Janelle Saffin (Page, Australian Labor Party) Share this | Link to this | Hansard source

I rise to speak in support of the Customs Amendment (Anti-dumping Measures) Bill 2011 and, in so doing, I want to outline, firstly, just what the bill means and why it is necessary. The bill contains amendments to the Customs Act 1901 and obviously concerns antidumping measures. On the face of it, it seems like a simple measure but it is not that simple when you actually read the number of amendments that are required. The amendments will actually clarify circumstances in which the Minister for Justice may revoke antidumping measures as a consequence of review.

Currently, there is no legislated revocation test. The existing legislation does not set out the grounds upon which the minister should revoke measures following a review. The bill responds to a decision of the Federal Court in the Minister of State for Home Affairs and Siam Polyethylene case. In the absence of an express revocation test, the full Federal Court imported the same test that applies before measures can be imposed following an initial investigation. That caused lack of certainty and a lack of clarity. With any legislative framework, particularly when you are dealing with customs and antidumping, you cannot have that lack of clarity and lack of certainty. Everybody needs to know exactly what is going on and what will happen, particularly when you are dealing with procedural matters.

The upshot of the Federal Court's decision was that the minister must be satisfied that if measures have not been taken there would now be grounds to impose them. In a sense, the finding creates a problem because if measures are in place and effective there may not be current dumping or subsidisation causing injury. The outcome could mean that it would be inconsistent with the objects of the antidumping system. That is really the upshot of the Federal Court decision, because there was what they construed to be an absence of this legislative test and the court said that that needed to be fixed.

These amendments will clearly clarify that. The minister, in his second reading speech, addressed the problem. He said that the amendments will cement the existing practice of Customs, which would treat revocation reviews as different in kind from reviews adjusting or updating the level of the measures. In essence, that is what the Federal Court decision changed.

It will require an affected party to provide evidence that there are reasonable grounds for asserting that measures are no longer warranted. The amendments clarify that if affected parties want the minister to revoke measures they must actually apply and must do so at the outset of a review process or within 40 days of a review commencing. It would not be something that could be imposed as a right without them applying for it. They could end up with it being applied when they do not really want it and they have not requested it.

As the minister said, the Siam decision is problematic for two reasons. Firstly, the case highlighted that lack of clarity in the review process that I referred to and, secondly, a new test was formulated through the court's decision. It was not that the court actually formulated a new test, but the upshot of the decision was that a new test was put in place. The minister also referred in the second reading speech to the established practice for the Customs and Border Protection Service. He said that, prior to the Siam decision to conduct reviews consistent with the nature of the review request, if there was no request for measures to be revoked Customs would not consider whether measures ought to be revoked. I covered that in the beginning, and that is the thing that creates the uncertainty and the lack of clarity, and that is what this amendment actually sets out to fix and correct. That formulation is a problematic one, and it is necessary to have this amendment so that is all put beyond doubt. It will be a clearer test and it will revert any unnecessary revocation happening.

There are some other issues that have arisen. Some people have said, 'Is this related to the Productivity Commission?'—they are being asked to review the antidumping system—but it is not. It is a separate thing. It was a problem that was thrown up, arising out of a Federal Court decision. This amendment will correct that and put that beyond doubt. I note that the opposition announced a coalition task force looking at antidumping policy but, again, I do not see that related to this either. This is just a pretty straightforward measure to correct the uncertainty that has been thrown up.

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

Firstly, I thank the House for its rearrangement of business. As many members would know, the member for Page, the member for Forrest and I were in the selection committee meeting, which is actually a very important part of the parliament because it decides when debates happen, and it is something we cannot really get out of. So I do thank both the members here who have been arranging the business of the House in our absence and making allowance for this problem. It is very much appreciated by all of us—and I note the member for Page was saying the same thing as well, and I am sure the member for Forrest appreciates the fact. I also thank those other speakers who thought they might have been on and have had to wait a little bit longer. We really do appreciate the effort that the House has gone to to ensure that we can continue with this.

The Customs Amendment (Anti-dumping Measures) Bill 2011 is a very important bill. There are several reasons why I wanted to speak on this bill. The first is because businesses in my electorate of Barker have been harmed by foreign imports dumped in Australia. This is not a thing about cheap things coming into Australia; this is actually where it has been proven that the products have been dumped in Australia at less than the cost of production. Under the World Trade Organisation rules we had every right to penalise the dumpers of those products, because we need to have fair trade. Certainly businesses in my electorate have been harmed by these foreign imports that have been dumped—another reason I like to buy Australian. I think everyone likes to buy Australian if they possibly can, and we do want to protect Australian industry, within reasonable WTO guidelines. I want to highlight this because the Gillard government has not lifted a finger towards fixing the problem of this product being dumped in Australia. It is frankly a disgrace. It is a very important industry—I am referring to the Kimberly-Clark plant in Millicent in my electorate, which makes a lot of tissue paper. It has had to try to compete with unfair imports from other countries. One of those countries is, I believe, Indonesia. Another is Thailand. It was a bit of a shock to us in my electorate and to those in the company. In fact they have had to lay off over 100 people—that is a lot of people who have lost their jobs as a result of the inaction of this government.

The government had many chances to take action and many reasons to want to fix this. There were many warnings to the government about the effects this dumping would have. Despite ongoing pressure from the coalition and the calls for help from national and local businesses and local government to do something, this Labor government seems totally oblivious or is just plain ignorant about the issue.

The coalition has set up an antidumping task force and certainly the coalition can see that there is a real problem here that is taking its toll on Australian businesses, on jobs and on the communities that rely on the businesses and the jobs. We want to make sure that Australian businesses are protected so they can continue to do what they do best: manufacture goods so that consumers can actually buy Australian made products. Consumers want to walk into their local supermarket and see 'Australian made' on the shelf. Tradies want to use Australian made steel to build homes and Australians want to buy Australian made products. That is what it comes down to.

The problem is though that the Labor government just does not seem to grasp the concept that if you do not protect Australian industries they will just not be there in five or ten years time. In the case that I quoted, it has obviously had a pretty drastic effect immediately.

I am not saying that we should not have competition. We as a party believe in competition, but, when it is unfair competition and it forces Australian businesses to close or shrink, then there will be no choice to buy Australian made. Not all competition is unfair. The coalition supports healthy competition. It is good for consumers and drives business innovation. However, selling foreign goods cheaply into Australia at below the cost of production is not healthy or fair competition. The consumer might be happy for five minutes when they are buying the cheap steel or the cheap milk, but after the local steel company or the local farmer has closed up shop there will not be any more Australian made product and it might be your brother's or neighbour's job that is lost. It may not be there anymore because they have had to sell the farm and move.

This is what will happen under this government, because it fails Australian businesses. It fails to protect them and fails to act. But not the coalition. We have taken measures so that this sort of thing will not happen under a coalition government. My colleagues are working hard so that a coalition government can hit the ground running and have sound policy to protect Australian business against unfair competition. I do not see the Labor government doing anything like this.

What the government has done is lie to the Australian people. They have promised action and delivered nothing. On 27 May last year the Minister for Home Affairs and the Assistant Treasurer released a statement about the Productivity Commission's report. This was nearly a year ago, almost to the day. The minister said that the Productivity Commission has made recommendations about changes to the operation of the current system. He then went on to say:

… the report contains recommendations that need to be carefully considered.

Then, later in the release, he said that the government's response was to be:

… developed and considered in the 2011-12 budget process.

Here we are, just after budget week in 2011-12, and there is nothing in this government's budget about improving Australia's antidumping regime, nothing at all. The government must think it is okay that Australian businesses have to close down because of product being dumped here, because there was no response to the Productivity Commission report in this budget the Treasurer handed down. There is nothing in this budget to combat dumping in Australia. After three years of talking about it, this government has failed Australian industries yet again—no claims from this government, in this year's budget, to support businesses.

During the 2010 election, the coalition announced that we would act to improve Australia's antidumping regime. Unlike Labor, we then took action. Yes, we were as good as our word and acted on that when we established a coalition task force, unlike the ignorant Labor government that has once again been all talk and no action. The coalition task force has been working hard to find out the key issues with the current arrangements and what needs to be fixed. One of the issues with the current arrangements is that businesses are faced with large bills and spending a lot of time internally to prove that their businesses have been retrospectively harmed by product being dumped in Australia. 'Retrospectively' means that the damage has already been done—irreversible damage, more often than not—and then, on top of that, a business has to spend time and money to prove its case. I do not think this is good enough, and Australia should be acting before the fact to protect businesses. This is the coalition's plan.

Many businesses have voiced their concerns that the current arrangements are too cumbersome, place the onus of proof on domestic businesses rather than on their competitors, and are generally prohibitively expensive to access. Foreign goods sold cheaply into Australia unfairly distort the marketplace, harming Australian businesses and ultimately costing jobs.

I have an example of this in my electorate of Barker, as I said: the Kimberly-Clark mill in the township of Millicent. Millicent is a town with a little over 5,000 people, about 700 of whom are employed in the Kimberley-Clark factory—so you can understand how important the Kimberley-Clark mill is to the people of Millicent. The factory uses a lot of our wood products, which we also grow in the local area, and it is a very strong part of our whole economy down there. In fact, the forestry industry is worth more than $2 billion a year to the local economy. It is not just a very substantial part of the direct local economy around Millicent; it is also important to the area for another 100 kilometres around it, where there is a lot of forestry.

This factory uses those products and makes tissues, toilet paper and those sorts of things. The Productivity Commission report showed that there were other countries dumping tissue and toilet paper in Australia to quite an extensive degree, at up to 60 per cent below the cost of production—not five or 10 per cent but up to 60 per cent below the cost of production. When faced with that sort of evidence that product is being dumped in Australia—which affects what is produced in Australia—and is competing unfairly with what is produced in Australia, I would have thought that the government would have said, 'We're going to impose some penalties in the form of tariffs,' or whatever, 'on the tissue that is being dumped in Australia.' But the Labor government did not take any action, which was very disappointing, I have to say.

The local community was hugely concerned about job losses and the effect they would have on this small country town of Millicent that relies so heavily on the mill. The Gillard government were not interested at all in hearing about the Millicent community's concerns. That was evident when they took no action then, and they still have taken no action over a year later.

I have stood in the House before and spoken of the problems Kimberly-Clark are having. The government has been well aware of examples from around Australia of businesses struggling with the unfair competition. Labor cannot plead ignorance on this issue. I brought the plight of Kimberly-Clark to the government's attention some time ago, but here I am in this House again speaking about Kimberly-Clark and about dumping in Australia, because the government is failing Kimberly-Clark and Australia's industry. What the Labor government have done is to offer a patch up solution, and that is simply not good enough. This week the Labor government announced that the budget would contain an initiative to support workers at the Kimberly-Clark mill who have lost their jobs, but I think it is a bit cute to come along and say, 'We'll provide training because we actually didn't act in the first place to stop those jobs being lost.' We have a bandaid solution: 'Yes, we'll provide all this retraining'. We have a great government announcement: 'Aren't we such a great government because we're going to try to help those people who have lost their jobs.' But we have both of these because the government refused to act when they had the chance to act. I am hugely concerned that this funding is a patch up job, and the funding would simply not have been needed if the government had done its job in the first place.

This is a trend I have identified with this government—they fail to take the right action to start with and then when it all goes bad, as it so often does under this government, they have to run around patching up all the holes. One only has to think of things like the Green Loans or the Home Insulation Program, as a result of which 200 houses were burnt down and which was a real rort. The government create a shocking system and then have to spend all that time fixing up the problems they started.

Someone should point out to the government that, if you take appropriate action to start with, you get the job done right and do not have to spend double the time and money fixing it up later. This government have spent a lot of extra time and money fixing up mistakes, and it has come to be the norm to expect Labor to make very costly mistakes. The set-top box funding announced in this budget is the latest example. The story broke, and not long after the Treasurer had to defend his government's program and promise it would not be rorted like so many other programs under Labor have been.

The issue of dumping in Australia is just the same—the government knew about the problems but failed to act. The Australian Workers Union has been running its own antidumping campaign, and you would think that, given the union's love of the Labor Party and vice versa, the government would listen to the union. However, all the union's boss, Paul Howes, had to say was, 'Go and speak to your local MP about it.' But I can assure you that they have spoken to me, and the government have done nothing. (Time expired)

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

I thank the House for its consideration for those members who, like myself, are part of the Selection Committee. In speaking to the Customs Amendment (Anti-dumping Measures) Bill 2011, I say that dumping is defined by Australian Customs as a form of price differentiation whereby goods are exported to Australia at a price that is below the normal value. Dumping also includes the use of export subsidies paid either directly or indirectly to the foreign exporter of goods into Australia, which gives a price advantage to the foreign entity and causes or threatens to cause material injury to an Australian industry, as we heard from the member for Barker. Put simply, antidumping measures apply a temporary import duty on products that are sold in Australia below the cost of production in the country of origin and impose a countervailing duty for subsidised products for the purpose of eliminating the price advantage that gives the foreign supplier that unfair commercial advantage and causes, as we heard earlier, significant damage to or destruction of local production.

Antidumping measures are just one small step in the fight to level the international playing field, which is supposed to be the basis for free international trade. Yet the playing field remains far from level. Many countries around the world provide advantages—including low levels of government regulatory compliance measures, direct subsidies and low labour costs—for their industries. These in turn provide cost advantages for products sold in mature overseas markets such as Australia's, where our local producers are inundated with compliance and cost issues such as the proposed carbon tax, which will add another layer of issues for them.

In this international marketplace, Australia, which produces some of the world's best quality agricultural and food products and manufactured goods, is forced to struggle to compete on price and price alone. This price disadvantage is exacerbated by the Labor government's consistently making compliance more onerous and more expensive for Australian businesses while at the same time making access to our markets easier and cheaper for our competitors. You just need to look at the New Zealand apple imports—the government has said that the compliance burden will rest on those who will profit most from exporting the apples. What a dreadful joke on our Australian growers, especially those in the south-west of Western Australia. They are distraught at this one. This government has an embarrassing record of increasing the cost of doing business in Australia compared to our international competitors. It now proposes to make this worse by imposing, as I said, the carbon tax, which will hit every business that uses power to manufacture its products, and that is almost every business in Australia. They will be less competitive, and that is if they are able to export; they will also be less competitive in our own domestic markets, competing against foreign imports, which will not have that same tax.

Of course, it is really important, as we are an exporting nation, that we are able to compete, and it is important to note that the Labor government has a poor record of defending Australia's borders and maintaining our quarantine and biosecurity. The Beale quarantine and biosecurity review that was commissioned by Labor called for hundreds of millions to be spent on AQIS and quarantine annually just to provide proper and real protection for our nation's borders. Instead of responding to this report, the government has failed to act, except to spend the 2½ years since its release running down the report and stripping out its assets.

This is particularly important in this debate because without price advantage Australian producers and manufacturers have to rely on quality and safety to compete effectively in the marketplace, be that domestic or international. For example, Australian agriculture and food producers rely on our clean, green image of high quality to find and retain markets. Agricultural production in this country drives $155 billion a year in economic production, which is over 12 per cent of GDP, generating around 1.6 million Australian jobs and $32 billion a year in farm exports. In competing with cheaper foreign food products which are underwritten by cheap labour or low quality control and compliance, our producers absolutely rely on our capacity to produce a higher quality, safer and more ethical product. But this is being undermined by the changes that the government is going to make to the import options for these New Zealand apples. We are opening our borders to New Zealand apples and to a whole raft of pests and diseases that we do not have and have never had but that New Zealand has. Around the world, Australian produced food is regarded as safe, clean and green, and it is absolutely critical that we maintain that reputation. That is all we have. However, it is this very reputation that is put at risk by Labor's really incompetent neglect of our nation's border security and biosecurity.

Our worst fears look increasingly likely as the government continues to ignore glaring failures in proactively protecting Australia's shores from pests and diseases. Australian farmers and food manufacturers know that their greatest marketing asset is our virtually disease-free status. That is at risk. For example, the 2009 federal budget took $35.8 million from quarantine and biosecurity budgets, reducing the number of inspections of arriving passengers and cargo and leading to the loss of 125 jobs. More recently, another $58 million was slashed from the Customs budget, leading to 4.7 million fewer air cargo consignments being inspected each year and 2,150 fewer vessels being boarded on arrival. So, if you are a producer, these issues are front and centre in your consideration.

Vets, scientists and other experts in the field know that with such a poor focus on biosecurity and border protection the next major outbreak of an industry-crippling exotic disease, foreign pest or weed incursion is a matter not of if but more of when. They know this because, from what we can see, the aim of Biosecurity Australia is not to prevent the entry of exotic diseases and pests but to minimise the risk of diseases or pests entering with other products. This simple statement means that it becomes a numbers game. Even with low statistical risk, and even if enough product is imported, a breakdown will eventually occur, and this is what is concerning my apple and pear growers in the south-west.

In addition, Australia's status as a premium international tourist destination makes vigilance in pest and disease protection paramount. Our native plants, animals and ecosystems are a major part of the attraction that brings tourists here, and protecting them should be a government priority. Sadly, it is not. We have seen the government fail to quarantine, contain or eradicate the native South American myrtle rust, detected over a year ago, a yellow fungus that attacks a wide range of trees and plants and reduces timber yield by up to 40 per cent. There are now Asian bee incursions. There is the issue of the three tonnes of missing diseased Malaysian prawns and, from two years ago, the still unresolved issue of hamburger meat coming from China, now claimed to be from New Zealand. The bill before the House fails to address any of these important issues. It deals with the need to update the review process so that the minister can revoke an antidumping measure after a review instead of waiting for a five-year sunset period. The bill is a response to the full Federal Court decision in the Minister of State for Home Affairs v Siam Polyethylene Co. Ltd. In that case the court found that, if the parameters that existed to cause an antidumping measure to be initiated no longer exist, then the measure should be removed—that is, the measure should be removed unless the Australian industry or an Australian producer or manufacturer would suffer material injury. It is unfortunate that the court considered the antidumping provisions in isolation and could not consider the greater lack of a level market playing field in coming to its decision; however, that is the role of law-makers in parliament.

The bill also defines the test that the minister must apply in deciding whether to remove the antidumping measure. In this regard the bill may achieve a measure of success. However, it falls short of all of the reforms needed to the Australian customs system. An improvement has been foreshadowed in the Senate which may, in some part, add strength and integrity to the system. In seeking to put the onus of proof onto those seeking to import into Australia, those amendments are an acknowledgement of the potential impacts, including the cost of assessment on Australian industry. But that is only a small step, and the issue that deserves to be debated is the lack of a level playing field for trade. There is no greater acknowledgement of the lack of equity in trade than the failure of the Doha Round to deliver that level playing field for Australian growers and exporters. Professor David Hughes recently said that, taking into account what we consume domestically and those we feed in international markets, Australian farmers today are effectively feeding 60 million people. The global food task is going to increase significantly. The world's projected population growth will be between nine and 10.5 billion by 2050.

So the importance of not only maintaining but growing our agricultural and food production capacity is really quite clear, which is one reason why the cuts to research and development, biosecurity, AQIS and agriculture budgets are so critical. But the government is really quite used to using the agriculture budget as a cash cow—a pretty accurate term. In this budget the government has not provided information on what is going to happen with the funding of research and development. It is really clear that the government places no value on growers, on agriculture or on the nation's food security, food self-sufficiency or those engaged in food manufacturing. This is in direct contrast to many other countries, particularly where they have or have had food shortages, and there is no doubt that other countries view food security as a national security issue.

During a recent visit to my electorate the US Consul General, Aleisha Woodward, talked about the strong relationship between the US and Australia. However, when it came to government subsidies for agriculture, Ms Woodward said, 'I think every country has a challenge in balancing national security issues and free market economics. There are some very powerful companies in the US that argue that a lot of our agriculture is a national security issue, so the government is not willing to let it be completely subject to the forces of the market. And it is still the biggest issue in free trade today.' Perhaps that is the reason that, historically, no foreign developed nation has been, or appears to be, willing to sacrifice their own food manufacturing industries or their own farmers completely in the name of absolute free trade. The President of Uruguay is on record as saying:

… there is no more noble undertaking for mankind than to be engaged in the production of food.

I note that the Premier of Western Australia, Colin Barnett, spoke about the surge of business between WA and India, including Perdaman Industries' investment of $3.5 billion in a coal to urea plant in my electorate. The Premier has called for agriculture to be included in any free trade agreement, which is reported to be unlikely because rice and wheat are heavily protected in India. When you look at the website of the Indian Central Board of Excise and Customs, you can see what our Australian growers are up against: meat, chicken, vegetables and fruit have tariffs of 100 per cent or more, wine has 150 per cent, wheat has 100 per cent and rice 70 to 80 per cent. Any reduction or removal of tariffs on agriculture and food products would benefit Australian growers, who have had to operate in very efficient ways in that rarely level international playing field.

I know that the coalition is very active with its antidumping task force and is working at fixing current issues, but I am seriously concerned that the federal government through Biosecurity Australia is putting every south-western apple and pear grower at risk by lowering quarantine standards for New Zealand apples in ports, and is relying on standard farm practices and every backpacker who is actually picking or packing in New Zealand having a good day every day when they are picking or packing fruit. That is the level of scrutiny that will be applied. They will only be inspecting 600 pieces of fruit per consignment, and when you look at the size of a consignment that could be one out of a million apples. And of course the fire blight, the European canker and the leaf-curling midge are really serious issues that we do not have here. At this point the New Zealand practices are confidential on-farm and we cannot access those, so really Biosecurity Australia is outsourcing responsibility for our biosecurity and quarantine risk basically to New Zealand growers. That is of serious concern. No other country accepts quality assurance and management systems as a quarantine measure.

I have very serious concerns. This bill is one small step but I hope that one day we will be able to debate Australia taking a giant trade leap. I have great confidence in the findings and work of the coalition antidumping task force and its findings ahead.

Brendan O'Connor (Gorton, Australian Labor Party, Minister for Home Affairs) Share this | Link to this | Hansard source

Tonight we have had a number of contributions to the debate on this bill because it is an important bill. It is a measure to ensure we have a better process in place with respect to our antidumping regime. Whilst you could be forgiven for thinking that opposition members are voting against the bill, they are actually voting in favour of the bill without amendment. I thank them for that. Whilst there were contributions that would have given the impression that some of the opposition members thought they had stumbled into the Appropriation Bill debate, the facts are that there is no dissent when it comes to this bill because this bill is a good bill and is responding importantly to improve the effectiveness of the antidumping regime. The government will have more to say on these matters.

I will add one final thing given that the member for Indi chose to speak very broadly on this area of public policy. In the 11½ years of the Howard government there were no changes whatsoever to the antidumping regime, there were no reforms put in place to make it more effective. So what we are dealing with here, if there are changes that may need to be made, is a construct that was not changed one iota by the Howard government.

Having said that, in brief response to some of the broader matters that were raised in this debate, I would like to thank all speakers for their contribution. The Customs Amendment Bill 2011 will clarify the circumstances in which the minister may revoke antidumping measures as a consequence of a review of the measures. The amendments will improve procedural fairness by making the process of applying for a revocation review transparent to all affected parties. The amendments will also give interested parties adequate time to defend their interests and will ensure that investigators have time to consider the issues before reporting to the minister. The amendments were drafted in close consultation with the Customs and Border Protection Service, the Attorney-General's Department and the Department of Foreign Affairs and Trade and are consistent with Australia's international law obligations. More importantly, the amendments will ensure that where measures have been put in place to address injury faced by Australian industry as a result of unfair trade practices, those measures remain effective.

These amendments have been welcomed by the Australian Workers Union, the CFMEU, the AMWU, the Australian Food and Grocery Council and the Australian Industry Group among others. Australian manufacturers have applauded these amendments because they restore the appropriate balance between the interests of Australian manufacturers and importers by ensuring that measures are not unduly or prematurely revoked.

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.