Andrew Nikolic (Bass, Liberal Party) Share this | Link to this | Hansard source

I seek leave to speak again without closing the debate.

Leave granted.

I welcome the opportunity to once again highlight the trifecta of mutually beneficial free trade agreements concluded by the Abbott government. I have spoken many times before of the huge benefits of these free trade deals for my home state of Tasmania in particular, and that is because free trade—more trade—means new markets, new investments and more jobs across the entire economy.

But I regret to inform the House that not everyone thinks that way. It is very clear from the union campaign being run against the China free trade agreement that those opposite and their union handlers have little regard for the beneficial effects of growing regional trade. The suggestion that Australia's free trade agreement with China will open the floodgates for foreign workers is, frankly, false, xenophobic and irresponsible. This union campaign demonises China—remember, our biggest trading partner—and even former Labor leader Simon Crean has publicly called on the opposition leader to back this free trade deal, which will be good for jobs and good for the economy.

But it should not surprise that the opposition leader ignores such good advice, because again I regret to say he has form in this area. It is regrettable to recall him clambering onto a flatbed truck at a union rally in Adelaide last September. He gave a speech that The Australian newspaper wrote was 'an inexcusable performance' that 'stank with racist and protectionist rhetoric'. Instead of acting like a statesman and highlighting that Japan, China and South Korea are vital trading partners, Mr Shorten said we should think of Japan as an enemy responsible for sinking 366 merchant ships off Australia in the Second World War. In suggesting that Japan was still our enemy, the member for Maribyrnong confirmed he was unfit to be the alternative Prime Minister of our country. I remind those opposite that the provisions in the China FTA are entirely consistent with those previously signed by the Labor Party, and it is reckless for union officials, supported by Labor, to launch a campaign that opposes an agreement which will result in new investment and new local jobs, including in Tasmania.

The opposition leader's comments confirm again how beholden his leadership is to the most militant elements of the union movement, like the CFMEU, which funds this dishonest and xenophobic anti-China campaign. Remember that the opposition leader sat in this parliament smiling at, listening to and applauding the leaders of Japan and China. He said he supported these free trade deals, the thousands of local jobs they will create and the billions of dollars that they will bring and add to our economy. Yet Mr Shorten's actions tell an entirely different story. Labor and their union colleagues deliberately ignore provisions in the China FTA which make it abundantly clear that:

The department will only enter into a project labour agreement where it has been satisfied that Australians have been provided first opportunity for jobs.

Ms Parke interjecting—

There we go. Here we have the member opposite interjecting. I might remind the member about the front page in The Australian this morning, where unions appear to be using the same provisions to hire workplace relations advisers, copywriters, database administrators and training professionals from overseas. Surely there must be some workplace relations advisers in Australia they can draw on without getting them from overseas. So what rank hypocrisy from the member opposite! These are inconvenient facts that expose the union-led, Labor-supported scare campaign, which is irrational—

Pat Conroy (Charlton, Australian Labor Party) Share this | Link to this | Hansard source

Mr Deputy Speaker, I rise on a point of order regarding use of an unparliamentary term.

Steve Irons (Swan, Liberal Party) Share this | Link to this | Hansard source

I heard no such unparliamentary term.

Andrew Nikolic (Bass, Liberal Party) Share this | Link to this | Hansard source

My time is ticking away.

Steve Irons (Swan, Liberal Party) Share this | Link to this | Hansard source

But, if it assists the House, the member will withdraw.

Andrew Nikolic (Bass, Liberal Party) Share this | Link to this | Hansard source

I used no unparliamentary term, but if it assists the House, Deputy Speaker, I withdraw. These free trade deals will provide enormous opportunities for Australians in decades to come. They account for 61 per cent of our goods exports and 19 per cent of our services trade. When fully implemented, more than 95 per cent of our exports to China will enter duty-free. The FTA with Korea will see 99.8 per cent of Korea's tariffs eliminated on full implementation, and our FTA with Japan is the first they have signed with a major agricultural exporter, giving 97.5 per cent of our exports duty-free or preferential entry into the world's third-largest economy. So I call on this parliament to get behind the extraordinary benefits of the Asian century in a bipartisan way, and cease this xenophobic campaign. (Time expired)

Melissa Parke (Fremantle, Australian Labor Party, Shadow Assistant Minister for Health) Share this | Link to this | Hansard source

I seek leave to continue my contribution on this motion concerning FTAs.

Honourable Member:

An honourable member interjecting—

Steve Irons (Swan, Liberal Party) Share this | Link to this | Hansard source

The debate is open. Order! The member for Fremantle has sought leave to continue her speech without closing the debate; is leave granted?

Leave granted.

Can we restart the clock as well, thanks.

Melissa Parke (Fremantle, Australian Labor Party, Shadow Assistant Minister for Health) Share this | Link to this | Hansard source

Since the motion was last debated, the text of the ChAFTA has been released and, as AFTINET's excellent submission to the treaties committee shows, it reveals extraordinary concessions by the Australian government to China, of a type and level unseen in any of Australia's other FTAs. Government denials about these concessions constitute a serious misrepresentation to the Australian people.

The provisions on temporary movement of people are contained in four different documents: in chapter 10 of the agreement, in a side-letter to the agreement, and in two MOUs that were negotiated as a condition of the agreement. Chapter 10 of the agreement provides explicitly that there will be no labour market testing or economic needs test for any categories of temporary skilled workers. The side-letter states that Australia will remove the requirement for mandatory skills assessment for 10 occupations, including electricians, mechanics and carpenters, and will aim to reduce or eliminate skills assessment for all occupations within two years.

Despite the government's unprincipled denials, together Chapter 10 and the side-letter clearly remove local labour market testing and skills assessment for temporary workers in skilled occupations. There is thus no guarantee that temporary workers will have the same level of skills, health and safety knowledge and qualifications as required for local workers, thus creating serious safety issues for themselves, other workers and the general community.

A separate MOU on an investment facilitation arrangement provides that, where a Chinese enterprise owns at least 15 per cent of a project worth $150 million, it may bring in an unlimited number of temporary workers, with the terms and conditions of their employment, the English language requirements, qualifications and experience and minimum wage to be subject to negotiations between the department of immigration and the company. There will be no requirement for local labour market testing. There is a significant risk that these workers will be isolated from the local workforce and will thus be very vulnerable to exploitation. Given the lack of enforcement of the existing 457 visa regime, it is hard to see how the community will be able to feel comfortable about such arrangements, which will occur behind closed doors, hidden behind claims of commercial-in-confidence.

There is a further MOU by which Australia will grant, each year, 5,000 work and holiday visas to Chinese young people with a tertiary education, for working holidays; however, this arrangement is not reciprocal for Australians in China. There is also no reference in the MOU to compliance with Australian laws and workplace standards, so this would seem to be another potential area ripe for exploitation.

As with our FTA with Korea, the ChAFTA also contains ISDS provisions. However, the ChAFTA provisions—including important matters such as the definition of indirect expropriation and the minimum standard of treatment of foreign investors—are not complete and have been delegated to a committee to review in three years' time. One wonders how a country like Australia, with battalions of bureaucrats and lawyers, could sign up to an agreement that is not finished, unless it was a politically-driven decision to just get it done without regard to the consequences. It is also difficult to see how the Australian parliament could be asked to vote on implementing legislation for the agreement without having details as to the future provisions.

Regarding the ISDS clauses that are in the agreement, they demonstrate less transparency than the KAFTA, as they do not require ISDS hearings and documents to be made public. Given the recent imported frozen berries scandal, it is also extremely concerning that, while the KAFTA excludes ISDS from application to the 'Technical barriers to trade' chapter, which includes food labelling, the ChAFTA does not. Why did the Australian government not seek specific protection of food labelling from ISDS in ChAFTA?

As the AFTINET submission notes, in October last year the Australian Industry Group reported that a survey of its members found that many manufactured goods coming from China do not meet Australian safety and quality regulations, including dangerously faulty electrical cables which could have affected up to 40,000 homes and businesses. However, rather than strengthening the assessment of imports for conformity with Australian safety and quality standards, the government—through ChAFTA—is doing the very reverse, in reducing import controls and assessments. Unlike KAFTA, ChAFTA also does not contain chapters on labour environment, which means that neither government has made any commitments not to reduce labour rights or environmental standards, nor to implement ILO rights or international environmental agreements. This means that ChAFTA, in effect, rewards violations of labour and environmental standards by granting preferential market access to Australia for goods produced in substandard conditions.

Finally, I think it is important to say—as did Rep John Conyers, a Detroit democrat, in the context of the recent TPP debate—that instead of asking about implications for economic growth I hope my colleagues ask: 'Is this policy good for living standards, the health of the planet, creating jobs with dignity, promoting peace and ensuring an educated populous?' The truth is that, as the Productivity Commission has found, these so-called free trade agreements stand to undermine the high-quality social, economic, health, workforce and environmental standards that countries like Australia have painstakingly established.

Scott Buchholz (Wright, Liberal Party) Share this | Link to this | Hansard source

I thank the member for Fremantle who spoke before for their contribution, because it was that delivery that crystallises for every Australian that those on the other side of the House are not in support of the free trade agreements. They suspect that the free trade agreement brings with it issues of national security—I think they alluded to that—and it brings about issues of conflict in the way of environment and a number of other issues. Once you understand that that is the position of the other side, espoused in this very place, you now know why Labor, when in government for six or seven years—with a foreign minister, who was previously the Prime Minister—had no intention whatsoever of dealing with the issues of free trade. I commend the excellent work that has been done in this place by our trade minister and the work that has been done by the office of Minister Robb, on delivering economic reform that will have an immediate benefit not only in Australia but in my electorate.

The Japan-Australia Economic Partnership Agreement is the most liberalised bilateral trade agreement that Japan, our second-largest trading partner, has ever concluded, providing Australian exporters, importers, investors and producers a significant advantage over their international competitors. Japanese Prime Minister Abe was warmly and openly received by both sides of the House. It beggars belief that today you would have speakers from the other side of this House rise to not only contradict their own leader's position when in the company of a foreign dignitary but truly show their underbelly and how much those on the other side of this chamber detest the fact that the world is becoming a smaller place and that free trade agreements are a necessity.

More than 97 per cent of Australian exporters to Japan will receive preferential access to enter duty free when the free trade agreements are fully implemented. The agreement would also deliver major benefits to local consumers, with tariffs to be eliminated on Japanese cars and parts and a wide range of household items including whitegoods and electronics. What that potentially means is that, when tariffs are removed from the stuff we are currently buying from Japan that has tariffs on it, the benefit will flow directly to households. We came to this election saying that we wanted to reduce the cost of living. This is one of the mechanisms by which we will achieve these outcomes. Admittedly, one does not go out and buy a fridge, a washing machine, a Toyota or a Mitsubishi every week but, when those capital purchases are made in the fullness of time, these free trade agreements will provide a cheaper cost of living to the Australian public and that should be celebrated. Cheaper imported items from Japan, including cars, increases the choice buying power of local households, and ultimately leads to the improvement of living standards for Australians.

With reference to the Korean free trade agreement, it is a world-class comprehensive agreement that has sustainably liberalised Australia's free trade agreement with our fourth largest trading partner. The agreement helps to level the playing field for Australian exporters competing with those from the United States, the European Union, Chile and the Association of Southeast Asian Nations, who benefit from the existing trade deals.

In the time that is allowed to me, I want to go to the union movement, who the Australian Labor Party rely so heavily on for funding. On the television at the moment, they are running a scare campaign advocating that the free trade agreement is not good for our country. The premise of that advertisement is fundamentally flawed given that they use the example of an electrician, saying that an electrician can come here and does not have to have the qualifications. To trade as an electrician in Australia, you need to meet the Australian minimum standards. I am interested to see whether the next speaker intends to rebut that point. It fundamentally underpins the falseness or the flaw in that television campaign, and I look forward to listening to the next speaker's contribution.

Pat Conroy (Charlton, Australian Labor Party) Share this | Link to this | Hansard source

I think that all in this place agree that good-quality free trade agreements improve the economic welfare of this country. Unfortunately many aspects of the three agreements we are discussing today are not good-quality free trade agreements. The truth is that the coalition government have sold out Australia on these agreements just as they sold out Australia on the US free trade agreement.

Andrew Nikolic (Bass, Liberal Party) Share this | Link to this | Hansard source

Madam Deputy Speaker, under standing order 66(alfa) there is an opportunity for members opposite to either ask a short question or to provide a 30-second intervention, and I would ask the honourable member for Charlton whether he would be willing to accept an intervention on what he has just said about the quality of these free trade agreements.

Michelle Landry (Capricornia, National Party) Share this | Link to this | Hansard source

Do you accept that?

Pat Conroy (Charlton, Australian Labor Party) Share this | Link to this | Hansard source

I do not, because I will be addressing that in my remarks. The truth is that saying that a free trade agreement benefits all is grossly overstated and exaggerated. This is not from me; this is from the Productivity Commission. For example, the Howard government claimed that the US FTA would deliver $4 billion per year of benefits to the Australian economy. Studies have shown that the copyright provisions alone cost $700 million. The Productivity Commission study found a $700 million cost from the copyright changes alone. The Crawford School of Public Policy, Australia's pre-eminent trade academic institution has found that the US FTA diverted trade by $52 billion and actually led to a decline in trade between the United States and Australia.

Mr Nikolic interjecting—

Michelle Landry (Capricornia, National Party) Share this | Link to this | Hansard source

I ask the member for Bass to sit.

Pat Conroy (Charlton, Australian Labor Party) Share this | Link to this | Hansard source

The truth is they do not want to hear the truth on these free trade agreements. There is a reason they were not negotiated under the last government: because we were sticking up for the automotive industry and against the implications of these FTAs for the automotive industry, and then you killed the automotive industry.

The other sticking point is the investor-state dispute settlement clauses, clauses that give foreign corporations more power to sue the Australian government than home-based corporations. These are clauses that are opposed not only by the Labor Party but also by the Chief Justice of the High Court of Australia, hardly a Labor puppet. They are also opposed by the Productivity Commission. The pre-eminent free trade institution in this country opposes ISDS clauses and says that they reduce the net benefit to Australia. The truth is that these agreements are sub-optimal. They impact negatively on the welfare of Australia in many areas, including the ISDS clauses. On the China free trade agreement, the labour mobility clauses are unprecedented in selling out the rights of Australians. The IFAs provide no requirement for labour market testing. All we have seen is a vague flow chart from the Department of Foreign Affairs and Trade that they somehow would think about labour market testing at some point in the future. I say to the government: if they are certain they will test the labour market, put it in legislation—amend the Migration Act to confirm that labour market testing will apply to IFAs and other provisions under the China free trade agreement.

The second aspect of the labour mobility provisions that is very worrying goes to the requirement to only pay the minimum wage and not the market rate. That has the effect of driving down wages in this country. If you are only required to pay the minimum wage—rather than, for example, the enterprise agreement wage—you are going to drive down wages in these very important professions.

Thirdly, chapter 10 of the free trade agreement makes it very clear that, if you purchase Chinese capital equipment, you can bring in Chinese labour to install and service that equipment. Chapter 10 makes it very clear that will occur without labour market testing and without any requirement to pay market rates of pay.

The truth is that those on the other side are very sensitive about this agreement, because it is cutting in their electorates. It is cutting in their electorates because they are selling out Australian worker's rights. They are selling out the rights of Australian workers on two fundamental premises: to test the labour market and to pay market rates of pay. They are two fundamental principles that we will keep driving home, because the free trade agreement, as presently constructed, will hurt Australian workers, will drive down wages and will not be to the net benefit of Australia.

Debate adjourned.