Mike Kelly (Eden-Monaro, Australian Labor Party, Parliamentary Secretary for Defence Support) Share this | Link to this | Hansard source

The Minister for Agriculture, Fisheries and Forestry, the Hon. Tony Burke MP, has asked me to make a statement on his behalf outlining the reason why debate on this bill was deferred. Following the introduction into the House of Representatives of the Australian Wine and Brandy Corporation Amendment Bill 2009 on 22 June 2009 by the Hon. Tony Burke MP, European Commission regulation No. 607/2009 came into effect on 1 August 2009. The regulation outlined detailed rules regarding protected designations of origin and geographical indications—that is, regional names, traditional terms, labelling and presentation of certain wine sector products.

The Australian government and the Australian wine industry were both concerned that this regulation had the potential to diminish the benefits under the Australia-European Community Agreement on Trade in Wine—the agreement for Australian winemakers—which this bill implements. The Minister for Agriculture, Fisheries and Forestry wrote to the EC Commissioner for Agriculture and Rural Development last year, expressing concern that the EC regulation imposed more restrictive conditions on Australian wines than existed at the date of the signing of the agreement. Minister Burke indicated that Australia wanted to resolve these concerns before proceeding to ratify the agreement. The main Australian concerns related to the access that Australian wine producers would have to grape variety names in the description and presentation of their wines. Australia’s interpretation of the EC regulation was that a number of common grape variety names, including sangiovese and nebbiolo would not be able to be used in the EC market by Australian producers. Such restrictions on use would have been detrimental to the Australian wine industry, especially given the increasing importance and popularity of these new and niche varieties in Australia’s domestic and overseas markets.

Australia and EC officials have discussed the Australian concerns and agreed that derogation from the regulation allowing certain EU wines with a geographical indication, or ‘GI’, to have alcohol content as low as 4.5 per cent continue to be extended to Australian wines with a GI. This means Australian producers of low-alcohol wine will continue to be able to market their product as ‘wine’ in the EC market, providing that the wine has an alcohol volume of at least 4.5 per cent. The least trade restrictive provisions in the regulation and agreement will apply to Australian wine, particularly with regard to wines without a GI claiming vintage and variety. This means Australian producers who choose to label their wine without a GI will be able to present the vintage year and variety name on the wine label when selling the product in the EC market. The agreement provides that the two per cent limit on partial de-alcoholisation of wine does not apply to Australian wine. This means Australian producers who choose to remove more than two per cent of a wine’s alcohol content will be able to sell the wine in the EC market, providing they do not reduce the total alcohol content to less than 4.5 per cent.

Finally, it was agreed that the EC amend the regulation which restricted the use of the name of a number of grape varieties in the EC currently used by Australia—including common Italian vine variety names such as sangiovese, on the basis that they contain or evoke GIs—to confirm access in the EC to the relevant grape varieties for Australian winemakers. This means that Australian producers of wines who use these common Italian variety names will be able to sell these wines in the EC market. Agreement to the outcomes was finalised on 23 March 2010. The wine industry has indicated that their concerns have been addressed and industry supports the passage of this legislation and ratification of the agreement.

John Cobb (Calare, National Party, Shadow Minister for Agriculture, Food Security, Fisheries and Forestry) Share this | Link to this | Hansard source

I rise to speak on the Australian Wine and Brandy Corporation Amendment Bill 2009 not only as the shadow minister for agriculture, fisheries, forestry and food security but also as the member for Calare, an electorate which, if I say so myself, produces some excellent wines. I recommend to the Deputy Speaker that any time she is in the area she should try them. This is a bill which rectifies changes made through the Australia-European Community Agreement on Trade in Wine. It will ensure that Australian wines from the Hunter, the Barossa, the Yarra, Margaret River and my region sit on tables side by side with some of Europe’s most distinguished and long-serving wine regions.

The bill also means that the regions of France, Portugal, Spain and Germany, in particular, will continue to provide direct competition with Australia’s vineyards and our hugely important export market. With this competition comes increased pressure on Australian winemakers and Australian wineries to be able not only to match the style and quality of wine from Europe but to differentiate and create their own unique style that sets our Australian wine apart. Creating such a style and reputation has been testing in recent years. As has been mentioned both here and in the House, regional Australia is hopefully coming towards the end of the worst drought on record. The wine industry has had to deal with drought, which perhaps has been good for quality but terrible for quantity. At the same time, there has been a world glut of wine and winemakers have had to deal with that to a large extent right around Australia. It is essential that, with the signing of this agreement, we as a parliament provide the assistance needed to encourage the highest standards amongst Australian wine producers and in Australian wine.

Our wine has a reputation world wide. The Christmas before last, on holiday in New York, I found Australian wine very well accepted everywhere you went, whether it was in the deep south of America or in New York itself. Wherever it is, we must all work hand in hand to protect our brand, protect our reputation and expand on the foot in the door that Australian producers currently have. The export area is where it has got toughest. The domestic market is always the best market, but obviously far and away the bulk of Australian wine is exported. It has got very tough, particularly with competition from South America.

I mentioned earlier the need for our wines to develop their own reputation. There is no more perfect example of a geographical area having dominance over a market than the Champagne region of France. It is synonymous with what we in Australia now call sparkling wine—we have it in the title. Everyone knows Champagne for its bubbly, and the French economy and the French producers reap the benefits. I do not doubt for a second that our own sparkling is just as good as the French champagne, if not better. They do have one obvious advantage, and that is the dominant reputation that we need to encourage our own producers to develop in the future. This bill provides protection for the 112 registered Australian geographical indications. It is an opportunity for us to build our own geographical indicators and build on the value and respect of their brand.

The second part of the bill concerns the Australian Wine and Brandy Corporation’s Label Integrity Program. The program is a key step forward in protecting the reputation of our own product. I am sure all would agree the information provided on a label has to sell the product to those browsing the aisles, but it also has to be honest and accurate.

Basically, this bill is about protecting a huge export market. It is all very much about the EU product and our own. Some two years ago we exported almost 400 million litres, for a return to Australia of $1.3 billion. On the other hand, we imported from the EU only 18 million litres, at a value of about $220 million. So it is quite obvious that change had to happen. We had to recognise the Europeans’ own name brands and we have to ensure that the reputation of our wine is encased around its own geographical indicators. The industry is very much behind this amendment to the act. As I said, it is about protecting and enhancing the $1 billion value of 400 million litres of wine two years ago. The main benefits include the Europeans recognising an additional 16 Australian winemaking techniques, simpler arrangements for approving winemaking techniques that may be developed in the future and simplified labelling requirements. The EU protects two and a half thousand registered indicators and 12 sensitive European geographical indicators. Those two and a half thousand European GIs include all those that have come into being in the last 16 years. We support the bill and the industry supports the bill; so it will be in everybody’s interest for it to be passed.

Nick Champion (Wakefield, Australian Labor Party) Share this | Link to this | Hansard source

I rise to support the Australian Wine and Brandy Corporation Amendment Bill 2009 also. It is nice to have a bit of bipartisanship in the chamber. I spent my youth in Kapunda, which is a small town on the edge of the Barossa Valley. I still have school friends who work in the wineries as winemakers and in the packaging industry, so I am well aware of the importance it has to regional economies and to employment. Over the last decade or so we have seen the industry transform itself into an absolute champion exporter of Australian produce. We have to appreciate the effort and skill that goes into the production of some of those prestigious wines. With that experience in the back of my mind, I am happy to commend this bill to the House and to support it.

Any of the wine consumers present or listening to this speech will acknowledge that the Clare Valley, the Barossa Valley and the Adelaide Plains, all within my Wakefield electorate, are regions with well-deserved reputations for producing some of Australia’s finest wines. The Clare Valley is home to 50 wineries, produces only two per cent of Australia’s grape crush and yet wins 20 per cent of the wine awards available to Australian wineries every year. The Barossa Valley, which is home to 150 wineries, is listed as one of the world’s top 10 wine destinations. It is a wonderful place to go, not just for wines but for great food, scenery, fellowship and company. It is one of those terrific places to live or to visit. The Adelaide Plains are not quite as famous, but I have been out there many times and visited some of the wineries. A different type of wine is produced there, but there have been terrific achievements nonetheless.

It is the longevity of these achievements and many others that the bill before the House seeks to maintain. One of the objectives of the bill is to preserve the reputations of geographical indicators, such as those I mentioned as well as many others throughout Australia, from becoming targets of misuse, either domestically or from foreign export markets. The bill achieves this by allowing the Australian-European Community Agreement on Trade in Wine to come into full effect. Furthermore, the EC agreement certifies Australia’s reputation as a producer of wines of quality and integrity and expands access to our largest export market. The second objective of the bill is to strengthen the Australian Wine and Brandy Corporation’s Label Integrity Program, the LIP. This program seeks to protect all stakeholders within the Australian wine industry by ensuring that the Australian wine labels are truthful and accurate with regard to their origin and their characteristics.

The bill introduces accountability within the Australian wine industry, which is fundamental to ensuring the longevity of its world-class reputation. Accountability will ultimately also help us move up the value chain, which is one of the most important things for us to do.

This bill is receiving widespread support from the Australian wine industry, and it has the support of stakeholders and the opposition. As I said, it is wonderful to speak on a bill which has bipartisan support. It is something of a rarity these days, and we hope that there is no change of mind between now and its passage to the other place. Bipartisanship is important to the Australian wine industry at this time.

This bill also allows Australian winemakers to enjoy better access to European markets, and that access is a terribly important thing. The bill includes European recognition of an additional 16 Australian winemaking techniques, simplifies labelling requirements for Australian wine sold in European markets and provides protection within Europe for Australia’s 112 registered geographical indicators, including—most importantly to me—the Barossa Valley, the Adelaide Plains and the Clare Valley.

Patrick Secker (Barker, Liberal Party) Share this | Link to this | Hansard source

You’re not claiming the Barossa Valley, are you?

Nick Champion (Wakefield, Australian Labor Party) Share this | Link to this | Hansard source

I am indeed claiming the Barossa Valley—the best bits of it, anyway! I acknowledge the member for Barker’s strong support. He perhaps has proprietary over the Barossa Valley, but I will claim it for myself in this instance.

This bill clearly demonstrates the Labor government’s concern for and cooperation with this important rural industry. It also highlights the government’s ability to effectively utilise policymaking in a manner that not only supports and encourages economic growth through favourable terms of trade but at the same time protects the interests of Australian businesses—in particular, in this case, Australian small businesses. Through the process of listening to industry stakeholders, taking into account their concerns and having the European Community’s concerns registered through bilateral negotiations, the government has successfully preserved Australian wine and winemaking techniques within the agreement with our largest export partner.

This achievement has been suitably recognised by the Australian Wine and Brandy Corporation, the Winemakers Federation and a legislation review committee, all of whom have formally expressed to the minister their support for the bill. The minister is to be commended for his work not just in this area but in a lot of other areas. He has a very good reputation for being a hard worker and someone who is prepared to listen to the primary industries of this country.

I remind the House that Australia is the fourth-largest wine exporter in the world, and we want that to continue. By giving effect to this agreement—the Australia-European Community Agreement on Trade in Wine—this bill clearly seeks to promote and protect in the best sense of the word Australia’s hugely successful wine industry. We boast some of the oldest grapevines in the world. In the Barossa Valley, there are the shiraz vines that were brought all the way from Europe and are the only survivors of a disease that wiped out many of the established European vineyards. Our viticulturalists have developed new vine-management techniques which are now in application throughout the world. All these achievements—and the many others—of the wine industry underpin the necessity of this bill.

In closing I say that this is not the easiest time for the Australian wine industry. There are really difficult economic conditions in many of our export markets. The United Kingdom and the United States have suffered very severe downturns, and this has obviously impacted on our export growth. Slow economic growth across European markets coupled with the appreciation of the Australian dollar provide challenges to any exporter, particularly the wine industry. On top of that, the wine industry has an oversupply of grapes and emerging competition from countries like Chile, Argentina and South Africa.

This bill helps to meet those challenges in part. We know that there is some pretty difficult restructuring to go on and we know that we must move up the value chain if we are to be successful in the future. This bill is particularly important and perhaps marks a bit of a start on that journey. I am glad it protects some of Australia’s most distinguished wine regions, particularly those in my electorate—or adjacent to my electorate, as no doubt the member for Barker will correct me. It is with a great sense of pride in these industries that I commend this bill to the House.

Patrick Secker (Barker, Liberal Party) Share this | Link to this | Hansard source

The grape industry is an area of great interest to me and has been of great interest to me all my life. I can remember picking our own grapes. We had 220 acres of grapes at Happy Valley, where I grew up. I remember picking them for thruppence a bucket, when the buckets were four to the hundredweight and of course 20 hundredweight to the tonne. An average picker could pick 80 buckets in a day and the top guns could pick 100 buckets a day. That is how far back my own history with the grape industry goes.

One of the great pleasures of being the member for Barker has been representing Australia’s grape-growing industry—at one stage, about 43 per cent of it. It is a very important part of my electorate. And, yes, there is a small part of the Barossa in the member for Wakefield’s seat. It is that little bit outside the Barossa council region, just over the Para River, and they do grow some good grapes there. But the majority of the Barossa is in my electorate.

I also represent the Riverland, which is a huge producer in itself. At one stage, 25 per cent of Australia’s grapes came from the Riverland area in South Australia. That has changed a bit. I do not have the latest figures but, with the drought and the lack of irrigation due to the reduced allocations, I am sure that percentage has reduced a bit. There is no doubt that the Riverland in South Australia still represents, by itself, a very large part of Australia’s grape production.

I also have the pleasure of representing other great grape-growing and winemaking areas. The Coonawarra is one of my favourites. Of course, in this job, you cannot pick a favourite because other regions will say, ‘Well, what about us?’ The Coonawarra are very well recognised worldwide for their cabernets and their shiraz, and their chardonnays are coming into high esteem all around the world. I have other great areas in my electorate such as Padthaway, the Mount Benson area down by Robe, and an up-and-coming area called the Wrattonbully. Wrattonbully is producing some sensational wines. Anyone who is interested in wine should be looking favourably on anything—in the reds especially but also in the whites—coming out of the Wrattonbully area. The area is about halfway between Padthaway and the Coonawarra, so you can get a feel of its climatic conditions. It has some very good soils. I am known by some of my colleagues as the ‘member for wine’ because of these great wine areas, and I am often asked my opinion on certain wines. Can I say I am quite happy to give it at any time! It is certainly one of the great pleasures of life to represent the seat.

We should also recognize our forebears, who went to the trouble of planting vines. A lot of that in the Barossa, for example, is due to the area’s German and Lutheran heritage. I think 90 per cent of Lutherans in Australia are in South Australia, and about 90 per cent of them are in my seat of Barker, which means I am not only the member for wine but also the member for Lutherans, in many ways. That is not a coincidence because the two go hand in hand. For probably 160 years they have been very important to our history in the grape industry in South Australia, and they have been a very strong part of making Australia the success it is in producing wine.

The Australian Wine and Brandy Corporation Amendment Bill 2009 amends the Australian Wine and Brandy Corporation Act 1980. On our side we have quite a bit of goodwill towards this legislation. It does the right things and I suspect we would have done exactly the same if we were in government. It has wholehearted support across the chamber. As I said, it is of great interest to me and my electorate. Certainly all of the wonderful regions are world-renowned: the Barossa, Coonawarra, Padthaway and all the other areas are recognised worldwide. Unfortunately, as the member for Wakefield said, the wine industry is currently experiencing tough conditions, with the drought causing ongoing issues with low water allocations, and that means lower production levels.

Growers are facing much uncertainty about their future. That is a shame because it is a great industry. There are a lot of hard workers in it and they provide a lot of our wealth. They have increased exports enormously. Twenty years ago we were exporting about one per cent of our production; we are now exporting something like 63 per cent of our production. Unfortunately, the level of the Australian dollar has made that a bit tougher and, of course, we have competition from other good winemaking countries such as South Africa, which has a very low rand so it is quite competitive. I recognise that countries like Chile and Brazil make some pretty reasonable wines and they are always going to be competitive on price and quality, although I will always say that our wines are better and are certainly value for money.

Dennis Jensen (Tangney, Liberal Party) Share this | Link to this | Hansard source

Dr Jensen interjecting

Patrick Secker (Barker, Liberal Party) Share this | Link to this | Hansard source

There is nothing wrong with the Margaret River wines. I just think they are overpriced compared to some of the others—certainly the wines that come from my electorate. Many jobs and livelihoods are being compromised. Growers are having to sell up and move on or are struggling to hang on by the skin of their teeth, knowing that each season may have to be their last. That is a real shame. Oversupply is a huge problem, but I can tell you from my personal history that the wine industry, the grape industry, had a downturn in every decade bar the 1990s. What has always happened is that grape prices go up, people start planting and it takes four or five years before you get some decent production out of a block, and by that time all the extra vines have oversupplied the industry. But in the 1990s the wine industry went for export. That has been very successful for close to 20 years. We now have the downturn that was missed in the nineties because of the push for exports.

There is no doubt that we have too many vines on the land. It is not for the government to say who pulls vines out. In fact, I do not support a vine-pull system funded by the government. We had that in the eighties when we had a downturn. We stopped it because we were pulling out some of the great old shiraz vines on the basis of it. We were getting some money for it, so we did it. We got some pain out of that decision.

But we do have a problem: MIS—managed investment schemes—legislation is still allowing for the planting of vines. There are quite large plantings still happening in the Barossa, for example. It is not for me, you or anyone else to say that they are wrong in doing that, because they might be right. When those vines start producing in four years time there might be a change in that oversupply, but I am not sure that it is a wise decision. I certainly would not be investing in the planting of grapes right now. By and large, as I said, the wine industry has survived with the high levels of wine being exported. It prides itself on the excellent quality of wine. We have maintained high levels of trade and that is paramount in keeping the industry alive in Australia.

I think it is very interesting, when you look at how we have progressed in Australia. It certainly could not have been achieved without mechanical harvesting, because we just would not have had the pickers out there to pick the huge increase in the planting of grapes. We have certainly perfected the science of winemaking. In fact, people from even countries like France are coming to Australia now to try and get some of the expertise from Australia.

The purpose of the Australian Wine and Brandy Corporation Amendment Bill 2009 has three parts. The first is to allow the Australia-European Community Agreement on Trade in Wine 2008 to come into play; it is very important that we do so. The second is to strengthen the AWBC’s Label Integrity Program. I think consumer information is always important, so we should do that. We have to ensure truth in labelling and enhance consumer confidence in label claims. The third is to correct a number of weaknesses in the compliance provisions of the Australian Wine and Brandy Corporation Act 1980. There is no blame going on here. Things move on, and we have to make these amendments to improve the act.

The first purpose of the bill is to bring into force the Australia-European Community Agreement on Trade in Wine 2008, and it is about ensuring winemakers have continued access to Australia’s largest export market, Europe. I do not know how long it will stay as the largest export market; it is certainly way ahead of the others. But I think we have huge potential in Asia—in Japan—as well as in the United States and Canada to actually improve our exports in that area. Presently I am working with our officials in Guangzhou, the old Canton province in China, to help promote Australian wines at their expo. I think it is in October this year. It is important that I get as many of the wine producers in my electorate to the expo to jump on the growing demand for quality wine in China, because China’s state brand, to put it bluntly, is not great wine—it never has been and never professes to be great wine. It brings to mind raspberry cordial as an equivalent in quality.

The give you an idea of the proportions of the European market, during the 2007-08 period Australia exported 397 million litres of wine to the European community, and that was worth $1.3 billion. That is a pretty large amount for any industry. The European community accounted for just over half of our wine exports during that time. It is important that we keep this level up and even, if we possibly can, increase our percentage there whilst at the same time trying to increase our share of other markets around the world. If we go by quality and price, I think we can compete very well. During that period, Australia imported 18 million litres from Europe. That is 18 million litres versus 397 million exported, so we actually have a very positive balance of trade there, but it was valued at $212 million. So obviously, if you look at those figures, we have been importing quite expensive wine, probably on a connoisseur level compared to some of the wine that we sell. I think that is one of the problems for Australian wine: we need to see if we can get the price point at which we are exporting higher.

This agreement on trade has many benefits to Australian producers, one of which is the European recognition of an additional 16 Australian winemaking techniques. I raise one of these techniques in particular, and that is the use of oak chips in the fermentation process, which can deliver in a matter of weeks an intensity of oak character that would take one to two years to achieve in oak barrels. If anyone understands anything about wine they will know what I am talking about when I talk about the oak characteristic. A former colleague of mine, a former member for Wentworth, explained to me that when he was in the United States he was getting a lot of information that Europe was actually trying to stop Australia using that technique as a form of non-tariff trade barrier. I am very pleased that we have been able to get over that sort of proposed non-tariff barrier, that we have outstared them and that we will still be able to use that technique.

If anyone looks at the wine industry, they will see that more and more of our wine is produced not for the connoisseur but for someone who is going to buy it and consume it within 48 hours. It is often said that 90 per cent of wine in Australia is consumed within 48 hours of purchase. This is a matter of convenience, and a lot of people do not have the facilities to store wine properly and are not interested in storing a whole lot of wine for the future. I have been buying wine for many years, and I do store wine quite often for 10 years or more. It is an important part of the mystique of the wine industry, and it is something we have to continue to encourage.

Other techniques which I know will be recognised include spinning cone technology and reverse osmosis. Both techniques are used in the de-alcoholising process, to lower the alcohol content of wine. I was recently in the Riverland and spent some time at a property where they are using world class technology to irrigate their vines and measure soil quality. That is an important part of producing good wine—you have to make sure you get the quantity and the quality right. If you overproduce it is going to be hard to produce the quality, but having the right soil and the right climate plays a large part in producing high quality wine.

Unfortunately, those same growers who are using this world class technology are really struggling. Although the technology has improved their practices immensely, the drought is taking its toll on production levels and unfortunately their future is at stake. We need to ensure that we continue to encourage these people to take up the best possible techniques. We need to be protecting growers and providing programs that help them to continue exporting and keep productivity at sufficient levels to meet new demand. Certainly we can do that through our export grants and other measures.

The government’s Henry tax review proposed a disastrous switch to a volumetric tax system. We know that Ken Henry has always wanted a volumetric tax, and on the face of it you would say that was the fairest thing. But it would be an absolute disaster for the wine industry if we changed to a volumetric tax system. It would have pushed many growers to their limit, and many of them would have been pushed out of the industry altogether. They simply would not have survived under that sort of change. Thankfully the government shelved the recommendation, and I was certainly ready to make a whole lot of speeches had they accepted it. We do need to protect the value of the produce we are exporting, maintaining a high standard that reflects Australian wine of the utmost quality.

The second and third parts of the Australian Wine and Brandy Corporation Amendment Bill 2009 strengthen the AWBC’s label integrity program and correct some of the weaknesses in the compliance process. It was introduced to ensure an industry wide system of record keeping to substantiate label claims in respect of vintage, variety and region of origin—very important things when it comes to producing wine. The AWBC 2007-08 annual report states that the corporation’s auditors monitor the industry for compliance with the label integrity program provisions of the AWBC Act and checks that the origin of the wine can be traced from the grapevine through the dispatch of an export consignment or to a domestic retailer’s shelf. A total of 133 LIP audits were conducted throughout Australia in 2007-08, with 76 wineries visited in South Australia, 19 in Victoria, 19 in New South Wales and seven in Tasmania. That is only a reflection of the fact that South Australia produces over half of Australia’s wine.

The annual report also states that wine compliance continues to be very high, and that is very pleasing to hear. Nevertheless, the export licences of two wine producers were suspended during the year due to non-compliance with LIP provisions. So we are acting to continue to uphold this high compliance. This bill seeks to require all those involved in the production, distribution and sale of wine and grapes used to make wine to record the specified information to ensure a traceable trail throughout the wine production process. I certainly support measures that streamline and improve production, and encourage the wine industry to keep doing what it does best: making wine that can be enjoyed the whole world over, and especially in Australia.

Brett Raguse (Forde, Australian Labor Party) Share this | Link to this | Hansard source

I rise tonight to speak in support of the Australian Wine and Brandy Corporation Amendment Bill 2009. This is a bill of significant interest certainly to my electorate of Forde, which contains nearly a dozen Gold Coast hinterland wineries that produce a variety of table wines, including fortifieds and spirits. I commend the previous speaker, the member for Barker, for his presentation. He is a South Australian, and we always hear South Australians are well versed on the wine industry, and certainly it is a big part of their culture. With many experts, when they talk about wine, there is always a lot of levity. Even in this chamber tonight there has been levity when talking about wine, because it certainly does represent for Australians part of our recreation and our entertainment. But certainly the quality of the wine this country produces is very important.

As I said, I commend the member for Barker, and also the member for Tangney, who is also here, for talking about South Australian wines versus Western Australian wines. But the member for Bowman, who sits across the chamber, and I, being from Queensland, are rightfully proud of what the Queensland industry has been able to achieve, certainly in the past 20 to 30 years. I often watch wine shows when they are on TV, but I often wonder about the South Australians and the Western Australians. They drink their wine and then they spit it out. We do not do that in Queensland, we drink the whole lot. A little bit of humour, but the reality is that the wine industry and its growth has been very important for all of us. There is a famous actor who once said that a day without wine is like a day without sunshine. The reality is that it is a supplement or a complement to our gastronomical delights and our eating.

The Australian Wine and Brandy Corporation, or the AWBC, dates back to 1981 when it replaced the Australian Wine Board, itself a label introduced back in 1936. The AWBC continues to play an important role today in Australian wine industry promotion, coordination and research. In his second reading speech, the Minister for Agriculture, Fisheries and Forestry outlined the three objectives: allowing the recent Australia European Community, or EC, agreement on trade to come into force; improve the label integrity program; and update compliance provisions from the act. I will review each of these objectives separately.

The first wine agreement between Australia and the European Community came into life under the Keating government in 1994. Since this time it has become apparent that revisions were needed to resolve issues faced by both sides of the agreement. Signed on 1 December 2008 in Brussels by our Minister for Foreign Affairs, Stephen Smith, and the European commissioner for agriculture, Mariann Fischer Boel, the new agreement has been carefully negotiated over an incredible 14 years. The Department of Agriculture, Fisheries and Forestry notes the following benefits of the new agreement for Australia:

• European recognition of an additional 16 Australian winemaking techniques…
• Simpler arrangements for the approval of winemaking techniques that may be developed in the future
• Simplified labelling requirements …
• Protection within Europe for Australia’s 112 registered geographical indicators—

or GIs, and that wholesalers will have five years to sell stock labelled with an EC GI, and retailers will be able to sell all of their stock. There will also be a defined use of a number of quality terms in the presentation and description of wine.

The Winemakers Federation of Australia has also supported the new agreement, particularly noting the recognition of winemaking techniques and the simplified procedures for approving new winemaking techniques. The first schedule of this bill contains provisions to bring this agreement into force. Among many significant changes, the bill protects the unique identity of Australian geographical indications, or GIs, which indicate particular winemaking locations; provides rules for translation of foreign country GIs and traditional expressions; resolves a series of issues relating to false, misleading and deceptive GI practices; modifies the Trade Marks Act 1995 to ensure consistency with the AWBC Act; clarifies situations where common English words may be used to describe GIs; and places responsibility for determining GIs with a new, independent geographical indications committee, or GIC.

This agreement will bring about even closer ties with countries that are already among our biggest export markets. By value, during the 2008-09 financial year, 43.2 per cent of Australia’s wine exports went to Europe. That represented up to 14 countries in the European community who are very much in love with Australian wines. Australian wine has a good reputation for clear, consistent labelling. Schedule 2 of this bill has the objective of further strengthening our processes in this area so that people can be certain that our wine labels are truthful and accurate. At the moment the Label Integrity Program applies to wine manufacturers but not to other parties in the wine supply chain. Record-keeping requirements are to be extended beyond wine manufacturers to those involved in the distribution and sale of wine and grapes. In most cases, existing documentation will suffice in complying with these legislative changes. Retailers and other endpoint sellers only have to keep records of total quantity and vintage, not individual sales. Once in place, the AWBC will make it possible to verify wine label claims via the records kept by all participants in the wine supply chain. The trail will be auditable from the point where the grapes are harvested to the point of the sale of the wine. Furthermore, a new offence is proposed for a person to make a claim about a vintage variety of GI of a wine product when this claim is not supported by their records.

The third and final section of the bill strengthens the powers of the AWBC to deal with people taking actions that may be contrary to the AWBC Act. As noted by the Minister for Agricultural, Fisheries and Forestry in his second reading speech, the bill proposes that the AWBC be able to apply for an injunction to stop or direct a person who is acting in a way that is contrary to the Label Integrity Program, the provisions relating to the protection of geographical indications and other terms, the export control offence provision or the regulations made for the purposes of these provisions. The bill also modernises the applications of penalties by referring to penalty units rather than fixed dollar amounts. These changes will ensure that not only do we have a modern internationally recognised system in place but also that we can enforce it when needed.

The Queensland government has had an encouraging and increasing interest in winemaking and recognises the importance of the growing of the wine grape within Queensland. In 2004 Margaret Keech, one of my local state members, was appointed Minister for Tourism, Fair Trading and Wine Industry Development and Minister for Women. As minister, Margaret Keech oversaw the formation of the Queensland Wine Industry Development Strategy and many other actions to support that industry. Within my electorate, I am fortunate to have areas of the Gold Coast hinterland, which is a relatively recent but now established wine region within southern Queensland. This region is the glorious Tamborine Mountain. Over the last 20 years Tamborine Mountain has become an increasingly popular tourist attraction, with the wineries being one of the main attractions. It is no surprise, seeing the rapid local expansion, to see that the 2025 Australian target of 4.5 billion in annual wine sector sales was actually surpassed in 2005. This target was set in 1996 and was achieved in under one-third the expected time frame.

The wine industry’s connection with our entertainment and leisure industries within Australia not only makes it very much a local product but also an export market that we so enjoy. I see the South Australian member over there, the member for Mayo—who is certainly well aware of the wine industry in his own region and would certainly understand the development of wine in Queensland—talking about, with some hilarity, how we grow wine and consume wine in Queensland. This is an industry that grew in a region that had no history—when you look at South Australia and its long, long history, we have done exceptionally well. Many years ago, when travelling to places within South-East Queensland, in Stanthorpe, and just as there is hilarity across the chamber right now, if you talked about a Stanthorpe wine people would laugh. People would say Queensland wines do not really stack up to much. The reality is, if you go back 30 years in that region, they decided that it was an area that grew grapes, but of the table grape variety. They really did not have the knowledge or ability to grow grapes or to make wine. About 25 years ago, a local winemaker in Stanthorpe, who had come from the Hunter region, decided to set up Old Caves Winery. That was very much the starting point for the industry, in a mainstream way, to convince the local growers to grow not only table grape but also grape for wine production. And the rest is history.

In fact, if you look at the region now, in South-East Queensland, including in my electorate, there are a dozen wineries that have developed over the last 20 years. We have the Aussie Vineyards, the Tatra Winery with its cafe-restaurant and the Cedar Creek Estate Vineyard and Winery—owned by a fellow called John Penglis, who is not only a good friend but also a great vintner and businessman, and someone who has been able to establish a core to the industry in South-East Queensland. While we do enjoy a lot of cellar-door product, the wine making is still developing within our region. We also have the Mount Tamborine Winery and Homestead, Heritage Wines, Tamborine Mountain Distillery—which is essentially putting together fortified wines—and the Witches Falls Winery. We have some wonderful brands that have been developed and that have won many awards. There are the Albert River Wines, the Thumm Estate and Sarabah Estate Vineyard and Winery. All these are new businesses to the region and are responsible for some of the agricultural growth within our region.

One of those wineries is owned by the O’Reilly family, who many people know about from the history of the Stinson crash and from their involvement in a very traditional area of our region. The member for Dobell beside me knows well that I have talked on many occasions about Duck Creek Road, and Duck Creek Road leads its way up to the O’Reillys and the O’Reilly homestead. The O’Reillys also established a winery some years ago and, back in about 2005, they won a San Francisco International Wine Competition award for one of the best shirazes. That is out of an area that over the last 30 years has developed into something now unique for our region.

We do it reasonably tough in Queensland in terms of the growing traditions, but we have been able to work through that and grow the varieties of grapes that really do bring excellence to our region. I am sure that any South Australian members or the member for Kingston, who is also here tonight, who represents well her winegrowing district, would be proud of what we have been able to establish as a Queensland industry.

I spoke about Duck Creek Road in connection with the O’Reillys, and I have spoken about it on many occasions in this house. The reality is that these are families who have banded together as an industry to produce some very good wines. I say to South Australian members that, while their industry is well recognised and accepted and their branding and labelling are very well known overseas, Queensland wines are making their way to the tables of many people in different parts of the world. It is probably better at times that we compete in the production of wine than in AFL or the national league. The reality is that we now have another area of competitiveness, and Queensland’s wine industry is growing at a phenomenal rate. The development of our wine industry along with this amendment legislation will allow the geographical regions that are represented within my electorate to make their mark.

In conclusion, the Australian Wine and Brandy Corporation Amendment Bill 2009 will further advance our wine industry exports and our opportunities in Europe. Our wine labels will be clearer, internationally consistent and enforceable. This is a bill that supports one of the great Australian success stories of the last two decades, including that of South-East Queensland. I commend the bill to the House.

Jamie Briggs (Mayo, Liberal Party) Share this | Link to this | Hansard source

The old saying that you learn something new every day is certainly true in this place. I learnt today that Queensland produces wine. I did not know that Queensland produced wine. I knew that they stole our water to do lots of things but I did not know wine was one of the things that they did with it.

Damian Hale (Solomon, Australian Labor Party) Share this | Link to this | Hansard source

Mr Hale interjecting

Jamie Briggs (Mayo, Liberal Party) Share this | Link to this | Hansard source

Member for Solomon, I do not think they produce wine in Darwin but they certainly drink a lot of it; there is no doubt about that. They drink some very high quality Adelaide Hills wine in Darwin—the sav blanc suits those sorts of climatic conditions perfectly. I imagine the member for Solomon would enjoy that before his pints of beer.

I rise to speak this evening in support of the Australian Wine and Brandy Corporation Amendment Bill 2009 and its passage through this place. Of course, the member for Kingston will agree that the wine industry is extremely important to South Australia. It is not without its challenges at this time, whether it be in the Adelaide Hills, in Langhorne Creek, in Fleurieu or indeed in McLaren Vale. It is a hugely important industry to our economy and to Australia’s economy as well and is driven very much from South Australia through the Barossa Valley and the other regions—including Coonawarra, of course, in the seat of the member for Barker. It employs many South Australians. It has many small family businesses. Many larger businesses are involved in the industry as well.

In my electorate there are about 450 of South Australia’s wine-producing establishments, with a rough value to our economy of about $300 million per annum. We have about 16 per cent of South Australia’s wine industry, which in 2007-08 was worth about $1.8 billion to the South Australian economy. In anyone’s language, that is a very important industry to our state, so if there is good legislation before the parliament we will support it to ensure that the industry is stronger than it was before.

We support this bill as it provides for a much-needed amendment to the current legislation. It will bring the Australia-European Community Agreement on Trade in Wine into force. This agreement was signed in Brussels on 1 December 2008 by the Minister for Foreign Affairs. The amendments are strongly supported by the industry, including the Winemakers Federation of Australia. I have spoken to Stephen Strachan about this issue; in fact, he appeared before the Joint Standing Committee on Treaties when this issue was before that committee and gave it his strong endorsement. He is a very strong representative of the wine industry in Australia and in particular in South Australia. He has a very large soft spot for the wine industry in South Australia and is a great supporter.

The agreement ensures that winemakers have ongoing access to Australia’s largest export market. During 2007-08 Australia exported to European countries 397 million litres of wine worth $1.3 billion, accounting for just over half of Australia’s wine exports that year. The amendments will give Australian wine producers European recognition of an additional 16 Australian winemaking techniques and simpler arrangements for approving such techniques that may develop in the future.

The bill provides simplified label requirements and protection for Australia’s 112 registered geographic indicators. Secondly, it further strengthens the Australian Wine and Brandy Corporation Act by protecting Australia’s reputation as a quality wine producer through the Label Integrity Program. The program was originally established to increase consumer confidence in labelling. Finally, the bill provides for tough offence provisions and proposed penalties, which include imprisonment, for breaches. These will enhance and improve industry compliance. In that respect, we support the bill.

I will use this occasion to make some remarks about the challenges that the industry faces in my electorate and more broadly in South Australia. They are significant challenges. The first, of course, is the ongoing challenge with water and access to water in South Australia, which is all tied to how much we get across the border—how much is allowed to flow down through Queensland and New South Wales and how much is taken out in Victoria. We have an ongoing and major interest in the activities of those states, and we are of course continually disappointed by the failure of this government to have a truly national system which can regulate the use of and access to water by those eastern states, which do tend to take more than their fair share, in our view. That has flow-on effects for industries like mine in Langhorne Creek, which is right next to the Lower Lakes, in South Australia, and we are therefore continually interested. That is why I was very pleased that the Leader of the Opposition announced some time ago that when we are elected to government, if we cannot get the state premiers to agree to hand over their powers in relation to the management of Australia’s water, we will hold a referendum to ensure that that will be the case. That is a major ongoing challenge.

The more immediate challenge for the wine industry is the glut, which is going to affect many producers throughout the state. The Riverland is facing the double whammy of the glut and the restrictions on irrigation. This is also affecting other regions, but probably not so much. There were reports over the weekend that the Barossa and other regions, including Langhorne Creek and McLaren Vale, are looking at pulling out up to 20 per cent of their vines. That will have a real effect on many of the workers, on the industry and on small businesses. While consumers will benefit over the next few years from lower prices for very high-quality South Australian wine, we will have to go through a very difficult period where many people will face some very challenging economic circumstances. It is important that governments both state and federal are aware of this and ready to assist those people if necessary. I know that Steven Strachan and the Winemakers Federation are working very hard with government to ensure that the industry is managed properly so that we do not have communities destroyed by the situation relating to the glut. It is something we need to continue to watch and face up to. I went to the Langhorne Creek winemakers’ lunch on 30 April this year. It is always a very enjoyable day. Winemakers expressed concern about the industry and the impact of the glut. Added to that are the water challenges that South Australia faces. The winemakers are very conscious of the impact that that is having on an extremely important industry in South Australia. I commend the bill to the House.

Amanda Rishworth (Kingston, Australian Labor Party) Share this | Link to this | Hansard source

I rise to speak in favour of the Australian Wine and Brandy Corporation Amendment Bill 2009. This bill is very important to many of my constituents in the seat of Kingston. As I have mentioned many times before, the electorate of Kingston contains the regions of McLaren Vale and Willunga. I have introduced many members of the House to McLaren Vale wine, and McLaren Vale is one of the premium wine-producing regions in this country. The changes to the laws in front of us today with regard to the wine trade are of particular significance and will be welcomed by grape growers, winemakers and wine lovers everywhere.

As the previous speaker mentioned, the wine industry in South Australia is facing some significant challenges, including water, the grape glut and the value of the Australian dollar, which is affecting exports. I commend the growers and winemakers of McLaren Vale because they have really risen to the challenge. While a lot of other winemaking regions around Australia continue to discuss how they might meet the challenges of a lack of water, the winemakers and grape growers of McLaren Vale got active and worked with other companies, the local council, the state government and the federal government to get recycled water to the vineyards. I will not use the term that has often been bandied about in media releases, but it is about turning ‘something’ into shiraz. It is about turning effluent into water for the grapes of McLaren Vale. This is an example of the growers and winemakers of McLaren Vale being at the forefront of looking at what they can do to secure their future.

As I said, things are difficult at the moment, but I have great confidence in the industry. I was very pleased to recently attend the launch of the sustainability program that McLaren Vale is looking at. They are looking at becoming certified as sustainable so that vineyards and winemakers will be able to label their products as ‘certified sustainable’. That is really important and I know they are really working on that. I just wanted to do a bit of a plug for McLaren Vale because it is a wonderful region. I would encourage all members to visit, and I am happy to give you a guided tour at any time. It is a wonderful place.

In all seriousness, I come back to some specific elements of this bill in terms of Australia’s agreement with the European Community on the trade in wine. This is a significant agreement and I must congratulate the minister for securing the negotiations. The minister has done a lot of work, including signing agreements with Hong Kong and China to ensure access to those markets for Australian wine. Agreements like these make a real difference to growers and winemakers in Kingston. I thank the minister also for visiting the McLaren Vale region and speaking with growers and winemakers on many occasions. He has certainly shown a very active interest in my local area.

The Australian Wine and Brandy Corporation Amendment Bill includes a whole raft of measures for the industry. These benefits flow both ways in our wine trade. Some will be felt here at home by consumers of Australian and European wines. Any measures that make it easier for someone in Europe to identify and buy a McLaren Vale shiraz must be a good thing.

The first key change provided for in this bill is the European recognition of an additional 16 Australian winemaking techniques and the institutionalisation of a process for future approval of winemaking techniques as they evolve. For a country with a cutting-edge industry this agreement is particularly important so that our evolving and world-best winemaking practice is both recognised and enjoyed by European consumers.

The agreement includes a provision for simplified labelling of geographical indications. Most consumers of wine will know that geographical indications—the GIs—are very important in the labelling of wine, and guide a whole lot of decisions in the purchase of wines. This bill simplifies the labelling requirements of Australian wine in Europe and accords protection to Australia’s existing 112 registered geographical indications. These amendments will ensure the protection of Australia’s GIs in Europe and see that the translation of GIs from Europe meets Australia’s international obligations under the World Trade Organization Agreement on Trade-Related Aspects of International Property Rights. The amendments provide rules for the protection of European GIs and the translation of European GIs from their source country language. The amendments also provide rules to cover the traditional expressions used by European winemakers in their labelling.

Finally, the bill also introduces provisions for determining GIs. All of these changes are very important when you consider the significance of GIs that have already been given, such as champagne. One practice that will be stamped out by this bill is the misleading and deceptive use of GIs in some of the European wine labelling. I know that many consumers get confused. Confusion is not used often by European winemakers in their labelling practices but it does happen and these amendments resolve issues around the meaning of false, misleading and deceptive practices, traditional expressions and protected terms, including providing exceptions for common English words in the false and misleading provisions relating to the sale, export or import of wine. This should prevent European winemakers using technicalities to label their wine as coming from a region when it does not, and should reduce the confusion for Australian wine consumers.

A technical amendment relating to the European community agreement is the replacement of the previous register for protected names with a new register of protected geographical indications and other terms. This change is important to bring into practice everything I have been discussing and will ensure the protection of GIs, traditional expressions, wine quality terms and additional terms, so that the Australian consumer is not duped by misleading labelling. I have to say that this bill has been welcomed. I know that some people want to get better at wine tasting and start to learn what all the experts are talking about when they use words like ‘peppery’. Certainly, I think that clearer labelling of the types of wine that people are drinking can only enhance the experience for consumers.

Before I conclude, I want to briefly mention the non-agreement related amendments introduced by this bill. The first is the strengthening of the Label Integrity Program for a system that will allow the Australian Wine and Brandy Corporation to trace a batch of wine from the retailer to the vineyard and confirm that the details that appear on the label are consistent at each point of the supply chain. These amendments will be important in maintaining the positive perception of Australian wine both domestically and internationally. An extension of the Label Integrity Program will mean that Australian and European wine consumers can be confident of the accuracy of claims regarding vintage, variety or region of origin.

In addition to these changes, the bill provides for a broader range of injunction powers for the Australian Wine and Brandy Corporation so that it can deal with anyone engaging in conduct that compromises the integrity of the Australian wine industry. We do know that the Australian wine industry has a very good reputation overseas as well as here in Australia. This measure is important to make sure that that reputation is not compromised.

In conclusion, the Australian wine industry includes over 2,200 winemakers supported by 8,000 grape growers in 112 distinct geographical wine regions. These winemakers and grape growers and Australian consumers will welcome this bill. The bill will ensure that the integrity the Australian wine industry enjoys will be maintained both here in Australia and, importantly, in the export market in Europe. It will also ensure that consumers here in Australia can be confident that wine coming from Europe is exactly what the label says it is. I commend the bill to the House.

Robert Oakeshott (Lyne, Independent) Share this | Link to this | Hansard source

I also rise to support the Australian Wine and Brandy Corporation Amendment Bill 2009 and put on the record some thoughts from a boutique winegrowing region. It still surprises me that, apart from connoisseurs, people do not know that there is a very active, emerging, organised winegrowing community on the mid-North Coast of New South Wales. I am probably the only member here not laying claim to representing the premier region amongst the battle of the valleys—you have all done it! But I put on the record that there are some new locations snapping at the heels of many of those valleys throughout Australia and the more recognised premier brands. The mid-North Coast of New South Wales is certainly in that category. We have a desire to grow. I am pleased the growers themselves are now organised. That spirit of working together will enable the region itself to grow and emerge. With beaches, rivers and a wonderful lifestyle to throw in with your bottle of red or white, the mid-North Coast brand is an attractive option for a growing number of people to try.

The bill is important for many of my boutique wines because some are involved in the export market and are incredibly sensitive to two things that public policy can deliver for them. One is export marketing and the work done by various agencies such as Austrade and any other overseas entities of the Australian government that can help gain access to or grow markets such as the European Community. The second is tax. It is an ongoing issue for boutique wineries and, I might add, boutique breweries that how government sets its policy agenda is sometimes targeted towards the bigger players—the big winemaking regions or the big producers—and quite often public policy is driven by those large volumes.

However, I ask for consideration in matters of taxation of small-scale farming and the role that small-scale farming plays in the growth of the Australian economy and in the growth and diversity of branding in things such as wine exporting and agreements with international areas such as the one we have before us tonight. This bill is, I hope, beyond partisan in its support throughout this chamber. The changes it represents are sensible, and hopefully they will continue to grow the Australian wine industry story.

I was first elected to a state parliament in 1996, and the wine industry went through the roof, so I lay claim to everyone’s dancing with joy at my state election and having a nice bottle of red. I also noticed that when I first got into the federal parliament, in 2008, the wine industry bounced back from some tough years. So I am pleased to do my bit to contribute to the growth of the industry, and hopefully we will continue to see that trend rise and the Australian brand continue, not only domestically but internationally, to show itself off as a brand of value and quality and one that we can all be proud of whether we are wine drinkers or not.

Bernie Ripoll (Oxley, Australian Labor Party) Share this | Link to this | Hansard source

It is also a pleasure for me to speak on the Australian Wine and Brandy Corporation Amendment Bill 2009. It has wide support across the parliament and also across the industry and the sector. It has that support because it is a sensible bill that brings into line a number of agreements between Australia and the European Community on our trade in wine, which has been a long time in development. While in 2008 and 2004 there were particular agreements, this bill in 2010 brings into line some gaps in those previous bills. The amendments in this bill are good and provide some clarity on definitions, particularly, as we have heard from other speakers on this bill—and I will not traipse over the same territory—in terms of geographic indicators of where wine originates, countries of origin and so forth.

There are a number of important points to make. Traditional thinking in this country would probably tell people that it was the Europeans rather than Australia who were trying to protect their wine brands, their labels and their geographical indicators. But I am more than happy to say that I think that balance sheet is truly now pointing more in our favour. Australia now wants to protect its geographical indicators, brands and labelling and provide that confidence and security so that when people overseas buy Australian wine it is exactly what it says it is—it is labelled correctly, there is the assurance of quality and there are all of those things that Australia is very famous for.

People may be surprised to realise that 60 per cent of Australia’s production of wine is exported and that Australia’s exports to the European Community represent 397 million litres of wine with a value of about $1.3 billion, which is quite substantial. In comparison, we only import approximately 17 million litres of wine with a value of about $197 million. That is probably not what people traditionally think of as the balance of trade in wine between our countries. I fully accept the principle that places like Champagne in France want to protect that particular name and that particular product and what it represents as much as we in Australia want to protect brands such as Penfolds, Henschke or others—Three Rivers, for example, which is probably not that well known to many people even in Australia but is one of our most famous Australian labels—in different areas.

We have heard a number of people speak about the importance of this bill in amending the Australian Wine and Brandy Corporation Act. It has gone through a proper review process and, as I said, it is well supported. In fact, there are a number of letters to the minister congratulating the minister and supporting this bill. It does the right things for not only our trade with the European community but also Australian wine. It also meets all of our international obligations under the World Trade Organisation—obligations that Australia is doing very well in keeping in order. The bill is also, as I said before, quite important in preventing the misuse of Australian labels.

It is also important to note the significant advantages that this legislation brings to Australian wine producers, not only in the wine itself but also in the technology that we export overseas. It may surprise a number of people, but countries like France and others are regular users of Australian winemaking technology, and have been for a number of years. We bring to the table expertise in manufacturing processes, in consistent quality and in procedures. We have for quite a number of years been exporting our technology, which is reimported to Australia through the product.

We heard before a number of comments from the member for Kingston, who has a very famous winemaking region in her electorate in South Australia, and from the member for Forde, who spoke about Queensland wines. I too am from Queensland, and the quality and level of winemaking that we have in Queensland is probably not well-known even in that state. It is not famous for it today, but I think sometime in the future Queensland wine will be known for its quality. I recently did a wine tour with a group of branch members just up the road, in the electorate of Forde. We went to the Tamborine Mountain winery area. I was actually quite surprised at the level of quality at the cellar doors, not just in the white wines, which tend to be traditionally better than the reds, but also in the reds. What I found there was a thriving industry, creating local tourism, and a real bonus to the area. I have to be honest—I had not expected the quality of wine that I found; it is something that can be promoted right across Australia and even overseas.

We have other wine success stories much closer to my electorate in Ipswich. Warrego Wines and others for a number of years have been working on wine technology, consistency and quality. They are using mixed grapes from a variety of regions and crushing on site grapes that they grow locally. Again, these boutique wines may not be well known across Australia but they are certainly very good quality. Wines that we export overseas are probably more famous internationally than they are in their own home state.

All in all, we have a thriving wine and grape industry in Australia. It is great for us locally in terms of tourism and great for Australian produce. Due to the sheer numbers and volume that we export internationally, the industry needs to be properly administered and protected, and that is what this bill does. As I said earlier, it is supported across the House, it is bipartisan and it was done in consultation with the sector. I commend the bill to the House.

Nola Marino (Forrest, Liberal Party) Share this | Link to this | Hansard source

I rise to speak on the Australian Wine and Brandy Corporation Amendment Bill 2009, which contains three schedules to align the penalties in the Australian Wine and Brandy Corporation Act 1980 regarding offence provisions and the use of penalty units as a replacement for fixed dollar amounts.

The purpose of the first schedule of the amendments contained in this bill is to make the necessary changes to the Australian legislation to bring the Australia-European Community Agreement on Trade in Wine into force. This schedule amends the Australian Wine and Brandy Corporation Act 1980 and the Trade Marks Act 1995 and will ensure winemakers have continued access to Australia’s largest export market. This will come as a benefit to all Australian wine producers, as it will give them European recognition of an additional 16 Australian winemaking techniques. It will also simplify arrangements for approving winemaking techniques that may be developed in the future.

The purpose of the second schedule of amendments to the AWBC Act is to further protect Australia’s reputation for the production of wines of quality and integrity. This is the key to our future in exporting wines. This will be achieved by strengthening the Australian Wine and Brandy Corporation’s Label Integrity Program. This schedule will simplify labelling requirements and create protection within Europe for Australia’s 112 registered geographical indicators. Under this amendment, wholesalers will have five years to sell stock labelled with EC GI and retailers will be able to sell all of their stock.

The third schedule corrects a number of weaknesses with the compliance provisions of the AWBC Act that have been identified. The changes to the compliance provision will strengthen the AWBC’s ability to stop people from engaging in ways that are contrary to the act and enable the AWBC to pass on information to others who could enforce the laws relating to wine and health.

The coalition is supportive of this legislation, but there are a number of factors currently facing the wine industry that I and the coalition also believe need to be acknowledged and addressed by the government. The wine industry in my electorate of Forrest is a very compact but very high-quality unit-value contributor to the national wine industry, with the Margaret River region recognised internationally as a producer of premium and ultra-premium wines.

During 2008 the estimated value of grape production in the south-west region was $67.8 million. The Margaret River wine region accounts for most of the viticulture production in the south-west of WA with 67.1 per cent of the total tonnage coming from the area. The south-west viticulture industry produces both white and red grape varieties with 26,259 tonnes and 24,000-plus tonnes crushed respectively in 2008. But the wine industry stretches right throughout the south-west from Harvey to Ferguson Valley and all the areas in between.

I recently conducted a survey of the wine industry in parts of my electorate that are currently facing some challenges and one of the major findings from the survey was the concerns and negative impact the new wine industry award is having on all of the wineries in my electorate. One winery owner stated:

The penalty rates in the modern award are a financial impost.

Our cellar business is in ‘wine tourism’—public holidays and weekends are the busiest and we will be unable to afford to pay the loadings required. THIS WILL COST JOBS!

Another winery owner stated that the new award is:

… confusing and very unworkable for both employers and employees in the industry.

On the issue of award modernisation processes I would also like to refer the minister to Tassell Park Wines in my electorate, which has been unable to receive clarification as to whether their winery business is covered under the new wine industry award or not. Tassell Park Wines, a family trust which has a corporate company as the trustee, has been in contact with both the Fair Work Ombudsman and the Chamber of Commerce in Western Australia seeking clarification on whether their business is covered under the new wine industry award. On both occasions, which concerned me greatly, they were advised to seek legal advice—that neither of these bodies could give them the definitive advice that they needed—and this would be at their expense. I call on the government to give Tassell Park Wines a simple answer as to whether or not they are covered by the new national award system.

Another issue consistently raised in my survey was the overwhelming supply within the market, also known as the wine glut. An article in the weekend edition of the Financial Review in May stated:

No longer able to sustain plunging prices for their fruit—or unable to sell it at all—an increasing number of grape growers will this winter begin ripping up vineyards as a persistent wine glut, high Australian dollar, a deluge of New Zealand wine imports and increased dominance by the supermarket chains conspire to erode profitability.

The article also quotes Wine Grape Growers Association executive director, Mark McKenzie, stating that he expects a further 3,000 to 5,000 hectares of wine grapes to be pulled out in areas including a part of the south-west in WA and central and western New South Wales. In another article also in the Financial Review, Mr McKenzie said that of Australia’s 165,000 hectares of wine grapes about 40,000 hectares should be pulled out.

A majority of the growers who have responded to my survey believe that the current wine glut is one of the major constraints to profitability. One winery owner summed up his situation by stating:

There will be on-going financial hardship until some kind of balance is restored—the industry is currently unviable.

The wine industry in my electorate of Forrest is suffering as a result of the current state of and pressures on the wine industry. A number of vineyards and wineries have been sold recently or are on the market and some smaller operators have not been able to lock in long-term fruit contracts. The cheap imports from New Zealand have led local growers in my electorate to launch a marketing campaign called Summer with the Locals to promote their wine and the local industry. I understand that 19 WA producers have contributed more than $100,000 towards the campaign. Campaign instigator, Jeff Burch from Howard Park Winery, was quoted in an article in the West Australian:

I got sick of seeing advertisements using the principle of banding whereby a good and respected quality WA wine was being offered with a cheap import …

We are not asking people to buy wine—

from WA—

out of a sense of parochialism but because we produce such a superior product …

As a result of cheap overseas wine imports, some wineries have been forced to reduce the price that they charge for what is a quality product. The Australian Financial Review reported on 30 January this year that Western Australian wines were selling from between $17 to $22 three years ago and are now advertised for $12.99 or lower. As you can see, Mr Deputy Speaker, there are significant issues that need to be researched and acted on to ensure the sustainability of the Australian wine industry.

In my electorate a five-point plan has been developed to assist the sustainability of the wine industry in the south-west region. The plan targets five key areas: strengthening of the domestic markets; expansion of export markets; building on the strategy of the overall Australian wine industry that combines a rigorous business- and return-driven approach, with quality and innovation; gaining a strong high-end position by cooperating with wine industry associations and national bodies; and developing partnerships with all levels of government to ensure that the south-west wine region is supported through liquor licensing trade facilitation and market access planning, environmental and business regulation, and taxation. This five-point plan aims at assisting south-west wine producers through the present and emergent issues currently facing the industry and facing the industry in the future. As we know, the main export markets for WA wines are the UK and the USA. Smaller niche markets established in Asian countries also contribute quite significantly to the local industry—even China.

While I am here, I briefly want to acknowledge the Dardanup Art Spectacular Trail and Exhibition that combined two very interesting factors: wine and art. This was a program in the Ferguson Valley where you could pick up a brochure and follow the art and the wine together, right throughout the Ferguson Valley. There was some wonderful entertainment at a sundowner, including a jazz band. It was a great way of promoting not only the south-west and our quality wines but also the great art and the experience of being in the south-west.

I support this legislation as a positive step for the industry, bringing the Australia-EC Agreement on Trade in Wine into force and protecting Australia’s reputation, particularly that of my electorate of Forrest, in producing wines of quality and integrity.

Damian Hale (Solomon, Australian Labor Party) Share this | Link to this | Hansard source

I stand today to make my contribution to the government’s Australian Wine and Brandy Corporation Amendment Bill 2009 which will amend the Australian Wine and Brandy Corporation Act 1980 to allow the Australia-European Community Agreement on Trade in Wine to come into force. In addition to this it will further protect Australia’s reputation for the production of wines of quality and integrity by strengthening the Australian Wine and Brandy Corporation’s Label Integrity Program and correct, via updates and modernisation of the previous legislation, numerous weaknesses within the compliance provisions of the Australian Wine and Brandy Corporation Act 1980.

On 1 December 2000 the Australia-European Community Agreement on Trade in Wine was signed by Stephen Smith, the Minister for Foreign Affairs. For many this date will be forever remembered for a simple stroke of a pen that concluded the long and drawn out negotiations. The signing of the agreement represents the culmination of protracted negotiations spanning some 14 years, since the signing of the original agreement in 1994—an agreement which left much to be desired. The new agreement finalises negotiations on numerous issues from the initial agreement that were never of a satisfactory standard. This includes issues such as geographical indications and traditional expressions. Fortunately, after 14 long years in which extensive consultations were conducted with the Australian wine industry, the Department of Foreign Affairs and Trade, the Attorney-General’s office, IP Australia and the Australian Government Solicitor, these issues have been resolved.

The agreement represents a solution to every problem and loophole found in the agreement signed in 1994. Effectively, it fixes the problems that the previous agreement did not, taking a very positive step in supporting and strengthening not only the Australian wine industry but also the ties it has with its European counterpart and the large, lucrative European market. As the Winemakers Federation of Australia noted, this agreement ushers in a new era of cooperation with the European Union, which will not just bring mutual benefits for our respective wine industries but also help cement wider relations.

As the Winemakers Federation of Australia has said, the agreement represents a positive step in building stronger relationships with the European Union, but it is important to remember that this is not the only positive to come out of the negotiations and the final agreement. There are also many other benefits that have come as a result, benefits that the winemakers of Australia are keen to realise. The numerous key benefits to Australia’s wine producers are the European recognition of an additional 16 Australian winemaking techniques, simpler arrangements for approving winemaking techniques that may be developed into the future, simplified labelling requirements, European protection of 112 Australian registered geographical indications, labelling requirements for Australian wines sold in European markets and an effective dispute resolution system for trade related disputes.

The method by which the agreement has brought about these benefits is through the clarification of the intention of the original agreement by redefining, expanding and strengthening a number of provisions, the most important being the assurance of the preservation of Australia’s reputation as a producer of wines of quality and integrity. This also allows the promotion and enhancement of Australian winemakers’ assets in the large and valuable European market, which was worth over $1.3 billion in exports in 2007-08 alone, representing over half of Australia’s wine exports for that year.

In summary, this agreement basically allows producers to make fewer changes and concessions to sell their wines in the European Community. As a result of this easing of trade barriers, Australian winemakers’ techniques will be accepted and the requirements for everything from labelling and blending rules to alcohol levels will be much simpler. It effectively means the European Community implicitly recognises the provenance and prestige of Australian wines. For the winemakers of Australia this means that they can now market themselves independently. No longer will they need to hide behind European names. They can stand freely and be recognised. For wineries in Australia this is perhaps one of the most positive outcomes of this agreement. It will allow them to stand alone as a representation of their own independence and quality in the valuable European market.

However, despite all the benefits that this agreement will provide to winemakers in Australia, amendments must be made to our domestic legislation to bring them into effect, amendments that are presented in this bill. This fact alone demonstrates how important the bill is to winemakers. It represents an excellent opportunity for winemakers here in Australia to capitalise on the potential of the agreement. The first of these amendments is purely to ensure that the protection of geographical indications and translations of geographical indications meet Australia’s international obligations under the World Trade Organisation Agreement on Trade-Related Aspects of Intellectual Property Rights. The changes will provide rules for the protection of foreign countries’ geographical indications, translations of foreign countries’ geographical indications and traditional expressions and the introduction of provisions by determining geographical indications.

The changes also provide a determination process for foreign countries’ geographical indications and translations of geographical indications. These amendments will effectively protect Australian and European wine distributors from misuse in Australia. In addition, the amendments also resolve issues regarding the meaning of ‘false, misleading and deceptive practices’ in relation to geographical indications. These are all very important amendments in this bill.

Section 42 makes it an offence to sell, export or import wine in trade or commerce with false description. This is to ensure the geographical indications, traditional expressions, quality wine terms and other terms that are protected under the agreement have adequate protection against misuse. Under the current system the mental element of intention must be presented in order to prosecute someone for selling, importing or exporting a wine with a false or misleading description and presentation. This meant that if a person could provide incontestable evidence that they had no intention to mislead they would avoid liability. The amendments change the offence provisions to make it an offence if the sale, importation or exportation of wines is performed with the party or parties being reckless to the fact that the wine was false or misleading in its description and presentation. By changing the fault element to recklessness, the barrier to prosecution can be improved, making it easier to take action against any parties that commit this offence. It also brings offence provisions in line with the Criminal Code Act 1995.

Other changes extend record keeping requirements for the members of the grape and wine supply chain, whose actions are captured by the Label Integrity Program which operates under the Australian Wine and Brandy Act. The changes to the Label Integrity Program will benefit both consumers and the Australian wine industry by helping to ensure that Australian wine labels are truthful and accurate in relation to their origin and characteristics. Implementing this system will allow the Australian Wine and Brandy Corporation to trace a batch of wine from the retailer to the vineyard and confirm details that appear on the label are consistent at each point of the supply chain. This coverage will be extended to all wines. The additional reporting requirements for those captured by the Label Integrity Program will not be onerous, will not increase the reporting demands on the supply chain and will reflect was is generally considered to be sound business reporting practice. By having records at each point of the supply chain the integrity of the label can be confirmed. These amendments will strengthen the Label Integrity Program and increase the veracity of labels.

Another important change is to the compliance provisions in the bill. Changes will be made to rectify identified weaknesses in the compliance provisions of the Australian Wine and Brandy Act. The objective of these changes is to provide the Australian Wine and Brandy Corporation with the means to protect the reputation of the Australian wine industry for quality. Where a person is performing actions that may be contrary to the act, the change will provide the Australian Wine and Brandy Corporation with the power to apply an injunction to stop or to direct a person engaging in an action that may be contrary to the objects of the act.

All of these amendments culminate in a representation of every area that needs to be changed to maximise the benefit for the Australian wine industry and maximise its potential to expand further into the prosperous European market. It has become quite clear, through support of this bill from the wine industry, that they are very keen to see these changes come into force. The Australian Wine and Brandy Corporation, as the responsible authority, requested the amendments, which are supported by the Winemakers Federation of Australia, the national representative body of winemakers. This federation holds voluntary membership from parties that represent 95 per cent of the wine produced in Australia. The amendments will have been discussed and supported by the Legislation Review Committee of the Australian Wine and Brandy Corporation, which consists of representatives from the Wine Federation of Australia, an independent lawyer and representatives of the major wine companies in Australia. The representative group, Wine Grape Growers Australia, also attended the committee and supported the amendments, including the requirement the wine grape growers keep a record of geographical indication in which the grapes were grown. The legislation review committee advised that the industry would derive considerable benefits from the enhanced Label Integrity Program and improved compliance provisions that will assist in preserving Australia’s reputation as a producer of wines of quality and integrity.

This bill, which is widely supported by all the parties involved in the agreement negotiation process, will not only bring the agreement into force and allow the winemakers to benefit from the outcome of over a decade of negotiations but also provide improvements in label integrity and in the compliance provisions. With so much support for the bill from within the very industry it will regulate, it seems infallible that the bill will serve only to benefit the Australian wine industry and is thus worthy of receiving royal assent. The sooner it does, the sooner the Australia-European Community Agreement on Trade in Wine can enter into force and the sooner the Australian wine industry can start to enjoy the benefits that come with it, as well as the other benefits that will arise from the bill—benefits that have been long deserved by all of Australia as well as the Australian wine industry. For people working in the wine industry anywhere in Australia, whether it be in the Barossa Valley, the Margaret River area or the districts of winemakers in southern parts or in the Northern Territory, this bill is good news. I must admit that I googled to see if there was a winery in my electorate of Solomon, and its phone has been disconnected. The bill represents a positive step into a new, prosperous era for the wine industry of Australia. Having said that, I might just go and enjoy a nice glass of shiraz over dinner. I will finish those comments there. I fully support the bill and I commend the bill to the House.

Mr Tony Burke (Watson, Australian Labor Party, Minister for Agriculture, Fisheries and Forestry) Share this | Link to this | Hansard source

in reply—I thank all the members who have contributed to the debate on the Australian Wine and Brandy Corporation Amendment Bill 2009, most of whom have referred to the importance of the industry within their own electorate—although the most recent speaker, the member for Solomon, living in Darwin, has a limited number of vineyards in his electorate. Notwithstanding that, I am very grateful for all the comments that were made.

A lot of the themes of the contributions which have been made have gone well beyond the ambit of the bill, but importantly they have referred to some of the challenges that we have at the moment with a glut on the wine market in Australia. I want in particular to acknowledge the contribution made by the member for Barker, who acknowledged the importance of the wine industry’s need to be able to restructure and also noted that it was not for government to take control of that restructure; it is something for industry to do themselves. I do not think any of us want to repeat the mistakes of years gone past, when governments first of all paid people to pull out their vines and then provided tax incentives for them to put them back in, leading to another wine glut, which we are in now. There are some challenges which appropriately rest with industry and some challenges where government can play an important role. This bill represents one of the areas where we can play an important role.

The bill has a number of roles. Importantly, it implements the agreement between Australia and the EU on trade in wine. In that agreement, the Europeans wanted to make sure there was protection of their geographical indications and traditional expressions. In exchange for that, we wanted to make sure that they would recognise the need to simplify their labelling requirements for Australian wines and to protect our geographical indications from incorrect use in the European market. The bill strengthens the Label Integrity Program and rectifies weaknesses in the compliance provisions.

Some people have made reference in passing during the debate to the fact that this bill has been delayed, but thankfully no-one has complained about that delay. The delay was for the very good reason—I know that the member for Eden-Monaro referred to this—that there was a dispute and a disagreement between us and the Europeans over some particular varieties. The bill was stalled in the parliament here while that dispute was resolved. Now that there is agreement between us and the EU, we have a situation where the bill is again able to proceed.

As a result of these amendments, consequential amendments will need to be made to the Trade Marks Act 1995 to enable trademark owners to amend their marks where necessary. The bill also, as I said, amends provisions of the Label Integrity Program, including strengthening record-keeping requirements for those involved in the production, distribution and sale of wine and wine grapes and ensuring that the offence provisions which apply to those who make a false or misleading claim relating to the vintage, variety or geographical indication of a wine good are appropriate. Once again, I want to note that although the changes to the Label Integrity Program are important and necessary they do not place onerous requirements on industry and they are fully supported by industry.

The bill also proposes a number of changes to the compliance provisions of the act, which have stemmed from problems which have been identified in the current arrangements. These amendments will strengthen the Australian Wine and Brandy Corporation’s ability to stop a person from engaging in action that may be contrary to the act, while also providing the power to pass on information obtained under the act to others who may have a role in enforcing the laws relating to wine and health.

I take the opportunity to thank those involved in the AWBC, both those who work for it and those who chair and serve on the board, for the contributions that they make. I thank the various members who have spoken in the debate for their commitment to the industry, whether it be a commitment through their connection to producers or through their connection to consumers. In either case, the bill puts industry on a stronger footing and I am grateful for the bipartisan support which has been shown during the course of this debate. I commend the bill to the House.

Question agreed to.

Bill read a second time.

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