De-Anne Kelly (Dawson, National Party, Parliamentary Secretary Trade) Share this | Hansard source

indeed—and at growing the geographical base of our exporters. I think they are very pertinent points to keep in mind. As for revolving funds, that is one to think about. Can I say that I thought everybody came to this debate with a very constructive and positive approach. In the time I have left I would like to speak about the amendment proposed by the opposition. The government does not support the second reading amendment proposed by the member for Griffith. Firstly, the opposition has stated that it is concerned about the definition of ‘made in Australia’ and what will be applied under the amended scheme. The explanatory memorandum to this bill makes it clear that the definition to be used will be similar in concept to that of the certificate of origin criteria used by Australian chambers of commerce. These criteria take into account such matters as whether a product is mined, grown, raised or substantially transformed in Australia. This will bring the EMDG rules into line with standard industry definitions of Australian origin.

In June 2006 Minister Vaile expects to table the final criteria as a disallowable instrument. Those criteria will be consistent with the definition foreshadowed in the explanatory memorandum. It is not right to say that we are asking members to vote on criteria that are unknown. These criteria will be administered by Austrade, without ministerial discretion or involvement.

Secondly, the opposition called on the government not to proceed with the provision to remove the export performance test. As noted in the explanatory memorandum, the removal of the export performance test will overcome a number of anomalies that have resulted in genuine exporters being denied grants, including for instance businesses that spend on export promotion in one year but do not receive export earnings until the following year. I am sure that the member for Fraser would be aware that in many of our dealings now with countries in the region, particularly Asian nations, there is quite a long period of developing a business relationship with those to whom you seek to export. Sometimes that development can take a considerable period of time, particularly if you are dealing with complex equipment, as many of our exporters from the engineering resources area in my electorate are finding. In the end many of them are successful, but there is a period of time required to develop the relationship, to provide the engineering advice needed to the prospective customer and, finally, to achieve that export outcome.

There are many small firms as well that are unable to generate high volumes of exports. Also, there are firms that are impacted by circumstances beyond their control. They may well have genuinely spent export dollars on trying to open a market but then find that, for reasons they have no control over, they are unsuccessful in securing exports until a later time. The tourism industry, for example, with issues like terrorism or SARS, can find that their best efforts are thwarted. So this measure will overcome those anomalies.

There are other rules that will ensure the integrity of the scheme. Quite rightly, all members want to see the grants go to Australian businesses that are investing their own funds in genuine exporting activities. But there are other safeguards within the legislation to ensure that that occurs. Austrade will continue to audit claims carefully to ensure that grants are paid only where the requirements of the scheme are met. Firms will still be required to spend their own money on eligible export promotion before applying for a grant.

The opposition has also called on the government to request the Auditor-General to conduct a performance audit of the EMDG Scheme two years after the proposed legislation comes into effect. It is not correct to state that the EMDG Scheme is not subject to independent scrutiny, because it is. It has been reviewed or evaluated some 17 times since its inception in 1974.

The amendment bill before the House includes provisions for an independent review of the EMDG Scheme by June 2010. That is a review by a body other than Austrade. In addition, the EMDG Scheme is subject to ongoing scrutiny through regular audits by the Australian National Audit Office and KPMG, Austrade’s internal auditors. Of course, like many other government bodies with decision making, it can be subject to the Administrative Appeals Tribunal. The Auditor-General can, if he chooses, schedule an audit of the EMDG Scheme at any time. The government sees no need to request him to do so now, given that the scheme is going to be independently reviewed in 2010.

Members on both sides have supported the bill before the House today, which continues the EMDG Scheme for another five years and provides a number of enhancements to the scheme. These amendments will ensure that the EMDG Scheme continues to assist Australian businesses, particularly small and emerging exporters, to develop sustainable and growing export markets as part of a dynamic international community. I commend the bill to the House.

Question agreed to.

Original question agreed to.

Bill read a second time.

Ordered that the bill be reported to the House without amendment.

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