligations.
Medicare Locals
Ms KING (Ballarat) (19:50): I want to use the opportunity of the adjournment tonight to highlight the concerns the opposition has with the government's closure of Medicare Locals and transition to their new primary health network and certainly raise many of the concerns that have been raised not just by Medicare Locals but by those communities that are about to be affected by very significant change. Leaving aside, obviously, the fact that the now government did say that they were not going to be closing any of the Medicare Locals in the lead-up to the federal election and during the election campaign, it is pretty evident that the now government did wish to close and abolish all Medicare Locals but found themselves wedged during the election campaign and so made that statement.
The decision to close every Medicare Local and to move to the primary health network is causing significant anxiety amongst the sector, and not just amongst the sector but amongst the many, many services that are being provided and in regional and rural communities in particular. We know that Medicare Locals are, despite the government's attempts to paint them as mere bureaucracies, in fact providing substantial amounts of front-line services, particularly when it comes to allied health. We know that they are providing after-hours services, ATAPS and commissioning the ATAPS program, Partners in Recovery, and out of the flexible funding pool they are providing substantial allied health services, particularly in communities in Far North Queensland and in some of our more rural areas. They are providing access to speech pathology, psychologists and other services that have not been provided before.
The problem that we are hearing very strongly from the Medicare Local network—and I visited well over a third of the Medicare Locals across the country—is threefold. The first is that the government appears to not quite understand the role of Medicare Locals. It seems to be pushing for a view that the new primary health networks will be mere purchasers of services, and that does not accord with the roles that Medicare Locals were undertaking, even according to the Horvath review.
We also know that there are already funds that have been withdrawn from Medicare Locals. The estimate is about $70 million, and those have been drawn back into the department. The department tells us that that money is not being used to run the tender process. We already know as part of the review into Medicare Locals that there was over $500,000 in consultancies. We know that McGrathNicol has been engaged to move to the PHN or to wind up Medicare Locals. There are substantial costs involved in this. That is $70 million that has been drawn out of front-line services.
We also know that the estimates to wind up Medicare Locals are around the $100 million mark. That is in forgone contracts, rental and staff entitlements that they will have to find. That is $100 million—we think it is a little bit more than that, but that is from reports from the sector—that will be gone out of front-line service delivery. The Medicare Locals are now being told that whilst they are expected to wind up on 30 June, potentially they may have to exist beyond that because of the need to transition front-line services, and potentially that the new primary health networks will be purchasers of those services from Medicare Locals.
What all of this says to me very clearly, despite the fact that the government is I think now actually struggling to write the tender process, is that there is a substantial amount of waste occurring in a transition that at the end of the day may have no appreciable gain. There will be no appreciable gain in terms of providing better integration of services, nor in making sure that we provide those services that are needed in rural and regional communities, particularly in allied health and the networks that are supporting all of those allied health workers. We are getting reports in from Medicare Locals around the country that they have had staff leaving and they are not able to fill those allied health positions, particularly in some of the more remote communities, particularly in Far North Queensland.
I think the government really needs to be held to account for what potentially is a massive upheaval in primary care and in attempts to achieve better integration in primary care and the waste of around about $170 million that we know of to date. Again, this is for no appreciable gain in the change to Health and Hospitals reform. I want to put on record the opposition's very serious concerns about loss of services and the uncertainty that we are seeing in the sector at the moment. (Time expired)
National Security
WYATT ROY (Longman) (19:55): I rise tonight to speak on the overwhelmingly pressing issue of national security. The current climate was tragically underscored overnight with the tragic episode in Melbourne that left one man dead and two police officers battling grievous injuries.
At this time of elevated alert, our police and security agencies need to know that they have our support and gratitude. They are expertly trained, committed beyond belief, and courageous, without exception. They are at the front lines of a nation and its government, irrespective of political persuasion. They will always hold the protection of Australians as priority number one.
It is even broader, more united and stronger than that, in so much that our political and community leaders stand together against all threats to our nation. Our combined defiance sends the staunchest message that Australians will not cave in to fear. We will continue to go about our lives as a decent, fair and value-laden people, an inclusive and accepting people. We will not have our heads turned by self-styled doctrines that preach fear and hate.
The government will do whatever is required to keep our people safe. Australians should have confidence that our police, security and intelligence agencies have the skill and professionalism to stay ahead of those who harbour hideous ulterior motives. Hostilities in Syria and northern Iraq have managed to entice to the battleground a minority subset of alienated Australians. These conflicts have broken new ground in their level of brutality. Almost every imaginable crime against humanity has been perpetrated. Conveyed across social media and a sleepless media cycle, we get the news of these horrors so fast that we do not have time to turn them off. From lone beheadings to genocidal forays, the imagery is heartbreaking and regrettably vivid.
It is imperative that Australia responds as it has, ready as part of an international coalition to assist the Iraqi government in grinding down the will and capacity of the murderous ISIL movement. How can a cause, movement or ideology of any description justifiably slaughter innocent people. Let's be clear about this. Extremists do not raise their fist at Australia over any resentment about our foreign policy. The reality is that the freedoms we espouse, including freedom of religion, are anathema to those who would teach intolerance and retribution for not adhering to their heavily prescribed views. Our freedom, and the harmony found within it, is what threatens them.
An Australian ISIL operative last week instructed his followers, in a demonstration of their loyalty, to randomly seize people from Australian streets and commit murder. The plot was intercepted in a superior demonstration from security, intelligence and law enforcement. It showed the degree of our vigilance and determination. We were up to the task. Yet, we will do the job of keeping our people safe, without allowing our psyches to be penetrated by their vengeful thoughts. That may be the way for some, but it is not the way for this great country.
In August the government committed an additional $630 million to national security. We are moving to amend laws that we will implement in the future to help prevent potential terrorists from occupying our streets and suburbs. Australians who have proven to have fought with terrorist groups will be jailed for no small period. We will preserve our nation as one of peace, hope and opportunity. The Prime Minister said in this place that we may yet draw something from our current security challenges to make us even better. He said:
… it is not too much, surely, to expect that our world might finally and fully grasp that it is never right to kill people because they have a different view of God.
… … …
If the all-but-universal revulsion towards the ISIL horror has this result, good might finally emerge despite the pointless death and dislocation that confronts us now.
House adjourned at 20:00
NOTICES
The following notices were given:
Mr Pyne: To present a Bill for an Act to amend the Australian Education Act 2013, and for other purposes.
Mr Joyce: To present a Bill for an Act to amend legislation relating to research and development for primary industries, and for related purposes.
Mr K. J. Andrews: To present a Bill for an Act to amend legislation relating to aged care, and for other purposes.
Mr Morrison: To present a Bill for an Act to amend the law relating to migration and maritime powers, and for related purposes.
Mr Hartsuyker: To present a Bill for an Act to amend the law relating to social security, and for related purposes.
Mr E.T.Jones: To move:
That this House:
(1) welcomes Australia's contribution to the Multinational Observer Group at the recent Fijian election;
(2) notes that the conditions were in place for Fijians to exercise their right to vote freely;
(3) recognises Fiji's place as an important neighbour and strong nation in the Pacific;
(4) thanks the Australian High Commission and the Australian public servants who worked hard to ensure a good and fair result; and
(5) congratulates the Fijian people on the turn out and the manner in which they conducted themselves on polling day.
Mr Champion: To move:
That this House:
(1) notes that:
(a) Australian Hearing:
(i) has delivered hearing services since 1947 and currently provides services to children, young adults, Indigenous Australians and age pensioners every year; and
(ii) provides services at 468 hearing services centres and visiting sites throughout Australia including many rural and regional centres;
(b) the National Commission of Audit recommended Australian Hearing be privatised; and
(c) the Government has responded to this recommendation by funding a scoping study in the budget;
(2) acknowledges:
(a) that the Australian Government provides funding to Australian Hearing that is vital for the provision of hearing health services;
(b) that Australian Hearing delivers quality, low cost hearing health services to over 450,000 people every year; and
(c) the privatisation of Australian Hearing will result in an interruption to service delivery and impact the quality of services and access to services; and
(3) calls upon the Government to:
(a) reject the National Commission of Audit recommendation to privatise Australian Hearing;
(b) ensure that the Australian Hearing research division and National Acoustic Laboratories be guaranteed certainty of continued operation at current capacity or greater;
(c) guarantee the service level and quality of the current hearing health services provider; and
(d) provide certainty to rural and regional centres in the provision of hearing health services to the same standard or better than the current provider.
The DEPUTY SPEAKER ( Hon. BC Scott ) took the chair at 09:30.
CONSTITUENCY STATEMENTS
Tsardoulias, Councillor Emanuel
Mr ALBANESE (Grayndler) (09:30): Two weeks ago I opened the annual Dulwich Hill festival in my electorate of Grayndler. It was not the same. As much as it was a joyous occasion, I was deeply saddened by the absence of my friend the former Marrickville Councillor Emanuel Tsardoulias. This gave the day a solemn undertone for me and for many of Emanuel's friends and colleagues who were also there.
Emanuel Tsardoulias passed away at the youthful age of 38 on Saturday, 16 August this year. He leaves an enormous legacy as a deputy mayor, councillor, Dulwich Hill ALP branch activist, leader of Grayndler FEC and Canterbury SEC of the Labor Party, executive member of the local government association of New South Wales, SES volunteer, Rotary activist and community member.
Local festivals like the Dulwich Hill festival meant a lot to Emanuel. It was more than just part of his job as a councillor. This is because Emanuel was part of his local community. Our festivals in Dulwich Hill and Marrickville were always abuzz with the enthusiasm of hundreds of people. And enthusiasm is what Emanuel Tsardoulias had in spades.
He was a true champion of the inner west who was passionate about improving the lives of local residents. He was particularly proud and committed to Dulwich Hill, attending both Dulwich Hill Public School and Dulwich high school. He campaigned strongly against the high school's possible closure more than a decade ago. He was proud of the improvements that he instigated to Jack Shanahan skate park and Arlington Oval. He was one of the instigators of the Dulwich Hill street fair.
A small business man, he was active in the Greek-Australian community and was particularly concerned about providing opportunities for young people in the inner west. Emanuel approached every task with enthusiasm, optimism and commitment. This was reflected in his support and passion for the Labor Party, where he was a loyal comrade and exceptionally hard worker. Election time will not be the same without him.
Emanuel showed enormous courage while dealing with cancer and related illness over recent times. My heart goes out to his beloved wife Zoi and his beautiful 18-month-old twin boys, Stephen and Dimitri, who were his pride and joy. I will never forget his pride at their christening just last year.
His funeral at the Greek Orthodox Parish of St Nicholas saw many hundreds of people come to farewell one of Marrickville's finest citizens. We will miss his infectious laugh, love of life, friendship and loyalty. At 38 years old, Emanuel had so much more to give, and this is a tragic loss for his family and for the community. May Emanuel rest in peace.
Hunt Family
Ms LEY (Farrer—Assistant Minister for Education) (09:33): Today I wish to remember, with deep respect and sympathy, the five members of the Hunt family: Geoff, Kim, Fletcher, Mia and Phoebe. Yesterday, in the small town of Lockhart in the Riverina, they were farewelled, first with a private funeral and then in a celebration at the Lockhart Recreation Ground. It was an emotional and moving ceremony.
The Lockhart and Boree Creek communities are strong and warm and generous. They gave much to the nation, sending their young men to two world wars. Their farms produce grain and livestock and contribute to the regional economy. The community come together frequently around their football and netball teams, their volunteering efforts, their small country schools. Throughout all is love of land, of community, of family.
At yesterday's ceremony, family and friends talked about these five special people. The Hunt family were at the forefront when it came to helping. Their kindness and generosity shone through every word that was spoken in every reflection: Geoff as a devoted father and family man, a talented waterskier, tennis player and golfer, with a great sense of humour; Kim as a passionate and energetic community member, a wonderful nurse, chef and gardener. Fletcher was remembered for his love of motorcycles and his sporting talent. At age 10, playing in the under-14 team, he kicked five goals. Mia was remembered for her empathy and openness as well as her aptitude for tennis and netball. Phoebe, unsurprisingly as the youngest, was bossy, persistent and full of charm.
Schoolmates from St Joseph's School, smiling bravely, sang If I Were a Butterfly, and Kim's brother-in-law, Terrence, mentioned a birthday party for Kim at the couple's farm at Watch Hill. Describing Kim, in a moment of sheer fun, jumping from the rafters into the arms of several people below, he said that in his memory she seemed to float slowly through the air and alight like a butterfly.
The family was struck by tragedy when Kim had a serious car accident two years ago, and her road back to her home and her family was long and painful. Her bravery and determination was remarkable, as was the dedication of Geoff, by her side every step of the way, but—as her incredible sister, Jenny, has said—the effects of the injury took their toll.
At yesterday's public memorial the spirit of this small town was on display, and the care and compassion that will wrap around everyone touched by the tragedy were unmistakable—in particular, two of the great human qualities: gentleness and the ability to forgive. In loving memory.
Australian Broadcasting Corporation
Mr ZAPPIA (Makin) (09:36): On the night before the 2013 federal election, Prime Minister Abbott promised, on SBS news, 'no cuts to the ABC or SBS'. After the election it became another broken promise, and in the May budget $232 million was cut from the ABC. A one per cent efficiency dividend has been imposed on the ABC, and the Australia Network has been closed. The one per cent efficiency dividend comes on top of cuts imposed on the ABC by governments since 1986. Since the 1980s, staffing numbers have fallen from around 6,000 to 4,600 today, which is a 23 per cent reduction, and in real terms funding to the ABC has decreased by around $251 million. Simultaneously ABC services have increased with, amongst other things, the addition of three new radio stations, 11 new digital stations, three new digital television channels and expanded online services. So the ABC today is doing more with less.
Contrary to the rhetoric of some people, the ABC is a very efficient organisation. Indeed, it can be argued that the ABC is more efficient than commercial networks. In addition, by comparison with other Western countries, the ABC receives the fifth lowest government funding per capita. Yet the Abbott government continues to expect the ABC to find further savings, when it also knows that there are limited options for cuts, because around 20 per cent of the ABC's budget is spent on transmission costs and other fixed charges over which there is no discretion. Not surprisingly there are real concerns throughout the ABC that drastic staff cuts will be made and, in turn, services will also be cut or wound down. The cuts will particularly impact on country communities, for whom the ABC performs a vital service.
Last week, along with my Labor colleagues the member for Adelaide, Kate Ellis, and Senator Anne McEwen, I attended a rally outside the ABC offices at Collinswood, in Adelaide. The purpose of the rally was to draw attention to the Abbott government's cuts to the ABC and to the effects those cuts will have on jobs and services in SA. For South Australia, ABC cuts will be devastating. Currently over 408 staff work for the ABC in SA. Up to 150 of those jobs could be lost along with local production of programs and services. These are real jobs of dedicated staff who have already delivered the efficiency gains asked of them.
I believe the cuts are not just driven by the government's poor management of its own budget but also by the Abbott government's extreme right-wing ideology, where the ABC's impartiality is seen as an impediment to the Abbott government's agenda.
I call on the government to keep its election promises not to cut funding to the ABC, and I call on South Australian Liberal members including the member for Sturt, the member for Hindmarsh, the member for Boothby and the member for Mayo, none of whom fronted up to the rally to stand up for South Australian ABC services, to stand up for SA jobs and to oppose the Abbott government's cuts to the ABC. (Time expired)
North Queensland: Environment
Mr CHRISTENSEN (Dawson—The Nationals Deputy Whip) (09:39): The greatest terrorism threat in North Queensland, it is sad to say, comes from the extreme green movement. When I say 'extreme greens', I am not talking about ordinary community groups and individuals who genuinely care about and work to improve the environment or locals who have genuine concerns about local impacts of certain projects. What I am talking about are large, well funded, well organised ecoterrorists who use fear and blackmail to coerce government and the public into adopting their extreme political and ideological viewpoints.
Despite the fact that coal and iron ore drive the nation's economy and pump billions of dollars into state and federal coffers, there are those who would destroy those industries. They would destroy our economy, our jobs and our way of life. The ecoterrorists campaigned against the expansion the Abbot Point coal terminal by claiming that 'toxic sludge' was being dumped on the reef. That is despite the fact that the dredge spoil that was being disposed of was neither toxic nor being dumped on any coral reef. They knew it was a lie, but they deliberately took the Great Barrier Reef hostage and used it as a weapon to try and coerce government and the public to their own political and ideological world view—a world view against coal and a world view where Abbot Point would not be expanded.
Well, while those ecoterrorists were tying the project up in court challenges, which they knew were baseless, potential international tourists were led to believe, through the media, that the reef was now all covered in toxic sludge. I have been advised by a tourism operator that international bookings across the Great Barrier Reef catchment area have dropped by as much as 30 per cent as a direct result of that ecoterrorist campaign.
To circumvent the frivolous court action that threatened to permanently stall the Abbot Point project and to address water quality concerns from some local tourism operators, I sought another solution—a land based solution that would nullify the reef blackmail by the ecoterrorists. Such a solution has now been announced by the state government. By continuing to fight the project, the ecoterrorists have proven their protest was never really about the environment. They got what they wanted—no offshore dumping—but they still oppose the Abbot Point expansion.
The ecoterrorists butchered the international tourism market for our greatest tourism attraction, not for the reef but for political ideology. They threatened to kill off thousands more jobs in the resource industry because they do not like coal, they do not like capitalism and they do not like people working hard for a decent living. But North Queensland will not bow down to these ecoterrorists. We will not allow them to lie, to smear, to defame and to break the law and get away with it. The activists' unauthorised entry to a port to hang themselves like daft bats from a ship-loader is illegal. And threatening to lie inside a cardboard box on a train track is an act of stupidity and an act of terrorism.
More than 600 people rallied in Bowen in support of the Abbot Point coal terminal expansion last week in defiance of these ecoterrorists. Today I put extreme greens on notice: North Queensland will not bow down to those ecoterrorists; North Queenslanders will defend their jobs and lifestyles and call out the gutless green grubs for the terrorists that they really are.
Rural and Regional Health Services
Ms McGOWAN (Indi) (09:42): Today I would like to talk about a unique service that is offered in Albury-Wodonga. It is a cross-border education of doctors. Operating under the auspices Albury Wodonga Health, the University of New South Wales teaches third-, fourth- and fifth-year doctors at a rural clinical service. It is a wonderful service that has been operating since 2000 and that supports a catchment of 250,000 people. It was established 14 years ago with four students and now looks after 45 students in 2014. It is an award-winning service with doctors such as Dr Peter Vine, who won Teacher of the Year for the University of New South Wales in 2013, and Dr Ed Darby, who won the Royal Australian and New Zealand College of Psychiatrists Meritorious Service award. I would also like to acknowledge that this service is hugely supported by all the medical fraternity—and maternity, I think—in Albury-Wodonga. This service is unique in that it is the only cross-border medical service in Australia. So it works with the New South Wales and the Victorian government health services and with the Commonwealth government. It is an extraordinarily important initiative in cross-border service delivery for our community.
However, there is one particular issue that I would like to bring to the attention of this parliament today. This university operates under New South Wales arrangements within the cross-border set-up. Once students graduate they can get jobs all around Australia, but they like to stay locally because they have been trained in rural and regional health. However, if you are a Victorian and you study at this health service under New South Wales, you are not recognised for employment within the Victorian health service. In fact, Victoria selects Victorian graduates first, then international graduates and then graduates from any other state. This means that Victorians who go to study in Albury cannot get a job within the Victorian system, or find it extraordinarily difficult to do so. Today I call on the Minister for Health to please investigate this and see what he can do to help our community provide better services and end the discrimination that Victorians experience when they go to study in New South Wales.
The Lions Club of Crestwood
Mr HAWKE (Mitchell) (09:44): I rise today to mark a very special occasion. The Lions Club of Crestwood in my electorate recently celebrated 20 years of service to the community. It was a great privilege for me to attend this event as an honorary member of the club. This club was chartered on 3 September 1994 as part of Lions District 201N5. This 20 years of service was marked with all of the significant members from those years attending and reminiscing on all the great contributions they have made to the community—and on the great times, fun and laughs that they have had. This club honoured and thanked their members for their hard work and generous spirit. The electorate of Mitchell has so many service clubs and voluntary service people along the lines of Crestwood Lions, and I really appreciate their contribution.
The funds the club have raised over the past 20 years amount to over a quarter of a million dollars. They have supported numerous Lions foundations and charities: medical research, hospital facilities, disaster-relief appeals, special-education schools, the homeless, the elderly, the sick, Scouts, Guides, youth groups, Men's Sheds, women's refuges, equipment for the disabled, medical equipment and much more. This is really our society at its best, when individuals and individual communities—civil society—help each other, help themselves, rather than rely on the government.
I really want to pay tribute to these selfless people, who do it simply for the joy of giving, simply for the joy of doing things for others, because they want a strong society and a strong community. This is the way we used to be and it is the way we need to be again to be a strong society. These people are the finest people because of all those groups they help and the difference they make in the lives of those in our community who are very sick and desperate. They make the difference—and they help without any expectation of a return other than a benefit to our society.
The club has had a great set of laughs and experiences over the years. It was wonderful to be with all the former presidents. I will name a few of them, because they are all such exceptional community people: John and Kathy Ebbott, Elizabeth Lessells, Greg Dunn, Sue Groth, Ian Matthews, Helen Brawley, Helen and Bob Rose, Jennifer Touzel, David Duffield and Christine Andrews. There are so many more members and people that I cannot name today, but all of these former presidents for the past 20 years have really helped the community of Crestwood. It has come along in leaps and bounds. It was a pleasure to sit with the Kellyville Lions Club, as well, which founded the Crestwood Lions Club. I really valued the opportunity.
Lastly, I want to say a big thankyou to all of the members and past presidents for the service they provide to our community. The founding of this club 20 years ago was a special moment, but the 20 years of service has provided so much benefit to our community. I appreciate all of the members and thank them for their time and service.
Gas Supplies
Mr KELVIN THOMSON (Wills) (09:48): The Minister for Industry claims that the east coast of Australia is running out of gas and supports the funding of a pipeline to link the abundant gas fields in Western Australia to the supposedly exhausted east coast gas network. He said that even if we see major progress there in the next 12 months, because of all the time that has been lost in New South Wales, there is no way that will provide a solution to New South Wales's impending gas shortage and higher prices, which will really start to come into being in the winter of 2016 and 2017.
Before we embark on more corporate welfare that may simply enable east coast gas producers to export gas to the lucrative Asian markets—at the expense of Australian consumers—we need a proper business case and a lot more transparency about gas markets.
According to Michael West, writing in the BusinessDay section of TheSydney Morning Herald on 30 August, gas consumers face a tripling of prices as gas producers starve the local market, even as they export huge volumes of gas to Asia, and then complain they are being blocked from extracting coal seam gas, a process that could damage aquifers and water supplies.
While the gas producers claim innocence in all of this, the New South Wales Liberal Party energy minister, Anthony Roberts, apparently understands what is going on and has stated to a New South Wales budget estimates hearing: 'My message to the rest of the industry is simply that no-one will trust you until you are honest. No-one will trust you until you are transparent, be it the community or the government.'
The federal minister for industry, who has taken the side of industry against consumers, as well as his fellow party members in the New South Wales government, claims that as we have a domestic shortage in New South Wales the only realistic solution is to connect the Northern Territory to Moomba. Moomba has been an important source of east coast gas and is connected by pipeline to the gas network. In fact, demand for gas has been falling sharply and suppliers, in minimising the effect of the recent 15 plus per cent decline in consumption, have deliberately exaggerated the impending unnecessary shortfall. If prices triple and a supply crisis does develop, that situation will have been manufactured by the gas industry and by the Abbott government who are determined to put the profits of gas exporters ahead of the interests of the nation.
How do we know that there is not any supporting evidence? We have the statements of the New South Wales energy minister, who complained that he has repeatedly asked the industry to issue figures regarding the gas supply, yet, as he said:
To my great disappointment, they have continually refused to do so.
It is regrettable that the east coast gas market is faced by issues of transparency. I am not aware of any public policy-maker in Australia who has a detailed understanding of how much gas is being contracted to overseas customers. I am not aware of any public policy-maker that knows whether the east coast gas market has the ability to deliver this without causing domestic shortfalls.
In any other circumstance one might properly regard this situation as a scandal.
Bennelong Electorate: Sports Funding
Mr ALEXANDER (Bennelong) (09:51): Last week, I attended the Eastwood Ryde Netball Association's 60th year dinner. ERNA is a highly successful local sporting organisation that promotes the active participation of hundreds of netballers in the Bennelong community. ERNA was one of several organisations to receive Commonwealth funding through the Community Development Grants Program, which, according to the department's guidelines, is dedicated to 'upgrade facilities to provide long-term improvements in social and economic viability of local communities'. For ERNA it was $10,000 for refurbishment work of their clubrooms. There was also $20,000 to the Ryde-Carlile Swimming Club for new starting blocks, $93,000 to the North Ryde Dockers to upgrade the amenities block at the ELS Hall Park and $10 million to the Australian Rugby Union for the development of TG Millner Field as the new home of Australian Rugby. The ARU chief executive, Bill Pulver, said in a press announcement:
This funding will help to create a truly world-class training and community facility.
With the potential sale of the Rugby club, the current home of Rugby, this presents a fantastic opportunity for Bennelong to become the proud stewards of one of our nation's larger sports. Combining high-performance training and community health and recreation into a single facility is a key measure to capitalise on sport's position within the health portfolio by developing its role as a tool for preventive medicine. Exercise is the single best remedy to address one of our largest budget expenditure items—preventable illness. It is time for us to end the age of entitlement that has acted as a dead weight on the sustainable development of Australian sporting organisations. Professional sport is big business and, like any other industry, sports associations should be required to operate productively and profitably, rather than be hiding behind a veil of not-for-profit status. A cultural change should be encouraged to motivate sport administrators to focus on the development of facilities as community centres for participation sitting alongside elite athlete training programs and professional competition.
The addition of membership fees revenues can provide sporting organisations with significantly more ongoing income to support the construction of a profitable facility, offering elite players a greater range of high-performance training options and giving the community a world-class recreation club. The challenge is to get administrators and the sports club industry to work together to develop sites for athlete development and the community's development. This model will help achieve the Community Development Grants Program goal to 'support needed infrastructure that promotes stable, secure and viable local and regional economies'.
Australian Broadcasting Corporation
Ms KATE ELLIS (Adelaide) (09:54): Last Wednesday, in Adelaide, I attended a community rally in support of our national broadcaster, the ABC. Now, that rally should not have been necessary. This speech to our national parliament should not be necessary because we know that, on the eve of the election, the Prime Minister made a very, very clear promise to the Australian public, and each and every one of those sitting opposite reflected that promise in their commitments to their local communities. The promise was, 'There will be no cuts to the ABC.' Well, haven't we seen that that word from the Prime Minister is not worth a thing, just like so many other of the promises and commitments to given to the Australian public, with over $40 million already having been stripped from the ABC's core budget after just one budget from those opposite.
We know that the Australia Network, our voice in the world, has been totally terminated, with the loss of some of the most experienced journalists that this nation has. But what we spoke about in the Adelaide rally last week was the impact that this will have in South Australia. We know that this could mean the direct loss of 110 local ABC jobs already, as well as another 40 in our local production industry. We need to be very clear in this parliament about the impacts of the vicious cuts from those opposite on the ABC. This is meant to be our national broadcaster, yet already we see that it is the smaller states that will disproportionately feel the pain of these cuts and have our voices silenced in national broadcasting.
Reports this week suggest the ABC's state based current affairs programs and some of its radio shows are also facing the axe. The future of programs on ABC Local Radio and Radio National are also up in the air. This is not just about jobs and it is not just about broken promises. It is not just about party politics; this is actually about our democracy, it is about our culture and it is about our culture being reflected in our broadcasting.
The ABC puts reporters where no other news organisations do. It tells stories that would not otherwise be told at all, and it makes news that matters—not just content that sells. The ABC is an essential part of Australia. More than a new service, it reflects who we are. It holds up a mirror to our culture. The ABC is of huge cultural importance to Australia. The role it plays in the arts, in reflecting Aboriginal and Torres Strait Islander culture, and in the national debate really matter to our country. The brilliant story of ANZAC Girls, which was recently shown, made in South Australia, may never have been told without the ABC. Like so many other stories, like so many other services in times of emergency, we know that the ABC is critical to this country, and Labor will stand up and fight for it.
Dobell Electorate: Suicide Awareness
Mrs McNAMARA (Dobell) (09:57): I rise today to speak on a serious matter in our society. In the three minutes of time taken to deliver this speech, five people around the world will have taken their own lives—five in every three minutes. Suicide is the leading cause of death for Australians aged between 15 and 44. Almost twice as many people die from suicide in Australia than in road related transport deaths. In Australia there are seven deaths a day by suicide. For every suicide it is estimated that as many as 30 people attempt to take their own life. That is around 200 attempts per day, more than one in Australia every 10 minutes—200 people who spill so desperate and alone and that they think the only solution is to attempt take their own life, and seven people who leave behind devastated families and friends. This is the hard reality of suicide. In a world which expects so much and where the struggle to maintain a healthy work-life balance is increasingly difficult, we must reach out and support those battling depression and other serious mental health conditions. Sadly, we hear and see mental health issues affecting people of all ages, backgrounds and occupations throughout our community.
As a parent, the thought of mental illness crippling a child is devastating. At the launch of the Dobell Youth Advisory Committee I ask the participating students to identify the three major issues they wanted to address. Mental health in schools and amongst our youth was one of them. We must be conscious of the demands and pressures placed upon a youngest Australians and ensure that we are there to lend a helping hand.
As the member for Dobell, I have been privileged to work with many valuable local organisations that help those in need. I have attended the launch of facilities and programs aimed at helping those fighting mental health issues and struggling with the thoughts of suicide. The Central Coast community is fortunate to have a community groups such as the Central Coast Suicide Safety Network, the Iris Foundation and the Health and Wellness Centre, who together focus on providing a coordinated response to assessing, responding and referring people who are at risk of suicide to the appropriate level of care.
Behind these organisations are team of dedicated and experienced mental health workers who work hand-in-hand with our community on a wide range of mental health initiatives. Resources include the Suicide Awareness Tool and Early Intervention Centre for Suicide Prevention, which assists people to obtain the support they require and provide integration into mental health support services.
Technology now means that help is available in our homes and workplaces. I recently attended the launch of SANE Online Forum, a new peer-to-peer support service and partnership with mental health organisations around Australia, providing support for people living with mental illness, their families and carers.
There is no lack of goodwill in our community or of those trying to make a difference, and we must continue to raise awareness of mental health issues to let people know that there is help available and that we are here as individuals and as communities to help you. I commend the work of everyone involved in raising awareness and offering support to those with mental health issues. I look forward to working with them towards a brighter future free from these struggles.
The DEPUTY SPEAKER ( Hon. BC Scott ): Order! In accordance to Order 193 the time for members constituency statements has concluded.
BILLS
Customs Amendment (Korea-Australia Free Trade Agreement Implementation) Bill 2014
Second Reading
Debate resumed on the motion:
That this bill be now read a second time.
to which the following amendment was moved:
That all words after "That" be omitted with a view to substituting the following words:
"whilst not declining to give the bill a second reading the House urges the government to:
(1) seek to re-negotiate the Korea-Australia Free Trade Agreement to omit provisions relating to Investor State Dispute Settlement;
(2) provide clarity on proposed changes to copyright and assurance that any proposed changes as a result of the Korea-Australia Free Trade Agreement do not create adverse impacts for intellectual property owners or users;
(3) protect Australia's right to regulate labour market entry and promote labour standards;
(4) reverse its cuts to automotive industry programs and work with employers and unions to ensure Australia has a sustainable automotive components sector; and
(5) address business concerns about complex rules of origin in the Korea-Australia Free Trade Agreement and lack of harmonisation with other preferential trade agreements."
Mr PASIN (Barker) (10:01): I rise to speak on the Customs Amendment (Korea-Australia Free Trade Agreement Implementation) Bill 2014.
I welcome this agreement with our friends in South Korea, because I believe that free trade is a force for good not only in my electorate of Barker but for the nation. Total Australian investment in Korea in 2012 was valued at $10.4 billion with Korean investment in Australia valued at $12 billion. The Abbott coalition government's swift conclusion of historic agreements with Korea and Japan since then sends a strong signal that Australia is open for business. With one in five Australian jobs linked to trade, these agreements are good for the economy, good for growth and good for job creation. The Korea-Australia Free Trade Agreement, or KAFTA, as it has been referred to, was signed on the 8 April in Seoul for the Minister for Trade and Investment, the Hon. Andrew Robb, and his Korean counterpart, Minister for Trade and Industry Energy, Minister Yoong Sang-jik.
The Korean gross domestic product is $1.22 trillion, with growth last year of 2.8 per cent. Korea has a population of over 50 million people and Australia's trade with Korea is already worth in excess of $32 billion. Korea is one of Australia's most important trading partners—our third-largest export market, our fourth-largest trading partner and a growing investment partner. Currently Australia faces tariff and non-tariff barriers and restrictions in Korea. Korea's average tariff on imports is 16.8 per cent, with an average tariff on agricultural goods of 53.6 per cent, with tariff peaks of over—could you believe it?—500 per cent.
This legislation amends the Customs Act 1901 to implement Australia's obligations under chapter 3 of the Korean-Australian free trade agreement. The agreement contains simplified trade facility of rules-of-origin and related documentary requirements. Goods imported into Australia that meet the rules of origin implemented through this bill will be entitled to claim preferential tariff treatment in accordance with the agreement. The Korea free trade agreement is a comprehensive agreement that substantially liberates trade with South Korea and creates significant new commercial opportunities for Australian businesses.
South Korea is Australia's fourth-largest trading partner and the implementation of this agreement will significantly boost Australia's position in this major market, where competitors like the United States, the European Union and the Association of Southeast Asian Nations are already benefitting from preferential access. KAFTA is expected to be worth $5 billion in additional income to Australia between 2015 and 2030, and to provide an annual boost to the Australian economy of approximately $650 million after 15 years in operation.
In its first year of operation it is expected to create 1,700 jobs and 84 per cent of Australia's current exports by value will enter Korea duty free. Agricultural exports are expected to increase by 73 per cent and manufacturing by 53 per cent by 2030 as a result of this historic agreement.
The benefits to Barker of concluding a free trade agreement with South Korea are numerous and diverse and principally directed towards our agricultural and manufacturing sectors. Currently Australian exporters face high barriers, with Korea imposing an average tariff, as I have said, of 53.6 per cent on agricultural imports and prohibitive tariffs on some products of up to 550 per cent. Under the agreement, inter alia, Korea will agree to eliminate beef tariffs over 15 years; wheat, wine and some horticulture tariffs immediately; and most dairy tariffs over three to 20 years, with immediate duty-free increased quotas for cheese, butter and infant formula.
The agreement is expected to provide new market openings for Australian service providers in education and financial services. These services currently face a range of restrictions, including with respect to commercial presence, cross-border supply and licensing requirements. Under the agreement, Korea will permit new Australian access in these sectors, providing outcomes equivalent to those in its free trade agreements with the US and the EU.
The agreement also includes an agreement on intellectual property. KAFTA will ensure Australian innovators and Australian creative industries receive high levels of protection in Korea broadly, equivalent to protections provided here in Australia. There is an agreement on government procurement. For Australia, this will provide, subject to agreed exceptions, national treatment for Australian goods, services and suppliers in the Korean market for government procurement above agreed value thresholds. KAFTA contains provisions that safeguard electronic commerce, prevent the imposition of customs duties on electronic transmissions and maintain best practice regulations in this field.
Business and industry have welcomed the proposed free trade agreement with Korea because the agreement provides benefits and opportunities on a number of levels. Apart from the obvious direct benefit of reduced tariffs and increased market access, they have identified competitive advantage, protection of existing markets and the positioning to take advantage of future negotiating opportunities as positive outcomes.
Reduced tariffs and increased market access will provide an immediate boost to trade. For example, the dairy industry expects to increase its exports to the value of $7.6 billion in the first year of operation of the KAFTA, and there will be continual growth thereafter. The dairy farm manufacturing export industry is currently worth $13 billion a year to the Australian economy, and Korea is the 10th largest market for dairy. If KAFTA is introduced before the end of the calendar year 2014—of course, that is our intention—and the beef industry can take advantage of a double tariff reduction, Meat and Livestock Australia estimate that the red meat industry will benefit the tune of $408 million over the next 15 years. For the Australian Agricultural Company, for whom the Korean market is currently worth $35 million, the expected reduction in the tariff differential between Australia and their major competitor, the United States, from eight per cent to 5.34 per cent represents a significant increase in trade value.
For the horticultural industry, KAFTA is particularly welcomed, as the industry has faced higher tariff barriers in the Korean market. Australian potato growers, such as Mark Pye in my electorate of Barker, already hold a 37 per cent market share of the Korean potato import market, worth $11 million to $12 million annually, with an existing 27 per cent tariff. That tariff can reach 304 per cent if the above quota tariff clicks into force. With tariffs due to drop to zero with the implementation of KAFTA, the market is expected to double.
Australian nuts are an expanding horticultural sector, not just nationally but particularly in Barker. I speak here of almond production but also the burgeoning industry of macadamias in my electorate. The 30 per cent tariff on Australian macadamia nuts, for example, will be reduced to zero over five years, and exports are expected to grow from 175 tonnes with an annual value of $3 million to approximately 2,000 tonnes with an annual estimated value of over $40 million.
The wine industry too is enthusiastic about the opportunities presented by the Korea-Australia Free Trade Agreement. The 15-per-cent tariff on Australian wine will reduce to zero on entry into force. In 2013, the industry held approximately four per cent by volume of the Korean market, but expects that market share to increase to 15 per cent over the next two to three years against global competitors. Of course, Barker is the electorate that by area represents the largest wine-grape-growing areas of the country. That industry in particular is under increased pressure as the volume of wine being produced ever increases and we need to seek fresh markets at all opportunities. The Korea-Australia Free Trade Agreement is a step most significantly in the right direction.
However, it is the competitive advantage that the KAFTA presents that provides significant potential for many Australian industries. The Winemakers Federation of Australia believes that exports to Korea have been steadily decreasing since 2007, largely because of the Korean free trade agreements with the US and the EU, as well as with Chile. The wine industry sees the Korean market as a major growth opportunity and the KAFTA will enable the industry to compete, again, on a level playing field.
The Australian Nut Industry Council states that Australian growers have sold almost no almonds to Korea since the Korea-US FTA came into effect in March 2000, reducing the US tariff to zero. The entry into force of KAFTA will reduce the tariff for Australian almonds from eight per cent to zero, putting Australian industry back on an equal footing with the US industry. The Korean market imports 20,000 tonnes of almonds annually, worth $160 million.
Korea is Australia's third-biggest export market for Australian beef, worth a staggering $788 million last year alone. Elimination of Korea's 40 per cent tariff on beef will occur in 15 equal stages. Korea will eliminate its 18 per cent tariff on bovine offal and its 72- per-cent tariff on processed beef products over 15 years.
Australia exports $317 million worth of wheat to Korea annually. Under the KAFTA, Korea will eliminate its 1.8 per cent tariff on wheat from Australia. A tariff of eight per cent on wheat gluten will also be eliminated.
Australian dairy exports to Korea were worth $87 million in 2013, despite very high tariffs. The industry will benefit from immediate duty-free quotas for key exports and the elimination of tariffs by up to 89 per cent on most dairy products.
There are key KAFTA outcomes that cheese, Australia's main dairy export, will enjoy: liberalised trading, including an immediate duty-free quota of 4,630 tonnes growing at three per cent compound per annum;. progressive elimination of a 36 per cent tariff over periods ranging from 13 years for cheddar cheese; immediate duty-free quota of 113 tonnes for butter; elimination of eight per cent tariff on dairy spreads; infant formula will receive an immediate duty-free quota of 470 tonnes; and tariffs on a range of other dairy products such as milk, cream, ice cream and yoghurt will be eliminated over a period ranging between three and 20 years. Korea will also eliminate its out-of-quota tariff of 269 per cent for malt and 513 per cent for malting barley over 15 years.
For some of Korea's more sensitive horticultural products seasonal tariffs will be eliminated during Australia's exporting months: for potatoes, tariffs of up to 304 per cent, as I have previously indicated; for table grapes, tariffs of 45 per cent will halve to 24 per cent on entry into force and will be eliminated over five years for the months of December to April; oranges, of course, from the Riverland—Australia's premier citrus growing region is in the northern part of my electorate—will see tariffs of 50 per cent fall to 30 per cent on entry into force and be eliminated over seven years for the period from April to September each year; with mandarins, the high tariff of 144 per cent will be eliminated over 18 years during the months of April and September each year; and tariffs of between eight and 30 per cent on rapeseed oil, or canola, will be eliminated over a period of five to 17 years. It should be noted that Korea imports rapeseed oil to the value of $36 million from Australia, or at least it did so in 2013.
Korea will eliminate, on the agreement's entry into force, its three per cent tariff on cottonseed. Australia's exports were worth $36 million in 2013. Korea is also set to eliminate its 22.5 per cent tariff on all sheep and goat meat over 10 years. Tariffs on key pork exports of between 22.5 and 25 per cent will be eliminated over a period of between five and 15 years. Key seafood products such as rock lobster, fished predominantly from the Southern Ocean in my electorate of Barker, will enter duty free after three years.
As you can see, Australia, and regional Australia in particular, is an enormous beneficiary from this agreement. The areas I have listed are all key industries in my electorate, and a reduction in trade barriers will lead inevitably, and thankfully, to their expansion. The expansion of these industries necessarily means an expansion of jobs, the creation of jobs, in my electorate. I am unapologetic in my support for government initiatives that encourage business and industry to create and sustain jobs. I commend this bill and this agreement to the House.
Mr CONROY (Charlton) (10:16): At the outset let me make it very clear that Labor supports the Korea-Australia Free Trade Agreement. This is an agreement that delivers significant benefits to certain sectors of the economy, and the previous speaker highlighted the main beneficiaries, which are in the agricultural sector. That is a good thing, but it should be noted that the agricultural sector employs 300,000 people in this country out of a workforce of over 11 million. We should be delivering benefits to the agricultural sector, and I am happy that KAFTA does that, but I am nervous about some of the other aspects of this agreement.
To be serious, this agreement was poorly negotiated, and Labor has highlighted serious reservations with the agreement. We have outlined changes that we would pursue both in opposition and in government. Nevertheless, we support the Korean free trade agreement and we support free trade in general. We are a party of free trade, and we are a party that pursue multilateral free trade as the best course of action. Bilateral free trade agreements are a poor second choice in most times. But we do support free trade, and let us have none of these absurd reductionist arguments that, because we express concerns about aspects of free trade agreements, we are suddenly not for free trade. That is certainly not true.
We look at the actual facts of these matters. If you look at the recent Productivity Commission review of bilateral preferential trade agreements—or FTAs, as they are more commonly known—the Productivity Commission had some very interesting conclusions that we should be all very cognisant of. They included their finding that the increase in national income from FTAs was likely to be modest—quite modest, in fact. They found that there was little evidence that businesses gained substantial commercial benefits from FTAs, and they also found that modelling and claims by governments when FTAs are announced tend to oversell the economic value of these agreements to Australia. The Productivity Commission also highlighted the few benefits and the very considerable risks that occur when FTAs cover intellectual property and investor-state dispute settlement clauses, which I will return to in more detail later.
There can be no greater example of an FTA claiming great benefits but delivering very little than the Thai FTA. This is an agreement that was trumpeted by the Howard government as delivering real gains not just for the agricultural sector but for certain parts of manufacturing, and most especially the automotive sector, where there was great hope that the Ford Motor Company could export a lot of the Ford Territory—which is an excellent vehicle, a large vehicle, termed a medium SUV—into the Thai market. There was a great fanfare when we heard the announcements about the tariff reductions and everything else that was associated with it.
What happened? Within weeks of the FTA being signed and being implemented and tariffs being reduced on both sides of the ledger, the Thai government introduced a new motor registration and excise scheme that penalised vehicles with large engines. They effectively penalised vehicles imported into their country with large engines. The classic example was the Ford Territory, so exports of the Ford Territory to Thailand were hit with a cricket bat, and that was a market that never really eventuated. This is an example of an FTA promising to deliver lots, but, when behind-border measures interfere with that, we see consequences that are quite negative. That is not an argument against FTAs, it is not even an argument against multilateral free trade agreements; it is just an observation that often these agreements are oversold in terms of their benefits and that what really matters is the change in behaviour both by government and companies when FTAs are implemented.
If I can turn to the details of the Korea-Australia FTA, the most worrying aspect of this free trade agreement is the provisions around investor-state dispute settlement clauses—ISDSs as they are referred to—which give rights to foreign corporations, rights which do not accrue to domestically based companies, to sue governments for actions or decisions they take that might impact on the commercial operations of those businesses. The classic example of that, going on right now, is: the Hong Kong arm of Philip Morris is suing the Australian government for our actions around plain packaging for tobacco products—a piece of health reform that is already making significant impacts on reducing tobacco consumption, will reduce cancer rates within this society and save the Commonwealth billions of dollars and tens of thousands of lives. This is a great health reform that is being challenged under an obscure ISDS clause of a free trade agreement.
This is particularly worrying because this impacts on the sovereignty of nations. This parliament, on behalf of the people of Australia, has the right to legislate in the best interests of Australians. ISDS clauses interfere with that and, most notably, they give rights to foreign corporations that do not accrue to Australian corporations, and that is a real concern.
One area where we will see this more and more is around environmental regulation. This bill, with some caveats that you could drive a truck through, gives rights for Korean mining corporations to sue state and federal governments that make decisions around mining approvals. The classic example of this potentially in the future is a coalmine called Wallarah 2 in the seat of Dobell to the south of me. This is a coalmine proposal that has stirred up quite contentious public discomfort. Before the last election, former Premier Barry O'Farrell and the disgraced resources minister Chris Hartcher made a promise that this mine would not go ahead. Subsequently, it is going through its consent process—and I am not commenting on the actual merits of the case, but by the Wallarah 2 coalmine proposal being owned by a Korean company that company now has a potential right to sue the New South Wales government if the New South Wales government decides not to approve that mine—a right that BHP does not have, a right that Rio Tinto does not have, a right that any other Australian based coal mining corporation does not have. That is a significant concern.
We have already seen these ISDS provisions exploited in other countries on environmental regulations. For example, there have been some notable cases in Canada as well. It is a real concern. These ISDS provisions do occur in other FTAs Australia has signed and we should not be including them. The sovereignty of this parliament should not be restricted by free trade agreements. I am proud to say that Labor has said that in government we would seek to renegotiate this aspect of the Korean FTA, to remove these objectionable provisions.
The second concerning aspect of the Korean FTA is around copyright and IP provisions. I want to refer in some detail to the excellent contribution by the member for Gellibrand, who is an IP lawyer and who sat on the treaties committee and made some very trenchant observations about the IP provisions of this treaty. He has stated that the IP section of this treaty is one of the most mendacious examples of policy laundering that we have seen in recent times. The consultation attachment of the national interest analysis of the KAFTA provides that, consistent with Australia's existing obligations in the Australia-US and Australia-Singapore FTAs, and to fully implement its obligations under KAFTA, the Copyright Act 1968 will require amendment in due course to provide a legal incentive for online service providers to cooperate with copyright owners in preventing infringement, due to the High Court's decision in Roadshow Films v iiNet, which found that ISPs are not liable for authorising the infringements of subscribers. This characterisation firstly is frankly wrong in law. The High Court's decision did not change anyone's legal rights or obligations. It merely confirmed the scope of the obligations which have been well understood by the industry.
The House should be under no illusions that the terms of the authorisation liability safe harbour provisions have not changed in law since the implementation of the US FTA. This was the finding of the member for Gellibrand, and I agree with him completely on this case. And to use a trade obligation in this case, a very peculiar interpretation of this FTA, to circumvent the democratic debate over the merits of a policy initiative around copyright protection, is bizarre and I think it is not a good public policy outcome.
And what is happening here is the Attorney-General's Department has decided, unilaterally, that there is a risk that Australia could be perceived as being noncompliant with its US FTA obligations. And as I understand it, this is without any correspondence or prompting from the United States government. It is apparently also being done without consideration for whether this view should be tested legally.
If the Abbott government wants to reform Australia's Copyright Act, it should make the argument for this change on its merits. It should not hide behind an FTA, or use an obscure interpretation in this FTA, to drive a change that is quite inconsistent with the legal advice of most legal practitioners in this area. I am very happy to say that Labor has stated its concerns about the intellectual property provisions of this agreement and we have made it very clear that we will determine our position on any changes to the Copyright Act when they are made public.
This is part of a broader problem with FTAs, which is when they intrude into areas of intellectual property. DFAT has confirmed that none of the economic modelling done to justify the Korean FTA, around the benefits of the agreement, even considered the impact of the IP provisions of the agreement. And this is a gaping hole in the economic modelling of this agreement. This is important because the Productivity Commission's review of FTAs that I quoted earlier, quote a study of IP provisions that found that the Australia US FTA agreement has cost Australia nearly $1 billion through copyright changes that hurt the Australian economy. The Productivity Commission also found that it tilted the balance towards IP supplier interests over consumers. This is a dramatic concern. This is a concern that has not seen in the light of day. We are very focused on the benefits to agriculture—as we should be, and there are significant benefits to agriculture in this FTA—but we need to balance that against copyright changes that have not been tested, have not been modelled, include a bizarre interpretation of recent High Court changes and include ISDS provisions that threaten our sovereignty.
The third concern that Labor has flagged around the FTA is around the removal of the requirement for labour market testing for migration by Korean nationals. Labor believes that the government should require employers to show there are skill shortages if they wish to utilise KAFTA provisions on the movement of people. The government has informed the parliament that these provisions will not result in a significant increase in the use of section 457 visas and Labor will hold the government to account on this undertaking. This is a significant concern if this FTA is being used as a backdoor to bring in section 457 visa workers without genuine labour market testing. Labor is not opposed to the use of section 457 visas when it can be shown that Australians are not available to do the jobs that they are bringing in those workers for.
The fourth concern is around the provisions around the reduction in automotive tariffs. Unfortunately, this is a case of well and truly closing the barn door after the horse has bolted. It is well known that debates around the auto tariff provisions and ISDS were the two reasons why this agreement was not signed by Labor in government. Quite frankly, this government has removed one of those concerns by destroying the automotive industry. Within four months of coming into power, they have forced Holden and Toyota to leave this country by their $1½ billion cuts to the Automotive Transformation Scheme, and so they have removed the concerns around reductions in automotive tariffs. That is a real tragedy, because what we are seeing are 50,000 direct jobs going and another 200,000 indirect jobs going. Let us just put that in context: there are 300,000 workers in the agricultural sector and significant shares of that industry will benefit from this FTA, and that is a good thing. But we need to contrast that with this government destroying an industry that directly employees 50,000 workers and another 200,000 workers in the supply chain.
So this is an FTA that Labor has decided, on the broad merits of it, is justified, but we flag our significant concerns with it in the areas of ISDS, intellectual property, labour mobility and the treatment of the automotive sector.
I would also like to flag that I have significant concerns with how we are negotiating the Australia-China Free Trade Agreement. First off, I think it was a massive mistake by the Prime Minister to set an artificial negotiating deadline of the visit by the Chinese leadership to this country for the G20. I was in China on a delegation last month, and the Chinese were not hiding the fact that they regarded this date as a great opportunity to place pressure on Australia to accept a substandard agreement. I am voicing my concerns in advance to see what this government can deliver on the China FTA, but if that Korean FTA is any example I hold out few hopes, and I fear that we will be getting another substandard agreement. Nevertheless, Labor will support this agreement with the reservations that I have highlighted, and I thank you for the opportunity to speak.
Mr JOHN COBB (Calare) (10:31): I rise to speak on the Customs Amendment (Korea-Australia Free Trade Agreement Implementation) Bill 2014 and cognate bill. Exports are important to us because we are a country, particularly agriculturally, totally dependent on our ability to establish, maintain and develop trade relations with other countries.
There is a lot of talk, justifiably I believe, about the power of supermarkets in Australia. The best way for Australian agriculture to deal with supermarkets is to not need them. The way to not need them is to have good customers and good markets, and to export a good Australian product overseas.
I see this deal as extraordinarily important as one among others that we have to deal with and develop into maintaining a profitable Australian economy, particularly a profitable agricultural economy. This is undoubtedly—while it is not perfect, it will deliver great benefits to—
A division having been called in the House of Representatives —
Sitting suspended from 10:33 to 10 : 47
Mr JOHN COBB: To resume, we have a long history as a trading nation with an open, diverse and resilient economy. As I said earlier, two-thirds of what we grow, in agricultural terms and particularly in Calare, is exported to all parts of the world.
The Korea-Australia Free Trade Agreement does ,without doubt, add greater strength to our reputation and our ability to be one of the world's highest quality exporters—especially in key target areas such as Korea, our third largest export market and fourth largest trading partner. We must never forget that our greatest trading asset is our reputation for a very clean, green, high-quality product which is sought after around the world. Eighty-four per cent, initially, of our exports to Korea will enter duty-free after full implementation. In 15 years, the agreement will see no tariffs on 99.8 per cent of our exports. This helps level the playing field with some of the world's big exporters, including the US, and all exporters will benefit.
The beef industry is probably the best example of why the previous government should have concluded this before, when they had the opportunity. If they had not totally 'annoyed'—to be polite—the Korean government, I believe this would have happened. Beef is our biggest agricultural export to Korea; it was worth almost $800 million last year. Korea is our third biggest market for our beef. This agreement will see the elimination of Korea's 40 per cent tariff on beef over the next 15 years. Korea will eliminate its 80 per cent tariff on bovine offal as well over 15 years—and our exports of offal to Korea were worth nearly $70 million last year. Korea will also eliminate its 72 per cent tariff on processed beef over that same time frame.
KAFTA will provide a quick tariff elimination to most, but not all, of our horticulture exports to Korea. Cherries, for example, like beef, are a huge issue for people in Korea, be they on the land or be they not. Tariffs on cherries of 24 per cent; almonds and grapes—grapes come down to 21 per cent; asparagus. Any amount of horticulture really does well out of it—macadamia, citrus, tomato. This is going to be eliminated over five years. Tariffs on tomatoes—which have a 45 per cent tariff, and apricots the same—will be eliminated over the next seven years. Tariffs on our fruit—our mangoes, peaches, plums, peanuts—in their varying percentages, from 30 to nearly 64 per cent, will be eliminated over 10 years. Oranges, mandarins and kiwifruit will also have their tariffs eliminated.
Given Australian wine production has lifted so much over the last 20 years, the agreement with Korea—not due to Calare, which, I must say, does have some of the better wine in Australia. I am not one to skite but you are welcome to come and find out just how good it is! So this is really a big issue for Australia—not just my part of it but for the wine industry. Currently they face a 15 per cent tariff, and this includes sparkling wine, red wine and white wine, which will now enter Korea duty free.
I also expect the KAFTA to help revive the falling export dairy market. Dairy is another agricultural industry which is important to my part of the world but obviously huge to Victoria and Tasmania. They were worth nearly $90 million last year, which fell $20 million from 2011. The industry will benefit from immediate duty-free quotas for key parts of the dairy industry and the elimination of tariffs—up to nearly 90 per cent—on most other dairy products. Always, like with every other agricultural product in Australia, the dairy industry is dependent on the strength of its exports. Once again, I would love to see the dairy industry in New South Wales and Queensland, for example, become far more export orientated so they would be far less dependent upon our supermarkets.
Cheese, which is the main dairy export to Korea, will enjoy liberalised trade including an immediate duty-free quota of 4,600 tonnes—and that grows at three per cent per annum compound as though it was interest—and progressive elimination of the 36 per cent tariff over periods ranging from 13 years for cheddar cheese to 18 years for cream cheese, with all cheese tariffs eliminated over 20 years. Dairy and beef are actually two very sensitive issues in both Japan and Korea, so they have done a very good job here. The minister has done a very good job.
Infant formula and a range of other dairy products such as milk cream, ice cream and yoghurt: Korea is actually our biggest—
A division having been called in the House of Representatives—
Sitting suspended from 10:54 to 11:08
Mr JOHN COBB: One of the other things which Australia has really picked up its game in is the export of lamb in recent times. In the case of Korea, they will eliminate their 22½ per cent tariff on all sheep and goat meat over 10 years; pork in five to 15. That is good news not just for Calare but for Australia.
The economic modelling of KAFTA undertaken by the Centre for International Economics estimates that goods liberalisation alone will be worth nearly $5 billion in additional income to Australia between 2015 and 2030. Exports to Korea over that time should be 25 per cent higher than they would have been otherwise without this free trade agreement—not just agriculture; mining and manufacturing exports will be far, far better off. And the job situation in Australia reflects that increase. Quite honestly, this agreement protects our competitive position in the Korean market. I think I mentioned beef earlier—how big that was. We looked as of January this year. Without this agreement, we were going to be some eight per cent worse off than the USA, who are our main competitors in the beef market with Korea.
To sum up the whole situation, I think KAFTA is a world-class agreement. It does provide new opportunities for Calare and Australia. It also confirms our standing as a reliable quality exporter. I want to talk about that for a second. I think that in the years after the war Australia was very protectionist, but the thing that we have learnt over the years is that it does tend to make you somewhat lazy. If you are protected against exports then you tend not to take up new technologies, not to spend the money on becoming more efficient, to increase productivity, quality—the lot. And Australia has learnt that. Also, we must never forget that we are a very export orientated country, as I said earlier. If we do not liberalise our own position, we are not going to get our products into other countries around the world.
We have learnt over the years that protectionism does have its bad side—as well as admittedly its good, to establish industries. There are things that are still missing in this agreement, like canola, rice, milk powders, apples and various other products, which it would have been really good to have in there. I think that, as Korea realise that they are dealing with the best quality products that can be got in the world, which they get from us, they will always know that we are as tough on the quality of our exports—tougher, I would say—as on what comes into Australia. They will know that they will always get a good quality product from us, that we are reliable suppliers and that we are very efficient suppliers. I think that, as they realise—as they must be somewhat aware now—what a good country we are to trade with and how their own industries will lift their game when they have to, we shall and we must get some agreement with them in the future about those products which so far we do not have.
I congratulate the minister on getting this agreement. It should have happened over the last six years, particularly for beef, but thank Heaven it has. Let us hope that, in the time to come, those issues that are not resolved will be and that we continue to be very good suppliers to and traders with the country of Korea.
Ms MacTIERNAN (Perth) (11:12): I want to confirm that Labor does support free trade agreements, as we are a trading nation—indeed, we are an exporting nation—and we need to develop our markets. In particular, in Western Australia we are an even greater trader. Basically, over 80 per cent of what we produce in Western Australia is exported. So we recognise the need for bilateral agreements. We recognise that, whilst multilateral arrangements are preferable, there has been an amazing constipation in the negotiations for many of these significant multilateral agreements, so it is understandable that the Australian government, as Labor did, seek to negotiate a bilateral raft of trade agreements. Of course, these agreements with our Asian neighbours are a very critical part of our future.
I want to make a couple of comments about Korea. I was actually there earlier this week. It is a nation that has achieved enormously over the last 60 years. It has gone from being one of the poorest nations of the world to now being very much a developed country. Even in recent times, we have seen a marked leap in the GDP. Last year, the per capita GDP of Korea was $26,000. When you consider that in 1981 the per capita GDP was less than $2,000, you can see the growth that has occurred in this country. It is a strong democracy. Through my contacts with Korean members of parliament and through the Australian Political Exchange Council, I know that it is a very robust democracy where there is a strong contest of ideas. I want to preface my remarks by saying I totally respect and support us entering into a free trade agreement with Korea, but this is an agreement that has many, many problems. My view is that we have seen the government rush into this agreement. They pledged that this was going to be one of their 100-day achievements, and it was far more important for the government to have been able to tick that box of having achieved this, rather than putting Australia's national interest in the forefront.
There has been much discussion about the problems with this agreement. The inclusion of the investor-state dispute resolution provisions will be touched on by a number of my colleagues. I do think they are very, very significant problems. The whole notion that we would allow a foreign company to have greater recourse than our own companies have to contest government legislation is most inappropriate. I see these investor-state provisions detracting in a very significant way from our sovereignty and our rights to ensure that we make legislation for the good of our community. The inclusion of these investor-state provisions—which give investors the right to contest legislation that they believe harms their interest—gives only foreign investors the right to do that. I think this is extremely worrying indeed. The exceptions that have attempted to have been carved out in this agreement will be inadequate to provide decent protections and as it has been demonstrated—my other colleagues will go into the detail—where those particular clauses have indeed proved to be inadequate to provide protections on what any of us would consider would be legitimate activities of government in legislating.
What I particularly want to focus on today is the free movement of people provisions and the extraordinary asymmetry that exists in this legislation between the rights of Koreans to enter Australia and to participate in the Australian workplace, and the rights of Australians to enter Korea and participate in their workplace. If you look at some of the statements that the government has made, there is really no reference to this asymmetry and to the extent of this asymmetry. What we have allowed here is a massive capacity for us to lose control of the 457 visa system. Let us have a look at what is provided for.
This agreement allows for a Korean person who has a trade, a technical or professional skill, is experienced and has the existing qualifications, can come to Australia and work in Australia without there being any labour market testing. It is not confined—the person could be someone who is employed by a Korean company who has a contract in Australia to provide certain services. They could be that, but need not be. It can be any enterprise lawfully operating in Australia. It could be any Australian company; this is not confined.
We are not talking here about people who would necessarily have to have a high level of proficiency. It could be a trade—and I am not in any way demeaning trades. We are talking about people who could be bricklayers or electricians, or people who had qualifications in meat working—people experienced, qualified boners, for instance, qualified to do the various trade activities that are found in abattoirs. The bar has been set very low here. No market testing is required and the range of skills is very broad. Anyone with a trade or a technical or professional skill can be considered. They can work for a Korean company that is based here or they can work for any company that is legitimately operating in Australia.
If we go and look on the other side at what Australians are going to be able to do in Korea we find that it is very different. For a start, there is a different definition for a contractual service supplier. For an Australian it is someone who has to demonstrate a high level of skill, and there is a very detailed set of skills set out in one of the annexures. What is very interesting, I think, is that unless you read the agreement in detail you do not realise that that definition only applies to Australian workers seeking to take up residency in Korea. So we have a very restricted arrangement. We have got to show that we have a high level of technical, professional or managerial skill. It only applies to people who are working for an Australian company that is operating in Korea, that previously did not have a presence in Korea. So it is a really limited range of companies that it can apply to, and you have to demonstrate that you have already been working for that company for a year prior to your entry into Korea.
On top of that, they retain a couple of interesting rights, firstly, the right to numerically restrict it and, secondly, the right to do labour market testing. They also have another very curious provision within the legislation that gives them the right to exclude anyone on the basis that they might be involved in in a labour market dispute. The capacity for Australian people to go up into Korea is extraordinarily limited and it is at all times subject to labour market testing.
But on the other side, what we have achieved is extraordinary asymmetry. I was looking at the agreement that we have with Chile, an agreement that was entered into by the Australian government where there is almost complete symmetry between these two and we talk about having to establish a very high level of technical skill or professional expertise. But unlike any of the other agreements, here in the Korean agreement we have absolutely lowered the bar. We have absolutely reduced the requirement, the skills component, the level of skill that has to be demonstrated before one comes into the country.
We have already seen what has happened with Korean companies in Western Australia. We know that when Samsung got the contract to develop the Roy Hill mine they brought in hundreds of Korean workers. Complaints have been registered—and we understand that there is an investigation as to the allegations made, but the investigation is being kept secret. We understand that the allegations have been made by very well-placed whistleblowers about the operation of this company, that people brought in as engineers were indeed doing the work of administrative staff. So even under the existing 457 visa arrangements there was an alleged breach of the regulations.
And I know from what workers have been telling me out there that the Korean workers are required to do a swing of four months on. They are working up to 84 hours a week and they are being paid as little as $16 an hour, circumstances and conditions that are well and truly less than what Australian workers would receive in similar circumstances. The Korean company were very insistent that they bring their own people in.
We have now opened up a huge capacity for people—and not just for Korean companies but for other companies—to just import, wholesale, people from Korea without any regard to unemployment in Australia. This is not going to just be limited to remote sites. We now will see the capacity for people—if you are running a factory somewhere—to bring in Korean workers, as long as they have got some technical qualification—and it could be a very limited technical qualification.
I am really keen and enthusiastic about the beef market and opening up the packaged meat market. For the North of Australia and for the Kimberley in particular, I see a great potential benefit for us to be able to finish off our own stock rather than sending our live exports to Indonesia, to be able to value-add and to be able to create jobs, particularly for Aboriginal people, who have skills in boning and slaughtering techniques. This would be an ideal opportunity. But one of my real concerns—I can see what will happen now—is that we will get Korean-owned abattoirs being established, or any abattoir being established, where Korean workers will be brought down to staff that abattoir, and the necessity to develop Australian labour and create those opportunities in the North of Australia are going to be lost.
I want to repeat that this is a very bad agreement. There has not been honesty and transparency with the Australian people about the true asymmetry of this agreement and just how broad those entitlements are going to be for Korean people to come here and, totally without labour market testing, to work here at a time when we have rising unemployment. This is a dishonest agreement and I think it augurs badly for the current raft of agreements that we know are being negotiated. I ask the government to take stock about what it is they are doing here and to not repeat this travesty in the next agreement. (Time expired)
Mr VARVARIS (Barton) (11:28): I rise to lend my strong support to the Customs Amendment (Korea-Australia Free Trade Agreement Implementation) Bill 2014, which amends the Customs Act to give force to the Korea-Australia Free Trade Agreement signed on 8 April of this year. This is an agreement which reflects and strengthens the close bilateral relationship between our two nations, significantly improves our access to the Korean export market and contributes to an overall movement towards liberalised trade between Australia and Asia. Australia and Korea have a close bilateral relationship, a relationship built on a foundation of mutual interest, shared values and a strong trading partnership.
In 2013 two-way trade between Korea and Australia was worth $32.1 billion. Korea is Asia's fourth largest economy, our third largest export market and our fourth largest overall trading partner. One reason why this free trade agreement is so significant is that it represents the cutting edge, the first major breakthrough, onto the frontier of preferential access agreements with Asian markets generally.
The Asian nations of China, Japan and South Korea together comprise a 50 per cent share of the Australian export market, with the Korean market on its own comprising a sizeable proportion of this market share. This indicates that our access to Asian markets is truly the key to building on our prosperity into this century. These markets are of such significance to Australian trading prosperity that our access to Asian markets must be maximised into this century and we must find ways to encourage investment in our uniquely Australian industries, especially our primary and agricultural industries.
As the Joint Standing Committee on Treaties found, the opening up of Asia's major markets is essential if Australian businesses are to successfully compete with the world in the years ahead. Indeed, before the conclusion of the Korea-Australia Free Trade Agreement on 8 April, significant free trade agreements with Korea had already been established between Korea and their other major trading partners, such as Chile and the USA.
If our nation intends to pave the way forward for an even stronger relationship with Korea, we must adapt to the way in which other nations are engaging with the Korean market. After all, the Korean market, according to the Australian dairy industry's submission of 2009, often depends 'more on price and availability than long-term customer-supplier relationships'. It said:
… it is important that we not only strive to achieve any advantage that we can find but also that we ensure that our competitors … do not have any advantage brought about by preferred access arrangements.
We must adapt to the global state of competition and preferential access if we are to remain competitive and expand our share of the Korean export market. Free trade agreements, which could also be termed 'preferential access agreements', have received a strong vote of confidence from trade and industry bodies, including in relation to the Korea-Australia Free Trade Agreement. Preferential access in the context of the Korea-Australia Free Trade Agreement will mean that 84 per cent of Australian exports to Korea will be tariff free immediately—a figure that will increase to 95.7 per cent after 10 years and settle at 99.8 per cent tariff free upon full implementation of the agreement.
Such agreements grow firmly out of the ethos of this coalition government. Whether it be from the Liberal Party's commitment to liberalisation of markets or the Nationals' commitment to a strong export market, free trade agreements have always had a strong vote of confidence from this side of the House, in the coalition. As a member of the coalition, I firmly believe in the power of trade as the key to prosperity. When nations open their doors to investment, to import and export, their economies flourish and jobs are created. Australia has gained a sense of true pride in being such a quality exporter to Asian markets. Indeed, in Korea, our pork and beef products are known to be among the cleanest and highest quality imports in the nation.
Free trade agreements achieve three major objectives: Firstly, they encourage the liberalisation of markets—a key commitment of this government, which ratifies the Prime Minister's initial declaration that Australia is 'open for business'. Secondly, they open up market access for Australian exporters and Australian consumers. Thirdly, they strengthen the already close bilateral relationship between two major trading partners.
Failing to support action to remain competitive would mean that there is no viable alternative plan for the maintenance of our national prosperity. If our major competitors have concluded agreements of this nature, our market access to Korean markets will weaken. I am proud and grateful to be part of a pro-trade government that has entered into this important agreement wholeheartedly, where an alternative government would not have done the same, forfeiting growth, jobs and prosperity for the decades ahead.
The fact that this agreement has been successfully concluded within the first term of an Abbott coalition government, where other attempts have fallen short, should instil confidence in the people of this nation that, when the coalition is at the reins, the creation of prosperity is an absolute priority. If the Australian government of today had said no to this free trade agreement, Australian exporters would still be facing prohibitive barriers of, on average, a tariff of 53.6 per cent on agricultural imports and prohibitive tariffs on some products of up to 550 per cent. Australian exporters would face a reduced level of competitiveness, forfeiting an expanded market share and a strengthening of the significant Korean investment.
The coalition wants to be a friend to Australian industry. The coalition wants to stand by the comments of such an authority as Ian Murray AM, Executive Chairman of the Export Council of Australia, who says that the Korea-Australia Free Trade Agreement is particularly important to those exporters who have not been competing on a level playing field in Korea. He says:
It is a huge breakthrough—the value of which should not be underestimated.
Mr Murray's statement is absolutely correct. The main export markets which stand to gain in a big way from this free trade agreement are raw sugar, beef, wheat, malt, barley, dairy, wine, seafood, horticulture, ores, concentrates, petroleum, coal, chemical elements, pharmaceuticals and automotive parts.
It is legitimately exciting to consider the wide range of benefits that the conclusion of this agreement will bring about for Australian industries, and I will be happy to see these benefits culminate in a return to the farm gate and a boost in prosperity for regional Australia. I must say that the Minister for Agriculture has been steadfast on this point in alliance with the Minister for Trade and Investment.
It was heartening to review the submissions to the feasibility study on the Korea-Australia Free Trade Agreement and to witness such a variety of quarters urging the Australian government to proceed with this significant agreement. Key submissions came from the Western Australian Department of Agriculture and Food, the Ricegrowers' Association of Australia, the Generic Medicines Industry Association, Australian Pork Limited and the Australian dairy industry. The Export Council of Australia and the Australia Korea Business Council also made known their strong support for the proposal.
I would like to take a few moments now to read some of the clearest messages received in these submissions. The Western Australian Department of Agriculture and Food called the Korea-Australia Free Trade Agreement 'a big opportunity to help strengthen the businesses of Western Australian farmers and agrifood businesses'. They warned that failure to approve the agreement 'would be a substantial missed opportunity' in the light of other potential Korean and Australian free trade partners.
The Ricegrowers' Association of Australia supported the Korea-Australia Free Trade Agreement with the view:
… South Korea is an important market for the Australian rice industry …
The Generic Medicines Industry Association indicated:
… exports of medicines have shown the strongest growth of any major Australian manufacturing export to the Republic of Korea.
Australian Pork Limited gave some of the most enthusiastic support for the agreement, looking to the future in its statement:
… with Australia's high herd health status Korea can become an even larger export market.
It said:
… Australia cannot realise this market potential without an FTA.
Similarly, the Australian dairy industry used strong language in its submission, urging the Australian government to 'commence negotiations as soon as possible to achieve a substantial liberalisation of dairy trade between the two countries' and pointing out that the industry is 'keen to capitalise' on the growth of 'one of the world's most valuable and fastest growing dairy markets'.
Primary industries make up the backbone by which the whole of Australia is supported. Measures that free up export markets and benefit these pivotal industries will ultimately benefit us all. But the benefits that we will see come back to the farm gate and to the Australian industry as a whole are just one element of this agreement. The preferential access which Korean imports will be given in Australia represent a huge gain for all kinds of Australian consumers. As the member for Barton, I am keen to see my constituents benefit from a range of Korean goods becoming more affordable via preferential access—goods which will include refined petroleum; telecom equipment and associated parts; pumps; heating and cooling equipment; and motor vehicles.
Ultimately, these bills are about our longstanding support as government for the liberalisation of trade. These bills, and the free trade agreements that our government support as a whole, stem from our belief in breaking down barriers between Australia and our partners, our belief in being competitive on the international stage and our belief in job creation and staying ahead when progress is made by our competitors. These bills stem from our belief in strengthening the bilateral ties between our nation and our partners, especially our Asian partners, our belief in the openness of trade and exchange and our commitment to winning the benefits for the average Australian consumer. They demonstrate our commitment to a fair go for regional Australia and delivering benefits to the farm gate. For all these reasons, I am confident in commending these bills to the House.
Mr KELVIN THOMSON (Wills) (11:38): I want to acknowledge and congratulate the Australian Council of Trade Unions, the Australian Manufacturing Workers Union, the Construction, Forestry, Mining and Energy Union and the AFTINET for the work that they have done concerning the Korea bilateral trade agreement. I want to make it absolutely clear to the House that I share their concerns about the investor-state dispute settlement provision, about the labour market testing and work visa arrangements, about the copyright and intellectual property provisions and about the impact of this agreement on manufacturing.
I am very concerned about the labour market testing arrangements. The Korea bilateral trade agreement will allow Korean nationals to perform certain categories of work in Australia without any requirement for labour market testing to assess whether the work can be performed by Australian residents. Labor is opposed to the removal of labour market testing in bilateral and multilateral trade agreements. We believe that the government should require employers to show that there are skill shortages through labour market testing if they wish to utilise this treaty's provisions on labour mobility.
Let me be clear. At a time when we have over 750,000 Australians out of work, double digit youth unemployment and rising long-term unemployment, I think our first obligation is to employ Australian workers. It is my strong view that the number of people in Australia on temporary visas which give them work rights—which is over one million people—is way too high. The government claims that there are safeguards in place against the abuse of the various temporary migrant worker programs. But a report from Richard Baker and Nick McKenzie in The Age gives the game away; it says as many as nine in 10 skilled migrant visas may be fraudulent. There was a Somali people smuggling cell in Melbourne linked to a terrorist suspect but the investigation into that ceased due to lack of resources. Meaningful investigation and prosecution activity concerning migration fraud in the Melbourne office has effectively ceased. A 2010 investigation concluded that around 90 per cent or 40,000 visa applications in the general skilled migration program lodged per year for the previous three years were suspect. A 2009 investigation concluded that the student visa program was failing, the general skilled migration program was failing and that the falsifying of qualifications was prolific.
The key problem is that since 2004 the migration program has skyrocketed but the resources of the department have not increased to keep pace with that. The permanent migration program has gone up from 100,000 to 240,000 and we have over one million people in Australia on temporary visas who have work rights. It is simply beyond the capacity of the department to check the validity of the claims people are making about their qualifications and work experience. It is apparently even beyond the capacity of the department to close down passport swapping scams. This is not Operation Sovereign Borders; it is 'Operation Open Borders'.
I have been sent a statement by a young Irish worker about his experiences as a working holiday maker and 457 visa worker in Australia which should give us all real cause for concern about whether the protections and safeguards against exploitation of migrant workers such as those in this treaty are worth the paper they are written on. Conan Doyle is 24 years of age. He came to Sydney on a working holiday visa in 2010, when he was 20. He did not have any formal trade qualifications. He did labouring jobs, and in early 2011 he was asked by a company called Wilson Pacific if it could set up an ABN number—and he did so.
Later in 2011 he met other Irish temporary workers who introduced him to the company Lis-Con, who got him to work on the airport link tunnel. Andrew Bennett, the HR person for Lis-Con, asked Mr Doyle if he had an ABN and, when Mr Doyle told him that he did, he said words to the effect that that was good because he would not have to set one up. Mr Doyle started with Lis-Con as an ABN worker. During his time working for Lis-Con on an ABN he was paid by a number of different companies. He thought this was because it was a condition of the working holiday visa that you cannot work for a single employer for more than six months. Mr Doyle believes—and I agree—that Lis-Con paid him through separate companies to get around this condition. He adds that a lot of Lis-Con's employees are young Irish men on working holiday visas and their pay was also moved from one company to another. This looks to me suspiciously like visa fraud. I ask that the government investigate whether Lis-Con is engaged in fraud in its payment arrangements for people on working holiday visas.
But that was not their only dodgy dealing. Mr Doyle said that, in 2011, Mr Willie Dolan, from Lis-Con, offered to arrange for Lis-Con to sponsor him so that he could get work on a 457 visa. Mr Doyle states that Mr Dolan said words to the effect of 'do up your resume to say you've got four years experience as a carpenter and get someone in Ireland to vouch for you and say that you've worked for a carpenter'. This was in fact not true. After the initial conversation, Mr Dolan put Mr Doyle in contact with a migration agent named Judy Wells at Judith Wells and Associates in Currumbin, Queensland. Mr Doyle had a number of conversations with Ms Wells by phone and paid her $4,000. He says he was under severe stress and strain at this time and felt he had to lie to get his visa. Mr Doyle said that, from speaking to other workers, he knew that Willie Dolan sent all the workers that he sponsored to Judy Wells for their visa applications. Most of these guys told him that they had also lied about their work experience in Ireland.
Mr Doyle had his 457 visa granted in December 2012. Lis-Con then told him to open a new bank account into which his pay would now be paid. One wonders why Lis-Con wanted him to do that. Mr Doyle thinks it was to make it appear as if Mr Doyle was a new employee with a 457 visa. He also says that Lis-Con used ABN numbers for its workers rather than tax file numbers to avoid tax and superannuation payments. He says workers on ABNs were not entitled to medical treatment and, if an accident happened at work, they would secretly remove you from the site so your injury was not recorded, and you had to pay your medical fees and loss of income yourself.
Given these revelations, I urge the government to investigate the bona fides of the visas issued to Lis-Con workers. It is cautionary tales like this that make me sceptical about the capacity of the government to ensure that the open-ended visa arrangements we are entering into with Korea can be satisfactorily enforced. And I agree with the concerns of the CFMEU that this treaty grants labour-market-exempt status to all Korean nationals and residents covered by this treaty. I regard it as critical that we ensure that Australian workers are not disadvantaged through diminished labour-market-testing provisions.
I am also concerned about the impact on proper labour rights by a provision in the KAFTA text Annex 3B, which has been drawn to my attention by Dr Patricia Ranald of the Australian Fair Trade and Investment Network, or AFTINET. There is a sentence which says that the Kaesong industrial complex, located in North Korea, shall be identified by the joint Committee on Outward Processing Zones on the Korean Peninsula as one of the geographic areas that may be designated as outward processing zones. Now, this sentence was not drawn to the attention of the Treaties Committee by either the department or any of the witnesses and submissions, which is unfortunate because we then did not have the opportunity to tease out its significance. But it is clear enough that we are agreeing to discuss giving zero-tariff access not just to products from South Korea but to products from North Korea. I am told that there are 120 South Korean companies and 40,000 North Korean workers in the complex referred to. It certainly raises the question as to whether forced labour, or prison labour, may be involved. North Korea is notorious for having no basic labour rights. It is Australian Labor Party policy to support enforceable labour rights in trade agreements, and we are opposed to giving preferential access to products produced by forced labour, or prison labour, for obvious reasons.
Let me turn now to the investor-state dispute settlement provision. Labor does not believe that the Korean bilateral trade agreement should have included investor-state dispute settlement provisions, which give Korean firms greater legal rights than Australian firms. In government, we will continue to oppose inclusion of these ISDS provisions in trade agreements and we would seek to negotiate with Korea for the ISDS provisions to be removed. These investor-state dispute settlement provisions elevate the interests of corporations above those of the public and their democratically elected governments. They are fundamentally undemocratic.
The government says that the investor-state dispute mechanism contained safeguards, but there is no guarantee that the safeguards are adequate. We are agreeing to submit government actions to ISDS arbitration panels. These panels are made up of investment law experts, who have a past and a future in representing investor complainants. ISDS panellists can be an advocate one month and an arbitrator the next. Unlike permanently employed independent judges, arbitrators are paid by the hour, creating an incentive for cases to drag on. Most cases take from three to five years to resolve. ISDS has no system of precedents or appeals, and one arbitrator from Spain, Juan Fernandez-Armesto, has observed, and I quote:
When I wake up at night and think about arbitration, it never ceases to amaze me that sovereign states have agreed to investment arbitration at all … Three private individuals are entrusted with the power to review, without any restriction or appeal procedure, all actions of the government, all decisions of the courts, and all laws and regulations emanating from parliament.
The more you think about it, the more amazing it is. The Treaties Committee was informed that, as of April this year, there were 568 known investor-state dispute settlement cases brought under treaties. Two hundred and seventy-four cases have been concluded. Approximately 43 per cent were decided in favour of the state. Thirty-one per cent were decided in favour of the investor. Approximately 26 per cent of cases were settled. There is every chance that these cases involve taxpayers handing over money to corporations, and nearly 300 cases remain unresolved.
Investor-state dispute settlement claims have been launched against governments all over the world. In 2011, the German government settled an ISDS case with the Swedish energy company Vattenfall, which had launched a €1.4 billion claim against the government for strict restrictions that were imposed on a coal-fired power plant it was planning to build on the banks of the River Elbe. To settle the case, the German government had to agree to withdraw the restrictions. ABC radio's Background Briefing reports that now Germany is facing another investor-state dispute settlement claim from the same energy company, this time against the decision to wind back nuclear power after the Fukushima nuclear disaster. There have been dozens of ISDS claims launched under the NAFTA, the North American Free Trade Agreement. Background Briefing reports that Canada has been sued nearly 20 times. It has lost or settled seven times, paying American corporations at least US$158 million in compensation. One case was about a fuel additive called MMT, which the Canadian government decided to ban after it concluded that it could be a threat to human health and the environment. After being sued by Ethyl, the US corporation that manufactured MMT, the Canadian government settled the case for US$13 million. To settle, it had to agree to overturn the ban and, to add insult to injury, to publish a statement declaring MMT to be safe.
We do not need, and are crazy to have, such a handbrake on government. If the reason for establishing investor-state dispute settlement is to respond to failures in national judicial systems that do not provide independent justice or enforce the protection of private property, then the right response is to fix those shortcomings rather than allow foreign investors to seek justice elsewhere. These ad hoc arbitration tribunals are not a legitimate alternative to national courts.
There are numerous other examples of the kinds of problems that this approach has generated. The House will be aware that the Philip Morris tobacco company is using investor-state dispute settlement in an obscure Hong Kong investment agreement to sue the Australian government over our plain packaging law despite the fact that the High Court found they were not entitled to compensation. The US Lone Pine mining company is using ISDS in the North American Free Trade Agreement to sue the Canadian Quebec government for $250 million because it responded to community concerns and conducted an environment review of shale gas mining. So this potentially could apply to state governments here in Australia. Not having an investor-state dispute settlement clause did not stop a Labor government negotiating a trade agreement with Malaysia, it did not stop a Liberal government from entering one with Japan, and it should not have been allowed through the door here.
I also note, in closing, that Labor also has concerns about the treaty's provisions on intellectual property and that the opposition will determine its position concerning any changes to the Copyright Act when the details of that are made public.
Mr WILLIAMS (Hindmarsh) (11:53): I note with interest the member for Wills started off his discussion by talking about jobs. He would be interested to know—and I am sure he does acknowledge—that the Korea-Australia Free Trade Agreement is very positive for the jobs of young Australians and Australians in general. In terms of export companies, around 1,700 jobs are expected to be created by the benefits of this agreement—and 15,000 in total. It will be pleasing to hear the member for Wills acknowledge that at some time.
To return to the context, the coalition is always for jobs and a better economy, and free trade agreements are pivotal to that. One in five jobs in Australia is linked to trade. Completing two agreements with our major trading partners in Asia is only going to provide more opportunity for our local exporters and also our service providers who are looking to do more business in Asia, a fast-growing area. In terms of Asia being a fast-growing area, we all have heard for many years about the Asian century, and it is timely that Australia start to take maximum advantage of the growth in Asia and the Asian century.
I was lucky enough to participate in a boardroom discussion last week that was hosted by the ANZ Bank. I thank Jane Yule, from ANZ in Adelaide, for helping facilitate that discussion, as well as the University of Adelaide who put on a most fascinating presentation with ANZ. There were some really useful insights as to what is happening in Asia. In particular, their focus was on China. We all know the exciting growth coming out of China. Australia is benefiting from that now and will hopefully benefit more in the future, whether it be goods or services. In terms of services, the University of Adelaide—like other universities around Australia and the University of South Australia and Flinders University in my home state—has captured a good percentage of Asian students looking to study abroad. The figure is around 7,000 and, naturally, a number of them come from Korea.
South Korea, as we know, is an important part of Asia and the future growth of Asia. That is why this trade agreement is such a great result. As I mentioned earlier, the Korean free trade agreement, once in force, will create at least 15,000 jobs between 2015 and 2023 and add $650 million to the economy annually. Our agricultural producers will benefit strongly from this agreement with tariffs being eliminated for Australian raw sugar, wheat, wine and horticulture. Total services exported, comprising mostly education and recreational travel related services, are valued at $1.8 billion. There are numerous benefits from this free trade agreement across so many important growth sectors of our economy. We know that we can compete internationally, that we have first-class services and, importantly, that there is a demand for those services.
Korea is currently Australia's third-largest export market and our fourth-largest trading partner. It is significant to Australia and this is why this agreement is so beneficial for us. As I said, this agreement will be good for not just exporters but also importers, workers, consumers and investors in opening up markets and freeing trade and investment between Australia and Korea. There will be tangible benefits across the whole of the Australian economy and society.
The agreement secures Australia's competitive position in this major market where our competitors such as the US, the European Union and the ASEAN countries are already enjoying preferential access. It is a great result, along with the Japan free trade agreement and other agreements entered into over many years in Asia, including with Singapore. We are slowly putting together this puzzle. Andrew Robb is doing a great job of negotiating a potential free trade agreement with China in the near future.
When we look at free trade agreements it is always important to consider the implications of not acting and not negotiating such agreements. If we did not proceed with the FTA, our exports to Korea would be five per cent lower by the time the US and the EU's agreements are fully implemented in 2030. Korean imports of Australian agricultural goods would decline by 29 per cent by 2030 and our mining and manufacturing exports would decline by one and seven per cent respectively. My good friend the member for O'Connor has just joined us in the chamber. Agriculture is an important sector for his seat, for his state and throughout Australia.
After 15 years of the FTA's operation, by 2030, our exports to Korea will be 25 per cent higher than they otherwise would have been. This is a significant contribution that we might not have taken advantage of if we were not entering into this FTA. By 2030, exports of agricultural goods to Korea will be 73 per cent higher than they otherwise would have been, contributing to an increase of five per cent in Australia's total agricultural exports. We all know that we have great expertise and a competitive advantage in agriculture and mining. Mining exports to Korea will be 17 per cent higher and manufacturing exports will be 53 per cent higher—a great result for our manufacturers who are still manufacturing some world-class products in Australia. Overall, in terms of exporters, the FTA would create around 1,700 new jobs on implementation.
The Korea-Australia Free Trade Agreement will also promote increased investment. I just want to say a few words about this too, because this is something that should not be overlooked. Korea's total investment in Australia was worth $12 billion at the end of 2012 and this will only increase as a result of this agreement. Under the KAFTA, Australia has retained the ability to screen investments in sensitive sectors, including media, telecommunications and defence related industries at lower levels, and this is important in terms of safeguarding some of our expertise and what we currently do in some areas. It also reserves policy space to screen proposals for foreign investment in agriculture—land at $15 million and agribusiness at $53 million. These are important safeguards that the Australian public would be interested in knowing and understanding.
I just want to say a bit more about agriculture, given its importance. It will make a significant difference at the farm gate. From mango exporters, to macadamia nut growers, to potato farmers, Australia will enjoy improved acres to the Korean market. With potato farmers, there are some big ones in my state of South Australia—Mondello Farmsis one that comes to mind. They would be very happy if they look at export opportunities going forward.
Tariffs of up to 300 per cent will be eliminated on key Australian agricultural exports including beef, wheat, sugar, dairy, wine, horticulture and seafood. Again, some of these areas of agriculture, like seafood, are in great demand in Asia. We have some of the best seafood in the world, so this will be of vital importance to improving our exports in some of these sectors.
Onto a favourite subject of mine—wine—coming from South Australia: needless to say, a great wine state. We are currently subject to tariffs of 15 per cent, but wine from the US, EU and Chile enter duty free. Some of our major competitors around the world have duty-free wine going into Korea. That will now change with the FTA, where they will be 30 per cent lower than in 2007—a significant change for those in the wine sector. This is not only the wineries but also the suppliers that are so important in so many of these sectors, like the label manufacturers. Collotype Labels, just on the border of my electorate, have always been a leader in wine labelling and they will be happy if some of their customers are selling more wine into the Korean market. Printers—and there are many fine printers in my electorate of Hindmarsh—again, those that are involved in printing of a whole lot of things connected to the sector. Bottlers too: there is a bottling plant which manufactures wine bottles on the edge of my electorate. Again, they will be happy if their customers are selling more into Korea as part of this agreement.
I wanted to cover off briefly on services, because I have worked in accounting firms and law firms in the past and I know they will be beneficiaries of this agreement. For example, the agreement will allow Australian law firms access for the first time to Korea's legal consulting services market by permitting Australian firms to establish representative offices in Korea and Australian lawyers to advise on Australian and public international law. In terms of accounting firms, likewise, they will be able to establish offices and provide consulting services.
This is a new opportunity for some of Australia's best professional services firms. A former colleague of mine is actually in Canberra today on a matter, Tim O'Callaghan, who is the new head of the Adelaide office for Piper Alderman—and I congratulate Tim on his appointment. I know he is always looking at new opportunities so I am sure something like this might be of interest to Tim and Piper Alderman, among other firms.
In other areas: the audiovisual co-production agreement will deliver new commercial opportunities for our creative industries, with an audiovisual co-production agreement facilitating film and television collaboration. In Adelaide there is a firm in particular, Rising Sun Pictures, that does some great work in the audiovisual space. They might be interested in where they could go with this agreement, as would Kojo, another company in a similar space. Finally I want to touch on energy and resources. Under KAFTA, Korea will eliminate tariffs for all resources and products over 10 years. Some of the resource industries that will benefit from KAFTA include petroleum, natural gas—so Santos and Beach Energy, two of the great gas producing companies in Australia, will be great beneficiaries—and gold.
I congratulate Andrew Robb and his team on the fantastic work they have done with this free trade agreement with South Korea, as well as the other work they have done with Japan and their ongoing work with China. As we know, the growth from the middle class creates great opportunities, great chances, for Australian exporters and service companies to expand internationally. We are a small market so we have to take advantage of these international opportunities where there is this growth. I am sure my South Australian federal colleague over there, the member for Makin, will be most pleased that our state—whether it be in relation to wine, resources or agriculture—can benefit from this great work by the government in delivering free trade agreements. We cannot forget that there are some benefits as well for Australian business, whether it be IP or government procurement, in the whole equation. Australian suppliers will be allowed access to the Korean government procurement market, and with IP we are making sure that Australian innovators and creative industries enjoy higher levels of protection—so important for them when they enter new markets. This is a great result for Australia, a great result for Australian exporters and companies, and we look forward to the results being achieved.
Mr ZAPPIA (Makin) (12:06): This legislation deals with tariff changes that form part of the Korea-Australia Free Trade Agreement. Those tariff changes are critical to the agreement and are matters that both sides of politics have been pursuing for some time. Whilst I note that the government takes credit for having delivered this agreement, the truth of the matter is that most of the groundwork for it was done by the previous Labor government. The work was led for much of that time by the former member for Rankin, Craig Emerson, in a process which I understand began in 2009. So there had been already some four-plus years of negotiations and work carried out by the former government. Nevertheless, the current government did finally sign off on it.
I understand the agreement was not concluded by the previous government because there were matters within it that were simply not acceptable to the government. But they are, from all accounts and judging by the fact that this government has signed the agreement, acceptable to the current government. I believe those components of the agreement that were not acceptable to the previous Labor government are still not acceptable to many people throughout Australia—they are certainly not acceptable to me—and that is why Labor is putting forward some amendments to this legislation. It is my view that the Abbott government has been prepared to sell Australia short in order to rush the agreement through and chalk up a so-called win.
With all agreements there are winners and there are losers, and that is very much the case with the Korea-Australia Free Trade Agreement. The government and the Minister for Trade and Investment have been very quick to talk up the benefits of the agreement but have been silent on the downside of the agreement and silent about those sectors of the community that will either lose out or get absolutely nothing. It is expected that the net effect of this agreement will be that Australia will be a minuscule .04 per cent of GDP better off after 15 years. It does not give me much confidence looking at that figure, if it is projected correctly, that this agreement will make a lot of difference to the future of Australia one way or the other. Indeed, the aspects of it that concern me may well make a difference in a negative way for the future of our country.
Claims of significant benefits to Australia were also made about other free trade agreements in the past at the time that those agreements were entered into. Years later, there is no clear evidence that any of those agreements have resulted in a net benefit to Australia. In fact, there are suggestions that in some cases we are worse off because of them. It is a matter that I believe ought to be properly investigated because it is a matter of national interest. I therefore believe that this agreement and any future agreements should be subject to a much more thorough and independent net benefit analysis before they are agreed to. It seems that, whilst Australia enters into agreements in good faith and then honours the intent of those agreements, the same cannot always be said of all other parties, who, if it suits their purpose, find alternative mechanisms to continue to place import barriers on Australian products. We have seen that with regard to the agreement with Thailand and the ability of Australia to export cars to that country. The tariffs may not have changed, but other criteria in turn put barriers on exports to that country were introduced by that country.
Bilateral agreements can, in my view, also lead to backdoor methods of getting goods into a country, usually via a third country. In a globalised world where multinationals operate from several countries, that is becoming increasingly difficult to police. It is a matter that we have been grappling with in one of the committees of this parliament with regard to food labelling. It also seems to me that free trade agreements are often driven by a specific industry sector that lobbies very well—I will give them credit for that—and are prepared to advance their own interests at the expense of other industry sectors.
Free trade agreements also result in what some have referred to as a race to the bottom, where countries compete against each other in order to increase market access. Of course, a better outcome would be to work through the World Trade Organisation and have all countries deal with each other in an even-handed way. But I understand how difficult that is to achieve when individual countries want to establish a competitive advantage. There is also a fundamental difference between free trade and fair trade; and, regrettably, free trade agreements do not necessarily result in fair trade.
It is interesting that we are debating this legislation when, under Australian arrangements, free trade agreements can be entered into by the government of the day without the approval of parliament. I see no justification for that. The process is, in my view, wrong, and all free trade agreements should be subject to parliamentary approval before they are signed off. It should not be simply those sections of the agreement that require legislative change such as that which this legislation deals with. In fact it is not the case in all other countries that agreements are entered into by the government of the day without reference to their parliaments, so I see no reason why that could also not be the case in Australia. Indeed, when I look at how this process began—where Australian governments have been able to enter into agreements without having them signed off by parliament—it seems a little grey to me where the authority for the government to do that actually lies. But, nevertheless, that is the way it is, and my view is that that in itself is a matter that should be reviewed by the parliament.
I note that the inclusion of the investor-state dispute settlement provisions are not subject to parliamentary debate or approval, but I nevertheless make it clear that I do not support the inclusion of ISDS clauses in free trade agreements. I commend my colleague and friend the member for Wills, who spoke at length about this in his contribution to this debate just a moment ago. As paragraph 4.12 of report 142 of the Joint Standing Committee on Treaties reveals that, as of April this year, there were 568 known ISDS cases worldwide, of which '43 per cent were decided in favour of the state and 31 per cent in favour of the investor with approximately 26 per cent settled out of court.'
ISDS gives additional special rights to foreign investors that enable them to sue governments for damages in an international tribunal if they can show that a change in domestic policy has harmed their investment. ISDS clauses provide greater rights and protections to overseas companies than the rights offered to Australian enterprises. That is discriminatory and wrong and, as evidence clearly shows, is proving to be bad, costly policy. Nor are my concerns about ISDS eased by the so-called protections written into the Korea-Australia Free Trade Agreement, because the reality is that, whenever a matter goes to court, it is never black and white. It always becomes complicated. There are always arguments that are difficult to clearly define and ultimately they are determined by whoever sits on the bench at the time.
Interestingly, the Howard government did not include ISDS provisions in the US-Australia Free Trade Agreement in 2010 and the Productivity Commission found that there were no economic benefits from ISDS and no evidence of market failure resulting from political risk to foreign investors. I repeat that: there was no evidence that, by not having ISDS provisions in one of these agreements, it changed at all the investment by other countries in Australia.
Equally concerning is the fact that the ISDS proceedings are not public, there is no independent judiciary and there is no system of precedents or appeals. Not surprisingly, I note that countries around the world are now rejecting ISDS provisions and walking away from them. That does not surprise me at all because—and the member for Wills quite correctly pointed out some of the cases—it is simple to see that what governments are simply doing is putting at risk their sovereignty.
Labour mobility is also a matter of concern to me and many people I have spoken with about the Korea-Australia Free Trade Agreement. The concern is that the agreement may provide easy access for Korean workers to come to Australia and take jobs at the expense of Australians looking for work. The government has already taken steps to make it easier for foreign workers to take up Australian jobs by easing restrictions in respect of 457 visas, but I understand that provisions within this agreement may make it even easier for foreign workers to come to Australia from Korea because of the easing of what we refer to as labour market testing provisions. In fact, I am not even sure that they will apply at all if this agreement comes into effect. That in turn means that there is no security when Australians are competing for jobs with people from Korea. It makes sense that Korean businesses setting up here might want to bring their own workers over, but that is not in Australia's interest. The whole intent of having investment in Australia is because it generates productivity and jobs here in this country for Australians.
I note that the Australian government is right now negotiating a free trade agreement with China. I hope and trust that this Korean agreement does not form the template for the agreement with China. Our trade relationship with China is indeed very strong and I expect that any concerns that arise from this agreement, particularly the concerns relating to labour mobility and to the ISDS provisions, would be magnified if they also formed part of an agreement with China.
Whilst none of us have a crystal ball and circumstances may change in the future, the current economic modelling predicts that as a result of this agreement there will be job losses in the textile, clothing and footwear industries as there will be in wood, paper products, chemicals, rubber, plastics, motor vehicles, metal products, electronic equipment and manufacturing more broadly. Indeed, my recollection is that the car makers cited free trade agreements as contributing to their exit from Australia when making their announcements to end manufacturing here. My concern is that the Korea-Australia Free Trade Agreement will hasten the wind down of the Australian automotive sector. I note that there is already talk in my home state of that occurring. I note that only last week there was an announcement that 300 workers at the GMH plant in Elizabeth will be made redundant earlier than previously expected.
This kind of agreement, in my view, will hasten the closure of the car-making industry in Australia. My concern about that is compounded by two factors. Firstly, the Abbott government has made very little provision to assist workers who lose their jobs as a result of car making this country. We are talking about possibly up to 50,000 people across the country who are directly affected, and maybe another 200,000 that are indirectly affected. I am not prepared to say whether the total quantum of jobs is going to be specifically this much or that much, but we do know that it is going to run into the tens of thousands and the government has put on the table a miserable $100 million to assist. At the same time, I understand that the money has been put on the table in a way that makes it very difficult and unattractive for anyone affected to access it. In fact, the money that been put on the table is of little use to those people who are going to be made redundant.
Compounding that, we now have a situation where the government is likely to walk away in a substantial way from naval shipbuilding for our Defence forces in this country. Again, particularly for South Australia, that is a critical matter, because it was the building of naval ships and submarines that offered some hope and provided some light at the end of the tunnel for those people who are likely to be made redundant from the end of car making at Elizabeth—so that they could go into a different sector to continue employment. These are matters that truly concern me.
Mr WILSON (O'Connor) (12:21): I rise today to speak in support of the Customs Amendment (Korea-Australia Free Trade Agreement Implementation) Bill 2014, and to highlight some of the tremendous opportunities that this agreement presents for the farmers, fishermen and miners of my electorate of O'Connor.
Past policies of high tariff protection for our manufacturing industries have generally disadvantaged our primary production sector, which has borne the brunt of restricted access to key markets across the globe. The move to reduce tariff protection, begun by the Hawke government in the mid-1980s—which, I hasten to add, had the full cooperation of the coalition—has transformed our economy, allowing efficient industries to thrive and prosper while those unable to compete on the global stage have fallen by the wayside.
Unfortunately, many previous trade liberalisation agreements have focused on manufactured products, with many of our trading partners choosing to protect their domestic primary industries. As we all know, Australian farmers and miners are the best in the world and have long waited for the opportunity to compete on a level playing field, particularly into our key Asian markets. The bill before us today represents a major breakthrough, especially for farmers, horticulturalists and viticulturists across my electorate.
While I will outline in detail the specific tariff reductions and how they will benefit producers, it would be remiss of me not to mention the father of the free trade movement, the former member for Wakefield, known universally and affectionately as 'the modest member', Charles Robert—Bert—Kelly.
Bert Kelly was the strongest advocate in the federal parliament during the 1960s and 1970s for the principles of free trade, particularly lower tariffs, reduced government regulation and increased economic liberalism. This was an era of strong protectionist policies, and Bert Kelly was almost a lone voice, with occasional support from predominantly Western Australian farmers and miners. One of those Western Australian farmers was John Hyde, the member for Moore between 1974 and 1983, who is still active today promoting dry economic policies—an expression he coined and made his own.
In his foreword to the book The Modest Member: the life and times of Bert Kelly, John says that Bert Kelly used the opportunities afforded by his office to win public opinion for economic management that was efficient, mindful of the future and which did not give a privileged few the capacity to raise prices above competitive levels at the expense of many. That is a fine set of principles for any member of this place live by. In a happy coincidence, one of Bert Kelly's three sons, Tony, and his wife, Dawn, farm at Mount Barker in my electorate. I am sure that they and many other farmers, horticulturalists and viticulturists will finally enjoy the benefits of this KAFTA as well as other free trade agreements that are, in part, Bert Kelly's legacy to us all. I am certain that Bert would have been very proud of the tireless efforts by Minister Andrew Robb and the staff of the Department of Foreign Affairs and Trade in securing this agreement, which will substantially liberalise Australia's trade with South Korea.
Formal discussions between our two governments began in 2009 and concluded in May 2014, when the Korea-Australia Free Trade Agreement was tabled in parliament after signing by the Hon. Andrew Robb and his South Korean counterpart, the Minister for Trade, Industry and Energy, Mr Yoon Sang-jick, on 8 April 2014 in Seoul, South Korea. The governments of both Australia and Korea aim for this agreement to enter into force in 2014.
Korea is currently Australia's third largest export market and our fourth largest trading partner. The implementation of this agreement will significantly boost Australia's position in this major market, where other competitors already have preferential access. The United States, the European Union and the Association of Southeast Asian Nations are already benefiting from their respective FTAs with Korea, and Chile, Canada and New Zealand are close to concluding their own agreements.
Goods liberalisation alone is estimated to be worth nearly $5 billion in additional GDP to Australia between 2015 and 2030. On entering into force, 84 per cent of Australia's exports, by value, to South Korea will enter duty-free, rising to 99.8 per cent on full implementation of KAFTA. This agreement contains simplified and trade-facilitative rules of origin and related documentary requirements. Goods imported into Australia that meet the rules of origin implemented through this bill will be entitled to claim preferential tariff treatment in accordance with the agreement. The amendments include relevant obligations on Australian producers and exporters wanting to export Australian goods and to obtain preferential treatment for those goods in South Korea. This agreement reflects Australia's close bilateral economic relations with South Korea.
My electorate of O'Connor stands to benefit tremendously from the proposed tariff reductions and, in many cases, the complete elimination of customs duty on many of the agricultural products and mineral resources we export to Korea. Likewise, business in O'Connor will realise substantial cost savings on certain imported Korean products vital to our mining and agricultural sectors such as heavy machinery, diesel motor vehicles and tyres. My constituents throughout the electorate stand to benefit from more affordable Korean imports such as telephones, televisions and computer monitors, tyres, motor vehicles and refined petroleum.
With respect to exports, O'Connor is blessed with an incredible mineral wealth. Our iron ore, nickel and gold exports make up a substantial proportion of the $16 billion worth of energy and mineral products Australia exports to Korea. Whilst a large proportion of these mineral resources already enter Korea duty-free, there persists a tariff of up to eight per cent on some resources including gold. KAFTA will result in the elimination of the remaining tariffs on all resource products over the next 10 years.
My electorate of O'Connor is also one of Australia's largest agricultural electorates, producing cattle and sheep for the live and chilled meat export trade as well as cereal, oil seeds, premium wine and horticultural produce. On full implementation of KAFTA, 99.8 per cent of all Australian agricultural exports to Korea will have no tariffs. Tariffs of up to 300 per cent will be eliminated on key agricultural produce such as beef, wheat, dairy, horticultural produce, seafood and wine.
Although Australia's beef exports to Korea already account for a further $640 million in export earnings—and we are the largest supplier of beef into this market—our main competitor, the United States, has a 5.5 per cent advantage due to its 2012 free trade agreement with Korea. When enforced, KAFTA will eliminate the current 40 per cent tariff on Australian beef, 18 per cent tariff on offal and 72 per cent tariff on processed beef products over the next 15 years. This is great news for beef producers in my electorate, who have already seen increasing demand following this year's announcement of a $1 billion contract between chilled meat producers V&V Walsh and China.
Roger Fletcher, owner of the Fletcher International meat-processing plant in Narrikup and exporter of chilled meat, believes that the growing sheep meat industry in Korea can only benefit from the elimination of these tariffs. As a sheep producer myself, it is heartening to see that the 22.5 per cent tariff on lamb will be eliminated over the next 10 years. The tariff on pork, which is currently 22.5 to 25 per cent, will be eliminated over five to 15 years. O'Connor's small but significant dairy industry also stands to benefit from growing duty-free dairy quotas as well as the elimination of high tariffs on cheese, which is currently 36 per cent, and butter, 89 per cent, over 13 to 20 years.
With respect to fisheries, the southern rock lobster industry based on the south coast of my electorate will benefit from the elimination of rock lobster tariffs of 20 per cent over the next three years. O'Connor is also a productive grain-growing region, with our Wheatbelt, Esperance and Great Southern regions producing over 50 per cent of Western Australia's wheat, barley, oats and canola. Korea will eliminate its 1.8 per cent tariff on wheat and eight per cent tariff on wheat gluten immediately the KAFTA enters into force. Korea will also provide a growing duty-free quota for malt, and malt and barley, and over the next 15 years they will eliminate their high out-of-quota tariffs of 269 per cent and 513 per cent respectively. Tariffs on canola oil, currently at eight to 30 per cent, will be eliminated over five to 15 years.
The horticultural food bowl of my electorate surrounds the town of Manjimup and produces a large variety of fruit and vegetables for export. Many of these horticultural products will enter Korea duty-free on entry into force of KAFTA. Tariffs on premium produce such as asparagus, which can be as high as 54 per cent, will be gradually phased out over three to 10 years. Counter-seasonal demand will result in the high tariffs on produce such as chipping potatoes of up to 304 per cent being eliminated during their off-season, which coincides with our export season. WA produces some of the cleanest disease- and residue-free potatoes in Australia, which are very much in demand overseas. Potato growers in the Pemberton area, such as Dom Della-Vedova and his neighbour Bendotti Exporters, who process potatoes grown for export, stand to benefit tremendously from any tariff relief.
The farmers of my electorate are not alone in their support for the KAFTA. The National Farmers' Federation view is:
… that the agreement will provide millions of dollars in export value to Australian farmers, including those in the red meat, grains, dairy, sugar, pork and horticulture sectors. The agreement recognises agriculture as one of the nation's export strengths and will open opportunities for the sector in Korea.
The wine-growing regions in the Great Southern—Frankland, Mount Barker and Cranbrook—and Pemberton are currently subjected to a tariff of 15 per cent on all sparkling, white and red wines, whilst their Chilean, American and European counterparts enter Korea duty-free. On the entry of KAFTA into force, Korea will immediately eliminate all tariffs on imported Australian wines. I would hope that this would lead to an immediate rallying of our wine industry, which has seen a decline of wine exports into Korea of more than 30 per cent since 2007. One of my constituents, Kim Tyrer of Galafrey Wines in Mount Barker, currently exports premium wines to China and names Korea as a perfect market for their particular calibre of wine. The hip, young, educated Korean apparently loves cool-climate red wine, and tariff elimination will even the playing field with major players like the US, the EU and Chile.
When it comes to imports, up to 86 per cent of our current imports from Korea will enter Australia duty-free when the KAFTA enters into force, and this will increase to 100 per cent within eight years. For O'Connor, this means immediate tariff removal on some types of agricultural and mining equipment which are currently subject to an import duty of four per cent to five per cent. Australia wide, small to medium size petrol vehicles and medium size diesel powered off-road vehicles will have their five per cent tariff abolished on entry into force of the KAFTA. Larger petrol passenger and off-road motor vehicles, as well as larger diesel-fuelled vehicles, will have their four to five per cent tariff gradually reduced over three years. Importation of new tyres will be subject to immediate removal of the five per cent tariff, while retread tyres will have their five per cent tariff eliminated in five equal annual stages.
Independent modelling suggests that the Korean agreement will be worth $5 billion in additional income to Australia over the next 15 years, after which it will provide an annual boost to the economy of $653 million per annum. By 2030, agricultural exports to Korea are projected to be 73 per cent higher than without the free trade agreement. Mining exports will be 17 per cent higher than otherwise, and it is projected that KAFTA will create over 15,000 jobs between 2015 and 2030. For my electorate, these are all huge gains that everyone in O'Connor should be able to reap some benefit from.
Finally, I would like to reiterate my earlier thanks and congratulations to Minister Andrew Robb and the hardworking staff at the Department of Foreign Affairs and Trade for their tireless efforts in bringing this Australian free trade agreement to a conclusion. I commend the bill to the House.
Ms CHESTERS (Bendigo) (12:34): I thought it was important to rise and speak on the Customs Amendment (Korea-Australia Free Trade Agreement Implementation) Bill 2014 and put on the record some of the concerns that I have with this free trade agreement. There are some good things about the KAFTA. It will give Australian exporters an increased access to Korean markets, and it will help maintain Australia's competitiveness with the United States, the European Union and other nations in the Korean market. It will especially benefit Australian agricultural industries and offer other significant potential benefits to other service sectors. Modelling shows that it will boost Australia's exports to Korea by $3.5 billion by 2030. In particular, it will boost Australia's beef exports to Korea by 59 per cent, a figure that almost every speaker has highlighted in this House. It is believed that it will create an additional 1,745 jobs by 2015. The agricultural sector will stand to benefit by the inclusion of beef, sugar, dairy, wheat, wine and horticulture. These sectors employ more than 200,000 workers in Australia, including close to 4,000 in production in my electorate and about 6,000 in total in the central Victoria and Bendigo region when you put agricultural production together with the agricultural sector.
But my question is: when we create these jobs, who will actually be working them? There is a need not just within this free trade agreement but within government policy to look at building workforce participation of locals in these industries. We are actually in a crisis when it comes to creating jobs in our country areas, and I do not believe that this free trade agreement alone will give those people the working opportunities. For all the talk of jobs that we are creating, it is about who will work those jobs. The reason why I do not believe that those jobs will go to locals is the current employment practices going on in our production and manufacturing facilities already.
I will just give a few examples from my own electorate about how jobs that are being created are not going to the locals or to the permanent residents. KR Castlemaine—for everyone who likes their Dons and likes the KR Castlemaine bacon—employ about 1,500 workers. Most of them are local, but their seasonal work that is coming up will be entirely sourced by tourist working holiday visas. That is about 70 jobs that will not go to locals. Hazeldene's chicken factory, another big employer in food production in my electorate, has at least 200 boners that are on some form of visa arrangement, whether it be 457, a tourist visa, a protection visa or an international student visa—again, 200 jobs that are not going to permanent residents or locals. The last one I wish to highlight is Hardwicks, which is a beef and lamb slaughterhouse and a food producer. They have about 200 employees and on a recent site visit there I met 40, which is quite a significant chunk of their workforce, who were on tourist working visas, people who were over here on a working holiday—again, jobs going not to locals but to people recruited overseas by employment agencies and brought into Australia. Quite often, they are paid the award or worse, so undercutting the wages and the conditions of those locals employed in that facility.
My concern, and what I strongly encourage the government to do, is to ensure that in this agreement, in future agreements and in government policy we are encouraging development of a local workforce to take up job opportunities that may be created by free trade agreements. I believe that the government should have secured a better deal with Korea that picks up some of these very issues. I believe that KAFTA should not include the investor-state dispute settlement provisions, and many people on this side of the House have serious reservations about this inclusion within KAFTA. This provision gives Korean firms greater legal rights than Australian firms. Labor remains opposed to the inclusion of these provisions. In government, we will seek to renegotiate with Korea the removal of these provisions, ensuring that there is a fairer trade agreement with Korea.
Government should also require employers to show that there are skill shortages through the labour market testing provision if they wish to utilise the KAFTA provisions on labour mobility. This links back to the issue that I have just raised about who will be working these new jobs that potentially will be created as a result of the KAFTA agreement. This agreement is in danger of creating a net job loss if we do not address labour and employment conditions within the agricultural sector, as well as in other sectors. And why I say a massive net job loss is that if we are not creating good jobs that you can count on in the agricultural sector, if those jobs are actually being taken up by people on a tourist visa, on a 457 visa, on an international student visa and, at the same time, accelerating the job losses in the manufacturing sector, then we will actually see a massive net job loss in this country.
We have to ensure that the industry is ready to employ locals, which means we need government to be investing in that skills development, which means government needs to be making sure that we have locals ready to work. But it also means ensuring that we require employers to show that there is a skill shortage in their labour market. Quite frankly, the current provisions around that are just not strong enough.
In my electorate, from where I have used some examples, we have hit youth unemployment of 30 per cent. That is one in three young people. I doubt very much that every one of those young people has been asked if they want a job at KR Castlemaine, if they want a job at Hardwicks or if they want a job at Hazeldeans. I doubt very much that those people have been asked if they would like the opportunity to work in those facilities. That is part of the problem with this agreement.
I agree with the CFMEU's position that no 457 visa concessions should be included in this free trade agreement or in any free trade agreement. Australia's temporary visa program should not even be on the negotiating table when it comes to free trade agreements. These are domestic policy matters for the Australian parliament, in consultation with Australian industry and Australian workers.
The inclusion of this in the area of labour mobility, which is the clause that I am referring to, could open up the 457 visa program to Koreans. And we are not talking about small numbers of Koreans already working in Australia on the 457 visa system. Data shows that, as of 31 March 2014, there were almost 2,500 Korean nationals working in Australia on 457 visas. This is up from 1,750 the previous year. So we have already had a 39 per cent increase in the 457 visa program from Korea. That is six per cent of the total 457 visa program.
These workers are quite often exploited and have very few and limited avenues to voice their opposition and the challenges that they face. For an example about how bad the 457 visa system can be, the case that jumps to mind—a hire one, get another worker free—is the case where a Filipino couple employed by a motel chain in country Victoria had their employment unexpectedly terminated this July when they were overseas. This particular couple were hired under the 457 visa program in early 2013. They were hired as residential managers but both of them worked an average of 14 hours a day over six and sometimes seven days a week. Only one of the couple received a wage and that wage was for 40 hours of ordinary work—no overtime. The other partner in the relationship received no pay at all. They currently have a claim before the Fair Work Ombudsman for $250,000 worth of back pay. When asked why they continued to work in this situation, the couple said they had to pay off their debt to the recruitment agency first, before they started to earn a dollar.
This is the kind of exploitation currently occurring under our 457 visa system. These are the loopholes; these are the problems that need to be tightened up to ensure that overseas workers are not exploited at the expense of Australian workers. Again, my question is: how hard did this hotel try to find a local worker? How hard is it in regional Victoria, where we see unemployment peaking, to find somebody who could be this manager? It is easier for employers to look for the cheaper alternative, which is to engage an employment agent and bring an overseas worker in. As I have demonstrated, they are quite often exploited. If we are going to include the weakening of the 457 visa program within our free trade agreements, we need to ensure we have a stronger and more robust system which can ensure these workers are treated properly and that, if they do have an issue, they are supported in getting that issue resolved.
As I have mentioned, the KAFTA will lead to job losses in other parts of our manufacturing sector. We have heard from previous speakers that it will speed up the closure of automotive manufacturing in Australia. One of the things that really strikes me about the government on this issue is that they are standing up and championing cheaper cars for consumers yet, when you are out there talking to people, they get how important the auto industry is and they like their Australian-made cars. These job losses will not only immediately affect our local economy by withdrawing those wages, they will also affect our skill base and our capacity to maintain high-skill jobs in the future. The KAFTA will only add pressure to an industry already struggling to survive. That is why it is so important, when we negotiate these agreements as a nation, that we think about the long-term impact. Our auto industry has high-skill, highly trained workers from the people who draft and design our autos to the people who put them together. When you lose that skill base you do not get it back. We have seen that with the textiles industry. There is now no university or TAFE that offers a pattern-making or pattern design course in Australia. They do not need to because we no longer have a textiles industry, or if we do it is quite small. We have lost that skill base yet ADA, the manufacturer in my area which still makes uniforms for our Defence personnel, is now looking overseas for a pattern maker because we have none in Australia. This is an example of the skill base we will lose in the auto industry when this agreement—this trade policy—is finally signed off.
The question of whether a particular trade policy or trade agreement is in the long-term best interest of the nation must always take into account opportunities to develop and grow jobs, but not at the expense of others. These are just some of the concerns I have with the KAFTA and I urge the government to negotiate a better deal for our country.
Mrs PRENTICE (Ryan) (12:49): The coalition went to the last election promising three core free trade agreements, and the Korea-Australia Free Trade Agreement is the first of those to be negotiated and completed by the government. The coalition government is securing stronger trade relations with our most prominent trading partners as part of our strategy to build a stronger economy for the benefit of all Australians. There has been a lot of confusion about these free trade agreements in the media, where some people think exports equals 'good' and imports equals 'bad'. This is not the case at all. When discussing the impact the Korea-Australia FTA will have on the economy, it is important to look at a number of factors. There are five major elements that affect the extent of changes in exports that arise from the implementation of free trade agreements and are captured in the economic models.
One, the size of the trade barrier that is removed by the FTA has a major impact on the extent to which changes occur. Removal of a tariff barrier leads to the first round impact of decreasing the price paid by importers and increasing the price received by exporters. This acts to increase demand for these products, so the removal of tariffs would be expected to increase exports and also increase production of the goods. The extent of the increase depends on the magnitude of the tariff reduction. A large reduction in tariffs resulting, for example, from the complete removal of a high tariff would lead to greater changes in exports and production than a small reduction in tariffs from the complete removal of a small tariff or a decrease of the tariff rate. A free trade agreement will not result in this first round effect on products for which there are no tariffs to be removed, or for product lines excluded from the agreement.
Two, the exporting country's initial share of imports to the importing FTA trading partner will affect the degree of change in exports. If the share is small then the relative impact of the tariff reduction will be large. For a larger share, the tariff reduction will lead to a relatively smaller change in exports.
Three, when the demand for export products changes there are flow-on impacts to other sectors of the exporting country's economy. In order to meet an increase in demand for exports of one product, resources in the exporting country are redistributed towards production of that product, but away from other products. This will lead to a decrease in production, and potentially exports, of these other products. The extent to which production of other products decreases will depend on the pattern of input use and the elasticity of demand for these products. The opposite will happen if demand for exports of a product falls.
Four, trade liberalisation will increase the income—GDP—of both trading partners. Increased income will mean that countries are able to increase consumption and increase imports from all countries. This impact will be greater for FTAs that lead to greater trade creation, and therefore greater increases in GDP. It is possible that countries outside the FTA increase exports of some products due to the increase in imports by the countries within the FTA.
Five, consumer preferences in the importing country will also determine the extent of changes in trade flows. If there is greater preference for products from the FTA trading partner compared to other countries and products, the removal of tariffs will have a greater impact on imports from that country. The importers will substitute towards products from the FTA trading partner.
There are two related scenarios that were developed and analysed for this particular project. The first scenario looked at the impact of the Korea-US and Korea-EU free trade agreements on Australia where Australia did not have a similar agreement with Korea. This scenario was aimed at understanding how trade patterns are likely to develop as Korea's free trade agreements with the US and the EU are implemented, and what it meant for Australian trade. Considering trade in goods, the Korea-US and Korea-EU free trade agreements would result in Australia's exports being diverted away from Korea to other countries. At the end of the FTA implementation period, compared to what would be without the Korea-US and Korea-EU FTAs, Australian exports to Korea were 4.7 per cent lower, as Korean importers sourced their products from US and EU exporters at lower prices. As the US and EU gained increased access to the Korean market through the implementation period and displaced Australian products, Australian exporters redirected their products to other countries but received lower prices for their goods.
Exports to other countries are higher under the FTA scenario, compared to the baseline. The total volume of exports to all countries is higher by 0.03 per cent in the FTA scenario. This is, in part, because the expansion in the US and EU demands more resources from Australia. Overall, the terms of trade decline as a result of the two FTAs, and in order for Australia to maintain the volume of total exports the value of exports declined. Real wages in turn are lower by 0.2 per cent as firms adjust to the lower income from exports.
The second scenario looked at the impact of the Australia-Korea FTA in the presence of the FTAs between Korea and the US and EU. The baseline for this scenario was the result of the first scenario where the US and EU have free trade agreements with Korea. The objective of this was to understand the benefits that would arise from a new agreement between Australia and Korea, relative to the current situation. Australia's total exports are higher with the implementation of the Australia-Korea Free Trade Agreement than would be otherwise. Australia's exports to Korea are 25 per cent higher under the FTA than they would be without it, driven by lower tariffs and greater access to the Korean market. Australian exports to other countries are slightly lower as a greater proportion of Australia's output is directed towards the more profitable Korean market and, overall, the total quantity of exports from Australia increased by 0.1 per cent of $280 million as a result of the FTA. Real wages are higher than they would have been without the FTA and as Australia's terms of trade improve as a result of the FTA.
Building stronger trading relationships in Asia is critical to Australia's economic future. Signing the Korea-Australia FTA takes Australia closer to realising our goal of finalising FTAs with our major North Asian partners, which together account for 37 per cent of Australia's overall trade and two-thirds of our total goods exported. The coalition's success in negotiating this free trade agreement shows that only the coalition is serious about sending a strong signal that Australia is indeed open for business. I commend this bill to the House.
Debate adjourned.
ADJOURNMENT
Mrs PRENTICE (Ryan) (12:56): I move:
That the Federation Chamber do now adjourn.
Federation Chamber adjourned at 12:5 7
QUESTIONS IN WRITING
Perth Freight Link
(Question No. 164)
Ms MacTiernan asked the Minister for Infrastructure and Regional Development, in writing, on 26 May 2014:
(1) Has the Western Australian Government lodged the Roe Highway Stage 8/Perth Freight Link project to Infrastructure Australia, (a) if so, on what date was it submitted and what was the result of the assessment of the project, and (b) if not, will it be required to be subject to assessment by Infrastructure Australia before federal funds are committed to the project; if not, why not.
(2) Has he seen the cost benefit analysis of the Roe Highway Stage 8 Project completed by the Western Australian Government; if so, on what date.
(3) How many vehicles will be removed from the surrounding road network by Roe Highway Stage 8, and how was this number calculated.
(4) What is the economic benefit of the Roe Highway Stage 8 project per dollar invested, and how was this sum calculated.
Mr Truss: The answer to the honourable member's question is as follows:
(1) The Western Australian Government is preparing a business case for the project, following which the project will be considered by Infrastructure Australia.
(2), (3)and (4) The Roe Highway Stage 8 project will form part of the Perth Freight Link project. Further detail on the overall project scope and benefits is expected to form part of the business case for the Perth Freight Link project.
Financial Assistance Grants
(Question No. 188)
Mr Katter asked the Treasurer, in writing, on 17 June 2014:
Can he provide assurances that rural and rural/remote local governments will not be disadvantaged by the freeze on the Consumer Price Index for Financial Assistance Grants.
Mr Hockey: The answer to the honourable member's question is as follows:
The Government is maintaining the 2013-14 base level of funding for Financial Assistance Grants to local governments. It is important to note that over the last 10 years Financial Assistance Grants have increased from around $1.5 billion in 2003-04, to the current allocation of $2.3 billion.
Financial Assistance Grants are paid directly to State governments, which in turn determine the intrastate distribution of these payments. As such, the Federal Government has no direct control over which local governments receive this untied funding.
Foreign Investment
(Question No. 199)
Mr Zappia asked the Treasurer, in writing, on 26 June 2014:
What sum of capital was transferred from (a) China and Hong Kong to Australia, and (b) Australia to Hong Kong and China, in (i) 2011-12, and (ii) 2012-13.
Mr Hockey: The answer to the honourable member's question is as follows:
The Australian Bureau of Statistics (ABS) publishes information on foreign investment to and from Australia on a calendar year basis.
(a) Investment transactions from China and Hong Kong to Australia were $5.8 billion in 2012 and $11.4 billion in 2013 (Table 1).
(b) Investment transactions from Australia to China and Hong Kong were $4.9 billion in 2012 and $12.9 billion in 2013 (Table 1).
Table 1: Financial account transactions ($ million)
|
2012 |
2013 |
Foreign investment in Australia |
|
|
China (excludes SARs and Taiwan) |
3,831 |
8,847 |
Hong Kong (SAR of China) |
2,009 |
2,562 |
Total |
5,840 |
11,409 |
Australian investment abroad |
|
|
China (excludes SARs and Taiwan) |
2,212 |
9,872 |
Hong Kong (SAR of China) |
2,660 |
2,990 |
Total |
4,872 |
12,862 |
Source: ABS cat. no. 5352.0 - International Investment Position, Australia: Supplementary Statistics, 2013
Commonwealth Cleaning Services Guidelines
(Question No. 231)
Mr Brendan O'Connor asked the Minister representing the Minister for Finance, in writing, on 14 July 2014:
(1) How many contracts are covered by the Commonwealth Cleaning Services Guidelines 2012, and on what date does each contract expire.
(2) How many cleaners on current contracts are covered by the Commonwealth Cleaning Services Guidelines 2012.
(3) What is the process for transitioning workers away from the revoked Commonwealth Cleaning Services Guidelines 2012.
Mr Hockey: The Minister for Finance has supplied the following answer to the honourable member's question:
As this matter falls within the responsibilities of the Minister for Employment, I refer you to the response to Parliamentary Question in Writing No. 230.
Human Services
(Question No. 288)
Ms King asked the Minister representing the Minister for Human Services, in writing, on 27 August 2014:
By electorate, and for the calendar year (a) 2012, and (b) 2013, what volume of services was subsidised under the: (i) Pharmaceutical Benefits Scheme, and as (ii) Concessional non Safety Net, (iii) Concessional Safety Net, (iv) Total Concessional, (v) General non Safety Net, (vi) General Safety Net, and (vii) Total General.
Mr Andrews: The answer to the honourable member's question is as follows:
The following tables detail the service volumes, broken down by electorate, for the calendar years 2012 and 2013 by components as requested. The service volumes are for the Pharmaceutical Benefits Scheme (PBS) and do not include the service volumes for the Repatriation Pharmaceutical Benefits Scheme.
The Department of Human Services reports publicly on PBS service volumes on its website (www.humanservices.gov.au). The service volume descriptions from that website have been used for this answer. The honourable member's corresponding question titles are identified in footnotes to each page.
The records listed as 'Unknown' in the tabled documents are not allocated to any specific Electorate in the department's systems at the time of the extraction and make up less than one per cent of all service volumes. There are a number of reasons a record may be listed as Unknown including customer movement and changes to location names. Such records are corrected over time and allocated to an Electorate wherever possible.
PBS Summary Service Volume by Electorate and Patient Category for Date of Processing from 1 January 2013 to 31 December 2013
Electorate |
Service Volumes |
||||||
Concessional Ordinary (1) |
Concessional Free Safety Net (2) |
Concessional Total |
General Ordinary (3) |
General Safety Net (4) |
General Total |
Concessional and General Total |
|
Adelaide |
956,196 |
245,288 |
1,201,484 |
144,789 |
30,622 |
175,411 |
1,376,895 |
Aston |
671,350 |
183,231 |
854,581 |
111,664 |
21,173 |
132,837 |
987,418 |
Ballarat |
926,853 |
212,978 |
1,139,831 |
110,515 |
19,828 |
130,343 |
1,270,174 |
Banks |
792,898 |
214,539 |
1,007,437 |
102,667 |
18,053 |
120,720 |
1,128,157 |
Barker |
1,149,045 |
356,237 |
1,505,282 |
131,001 |
31,603 |
162,604 |
1,667,886 |
Barton |
826,107 |
244,461 |
1,070,568 |
100,676 |
18,809 |
119,485 |
1,190,053 |
Bass |
758,428 |
221,298 |
979,726 |
84,126 |
15,946 |
100,072 |
1,079,798 |
Batman |
841,899 |
220,884 |
1,062,783 |
84,577 |
10,814 |
95,391 |
1,158,174 |
Bendigo |
908,728 |
203,258 |
1,111,986 |
98,793 |
16,708 |
115,501 |
1,227,487 |
Bennelong |
670,313 |
175,528 |
845,841 |
112,526 |
22,867 |
135,393 |
981,234 |
Berowra |
499,164 |
127,417 |
626,581 |
144,784 |
32,439 |
177,223 |
803,804 |
Blair |
1,032,717 |
372,350 |
1,405,067 |
115,218 |
27,803 |
143,021 |
1,548,088 |
Blaxland |
1,094,732 |
312,166 |
1,406,898 |
70,977 |
13,876 |
84,853 |
1,491,751 |
Bonner |
790,916 |
256,700 |
1,047,616 |
136,194 |
31,398 |
167,592 |
1,215,208 |
Boothby |
945,870 |
263,772 |
1,209,642 |
138,668 |
28,144 |
166,812 |
1,376,454 |
Bowman |
877,992 |
295,851 |
1,173,843 |
139,348 |
30,502 |
169,850 |
1,343,693 |
Braddon |
848,340 |
260,756 |
1,109,096 |
77,967 |
16,070 |
94,037 |
1,203,133 |
Bradfield |
499,980 |
113,032 |
613,012 |
167,608 |
44,895 |
212,503 |
825,515 |
Brand |
732,291 |
161,505 |
893,796 |
122,137 |
16,561 |
138,698 |
1,032,494 |
Brisbane |
562,298 |
136,121 |
698,419 |
147,901 |
24,409 |
172,310 |
870,729 |
Bruce |
907,664 |
229,328 |
1,136,992 |
90,647 |
16,727 |
107,374 |
1,244,366 |
Calare |
985,826 |
276,313 |
1,262,139 |
121,940 |
27,250 |
149,190 |
1,411,329 |
Calwell |
869,667 |
204,902 |
1,074,569 |
90,761 |
14,758 |
105,519 |
1,180,088 |
Canberra |
566,519 |
111,045 |
677,564 |
169,677 |
34,221 |
203,898 |
881,462 |
Canning |
834,507 |
174,455 |
1,008,962 |
135,324 |
19,288 |
154,612 |
1,163,574 |
Capricornia |
831,665 |
256,036 |
1,087,701 |
160,859 |
33,792 |
194,651 |
1,282,352 |
Casey |
705,589 |
159,764 |
865,353 |
110,948 |
17,345 |
128,293 |
993,646 |
Charlton |
1,054,409 |
337,724 |
1,392,133 |
124,964 |
27,924 |
152,888 |
1,545,021 |
Chifley |
954,564 |
212,450 |
1,167,014 |
101,515 |
17,091 |
118,606 |
1,285,620 |
Chisholm |
787,717 |
198,583 |
986,300 |
98,303 |
18,844 |
117,147 |
1,103,447 |
Cook |
693,741 |
165,131 |
858,872 |
129,678 |
25,714 |
155,392 |
1,014,264 |
Corangamite |
746,189 |
163,583 |
909,772 |
102,697 |
17,615 |
120,312 |
1,030,084 |
Corio |
985,391 |
241,823 |
1,227,214 |
98,676 |
16,388 |
115,064 |
1,342,278 |
Cowan |
577,839 |
126,922 |
704,761 |
122,484 |
18,168 |
140,652 |
845,413 |
Cowper |
1,187,841 |
287,251 |
1,475,092 |
90,003 |
14,324 |
104,327 |
1,579,419 |
Cunningham |
905,933 |
241,223 |
1,147,156 |
110,494 |
19,396 |
129,890 |
1,277,046 |
Curtin |
465,475 |
88,358 |
553,833 |
150,605 |
24,997 |
175,602 |
729,435 |
Dawson |
794,907 |
247,318 |
1,042,225 |
177,208 |
37,709 |
214,917 |
1,257,142 |
Deakin |
783,344 |
196,343 |
979,687 |
107,165 |
18,670 |
125,835 |
1,105,522 |
Denison |
718,942 |
180,509 |
899,451 |
86,247 |
11,950 |
98,197 |
997,648 |
Dickson |
643,633 |
204,395 |
848,028 |
145,942 |
29,526 |
175,468 |
1,023,496 |
Dobell |
1,029,331 |
276,945 |
1,306,276 |
107,957 |
19,028 |
126,985 |
1,433,261 |
Dunkley |
883,022 |
198,013 |
1,081,035 |
106,268 |
18,997 |
125,265 |
1,206,300 |
Durack |
475,611 |
93,271 |
568,882 |
136,641 |
19,769 |
156,410 |
725,292 |
Eden-Monaro |
867,986 |
192,279 |
1,060,265 |
107,026 |
19,115 |
126,141 |
1,186,406 |
Fadden |
934,502 |
266,922 |
1,201,424 |
138,210 |
27,285 |
165,495 |
1,366,919 |
Fairfax |
965,710 |
289,989 |
1,255,699 |
120,334 |
21,043 |
141,377 |
1,397,076 |
Farrer |
1,031,915 |
249,075 |
1,280,990 |
115,966 |
20,065 |
136,031 |
1,417,021 |
Fisher |
1,007,332 |
340,052 |
1,347,384 |
109,372 |
23,866 |
133,238 |
1,480,622 |
Flinders |
996,150 |
245,173 |
1,241,323 |
113,195 |
22,907 |
136,102 |
1,377,425 |
Flynn |
761,349 |
213,193 |
974,542 |
148,541 |
27,874 |
176,415 |
1,150,957 |
Forde |
865,717 |
282,832 |
1,148,549 |
119,876 |
24,857 |
144,733 |
1,293,282 |
Forrest |
702,348 |
141,610 |
843,958 |
118,668 |
17,994 |
136,662 |
980,620 |
Fowler |
1,029,379 |
256,582 |
1,285,961 |
70,519 |
11,361 |
81,880 |
1,367,841 |
Franklin |
724,833 |
193,471 |
918,304 |
85,485 |
13,696 |
99,181 |
1,017,485 |
Fraser |
599,383 |
125,697 |
725,080 |
172,570 |
33,457 |
206,027 |
931,107 |
Fremantle |
639,822 |
133,587 |
773,409 |
119,007 |
17,114 |
136,121 |
909,530 |
Gellibrand |
834,757 |
208,824 |
1,043,581 |
93,229 |
12,058 |
105,287 |
1,148,868 |
Gilmore |
1,135,025 |
305,173 |
1,440,198 |
107,946 |
18,690 |
126,636 |
1,566,834 |
Gippsland |
1,053,225 |
271,390 |
1,324,615 |
106,697 |
21,242 |
127,939 |
1,452,554 |
Goldstein |
613,383 |
149,025 |
762,408 |
145,601 |
34,697 |
180,298 |
942,706 |
Gorton |
744,918 |
157,271 |
902,189 |
101,216 |
16,947 |
118,163 |
1,020,352 |
Grayndler |
651,231 |
158,089 |
809,320 |
104,616 |
12,575 |
117,191 |
926,511 |
Greenway |
670,421 |
154,525 |
824,946 |
117,633 |
21,462 |
139,095 |
964,041 |
Grey |
1,228,667 |
384,595 |
1,613,262 |
138,547 |
34,048 |
172,595 |
1,785,857 |
Griffith |
595,504 |
154,996 |
750,500 |
129,788 |
20,298 |
150,086 |
900,586 |
Groom |
995,195 |
344,904 |
1,340,099 |
131,508 |
35,601 |
167,109 |
1,507,208 |
Hasluck |
735,681 |
159,990 |
895,671 |
130,559 |
20,501 |
151,060 |
1,046,731 |
Herbert |
772,574 |
212,398 |
984,972 |
142,981 |
25,275 |
168,256 |
1,153,228 |
Higgins |
494,315 |
112,953 |
607,268 |
137,929 |
29,553 |
167,482 |
774,750 |
Hindmarsh |
1,118,535 |
322,212 |
1,440,747 |
126,682 |
22,769 |
149,451 |
1,590,198 |
Hinkler |
1,385,528 |
458,362 |
1,843,890 |
93,666 |
19,352 |
113,018 |
1,956,908 |
Holt |
824,362 |
192,106 |
1,016,468 |
103,819 |
16,207 |
120,026 |
1,136,494 |
Hotham |
856,349 |
227,402 |
1,083,751 |
91,682 |
16,623 |
108,305 |
1,192,056 |
Hughes |
640,669 |
165,812 |
806,481 |
120,508 |
21,746 |
142,254 |
948,735 |
Hume |
927,846 |
258,262 |
1,186,108 |
128,910 |
29,924 |
158,834 |
1,344,942 |
Hunter |
882,009 |
234,878 |
1,116,887 |
125,588 |
27,422 |
153,010 |
1,269,897 |
Indi |
879,154 |
200,669 |
1,079,823 |
95,105 |
17,263 |
112,368 |
1,192,191 |
Isaacs |
776,269 |
191,249 |
967,518 |
103,652 |
16,785 |
120,437 |
1,087,955 |
Jagajaga |
621,952 |
140,120 |
762,072 |
112,607 |
21,573 |
134,180 |
896,252 |
Kennedy |
941,540 |
248,676 |
1,190,216 |
142,452 |
30,933 |
173,385 |
1,363,601 |
Kingsford Smith |
741,855 |
179,946 |
921,801 |
122,649 |
21,783 |
144,432 |
1,066,233 |
Kingston |
1,040,962 |
323,204 |
1,364,166 |
116,460 |
23,421 |
139,881 |
1,504,047 |
Kooyong |
461,234 |
94,753 |
555,987 |
138,027 |
31,222 |
169,249 |
725,236 |
La Trobe |
575,681 |
137,090 |
712,771 |
115,727 |
21,919 |
137,646 |
850,417 |
Lalor |
709,108 |
162,222 |
871,330 |
114,051 |
19,778 |
133,829 |
1,005,159 |
Leichhardt |
775,202 |
154,818 |
930,020 |
142,796 |
18,643 |
161,439 |
1,091,459 |
Lilley |
891,269 |
296,413 |
1,187,682 |
145,327 |
29,643 |
174,970 |
1,362,652 |
Lindsay |
743,306 |
175,508 |
918,814 |
119,115 |
21,334 |
140,449 |
1,059,263 |
Lingiari |
140,258 |
19,572 |
159,830 |
54,927 |
5,505 |
60,432 |
220,262 |
Longman |
1,072,005 |
342,834 |
1,414,839 |
120,879 |
24,459 |
145,338 |
1,560,177 |
Lyne |
1,259,267 |
347,061 |
1,606,328 |
86,313 |
17,390 |
103,703 |
1,710,031 |
Lyons |
873,071 |
263,460 |
1,136,531 |
80,367 |
16,031 |
96,398 |
1,232,929 |
Macarthur |
715,299 |
180,639 |
895,938 |
120,891 |
23,623 |
144,514 |
1,040,452 |
Mackellar |
595,823 |
142,580 |
738,403 |
135,492 |
28,617 |
164,109 |
902,512 |
Macquarie |
696,854 |
154,608 |
851,462 |
123,560 |
22,105 |
145,665 |
997,127 |
Makin |
939,812 |
286,680 |
1,226,492 |
125,144 |
23,723 |
148,867 |
1,375,359 |
Mallee |
1,082,165 |
276,672 |
1,358,837 |
106,548 |
22,953 |
129,501 |
1,488,338 |
Maranoa |
1,072,405 |
341,958 |
1,414,363 |
139,603 |
36,750 |
176,353 |
1,590,716 |
Maribyrnong |
923,771 |
237,999 |
1,161,770 |
92,933 |
13,354 |
106,287 |
1,268,057 |
Mayo |
924,179 |
281,037 |
1,205,216 |
132,013 |
26,627 |
158,640 |
1,363,856 |
McEwen |
698,699 |
173,726 |
872,425 |
133,970 |
26,459 |
160,429 |
1,032,854 |
McMahon |
869,295 |
246,376 |
1,115,671 |
94,831 |
17,721 |
112,552 |
1,228,223 |
Mcmillan |
1,002,714 |
257,240 |
1,259,954 |
109,075 |
21,816 |
130,891 |
1,390,845 |
Mcpherson |
913,988 |
240,316 |
1,154,304 |
108,645 |
18,252 |
126,897 |
1,281,201 |
Melbourne |
515,503 |
94,064 |
609,567 |
99,529 |
11,542 |
111,071 |
720,638 |
Melbourne Ports |
504,063 |
114,714 |
618,777 |
130,291 |
31,329 |
161,620 |
780,397 |
Menzies |
688,842 |
163,290 |
852,132 |
114,530 |
24,926 |
139,456 |
991,588 |
Mitchell |
521,310 |
120,597 |
641,907 |
137,610 |
26,564 |
164,174 |
806,081 |
Moncrieff |
978,830 |
251,358 |
1,230,188 |
130,177 |
24,563 |
154,740 |
1,384,928 |
Moore |
462,175 |
94,548 |
556,723 |
137,327 |
18,903 |
156,230 |
712,953 |
Moreton |
699,598 |
207,312 |
906,910 |
121,472 |
26,616 |
148,088 |
1,054,998 |
Murray |
1,111,446 |
284,947 |
1,396,393 |
106,085 |
20,818 |
126,903 |
1,523,296 |
New England |
1,021,968 |
245,394 |
1,267,362 |
111,333 |
20,737 |
132,070 |
1,399,432 |
Newcastle |
904,525 |
231,123 |
1,135,648 |
107,562 |
20,268 |
127,830 |
1,263,478 |
North Sydney |
443,075 |
91,915 |
534,990 |
153,808 |
32,214 |
186,022 |
721,012 |
O'Connor |
693,134 |
132,377 |
825,511 |
131,983 |
23,507 |
155,490 |
981,001 |
Oxley |
766,811 |
222,278 |
989,089 |
122,696 |
23,336 |
146,032 |
1,135,121 |
Page |
1,133,016 |
286,706 |
1,419,722 |
90,023 |
16,688 |
106,711 |
1,526,433 |
Parkes |
1,015,861 |
222,421 |
1,238,282 |
149,385 |
25,162 |
174,547 |
1,412,829 |
Parramatta |
892,776 |
209,438 |
1,102,214 |
94,755 |
15,978 |
110,733 |
1,212,947 |
Paterson |
1,120,686 |
331,985 |
1,452,671 |
111,501 |
27,369 |
138,870 |
1,591,541 |
Pearce |
644,079 |
134,866 |
778,945 |
142,597 |
19,575 |
162,172 |
941,117 |
Perth |
755,129 |
158,558 |
913,687 |
124,592 |
18,823 |
143,415 |
1,057,102 |
Petrie |
1,042,846 |
347,550 |
1,390,396 |
130,702 |
29,590 |
160,292 |
1,550,688 |
Port Adelaide |
1,228,415 |
387,010 |
1,615,425 |
114,974 |
19,584 |
134,558 |
1,749,983 |
Rankin |
897,521 |
268,126 |
1,165,647 |
134,132 |
27,276 |
161,408 |
1,327,055 |
Reid |
689,467 |
186,573 |
876,040 |
109,867 |
21,601 |
131,468 |
1,007,508 |
Richmond |
1,022,560 |
276,276 |
1,298,836 |
86,045 |
14,416 |
100,461 |
1,399,297 |
Riverina |
939,901 |
247,255 |
1,187,156 |
125,488 |
27,099 |
152,587 |
1,339,743 |
Robertson |
1,029,511 |
278,161 |
1,307,672 |
118,702 |
22,367 |
141,069 |
1,448,741 |
Ryan |
523,710 |
145,335 |
669,045 |
157,881 |
31,906 |
189,787 |
858,832 |
Scullin |
830,004 |
204,793 |
1,034,797 |
94,535 |
14,014 |
108,549 |
1,143,346 |
Shortland |
1,143,386 |
363,954 |
1,507,340 |
101,388 |
20,726 |
122,114 |
1,629,454 |
Solomon |
302,919 |
38,374 |
341,293 |
93,069 |
7,420 |
100,489 |
441,782 |
Stirling |
709,653 |
150,196 |
859,849 |
109,259 |
15,764 |
125,023 |
984,872 |
Sturt |
1,006,783 |
302,813 |
1,309,596 |
134,009 |
31,503 |
165,512 |
1,475,108 |
Swan |
678,001 |
135,476 |
813,477 |
109,862 |
13,086 |
122,948 |
936,425 |
Sydney |
506,428 |
96,940 |
603,368 |
134,134 |
17,137 |
151,271 |
754,639 |
Tangney |
490,446 |
92,735 |
583,181 |
131,473 |
21,699 |
153,172 |
736,353 |
Throsby |
1,102,972 |
335,457 |
1,438,429 |
112,435 |
25,614 |
138,049 |
1,576,478 |
Wakefield |
1,220,096 |
400,048 |
1,620,144 |
129,110 |
30,221 |
159,331 |
1,779,475 |
Wannon |
963,205 |
243,049 |
1,206,254 |
102,778 |
21,864 |
124,642 |
1,330,896 |
Warringah |
454,691 |
88,301 |
542,992 |
146,143 |
24,560 |
170,703 |
713,695 |
Watson |
980,880 |
287,612 |
1,268,492 |
81,968 |
14,193 |
96,161 |
1,364,653 |
Wentworth |
459,352 |
94,054 |
553,406 |
193,995 |
50,852 |
244,847 |
798,253 |
Werriwa |
754,130 |
166,393 |
920,523 |
102,891 |
17,730 |
120,621 |
1,041,144 |
Wide Bay |
1,189,128 |
344,704 |
1,533,832 |
107,472 |
23,524 |
130,996 |
1,664,828 |
Wills |
896,389 |
248,939 |
1,145,328 |
86,412 |
10,400 |
96,812 |
1,242,140 |
Wright |
815,401 |
253,943 |
1,069,344 |
132,752 |
30,296 |
163,048 |
1,232,392 |
Unknown |
651,260 |
186,318 |
837,578 |
192,136 |
18,265 |
210,401 |
1,047,979 |
|
|
|
|
|
|
|
|
Totals |
124,401,082 |
32,878,388 |
157,279,470 |
17,961,040 |
3,380,942 |
21,341,982 |
178,621,452 |
PBS Summary Service Volume by Electorate and Patient Category for Date of Processing from 1 January 2012 to 31 December 2012
Electorate |
Service Volumes |
||||||
Concessional Ordinary (1) |
Concessional Free Safety Net (2) |
Concessional Total |
General Ordinary (3) |
General Safety Net (4) |
General Total |
Concessional and General Total |
|
Adelaide |
968,598 |
258,235 |
1,226,833 |
157,123 |
34,442 |
191,565 |
1,418,398 |
Aston |
756,274 |
250,439 |
1,006,713 |
142,132 |
32,402 |
174,534 |
1,181,247 |
Ballarat |
1,061,529 |
296,612 |
1,358,141 |
138,332 |
30,636 |
168,968 |
1,527,109 |
Banks |
929,352 |
323,377 |
1,252,729 |
131,342 |
29,718 |
161,060 |
1,413,789 |
Barker |
1,175,966 |
364,436 |
1,540,402 |
150,041 |
39,877 |
189,918 |
1,730,320 |
Barton |
970,502 |
373,564 |
1,344,066 |
128,884 |
31,449 |
160,333 |
1,504,399 |
Bass |
765,822 |
246,574 |
1,012,396 |
90,562 |
18,996 |
109,558 |
1,121,954 |
Batman |
1,058,748 |
363,378 |
1,422,126 |
112,099 |
18,566 |
130,665 |
1,552,791 |
Bendigo |
1,063,162 |
311,641 |
1,374,803 |
134,356 |
30,801 |
165,157 |
1,539,960 |
Bennelong |
787,925 |
262,517 |
1,050,442 |
150,491 |
38,480 |
188,971 |
1,239,413 |
Berowra |
565,368 |
181,825 |
747,193 |
191,917 |
54,895 |
246,812 |
994,005 |
Blair |
1,000,239 |
356,626 |
1,356,865 |
123,494 |
32,043 |
155,537 |
1,512,402 |
Blaxland |
1,281,998 |
450,811 |
1,732,809 |
90,599 |
21,727 |
112,326 |
1,845,135 |
Bonner |
781,190 |
257,429 |
1,038,619 |
147,744 |
35,796 |
183,540 |
1,222,159 |
Boothby |
950,515 |
277,288 |
1,227,803 |
152,814 |
32,594 |
185,408 |
1,413,211 |
Bowman |
852,560 |
286,928 |
1,139,488 |
151,497 |
33,652 |
185,149 |
1,324,637 |
Braddon |
859,918 |
276,256 |
1,136,174 |
87,017 |
20,297 |
107,314 |
1,243,488 |
Bradfield |
562,847 |
159,660 |
722,507 |
214,267 |
68,559 |
282,826 |
1,005,333 |
Brand |
887,309 |
261,203 |
1,148,512 |
157,853 |
28,033 |
185,886 |
1,334,398 |
Brisbane |
569,492 |
143,374 |
712,866 |
160,823 |
30,203 |
191,026 |
903,892 |
Bruce |
1,062,041 |
339,907 |
1,401,948 |
121,368 |
27,844 |
149,212 |
1,551,160 |
Calare |
1,085,934 |
375,195 |
1,461,129 |
146,952 |
39,674 |
186,626 |
1,647,755 |
Calwell |
1,052,096 |
313,597 |
1,365,693 |
122,224 |
23,773 |
145,997 |
1,511,690 |
Canberra |
647,067 |
167,571 |
814,638 |
214,668 |
53,680 |
268,348 |
1,082,986 |
Canning |
1,010,615 |
299,070 |
1,309,685 |
181,770 |
38,964 |
220,734 |
1,530,419 |
Capricornia |
818,112 |
263,781 |
1,081,893 |
167,094 |
37,579 |
204,673 |
1,286,566 |
Casey |
798,819 |
219,575 |
1,018,394 |
141,487 |
27,108 |
168,595 |
1,186,989 |
Charlton |
1,081,253 |
382,860 |
1,464,113 |
144,887 |
36,632 |
181,519 |
1,645,632 |
Chifley |
1,070,035 |
308,599 |
1,378,634 |
130,023 |
26,856 |
156,879 |
1,535,513 |
Chisholm |
945,928 |
306,737 |
1,252,665 |
134,725 |
32,372 |
167,097 |
1,419,762 |
Cook |
809,845 |
253,133 |
1,062,978 |
165,822 |
41,601 |
207,423 |
1,270,401 |
Corangamite |
918,644 |
263,093 |
1,181,737 |
143,471 |
30,487 |
173,958 |
1,355,695 |
Corio |
1,184,464 |
376,542 |
1,561,006 |
134,383 |
27,685 |
162,068 |
1,723,074 |
Cowan |
703,181 |
205,034 |
908,215 |
162,773 |
31,346 |
194,119 |
1,102,334 |
Cowper |
1,285,466 |
384,626 |
1,670,092 |
110,296 |
21,923 |
132,219 |
1,802,311 |
Cunningham |
998,725 |
320,425 |
1,319,150 |
136,223 |
28,656 |
164,879 |
1,484,029 |
Curtin |
574,792 |
142,185 |
716,977 |
196,854 |
46,436 |
243,290 |
960,267 |
Dawson |
775,993 |
241,133 |
1,017,126 |
178,832 |
40,020 |
218,852 |
1,235,978 |
Deakin |
898,131 |
268,377 |
1,166,508 |
136,113 |
30,286 |
166,399 |
1,332,907 |
Denison |
724,362 |
191,099 |
915,461 |
96,622 |
15,040 |
111,662 |
1,027,123 |
Dickson |
619,717 |
203,640 |
823,357 |
156,469 |
29,979 |
186,448 |
1,009,805 |
Dobell |
1,142,561 |
380,872 |
1,523,433 |
136,323 |
29,252 |
165,575 |
1,689,008 |
Dunkley |
1,057,199 |
297,456 |
1,354,655 |
151,581 |
33,703 |
185,284 |
1,539,939 |
Durack |
576,009 |
151,112 |
727,121 |
170,806 |
34,575 |
205,381 |
932,502 |
Eden-Monaro |
974,991 |
284,988 |
1,259,979 |
139,826 |
34,447 |
174,273 |
1,434,252 |
Fadden |
908,407 |
263,656 |
1,172,063 |
146,361 |
30,213 |
176,574 |
1,348,637 |
Fairfax |
941,400 |
286,695 |
1,228,095 |
131,693 |
24,400 |
156,093 |
1,384,188 |
Farrer |
1,137,023 |
346,510 |
1,483,533 |
144,126 |
32,434 |
176,560 |
1,660,093 |
Fisher |
982,998 |
333,072 |
1,316,070 |
122,069 |
27,154 |
149,223 |
1,465,293 |
Flinders |
1,171,225 |
377,313 |
1,548,538 |
159,391 |
40,584 |
199,975 |
1,748,513 |
Flynn |
736,662 |
207,143 |
943,805 |
154,351 |
29,492 |
183,843 |
1,127,648 |
Forde |
840,183 |
275,308 |
1,115,491 |
127,685 |
26,850 |
154,535 |
1,270,026 |
Forrest |
860,117 |
249,176 |
1,109,293 |
164,408 |
35,331 |
199,739 |
1,309,032 |
Fowler |
1,202,945 |
390,402 |
1,593,347 |
93,432 |
21,866 |
115,298 |
1,708,645 |
Franklin |
734,530 |
218,475 |
953,005 |
96,807 |
17,561 |
114,368 |
1,067,373 |
Fraser |
668,130 |
169,824 |
837,954 |
210,052 |
48,966 |
259,018 |
1,096,972 |
Fremantle |
783,375 |
224,565 |
1,007,940 |
159,184 |
29,980 |
189,164 |
1,197,104 |
Gellibrand |
1,013,831 |
312,755 |
1,326,586 |
117,188 |
18,294 |
135,482 |
1,462,068 |
Gilmore |
1,263,726 |
445,949 |
1,709,675 |
135,298 |
31,210 |
166,508 |
1,876,183 |
Gippsland |
1,223,657 |
401,084 |
1,624,741 |
138,825 |
35,122 |
173,947 |
1,798,688 |
Goldstein |
729,994 |
227,880 |
957,874 |
194,291 |
59,590 |
253,881 |
1,211,755 |
Gorton |
873,146 |
230,202 |
1,103,348 |
131,214 |
27,445 |
158,659 |
1,262,007 |
Grayndler |
765,872 |
235,887 |
1,001,759 |
134,896 |
22,136 |
157,032 |
1,158,791 |
Greenway |
744,536 |
218,374 |
962,910 |
150,389 |
34,697 |
185,086 |
1,147,996 |
Grey |
1,209,163 |
364,642 |
1,573,805 |
142,960 |
34,627 |
177,587 |
1,751,392 |
Griffith |
587,886 |
159,660 |
747,546 |
138,289 |
23,307 |
161,596 |
909,142 |
Groom |
983,866 |
329,237 |
1,313,103 |
139,078 |
37,965 |
177,043 |
1,490,146 |
Hasluck |
868,293 |
245,896 |
1,114,189 |
165,769 |
35,352 |
201,121 |
1,315,310 |
Herbert |
745,537 |
202,686 |
948,223 |
149,588 |
28,523 |
178,111 |
1,126,334 |
Higgins |
605,738 |
175,618 |
781,356 |
190,367 |
51,349 |
241,716 |
1,023,072 |
Hindmarsh |
1,117,425 |
323,688 |
1,441,113 |
137,287 |
25,681 |
162,968 |
1,604,081 |
Hinkler |
1,373,429 |
462,125 |
1,835,554 |
106,143 |
23,271 |
129,414 |
1,964,968 |
Holt |
972,947 |
298,453 |
1,271,400 |
140,566 |
29,931 |
170,497 |
1,441,897 |
Hotham |
1,018,520 |
343,894 |
1,362,414 |
125,069 |
26,907 |
151,976 |
1,514,390 |
Hughes |
732,901 |
250,960 |
983,861 |
155,361 |
39,253 |
194,614 |
1,178,475 |
Hume |
1,006,080 |
337,816 |
1,343,896 |
157,825 |
46,206 |
204,031 |
1,547,927 |
Hunter |
994,595 |
347,038 |
1,341,633 |
153,399 |
43,132 |
196,531 |
1,538,164 |
Indi |
1,022,508 |
303,564 |
1,326,072 |
127,571 |
30,341 |
157,912 |
1,483,984 |
Isaacs |
900,765 |
274,331 |
1,175,096 |
135,368 |
27,696 |
163,064 |
1,338,160 |
Jagajaga |
761,531 |
235,037 |
996,568 |
148,684 |
34,725 |
183,409 |
1,179,977 |
Kennedy |
908,678 |
235,391 |
1,144,069 |
146,701 |
32,204 |
178,905 |
1,322,974 |
Kingsford Smith |
876,171 |
278,791 |
1,154,962 |
159,883 |
37,574 |
197,457 |
1,352,419 |
Kingston |
1,017,179 |
314,607 |
1,331,786 |
127,085 |
26,028 |
153,113 |
1,484,899 |
Kooyong |
552,334 |
142,159 |
694,493 |
181,962 |
49,391 |
231,353 |
925,846 |
La Trobe |
652,961 |
187,779 |
840,740 |
148,753 |
34,100 |
182,853 |
1,023,593 |
Lalor |
817,640 |
237,714 |
1,055,354 |
150,225 |
32,502 |
182,727 |
1,238,081 |
Leichhardt |
748,782 |
148,847 |
897,629 |
151,084 |
21,500 |
172,584 |
1,070,213 |
Lilley |
888,735 |
301,015 |
1,189,750 |
156,443 |
34,684 |
191,127 |
1,380,877 |
Lindsay |
847,826 |
240,649 |
1,088,475 |
153,601 |
34,634 |
188,235 |
1,276,710 |
Lingiari |
133,529 |
16,462 |
149,991 |
53,401 |
5,751 |
59,152 |
209,143 |
Longman |
1,029,396 |
333,827 |
1,363,223 |
128,763 |
26,573 |
155,336 |
1,518,559 |
Lyne |
1,350,572 |
427,664 |
1,778,236 |
109,613 |
25,300 |
134,913 |
1,913,149 |
Lyons |
867,986 |
276,871 |
1,144,857 |
88,229 |
20,904 |
109,133 |
1,253,990 |
Macarthur |
806,881 |
264,677 |
1,071,558 |
155,231 |
38,660 |
193,891 |
1,265,449 |
Mackellar |
711,595 |
220,334 |
931,929 |
183,156 |
46,201 |
229,357 |
1,161,286 |
Macquarie |
794,920 |
223,074 |
1,017,994 |
160,572 |
37,058 |
197,630 |
1,215,624 |
Makin |
924,753 |
288,632 |
1,213,385 |
135,558 |
27,421 |
162,979 |
1,376,364 |
Mallee |
1,250,577 |
407,938 |
1,658,515 |
139,253 |
37,825 |
177,078 |
1,835,593 |
Maranoa |
1,048,612 |
323,781 |
1,372,393 |
143,917 |
37,617 |
181,534 |
1,553,927 |
Maribyrnong |
1,110,861 |
353,703 |
1,464,564 |
119,293 |
22,411 |
141,704 |
1,606,268 |
Mayo |
896,942 |
268,542 |
1,165,484 |
144,816 |
30,136 |
174,952 |
1,340,436 |
McEwen |
806,035 |
245,546 |
1,051,581 |
173,270 |
39,459 |
212,729 |
1,264,310 |
McMahon |
993,443 |
358,560 |
1,352,003 |
123,103 |
28,868 |
151,971 |
1,503,974 |
Mcmillan |
1,174,018 |
390,383 |
1,564,401 |
145,130 |
38,308 |
183,438 |
1,747,839 |
Mcpherson |
883,030 |
243,643 |
1,126,673 |
118,322 |
21,260 |
139,582 |
1,266,255 |
Melbourne |
628,184 |
145,056 |
773,240 |
125,838 |
17,958 |
143,796 |
917,036 |
Melbourne Ports |
605,532 |
172,308 |
777,840 |
170,498 |
50,968 |
221,466 |
999,306 |
Menzies |
791,382 |
235,484 |
1,026,866 |
150,977 |
40,654 |
191,631 |
1,218,497 |
Mitchell |
590,859 |
182,523 |
773,382 |
181,897 |
45,540 |
227,437 |
1,000,819 |
Moncrieff |
968,287 |
255,272 |
1,223,559 |
145,118 |
29,408 |
174,526 |
1,398,085 |
Moore |
544,010 |
146,987 |
690,997 |
179,918 |
32,956 |
212,874 |
903,871 |
Moreton |
693,708 |
214,838 |
908,546 |
133,206 |
31,313 |
164,519 |
1,073,065 |
Murray |
1,281,915 |
429,887 |
1,711,802 |
141,401 |
35,465 |
176,866 |
1,888,668 |
New England |
1,132,101 |
329,108 |
1,461,209 |
133,880 |
30,106 |
163,986 |
1,625,195 |
Newcastle |
980,943 |
299,119 |
1,280,062 |
130,273 |
29,435 |
159,708 |
1,439,770 |
North Sydney |
515,898 |
133,130 |
649,028 |
200,847 |
51,054 |
251,901 |
900,929 |
O'Connor |
851,803 |
223,344 |
1,075,147 |
168,240 |
43,492 |
211,732 |
1,286,879 |
Oxley |
739,790 |
217,344 |
957,134 |
127,419 |
26,683 |
154,102 |
1,111,236 |
Page |
1,272,685 |
409,153 |
1,681,838 |
114,788 |
28,005 |
142,793 |
1,824,631 |
Parkes |
1,136,596 |
331,161 |
1,467,757 |
177,858 |
42,888 |
220,746 |
1,688,503 |
Parramatta |
1,035,937 |
313,678 |
1,349,615 |
120,080 |
25,352 |
145,432 |
1,495,047 |
Paterson |
1,193,307 |
421,910 |
1,615,217 |
135,421 |
40,913 |
176,334 |
1,791,551 |
Pearce |
750,275 |
202,420 |
952,695 |
179,825 |
34,136 |
213,961 |
1,166,656 |
Perth |
923,872 |
258,931 |
1,182,803 |
160,301 |
33,627 |
193,928 |
1,376,731 |
Petrie |
1,004,644 |
340,427 |
1,345,071 |
139,849 |
31,566 |
171,415 |
1,516,486 |
Port Adelaide |
1,234,610 |
396,040 |
1,630,650 |
121,011 |
22,177 |
143,188 |
1,773,838 |
Rankin |
857,286 |
257,267 |
1,114,553 |
143,057 |
31,738 |
174,795 |
1,289,348 |
Reid |
790,362 |
259,637 |
1,049,999 |
137,676 |
32,079 |
169,755 |
1,219,754 |
Richmond |
1,067,104 |
311,058 |
1,378,162 |
102,381 |
19,525 |
121,906 |
1,500,068 |
Riverina |
1,055,374 |
344,727 |
1,400,101 |
157,479 |
42,200 |
199,679 |
1,599,780 |
Robertson |
1,109,138 |
357,576 |
1,466,714 |
146,567 |
34,459 |
181,026 |
1,647,740 |
Ryan |
517,833 |
144,672 |
662,505 |
171,871 |
38,607 |
210,478 |
872,983 |
Scullin |
978,768 |
317,510 |
1,296,278 |
122,758 |
23,738 |
146,496 |
1,442,774 |
Shortland |
1,213,358 |
443,657 |
1,657,015 |
125,306 |
30,560 |
155,866 |
1,812,881 |
Solomon |
292,224 |
36,463 |
328,687 |
91,189 |
7,889 |
99,078 |
427,765 |
Stirling |
880,366 |
250,404 |
1,130,770 |
145,438 |
28,451 |
173,889 |
1,304,659 |
Sturt |
1,020,748 |
312,807 |
1,333,555 |
149,439 |
37,946 |
187,385 |
1,520,940 |
Swan |
830,414 |
217,075 |
1,047,489 |
146,312 |
22,592 |
168,904 |
1,216,393 |
Sydney |
596,463 |
145,843 |
742,306 |
163,344 |
27,380 |
190,724 |
933,030 |
Tangney |
599,392 |
154,879 |
754,271 |
178,483 |
39,136 |
217,619 |
971,890 |
Throsby |
1,203,773 |
422,563 |
1,626,336 |
140,355 |
37,835 |
178,190 |
1,804,526 |
Wakefield |
1,207,131 |
400,526 |
1,607,657 |
136,794 |
32,205 |
168,999 |
1,776,656 |
Wannon |
1,130,672 |
379,298 |
1,509,970 |
134,409 |
39,265 |
173,674 |
1,683,644 |
Warringah |
543,901 |
134,451 |
678,352 |
193,953 |
45,350 |
239,303 |
917,655 |
Watson |
1,145,446 |
419,777 |
1,565,223 |
105,276 |
23,434 |
128,710 |
1,693,933 |
Wentworth |
536,783 |
136,699 |
673,482 |
243,329 |
80,070 |
323,399 |
996,881 |
Werriwa |
887,456 |
270,275 |
1,157,731 |
136,764 |
32,042 |
168,806 |
1,326,537 |
Wide Bay |
1,174,902 |
341,115 |
1,516,017 |
121,436 |
27,040 |
148,476 |
1,664,493 |
Wills |
1,080,658 |
379,418 |
1,460,076 |
111,145 |
16,679 |
127,824 |
1,587,900 |
Wright |
788,666 |
249,229 |
1,037,895 |
142,778 |
34,946 |
177,724 |
1,215,619 |
Unknown |
691,883 |
235,332 |
927,215 |
231,667 |
25,748 |
257,415 |
1,184,630 |
|
|
|
|
|
|
|
|
Total |
136,318,130 |
42,022,662 |
178,340,792 |
21,875,178 |
4,935,654 |
26,810,832 |
205,151,624 |
Speech and Media Training
(Question No. 314)
Mr Conroy asked the Minister for Communications, in writing, on 3 September 2014:
In respect of speech and/or media training since 7 September 2013, (a) what total sum has the Minister's department spent, and (b) what is the breakdown of such training for (i) the Minister, (ii) Minister's staff and, where applicable, each (iii) junior Minister (including Assistant Ministers), (iv) junior (and Assistant) Minister's staff, (v) Parliamentary Secretary, and (vi) Parliamentary Secretary's staff and (c) what services were provided and by whom.
Mr Turnbull: The answer to the member's question is as follows:
The Department has not conducted any speech or media training from 7 September 2013 to 7 September 2014.
Minister for Communications: Drinks Cabinet for Ministers
(Question No. 342)
Mr Conroy asked the Minister for Communications, in writing, on 3 September 2014:
Since September 2013, has the Minister's department paid for or stocked the 'drinks cabinet' for (a) the Minister, and where applicable, each (b) junior Minister (including Assistant Minister's), and (c) Parliamentary Secretary; if so, at what cost.
Mr Turnbull: The answer to the member's question is as follows:
My Department has not paid for or stocked a 'drinks cabinet' in my office or the office of my Parliamentary Secretary.
Minister for Employment: Hospitality Expenses
(Question No. 356)
Mr Conroy asked the Minister representing the Minister for Employment, in writing, on 3 September 2014:
In respect of hospitality since 7 September 2013, has the Minister's department paid for any function to introduce to the department (a) the Minister, (b) the Minister's staff, and where applicable, each (c) junior Minister (including Assistant Ministers), (d) junior (and Assistant) Minister's staff, (e) Parliamentary Secretary, and (f) Parliamentary Secretary's staff; if so, at what cost.
Mr Pyne: The Minister for Employment has provided the following answer to the honourable member's question:
Between 7 September 2013 and 19 September 2014, Minister Abetz and Assistant Minister Hartsuyker visited departmental offices to meet with departmental staff on 14 occasions.
Modest hospitality was provided with a total cost of $946.