Tony Zappia (Makin, Australian Labor Party) Share this | Link to this | Hansard source

I rise to speak in support of the Customs Amendment (Anti-Dumping Commission) Bill 2013, and I welcome its introduction into the House. Dumping is becoming a major problem for Australian manufacturing industries and for Australian farmers and food producers. It will continue to be a problem, and become a more serious problem in the future, because of a changing global economy. The global economic downturn, and the widening gap between the cost of labour in Australia when compared with labour costs in many other countries, is going to continue to cause problems for industries within Australia. The global economic downturn has also led to two serious affects for Australian manufacturing and food-growers.

Firstly, the value of the Australian dollar has risen in response to Australia's more stable and stronger economy.

Secondly, consumption has fallen across many countries, resulting in an overproduction of products and little demand for them from their previous markets. Australia is seen as a secure country in which to off-load goods when previous markets have dried up. It is also seen as a country to dump goods by industries who—because of the global financial downturn—are in financial difficulty and having a fire sale of their products.

In response to those threats, in June 2011 the government announced a series of reforms to protect Australian industries and Australian jobs. These were the most significant Customs reforms in more than a decade. The reforms will result in better access to the anti-dumping system, faster remedies and faster decisions, improved quality of decision making, greater consistency with other countries and stronger compliance with anti-dumping measures. Under the reforms a new anti-dumping commission will be established to investigate dumping complaints, improving the effectiveness and efficiency of our anti-dumping system. The anti-dumping system will be made easier for small- and medium-sized businesses to use; including by providing further funding for the International Trade Remedies Adviser to provide information, advice and support to small- and medium-sized enterprises.

Funding to Customs will be increased by $24.4 million so that it has the resources to deal with cases speedily and fairly, include almost doubling the number of investigators. Higher dumping duties can be imposed in cases where significant numbers of Australian small- or medium-sized enterprises are being injured by dumped goods. There will be speedier reviews, stronger remedies and higher penalties in cases where overseas producers or importers do not comply with, or deliberately circumvent, Australia's anti-dumping rules.

This bill implements three specific reforms. Firstly, the bill amends the definition of subsidy to more accurately reflect the language of article 1 of the Agreement on Subsidies and Countervailing Measures and to clarify that a subsidy is a financial contribution, income or price support that confers a benefit—whether directly or indirectly—in relation to the goods exported to Australia. The bill introduces a new section to provide that, where a countervailable subsidy has been received in respect of goods, the amount of the countervailable subsidy is determined by the minister in writing and should be worked out by reference to the units of those goods.

Secondly, the bill has amendments to deal with circumvention activities. Circumvention is a trade strategy used by the exporters and importers of products to avoid the full payment of dumping and countervailing duties. Circumvention behaviours take various forms, but they all aim to ensure that goods do not attract the intended dumping or countervailing duty. This bill will allow the minister to amend the original notice imposing the dumping or countervailing duty, including by extending the notice so that it applies to different goods, exporters and countries which were not specified in the original notice.

Thirdly, the bill deals with noncooperation in relation to dumping investigations, reviews or continuation inquiries. Schedule 3 also clarifies the provisions that deal with sampling in relation to dumping and countervailable subsidy inquiries and consolidates them into one provision. Sampling is currently undertaken for dumping and subsidy investigations. Sampling is also undertaken where the number of exporters who provide information is so large as to make a determination for each individual exporter impracticable. The minister may limit his or her examination to a selected number of exporters who are a statistically valid sample or who are responsible for the largest percentage of the volume of exports from the country in question that can reasonably be investigated.

Dumping is destroying Australian businesses and Australian jobs. Often when those jobs and industries are lost, they are lost forever. Competing on a level playing field is one thing, but competing with products that are sold below cost is another. That is what is happening. That is why this legislation is timely and why it will be welcomed by Australian industry and Australian workers.

I have had several representations about this matter from industries and residents within my electorate. One of the manufacturing industries that is currently being directly affected by alleged dumping is Tindo Solar, located in Mawson Lakes in the Makin electorate. I understand that Tindo is Australia's sole manufacturer of solar panels. The company began production in November 2011 and was officially opened by Prime Minister Julia Gillard on 26 October last year. At the time, Prime Minister Gillard, the Premier of South Australia, the Hon. Jay Weatherill, the Minister for Industry and Innovation, the Hon. Tom Koutsantonis, and I attended the official opening and were given a tour of the facilities. It is indeed an impressive manufacturing plant that I have no doubt can compete with plants around the world.

Tindo manufactures what the company refers to as 'technologically advanced, high-performing solar panels' and claims that it can compete with the real cost of solar panels that are being manufactured in China and other places. However, because of the glut of panels across the world—particularly in China—that are being dumped below cost on the Australian market, Tindo believes they are no longer competing on a fair and level playing field. They are confident of competing against real costs of manufacture but not when products are then sold below cost. That appears to be happening with respect to solar panels and, not surprisingly, we have seen the cost of panels come down in Australia. I suspect that part of the reason for that is because the allegations made by Tindo Solar are in fact true and that panels are being dumped on the Australian market at below cost. Proving that products are sold below cost is extremely difficult, particularly when those products are manufactured offshore in a country where we have no ability to carry out investigations.

Last year BlueScope Steel made similar claims about cheap imported steel coming in from Taiwan, South Korea, Japan and Malaysia, affecting production at the BlueScope Port Kembla plant and resulting in job losses. The member for Throsby referred to this matter in his own comments about this bill. Similar claims were made about paper imports from Indonesia and China and the effects they were having on the timber and pulp industries in the south-east of South Australia. I am well aware of the campaign that was raised at the time to try to prevent those cheap imports from coming in, because it was directly affecting output from the plants in the south-east of South Australia and in turn having a direct effect on South Australian jobs.

Concerns are also affecting our nation's food producers, and the member for Murray quite rightly referred to this concern. I have had several discussions with food producers who are not only competing at times with food produced overseas and being sold, in Australia or overseas, below cost but competing with food grown in countries where growers are provided with government tax breaks or government subsidies that do not apply here in Australia. Only last Sunday I spoke to a well-known South Australian winemaker, who raised with me his concerns about the unfair competition Australian winemakers are now facing from overseas produced wine.

The unfairness relates not only to the Australian market but to overseas markets that Australian winemakers were previously exporting to. Trying to stamp out dumping of products in Australia is one thing; competing with them when they are being dumped in a market in another country, but a market that our own producers have relied on in the past, is another—and perhaps a much more difficult matter to deal with. Nevertheless, it is happening. And it is happening because right now, as a result of the global financial crisis, there are companies around the world that are seeking to offload their products—products that in many cases they have in storage and are holding on to at below cost in order to recoup some money on them.

Additionally, our growers are continually having to compete with an oversupply of products resulting from good seasons in other countries. That is another concern that is very difficult to control but that nevertheless sees products being dumped both here in Australia and overseas in markets where growers are competing to have their products sold. In fact, I have also spoken with several fresh food growers and vegetable growers who are telling me that they equally are now facing serious difficulty as a result of fresh food coming into this country. There is no question in their minds that these products are being sold in Australia below cost.

This legislation will not resolve all the problems I have eluded to, but it is indeed a step in the right direction. It is a step that, as I said at the outset, industries and workers in this country will welcome. It is a step that closes some of the gaps, some of the holes, and enables Australia to better control products that are coming into the country and being sold at below cost. It is a step that does a great deal to protect the jobs of Australian people and the businesses that employ those people. In my own electorate there are about 8,000 people who work in manufacturing. Manufacturing is one of the industry sectors that is most at risk as a result of products being dumped into this country. If this legislation can act in any way to safeguard any of the industries or the jobs of those 8,000 people I refer to—or in fact the one million around the country who are also employed in manufacturing—then it will be worthwhile. I commend the legislation to the House.

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

The Customs Amendment (Anti-Dumping Commission) Bill 2013 is what we see as the next stage of the government's revamp of customs procedures, which it claims will enhance our anti-dumping capacity. It will allow the establishment of the Anti-Dumping Commission as a part of the Australian Customs and Border Protection Service and establish the role of Commissioner. Dumping is defined by Australian Customs as a form of price differentiation whereby goods are exported to Australia at a price that is below their 'normal value'. It also includes the use of export subsidies paid to the benefit of a foreign exporter of goods into Australia, either directly or indirectly, which gives a price advantage to the foreign entity that causes or threatens to cause material injury to an Australian industry. Put simply, anti-dumping measures are applying a temporary import duty, called an 'interim dumping duty', on products that are sold below the cost of production and a 'countervailing duty' for subsidised products in order to eliminate the cost advantage that would give a foreign supplier an unfair advantage and damage local production.

Many countries around the world, as we know, provide advantages for their industries, such as low input and labour costs and low levels of necessary compliance with government regulations. These in turn provide cost advantages to their products in mature overseas markets, where local producers are inundated with compliance and cost issues. In this international marketplace Australia, which produces some of the best-quality and most efficiently produced food and fibre in the world as well as high-quality manufacturing goods, often we struggle to compete on price alone. Frequently in the agricultural sector a large amount of research and development funding is being required to maintain our edge The agricultural sector was growing its production at over two per cent a year in efficiency, and this was quite above the normal rate, but it has come back to around one per cent in recent times.

That is also as a result of some of the challenges facing our growers and our farmers. Of course, one of the only ways that our primary producers can manage this and manage the challenges of the international market is to manage their costs of production. There is innovation, there is cost of production, and there are efficiencies. That is what Australian growers do very well. What really concerns me is that, in our effort to compete internationally, we do not need to make compliance to the extent where we are far less competitive by adding unnecessary cost to our local growers and producers and increasing the cost of doing business in Australia compared to international competitors. That is where we are at. I would say this has been much worse because, when you look at the costs added to an Australian producer, the cost of a carbon tax is right up there.

I talk to the dairy farmers and the dairy groups and, of course, they have to compete on an international stage and they have to compete in an international market that has a number of subsidy advantages—either subsidy, or tariffs or both. They have, through their efficiency, through their innovation, through their productivity improvements, been able to compete, but the more cost you add to that here the less they can be competitive. For instance, there is an excess of nine billion litres of milk that has to be cooled on farm, and we do know that our dairy manufacturers have been affected by the carbon tax. That adds cost which does not help any of our primary producers or their ability to compete in an international market. Any business that uses power is going to feel any increase in cost imposed by this Labor government. Almost every business in Australia is less competitive in overseas markets, if they are able to export, and less competitive in their own domestic markets against foreign imports because you have increased the cost of their production systems, and that is what we have seen.

It should also be noted by the parliament that the Labor government has a really poor record of defending Australia's borders and maintaining our quarantine and biosecurity. We have an international reputation as a clean and green producer and we should be guarding this. The government clearly has no care for this issue. It does not understand how important our clean and green reputation is around the world. We can see what has happened in China. We can see some of the challenges with consumption of products. That is why maintaining our quarantine and biosecurity measures are so important, but what we have seen is that Labor has consistently stripped funding and personnel from all of the Commonwealth law and border enforcement agencies. To those of us who are in the primary production sector this is front and centre of the problems that we face. Our borders are critical, and our clean and green reputation around the world is the best-selling tool that we have got. People around the world buy Australian produce because they know it is clean and green, but it only stays clean and green if we protect the integrity of our borders and our biosecurity.

I know that the government has taken a further million dollars this year from the Australian Commission for Law Enforcement Integrity and that includes 750 staff cut from Customs. So we are going to be inspecting less cargo. There is to be $64.1 million cut from Customs in the 2011-12 and 2012-13 budgets. Each one of these measures affects our capacity to manage our biosecurity. There has been $264.5 million and 97 staff cut from the Australian Federal Police, and $22.2 million and 144 staff have been cut from the Australian Crime Commission. We know that there have been $15.2 million and 35 staff cut from AUSTRAC and $8.7 million from CrimTrac and $1.2 million from the Australian Commission for Law Enforcement Integrity. Last year the Community and Public Sector Union confirmed the damage that Labor's staffing cuts are doing to Australia's national security.

Regional Australia, especially our agricultural sector, is extremely concerned. The Beale quarantine and biosecurity review was commissioned by Labor and it called for hundreds of millions of dollars to be spent on AQIS and quarantine annually to provide proper, real protection to our nation's borders so that we can compete internationally and maintain our clean and green reputation and our capacity to produce some of the best quality food and fibre in the world. Instead of heeding the Beale report, the government failed to act, except to spend 2½ years since its release running it down and stripping out its assets. This is particularly important in this debate because, without any price advantage and with additional cost applied by this government, Australian producers and manufacturers have to rely wholly and solely on their capacity to improve their productivity, on quality and on safety to compete effectively in the marketplace, be that domestic or international. We do know that the products that are being imported into this country do not have a carbon tax or certainly not one at the price that Australia has. Australian agricultural and food producers can only rely on that clean image of high quality to find markets. We need to retain that.

If you look around the world, in the future there is a premium on being able to produce some of the best quality food and fibre in the world. Agricultural production in this country drives $155 billion a year in economic production—over 12 per cent of GDP—and yet I do not see the Labor government placing a value on this and being prepared to protect that opportunity and the capacity to produce food. Australians have never gone hungry. Our food and fibre producers in this country produce some of the best quality food in the world, and Australians have never been hungry as a result. Agricultural production in this country supports around 1.6 million Australian jobs and $32 billion a year in farm exports. We do know, because I have said it frequently, that during the global financial crisis it was not acknowledged in this place, particularly by the other side of politics, that it was agricultural exports that kept Australia out of technical recession.

But how often was that recognised here. And how often since that time has more and more been removed out of the agricultural and biosecurity budgets. It has been a constant cash cow for this government. As for producing in this environment, productivity, innovation, research and development and protection of our borders are all key issues affecting growers in this country.

If we are competing with foreign food products that are cheaper and are underwritten by cheap labour or low-quality controls, our producers have to rely on their capacity to innovate, and they are innovative. I have great confidence in our farmers. We also rely on the perception in the international markets that we have a higher quality, safer and more ethical reputation. That is what we sell. We do not just sell a product. But it has to be maintained. Our border and biosecurity protection, our AQIS and quarantine are critical in this. Around the world I do know that Australian produced food is regarded as safe, clean and green. But the government is taking it for granted. It is essential that we maintain this reputation, but it is being put at risk by the incompetence over biosecurity. Our worst fears look increasingly likely as the government continues to ignore glaring failures in proactively protecting Australian shores from pests and diseases.

Australian farmers and food manufacturers know that their greatest selling asset, Australia's virtually disease free status, is at risk. We in rural and regional areas, we who are producers, understand this very well. But we cannot get that message through to the government. We see cut after cut. I despair to think what is going to be in this next budget. What is the next hit that agriculture, research and development, biosecurity or border protection are going to have to wear because of this government's addiction to wasteful spending. For example, Labor's 2009 federal budget slashed $58.1 million from the quarantine and biosecurity budgets and reduced inspections of arriving passengers and cargo, leading to the loss of 125 jobs. We know that the cuts to screening by the Rudd-Gillard government reduced the number of potential sea cargo inspections by 25 per cent, and 2,150 fewer vessels are being boarded on arrival. Labor has cut aerial surveillance by $20.8 million and 2,215 aerial surveillance hours, or more than 90 days. Labor cut boat interception funding by $48.1 million over the forward estimates. In 2012-13 budget, Customs was forced to cut 1 in 5 senior executive service officers. Labor has cut $9.3 million in 2014-15 to Customs in a plan to reduce capital spending and other 'low-risk' organisational activities.

These are critical matters for all of those who are producing food and fibre in this nation. What we have seen consistently from this Labor government is the failure to acknowledge the fact that they are critical. We have seen attacks on those budgets. What bothers me and others on our side of politics is what the next round of cuts are and how this government is going to continue to add costs. The diesel fuel rebate is coming back—another six-odd cents a litre. Every single thing we use, build with and use in our businesses is delivered on the back of a truck and everybody in regional Australia is actually going to have to pay more, and our capacity to produce and compete in international markets is going to be further compromised. Just consider how many kilometres the vehicles and prime movers do to deliver to us on a daily basis. Every single thing I use in our business on the farm and in our regional community arrives on the back of a truck. We will see that come into being in 2014 if this Labor government stays in office. We need to make a change.

Michael McCormack (Riverina, National Party) Share this | Link to this | Hansard source

It is a pleasure to follow the member for Forrest, who is always passionate about these particular agricultural and rural issues. She is a strident advocate for all things regional for her electorate and I commend her for it. I just received an email from Barney Hyams from Batlow in my electorate. He wrote that, in relation to this anti-dumping bill, I should highlight the effect that Chinese apple juice concentrate is having on Australian apple producers, with local growers now struggling to find a market for their processing apples due to manufacturers importing cheap Chinese apple juice concentrate. In fact, he said the amount of Chinese juice concentrate imported into Australia is the equivalent to the whole Australian apple crop being turned into juice. And, of course, China does not have the same high food safety production systems adopted by Australian producers. He further notes—and he is keen observer of parliament—that the member for Fremantle is at the table. Mr Hyams said that she would know the damage being done to the apple producers of Donnybrook by cheap imported Chinese apple juice concentrate.

We know that anti-dumping measures need to be put into place. There is no better form of flattery than copying someone else, and certainly the Labor government is copying the coalition when it comes to the Customs Amendment (Anti-Dumping Commission) Bill 2013, because it is something we have been fighting for for a long time.

The bill's passage will result in the establishment of a new body known as the Australian Anti-Dumping Commission. The government intends to empower this new body with the responsibility for anti-dumping investigations as a means of addressing some of the many stakeholders concerns about unworkability of the existing arrangements and the many complexities, and significant complexities they are, and costs associated with accessing the system.

There are all sorts of problems with dumping in Australia. No matter how we try and what sort of commissions or organisations we put into place, as we just heard from the member for Forrest we are going to have problems whilst ever the government does not fund our quarantine system to the level at which they ought to be funded and does not fund it to the point where they can actually stop a lot of the dumped produce coming into our nation.

In July last year there was a particular problem in my electorate concerning growers who raised three matters with me: a tenfold increase of federal Labor government charges associated with registering a facility for export; lack of drive and support for opening and maintaining export market access; and failure to impose the same quality restrictions on imported goods as Australian produce goods. It strikes to the heart of this debate that we are having tonight.

In July 2012 orchardists received a notice from the Department of Agriculture, Fisheries and Forestry advising new charges and fees to be imposed to register sheds for packing oranges for export. The new annual charge for registered establishments under what is called 'Tier 3 protocol markets' increased, under this new law put in place by Labor, from $550 per annum to—wait for it—$8,530. That is on top of the high Aussie dollar. That is on top of the fact that they were having their water taken from them. That is on top of all the other things that are affecting the markets and their ability to make a profit. It was a significant increase and an unfair and unwarranted increase which orchardists have no way of recouping. I am told that for a registered inspector to give the shed the all clear could, in some instances and depending on previous standards met et cetera, take as little as 30 minutes to an hour, which seemed, considering one of the new fees is as high as $8,530, quite exorbitant, if not downright outrageous. This was not just happening in Griffith, this was happening right throughout Australia.

Growers feel they were given very little warning about these changes—nothing new about that, coming from the Labor government, because everything they do is policy on the run and, 'Let's waste money here, but hit Australian families and Australian businesses on the other hand.' The move to a centralised unit in Melbourne for the south-east region plant export program is, as my citrus growers believe, bureaucracy gone mad. Indeed, they were right. Unfortunately, they were the ones who had to foot the bill, as always. Growers, families and small businesses are being hit in the neck by this uncaring, wasteful government. The orchardists felt that in addition to the increase in fees, the federal government placed undue barriers on new entrants to the export market. There is failure to assist growers to help their produce to enter key markets, including Japan.

On one hand they are being hit by imports coming in and flooding the market. On the other hand, when they tried to send our—as member for Forrest quite correctly pointed out—fresh, clean, world's-best produce overseas, they were being impeded all the way. And who by? The Labor federal government—the Commonwealth government which should have been supporting them, helping them and doing whatever it could to make sure that they were able to operate in the so-called free-trade market that we are supposed to be in. The level playing field which—as you would know Mr Deputy Speaker, coming from Maranoa—does not really exist.

Growers believe assistance into the Japanese market could inject many tens of millions of dollars into Australia's balance of trade. In addition to facing difficulty entering the export market, growers feel that they were being disadvantaged in the local market as they were forced to compete with citrus juice and citrus juice concentrate being sourced from overseas countries, particularly Brazil. This has seen many Australian growers withdrawing their juicing varieties. Australian citrus juice is of the highest quality and meets our very high, stringent standards—as it should. Growers are concerned that the imported juice does not appear to be required to meet these standards, and that is a common theme coming from my Riverina electorate, coming from the electorate of the member for Murray and, certainly, from the electorate of the member for Forrest.

Furthermore, many citrus growers are being forced to dump their fruit at record levels as the increase in cheap imports and the high Australian dollar allows juice companies to offer as low as $25 per tonne for navel oranges and the fruit is selling for $4 a box in the cities. So how can they compete? It is just heartbreaking to see this fruit either rotting on the vines or being stripped, laid on the ground and then churned back into the dirt while the good folk of Griffith, Leeton, Yanco and other places in my electorate just watch as their year's produce—their year's work—gets turned over into the ground. It is absolutely shameful and heartbreaking.

Local growers have expressed their dismay at this situation and they believed back then it was the worst case of dumping in history. Nothing has changed. It is still the same today. Citrus growers have a strong history in the Riverina and have spent a century doing what the nation has asked them to do—to produce food to feed us and to produce food to feed foreign nations. It is imperative that the government ensures that Australian produce has the opportunity to thrive not only in local markets but also in the international arena.

I am quite pleased that this Customs Amendment (Anti-Dumping Commission) Bill is going to be put into place, and I certainly hope it is effective. I referred to that huge increase from $550 to $8,530. I wrote to the Minister for Agriculture, Fisheries and Forestry, Senator Joe Ludwig, and I received a reply. It took him nearly two months, but I got the usual standard words from him and, really, it gave my citrus growers absolutely no hope or recompense for the problems that they felt were brought upon them by the Labor government. Only this week, Graham Gorrel, a friend of mine and a columnist in the local newspaper—indeed, Graham Gorrel was the editor of the Daily Advertiser newspaper when I began my journalistic career, and I followed him as the editor of that publication—wrote to me:

I notice in the past week the prune growers in Australia are facing dwindling markets because of cheaper imports, due to the high Australian dollar and the usual raft of other problems. Then a friend told me growers at Shepparton left either 60 tonnes (or it maybe 600 tonnes, but either way a lot) of apricots to rot because SPC couldn't handle any more for processing. … isn't there some way a Federal Government (of any persuasion) can't simply say no more imports of fresh produce in times like these or at any time for that matter? It is ridiculous that we pay less than half the price of Australian vegetables and fruit for overseas produce like grapefruit, oranges and onions, notably.

Of course, he is so correct.

I notice that earlier in this debate the member for Throsby was talking about the dislocation for manufacturing and for agriculture when we entered these so-called free-trade agreements. He is right. There has been severe dislocation for manufacturing—

Debate interrupted.