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

I rise to speak on the China-Australia Free Trade Agreement enabling legislation. From the outset, I make it clear that I support freer trade and I will vote for this agreement, but I do so reluctantly and with open eyes. I do so reluctantly because the coalition government's record on negotiating trade agreements has been diabolical. Seriously, if I were the foreign negotiator and Andrew Robb came to me, I could issue him with anything and he would sign it. This guy would buy the Harbour Bridge. Nevertheless, after a concerted information campaign and strong negotiations led by Senator Penny Wong, the final agreement is sufficient and Labor will support it. I will go to some of my concerns around the FTA in a moment.

I want to inform the House of some of the previous very mixed record of those opposite on free trade agreements. The best place to start is the US free trade agreement—a trade agreement that promised so much but has delivered so little, a trade agreement where they trumpeted modelling that other reputable economic modellers said did not pass the laughter test, and a free trade agreement which has been in operation for around 10 years. Shiro Armstrong from the Crawford School at the ANU, a university and a research school profoundly in favour of trade liberalisation. A research paper by Mr Armstrong has found that not only has our trade balance with the United States not improved but two-way trade with the United States has fallen. Let me repeat that: since the free trade agreement, two-way trade with the United States has fallen. We have seen research from Dr McGovern at QUT which has found that our trade balance with the United States and Thailand has deteriorated since the FTAs were signed, and the Thai FTA is really symbolic of the coalition's very poor approach to trade agreements. They promised that this trade agreement would deliver bounties for the Australian automotive industry and it would deliver thousands and thousands of jobs. What happened is that the free trade agreement was implemented and tariffs fell, nominally allowing Australian cars to be imported into Thailand. What did the Thai government do? The same day, they whacked up duties on large cars, directly targeting the Commodore and the Ford Territory, which meant that our car industry was unable to penetrate the Thai market, and that led to not a single additional job in the automotive industry in Australia.

We had the member for North Sydney's valedictory today which capped off a 20-year contribution to politics, which I honour, but a very important point of his speech was the fact that he spoke positively about destroying the Australian car industry and thereby enabling the free trade agreements with Japan, Korea and China. That is a factual statement. Having witnessed subcommittee of cabinet discussions in the last government, one of the key stumbling blocks between signing the free trade agreements was the impact on the automotive industry in Australia. The member for North Sydney removed assistance to that industry and destroyed 250,000 direct and indirect jobs, enabling free trade agreements. Let's be frank about it: the free trade agreements we are debating now are only in place because the coalition government destroyed the Australian automotive industry. That is a factual statement that the member for North Sydney admitted to in his contribution to his valedictory today. We have a very torrid and mixed situation from the coalition government.

The original free trade agreement was a dog's breakfast. It was a dog's breakfast that led to an information campaign from the labour movement that pointed out the very significant flaws in the agreement, and they were confirmed by The Conversation and the ABC FactCheck unit. Both the FactCheck unit from The Conversation and the ABC confirmed that the claims made by the labour movement were factually correct.

Government Members:

Government members interjecting—

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

I note the derision over there. Facts are the enemy of the coalition government. Facts are very inconvenient for those on the other side. Nevertheless, the Labor Party engaged productively and constructively with the coalition government and negotiated on three important areas. We identified significant flaws in the IFA process. We identified flaws in chapter 10 on the free labour movement and in the licensing of skilled trades, and we achieved significant concessions. On IFAs we achieved compulsory labour market testing, not just a mere policy that those on the other side could drop at any time I felt like it. We achieved a commitment to labour market testing, to training plans and to skills transfer, and put in place a real framework to support overseas workers. Chapter 10 was harder because the movement of free persons was embedded in the treaty of the agreement. We achieved a significant concession around all 457 visas which requires the market rate of pay to be the EBA rate of pay when it is applicable. That is an important concession. On licensing, we have achieved a concession where, for example, in skilled trades that require licensing, a 457 visa holder must notify immigration if they have not been able to satisfy the licensing provisions of the relevant state. So, important Labor safeguards have been put in place that make a substandard free trade agreement acceptable to the Australian Labor Party and, I believe, acceptable to the majority of the Australian people.

The skewed priorities of those on the other side are interesting. They were very happy to open up movement of natural persons, to allow Chinese 457 visa holders to come into this country without market testing, but at the same time they screwed down controls on the free movement of capital. They folded to the reactionary National Party, and instead of allowing the Chinese companies to purchase farmland at the same levels that the United States is allowed to under the USFTA, which is $1.1 billion, they have applied $15 million. So it shows who really runs the coalition government. It is the reactionary National Party, who allow Chinese labour to come in without labour market testing but will not allow Chinese capital to come in and invest in this country and improve the liquidity of the agricultural sector. It very clearly shows who controls those particular parties.

There is still more work to do. We have made that clear. This is not the agreement we would have negotiated. I am still very concerned about investor-state dispute settlement clauses that give foreign corporations the right to sue the Australian government for decisions we make to improve the welfare of Australians—a clause that we are seeing in operation right now, with the Hong Kong arm of Philip Morris suing the Australian government. We would not have negotiated that. The Labor Party's policy is not to include ISDS in free trade agreements, and our policy is to remove it where possible. We would not have negotiated it.

This whole tawdry episode has demonstrated the need for more reform around 457 visas to avoid exploitation. We need genuine labour market testing that demonstrates that Australian workers have been offered real opportunities to apply for the work first. We need adequate market rates of pay—not a tick and flick exercise—where there is genuine exploration as to the market rate of pay the Australian employer should pay. Also, we need genuine enforcement. There are 300 inspectors in the Fair Work inspectorate, who are tasked with overseeing the entire industrial relations system of this country, including the 457 visa system. That is simply insufficient. We need to employ more inspectors. To fund that, I would argue that we should go to a full cost-recovery for the fees that we charge 457 visa applicants, because the Australian people need to have confidence in the 457 visa system. I support the system, but it should be there to allow Australian employers to fill short-term skills gaps. It should be there to fill genuine gaps. To do that the Australian people need to have confidence, a) that Australians are not interested in the jobs, b) that market rates of pay will be paid, and, c) that there will be adequate enforcement and oversight so that we do not see the abuses that all too often come to light.

I acknowledge that the last Labor government moved on the 457 visa area. They made significant improvements, but it was not enough. So I am not saying this is a partisan issue. More needs to be done, no matter who is in power. We need to have a sophisticated trade debate. I support trade liberalisation, where there are adequate safeguards for the environment and for the labour movement. The interjections from the other side show just how incompetent they are. They fall into slogans about Paris and everything else. I support trade liberalisation, but it must be done in a way that does not impugn the sovereignty of the Australian government, does not affect labour safeguards, and does not undermine our environmental sovereignty. I will be very interested in reading the Trans-Pacific Partnership text to see what those provisions are, because I know the United States government insisted on them.

So, let's escape from these superficial slogans. Let's have a fair dinkum debate about trade. I support high-quality trade agreements that do not merely divert trade. But, unfortunately, under the coalition government we have seen too many tick and flick exercises where harbour bridges have been sold—Minister Robb. We have seen the USFTA over-promise and under-deliver and the Thai FTA over-promise and under-deliver, and I am hoping the China-Australia Free Trade Agreement does not fall into the same gap. I am not talking from a rabid lefty point of view. I am voicing the concerns of the Productivity Commission, for example, and I am voicing the concerns of the Crawford School at the ANU—so it is hardly rabid left-wingers. I will vote for the China-Australia Free Trade Agreement enabling legislation, because, as amended by Labor's negotiations, it is a satisfactory agreement that I am satisfied will have employment outcomes for Australians, but it must not be done with increasing exploitation of foreigners or by undermining Australian wages and conditions.

Rick Wilson (O'Connor, Liberal Party) Share this | Link to this | Hansard source

Today I rise today in support of the Customs Amendment (China-Australia Free Trade Agreement Implementation) Bill 2015 and its complementary Customs Tariff Amendment (China-Australia Free Trade Agreement Implementation) Bill 2015. I thank Minister Robb for introducing these bills to the House and for the incredible job he has done towards the enabling of this landmark free trade agreement, which, in his words is 'the highest quality and most liberalising trade deal that China, the world's second biggest economy, and our largest two-way trading partner, has done with any other developed country'.

On the passage of these bills, this agreement will provide Australia with unprecedented access to the world's second-largest economy and a market of some 1.3 billion consumers, eager for Australian products and services. China is currently Western Australia's largest export market, worth over $64 billion in 2014. My electorate stands to benefit tremendously from the timely passage of these bills, such that the agricultural, mining and tourism interests of O'Connor can reap the economic benefits of enhanced trade with China.

Immediately on the passage of this bill, 85 per cent of our exports will qualify for duty-free entry into China, rising to 93 per cent within four years, and 95 per cent on full implementation of the China-Australia Free Trade Agreement.

This agreement will give Australia a head start in many instances against competitors like the United States, Canada and the European Union. Nowhere is this better illustrated than in other countries' existing China FTAs, which have led to a fourfold increase in exports from New Zealand and a sevenfold increase in exports from Chile into China.

In 2011, Australia's agricultural exports to China were worth $5 billion, climbing to $9 billion in 2014. Prompt implementation of the ChAFTA will result in first-round tariff reductions immediately. The tariff reductions are scheduled annually, which means a second round of tariff reductions will occur on 1 January 2016. Australian beef already accounts for over half of China's beef imports, and our main competitors do not yet have FTAs. Our exports of beef to China are already on a steep trajectory, rising from 35,000 tonnes in 2012 to 128,000 tonnes, worth over $650 million, in 2014. Demand for our premium beef is tipped to grow exponentially with the expansion of China's middle class and the desire for a Western diet and high-quality protein. For the beef producers of my electorate, ChAFTA will enhance market access, with tariffs ranging from 12 to 25 per cent eliminated within nine years. Meat and Livestock Australia's Andrew McCallum spoke at a pastoralists and graziers conference I attended recently. He estimated that ChAFTA will reap annual benefits to the beef industry of $273 million per annum by 2024, to represent a total benefit of just under $3.25 billion between now and then.

China's demand for sheepmeat is also growing, with imports from Australia more than doubling between 2012 and 2014. China is Australia's second most important sheepmeat destination despite existing tariffs of 12 to 23 per cent. Although New Zealand has a longstanding FTA with China that will see its lamb enter tariff free from 2016, ChAFTA will gradually achieve the same status for Australian sheepmeat over the next eight years. Fletcher International Exports operates a sheepmeat abattoir and processing plant in Narrikup in the Great Southern region of my electorate. Fletcher reports a 30 per cent growth in exports of sheepmeat to Korea since the implementation of the Korea-Australia Free Trade Agreement. It looks forward to the implementation of ChAFTA, where sheepmeat tariffs into China of up to 23 per cent will be eliminated within eight years. Fletcher's plants in Narrikup and Dubbo together employ over 1,200 workers and have the capacity to process over 90,000 animals per week. In the last two years, they have exported over 51,000 tonnes of sheepmeat into China. Roger Fletcher, owner of Fletcher International Exports, states:

Without the China Trade deal, the Kiwi's will have the jump on us. That will mean lost jobs in regional communities.

In addition, Fletcher anticipates growth in demand for its sheepskin and lower value sheepmeat products as tariffs are reduced. The sheepskin tariff of seven per cent will be removed within four years, whilst the sheep offal tariff of 18 per cent will be removed within seven years.

According to Meat and Livestock Australia, the North Asia FTAs will reap over $20 billion in benefits over the next 20 years for Australian producers of sheepmeat, beef and their co-products.

With respect to dairy, China is now Australia's No. 1 market for dairy exports, with our industry worth $13 billion. Our dairy farmers face tough competition from New Zealand, the European Union and the United States. Currently, New Zealand dairy produce already receives considerable advantage due to its pre-existing FTA with China. Australia's dairy tariffs are currently up to 20 per cent, but ChAFTA will put our farmers on a more even playing field, with reductions to zero over four to 11 years, depending on the product. In the south-west of my electorate, this will have impact on large and expanding export operations like the Daubney family's Bannister Downs Dairy. I was speaking to Sue Daubney recently and she reiterated that this is a huge opportunity, not to be missed. Bannister Downs already has a seamless trade with Singapore, which she says is 'an open, friendly market'. Recently, there has been significant investment from big-business entities like Gina Rinehart, whose Hope Dairies is in partnership with Bannister Downs. Sue states that, although there are many barriers to trade with China, especially exporting chilled milk, they look forward to the ChAFTA helping open up this market to Australia's quality dairy produce.

O'Connor also has a significant wine-producing industry, with highly awarded premium wines coming from the Mount Barker, Porongurup, Frankland, Great Southern, Manjimup and Pemberton regions. The export of Australian wine to China was worth over $200 million last year. Australia currently competes with New Zealand and Chile, who have preferential access under their own FTAs with China. Tariffs on Australian wine exported to China currently range from 14 per cent to 20 per cent and are a significant impost on our producers, who vary from small boutique businesses to larger volume commercial propositions. On implementation of ChAFTA, this impediment to trade with China will be removed over four years. One of the big producers in our electorate is the Burch Family, who make MadFish, Howard Park and Marchand & Burch branded wines. I have had the pleasure of tasting their delicious wines at their Denmark cellar door. The Burch family have been exporting wines for over 20 years and are very Asia focused. Implementation of the Korea-Australia Free Trade Agreement has already seen an increase in their sales to Korea by 50 per cent. China is already one of Australia's largest wine export destinations, and Burch Family Wines CEO Jeff Burch is gearing up for when reductions in tariffs under the new free trade agreement with China commence. As he says, the government is creating a great opportunity with this free trade agreement, so with implementation of ChAFTA it is 'up to the business community in Australia to get off their backside, and get out there and have a go'.

As I mentioned, I am a farmer. I raise sheep for wool and meat and grow predominantly wheat, barley and canola. China makes up 75 per cent of Australia's wool market. Wool already enters China duty free but under a strict World Trade Organization quota of almost 290,000 tonnes. As part of the ChAFTA, there will be an Australia-only duty-free wool quota of 30,000 tonnes of clean wool on implementation, increasing by five per cent per annum to over 44,000 tonnes by 2024. This is in addition to continued access to the World Trade Organization quota. Good news for the grain farmers in my electorate is that tariffs on grains such as barley, oats, quinoa and millet will be immediately reduced to zero on the implementation of ChAFTA. Last year, Australia exported over $1 billion of barley alone to China, up 33 per cent since 2010. Although wheat is excluded from the current agreement, there is provision to have it reconsidered within three years. Andy Crane, Chief Executive Officer of Co-operative Bulk Handling, looks forward to the opportunities that will open up for the Australian grain industry with the implementation of ChAFTA, resulting in 'a sustainable competitive advantage to the economies and societies of both nations'.

For other agricultural produce like horticulture, aquaculture and fisheries, ChAFTA will also open up huge export opportunities. Horticulture is the predominant industry in the Manjimup area of my electorate, growing premium avocado, potatoes, apples and other vegetables. China is a growing market for Australian horticultural exports, with exports worth $56 million last year, up from $13 million in 2010. China applies some of its highest tariffs to our horticultural produce. The removal of tariffs of up to 30 per cent over the next four years will be a boon for the exporters of Manjimup. Manjimup also produces over 80 per cent of Australia's prestigious black winter truffle, which is harvested at the opposite time of the year to the French and Italian varieties. Italy currently dominates the truffle market into China. Manjimup's Truffle and Wine Company managing director Alf Salter welcomes any opportunity to contribute counter-seasonal produce to the Chinese high-end restaurant market and will ramp up his negotiations to try to secure access into China on the implementation of ChAFTA.

I have also been approached by constituents growing freshwater crustaceans, such as yabbies and marron, who are keen to capitalise on markets in North Asia. Their produce would be shipped chilled and live and so requires different consideration to chilled or frozen seafood. Australian seafood exports to China totalled $35 million last year. Our Great Southern produces world-class abalone, southern rock lobster, scallops and crab. My electorate's $10 million seafood industry stands to gain from the removal of tariffs of 14 per cent on abalone, crab and scallops and 15 per cent on southern rock lobster over the next four years.

While the agriculture, horticulture and viticulture sectors as well as fisheries and aquaculture are undoubtedly the biggest winners under ChAFTA, the resources sector, which is so important in many parts of my electorate, will also see significant benefits upon implementation of the agreement. While the gold sector is not currently subject to any tariff, the increased investment from China will see many mining operations either reopened or expanded. A great example is Hanking, operating St Barbara's Southern Cross mine, which reopened in the last 12 months with a workforce now of over 300 and is looking to expand by another 60. Norton Gold Fields owns the Paddington operation, 35 kilometres north of Kalgoorlie and one of Australia's largest domestic gold producers, with annual production of more than 178,000 ounces. The nickel industry, which is centred around Kambalda but also has significant operations at Leonora, Leinster, East Hyden and Ravensthorpe, has suffered price reductions of 30 per cent on the world market over the past 12 months. The collapse in prices has tested the viability of every nickel producer, and cost cutting has led to many job losses across the industry.

The ChAFTA does provide some relief with the immediate removal of a three per cent tariff on nickel mattes and oxide. Minerals Council of Australia Chief Executive Brendan Pearson recently summed up the benefits of ChAFTA by saying:

The trade agreement with China is an unambiguously good deal for Australia. It is a high quality agreement that will deliver stronger economic growth, more jobs and better living standards.

That quote sums up what this agreement means for my electorate: jobs, jobs and more jobs. One in five Australian jobs is linked to trade. Growing our international trade means growing Australian jobs. I thank all in the chamber today for reaching a united decision to support these bills for the good of our nation going forward. I therefore commend these bills to the House.

Joel Fitzgibbon (Hunter, Australian Labor Party, Shadow Minister for Agriculture) Share this | Link to this | Hansard source

In the spirit of the agreement struck between the government and the opposition to facilitate the passage of the Customs Amendment (China-Australia Free Trade Agreement Implementation) Bill 2015 and related legislation through the House tonight, I will keep my comments as brief as is possible. But of course no-one in this place is happier about this agreement now that it has been improved than me. It will be of great benefit to the agriculture sector. At the risk of repeating some of the comments made by others: for beef, for example, tariffs of between 12 and 25 per cent will go to zero over nine years; for dairy we will see the elimination of tariffs of between 10 and 15 per cent, depending on the product, over four to 11 years; and for sheep and goat meat we will see the elimination of tariffs of between 12 and 23 per cent within the next eight years. The list goes on and on; it stretches through wool, pork, wine and spirits, horticulture, barley, sorghum and other grains, seafood and even processed food. Sugar has not done all that well and appears not to be doing well under the TPP, which I know is a disappointment to our canegrowers, and the opposition stands ready to work with the government in any way it can to improve the circumstances for those growers.

Having said that it delivers substantial benefits to agriculture and of course many other sectors, I just want to point out that this is not a free trade agreement; it is best described as a preferential trade agreement. That means it allows Australia better access into China than some of our competitors. To say the same, it allows Australia to catch up with some of our competitors—those competitors who have been facing lower tariff regimes for some time. There is no better example than the dairy industry, in which our New Zealand competitors have had advantage for many years now. So, it is very, very important to the agriculture sector.

The changes the opposition sought are important ones. Again, it is a very beneficial deal to the Australian economy and many operators within that economy. But it is not necessarily such a great deal for those Australians who were not guaranteed the opportunity to take up the jobs that may be presented by the agreement with China. I thought our concerns were valid. It was quite obvious that they were shared by many in the broader community. I am thankful to the Prime Minister and Minister Robb for their willingness to come to the table and agree and in doing so to meet those concerns and indeed allay those concerns.

I want to pay tribute to my colleague Penny Wong, as the Prime Minister did today. She worked very hard and very smart and very cooperatively with Minister Robb to navigate these changes. They are difficult, because none of us wanted to do anything that would offend the agreement per se. That would be unacceptable. But we were determined that we could make changes extending those protections without offending the agreement. The government has now agreed to do so, and we appreciate it very much.

Of course, those agreements go mainly to ensuring that, first, Australians have the opportunity to secure those jobs through labour market testing and, second, that anyone coming into the country—for example, in a technical trade situation—has the necessary skills to do so in a safe manner, and to ensure that people coming in are not exploited. In addition to that, it is about making sure we are not giving over jobs to others at lower pay scales—in other words, entry-level type jobs rather than those that require far greater expertise and experience. So, that is a very good outcome.

I just want to make a couple of comments about agriculture and the so-called dining boom—the enormous demand now coming out of Asia for high-value food. These agreements, as I said, allow us to enter the market a little more cheaply, and that is a good thing—unequivocally. But Australia's real opportunity in Asia does not lie so much in volume—as important as that will be—as in value. Generally speaking, we therefore need an agriculture plan which helps the sector move up that value chain, tapping into niche markets, delivering a product for which people in the growing middle classes of Asia are prepared to pay a high price. So you can see that every reduction in our tariffs makes that task easier. But, in the scheme of things, it is not as important as it is in a commoditised market dealing with homogenous product, where each competitor is selling a product which is basically the same.

I believe we need to be cautious of complacency setting into the sector, the sort of complacency which might grow from an exaggeration of the benefits of this deal to agriculture. They are not infinite. They are substantial, but they are not infinite. I have heard many in the sector who might be doing it tough because of drought, for example, or other cost pressures, saying, 'We will be all okay now because we have signed the China free trade agreement and the world will be our oyster'—excuse the pun. That is simply not true. This bill will deliver substantial competitive opportunities and enhance our competitive advantage, but it is not the panacea for all of our challenges in the agriculture sector. I would be disappointed to see politicians promoting complacency in the sector by overstating the benefits of this deal. I read an article which extensively quoted a stock and station agent in a regional community. He was talking mainly about drought, but at the end of the conversation he said, 'But it will be all right now because we have signed the China free trade agreement.' That is a perfect example of what I am talking about. It is not a panacea; it is not going to overcome every challenge we face in the agriculture sector, and we as politicians should not in any way be indicating to people that that is the case.

It raises all sorts of questions about the current state of the beef sector and the size of the nation's herd. We do want to send more beef—boxed, frozen, chilled, live—to Asia. That is a good thing for the country. The reason beef prices are on the rise at the moment is a simple function of supply and demand. Drought and other factors are causing people to turn cattle off earlier, and the herd size in Australia is in decline. When the herd size is in decline, demand starts to outstrip supply and prices rise. That is good thing for the producer. I am not suggesting the producer should not be benefiting from that—that is good thing—but it is not necessarily a good thing for the consumer, because eventually those prices must be passed on. There might be delay as the processors or even the retailers take time to pass those prices on to the consumer, but it will happen. So there needs to be a broader approach, a broader strategy, from government to address those issues or take them seriously. Rather than have the minister, on a daily basis, attempting to take credit for higher beef prices—something he is in no position to do—he really should be looking further forward and asking himself what, if anything, government can do to work with the sector to address that shortage of cattle and what that is doing to the herd size and what that consequently is doing to prices.

As I was going through my ChAFTA file, I noticed an article which quoted Minister Joyce back in 2014:

… he said consumers should not pay higher prices, insisting ­retailers and processors were res­ponsible for any price inflation.

I do not really know what that means. If it means that processors and retailers who are paying more for their product are not going to pass that cost on to the consumer, then it demonstrates a fairly poor grasp of economics. Yes, I will be with everyone else in this place and say that it is for us, through our regulators, to make sure there is no gouging and they are not passing on more than their additional costs to the retailer. But the fact is that, if farmers are getting more at the farm gate, processors are paying more for the cattle and therefore they are more than likely charging retailers more. Knowing the retailers well, you can be pretty sure they are going to pass that cost on to consumers. So higher prices at the farm gate are a great thing for producers, but we need to be alert to the fact that higher prices, on average, are probably better for producers, processors and indeed retailers in the long run.

The opposition welcomes the Prime Minister's agreement to come to the party on our changes. This is a good day for Australia. It is certainly a good day for those who operate in our agriculture sector and of course many sectors beyond that, and I welcome that.

Peter Hendy (Eden-Monaro, Liberal Party, Assistant Minister for Productivity) Share this | Link to this | Hansard source

I rise in support of the Customs Amendment (China-Australia Free Trade Agreement Implementation) Bill 2015 and cognate legislation and therefore in support of the China-Australia Free Trade Agreement. Since being elected to office, the coalition government has pursued an aggressive trade and investment agenda aimed at putting in place the best possible settings for business to flourish. This agenda has led to the swift conclusion of three landmark free trade agreements with the major economies of North Asia: Korea, Japan and China. The agreements form a powerful trifecta which will open up many doors across goods, services and investments. Together, these agreements cover countries that account for over 62 per cent of Australia's export market and provide Australian business with access to more than 1.5 billion people. The Korea-Australia Free Trade Agreement and the Japan-Australia Economic Partnership Agreement have entered into force, and we are working hard to ensure that the China-Australia Free Trade Agreement comes into effect later this year through this bill.

Tariffs to Korea and Japan have been cut twice already. Among the wide ranging benefits these FTAs are delivering are significant openings for our world-class services sector, which represents 80 per cent of our GDP—services such as health and aged care, tourism and hospitality, financial services, education, construction, engineering, architecture, urban planning and insurance, to name just a few.

In terms of food exports, Australia's high-quality clean, green and safe produce is becoming increasingly popular among Asia's growing middle class, and they are prepared to pay a premium. Australia's dairy products, fruits and vegetables, beef, seafood and wine all command top dollar in Asia, and our FTAs enhance market access in all these areas, with tariffs either eliminated or substantially reduced.

It is also important to note that while the elimination of tariffs into these markets increases our competitiveness when exporting, the removal of tariffs on imports into Australia can result in cheaper inputs for Australian businesses, such as our high-end manufacturers.

This year the coalition government has also worked to lock away new agreements such as the Trans-Pacific Partnership Agreement, while negotiations with India are also well underway as we work towards an ambitious target to conclude an economic partnership agreement as soon as possible.

A key focus for the government throughout 2015 was to help as many Australian businesses as possible understand the potential benefits of our free trade agreements. This included a series of seminars across the country, the first of which I co-hosted with the Minister for Trade and Investment in my electorate of Eden-Monaro. The reason the trade minister took that series of seminars on the road is because the free trade agreements provide unprecedented access to the regions and some of the world's top markets.

ChAFTA, the China-Australia Free Trade Agreement, in particular provides unprecedented access to what is already the nation's top overseas agricultural market. That is very important to a rural and regional electorate like mine. China buys more of Australia's agricultural produce than any other country. In the last financial year this market was worth $9 billion to Australian farmers and the broader agricultural sector. I will go through some of those benefits. Under ChAFTA, Australia's beef, sheep and pork farmers will gain from the phased abolition of tariffs of up to 25 per cent while tariffs on all fruit, vegetables and nuts will be eliminated. Eden-Monaro contains one of the most important sheep-grazing districts in the country—not only for wool production but also for breeding programs that the industry acknowledges as being amongst Australia's best. Exports alone were worth $2.9 billion to the national economy in 2013-14. Across the capital region, on the Monaro and the high country, we can look forward to our graziers receiving an Australia-only duty-free quota of 30,000 tonnes of clean wool which will grow by five per cent each year to reach 44,324 tonnes in 2024. This is in addition to the 287,000-tonne existing WTO wool quota already extensively accessed by Australian wool producers in the China market.

Another important benefit for our local community will be the elimination of all tariffs on sheep and goat meat over the next eight years, the elimination of all tariffs on beef over the next nine years, and the elimination of all pork tariffs within four years. In the Bega valley we can look forward to tariffs being progressively abolished for Australia's $13 billion dairy industry, including the rapid elimination of the 15 per cent tariff on infant formula. Similarly, tariffs on most timber products will be removed immediately whilst tariffs on some products, such as bamboo, will be eliminated over four years.

On another part of the South Coast, in the Eurobodalla, we can look forward to the elimination of tariffs on seafood exports within four years. This includes the elimination of the 14 per cent tariff on crabs, oysters, scallops and mussels, and the elimination of the up to eight per cent tariff on prawns. This agreement, together with the increased demand by China's growing middle class for Australia's clean, green, premium produce means the opportunities for future export growth in this market are there for the taking.

The agreement with China not only secures improved market access but also enhances Australia's competitive position by giving our growers and producers an advantage over major competitors such as the United States, Canada and the European Union. But it is not just good news for Eden-Monaro's farmers and graziers. The free trade agreement with China will benefit the entire community through the creation of jobs, economic growth and greater prosperity for all.

With so much to gain from the successful and timely conclusion of ChAFTA, you would think that any right-minded person with an interest in advancing Australia's interests, promoting Australia's prosperity and doing the right thing for the country would support the timely conclusion of the ChAFTA. But enter the CFMEU. We have seen a xenophobic and disgracefully dishonest scare campaign waged by militant unions and led by the discredited CFMEU. To delay the implementation of ChAFTA would amount to economic sabotage and I am very, very pleased and happy that there has been bipartisan agreement in this parliament for these bills.

The tariff cuts scheduled are based on the calendar year, which means that if they come into force this year they will deliver an immediate round of tariff cuts. This will be followed by a second round of tariff cuts on 1 January 2016. This is exceptional news for Eden-Monaro. Let me give another example. Australia's Oyster Coast Ltd is an innovative Australian company based in my electorate of Eden-Monaro. They have a growing international brand and, as an emerging tourist destination stretching from the Shoalhaven to Eden on the New South Wales South Coast, Australia's oyster coast region is unique. Its growers produce three premium oyster species—the indigenous Sydney rock oyster, the rare Angasi flat oyster and the Pacific oyster—with strong year-round production. Each estuary is a unique ecosystem producing oysters of different taste and appeal. Through this newly-launched company, farmers from eight estuaries from the Shoalhaven to the Victorian border are benefiting from overseas sales while concentrating on what they do best: growing and harvesting the world's best oysters. Representatives of the company went to China in August to explore further export opportunities. They attended the Hong Kong Trade Development Council Food Expo and conducted the company launch in Guangzhou. I received a briefing from Mr David Trebeck, who is the chairman of Australia's Oyster Coast Pty Ltd, on his return from China recently. David conveyed to me the very positive outcomes of the launch. Australia's Oyster Coast confirmed short-term sales with expectations of sales tripling within three months. At the food Expo in Hong Kong Australia's Oyster Coast achieved great prominence, to the point where the Hong Kong Trade and Development Council CEO stated that it was 'the highlight of the expo.'

The existing tariffs on this sector will be eliminated under the China free trade agreement over three consecutive years. The resulting price reduction will be disproportionately influential in making our product more competitive vis-a-vis the current market leader, France—'the importance of which it is hard to overstate,' as David said. I have been working closely with this company and recently had a look at how oysters are prepared for market in both Batemans Bay and Narooma. Within 30 hours of harvest, Clyde River oysters from Batemans Bay can be in restaurants throughout Asia—faster than their rivals in France. The reductions in tariffs with the China free trade agreement will be particularly important to the Australian Oyster Coast. That is just one example in my electorate of where the agreement will be particularly valuable. In conclusion, with the three Asian agreements concluded and others on the horizon, there has never been a better time to be in Australian business looking to widen trade horizons abroad. I commend the bills to the House.

Kelvin Thomson (Wills, Australian Labor Party) Share this | Link to this | Hansard source

China is already our largest trading partner. Australian agriculture exports to China have trebled in the past six years, from $3 billion in 2007-08 to $9 billion in 2013-14. They will continue to grow in future. China had $22.7 billion—$12 billion of it in Australian real estate—in investment proposals approved by the Foreign Investment Review Board in the 2014 financial year, more than from any other country. Chinese investors bought more real estate in Sydney and Melbourne combined—almost US$3½ billion —than in each of London, Paris, or New York. Frankly the claim that Australia risks becoming less attractive to Chinese investment is fanciful, and out of touch with the reality of 2015 Australia.

Labor has made it clear that in government we would not have agreed to key items in the China-Australia Free Trade Agreement, including investor-state dispute settlement provisions and the general exemption from labour market testing in chapter 10. The Productivity Commission heavily criticised Australia's pursuit of FTAs in a 2010 report that recommended future agreements first undergo independent cost-benefit analysis and verification of the predictions produced by the Department of Foreign Affairs and Trade. More recently the Productivity Commission has pointed to a lack of transparency and a lack of rigorous assessment of provisions in recently signed agreements.

Trade Minister Robb has said Australian jobs would grow by 9,000 per year to be 178,000 higher in 2035. This is incorrect. Peter Martin, the economics editor at The Age, has crunched the numbers in the government's commissioned study by the Centre for International Economics on the combined impacts of the Korea, Japan and China FTAs. There is no separate study of the China FTA. That figure of 178,000 jobs does not appear anywhere in the CIE study. The three agreements will only create 5,434 net jobs in 2035. The government made a huge gaff by adding up all the job figures for each individual year without realising that each year's figure is a net figure counting both gains and losses up to that year. Peter Martin says that by 2035 Australia's workforce will exceed 15 million, meaning that the extra jobs will impact the unemployment rate by less than one-half of one-tenth of one per cent.

Ugly allegations of racism and xenophobia have been directed by the government and other China free trade agreement supporters to try to shut down debate. The allegations rest totally on the claim that the China FTA is no different from other trade treaties that Australia has entered into. But both the words and the meaning of the China deal are different from those of previous treaties. The definition of contractual service suppliers in the Chile deal refers to persons with 'high-level technical or professional qualifications, skills and experience'. The definition for the China, Korea and Japan deals was watered down to persons with 'trade, technical or professional skills and experience', with the words 'high-level' and 'qualifications' being omitted. The ASEAN and Malaysian FTAs, which Labor signed in government, provided labour market testing exemptions in the 457 visa program for very limited categories of foreign nationals. The China deal gives labour market testing exemptions to all Chinese nationals in the 457 program.

Furthermore, the initial period of entry for temporary contractual service suppliers in the Japan and Korea FTAs is one year. It is four years for the China FTA. The China deal also differs from other trade deals in that it has a memorandum of understanding which provides young Chinese with 5,000 work and holiday visas each year, with the right to work in Australia. It is regrettable that boosters of this agreement, rather than genuinely debating these serious matters, have resorted to name-calling, throwing around offensive and inaccurate jibes like 'racist' and 'xenophobic'. I am proud to represent, as best I can, Australian workers of whatever background. One-quarter of Australian workers are not Australian by birth, and fully one half of Australian workers have one or both parents who are not Australian by birth. They are entitled to our consideration.

Why are Labor's safeguards important? Labour market testing means a business has to prove there is a genuine shortage of skills and there are no local workers who can do a job before temporary visas are granted for migrant workers. The policy intent is to protect the employment opportunities of local workers. Without labour market testing there is no proper mechanism to ascertain that temporary migrant workers are needed. A recent joint investigation by Fairfax Media and Monash University revealed that hundreds of thousands of temporary foreign workers at any one time were being illegally exploited and underpaid in a widespread black economy for jobs. Fairfax Media said it had been flooded with emails of examples of illegal pay and conditions from across the country. The investigation found that hundreds of thousands of workers in food courts, cafes, factories, building sites, farms, hairdressers and retail shops were being systematically paid less than their legal entitlement.

Associated research by Monash University journalism students revealed that 80 per cent of foreign language job advertisements were offering wages below legal rates. Examples of exploitation include    Taiwanese workers on 417 working holiday visas being paid $4 an hour to work in a meatworks; Mandarin-language websites openly advertising jobs at $10 to $13 an hour, significantly below Australia's legal minimum wage; and working holiday visa workers being paid $15 per hour to pick fruit—no tax, no super, no holidays, no sick pay. The minimum legal rate for such work is over $21.

One feature of these abuses is employers using labour hire middlemen. This enables workers to be called contractors rather than employees, and the labour hire firms melt into the night on the rare occasions that whistleblowers or regulatory agencies expose them, enabling the employer to avoid responsibility for the exploitation. But employment minister Cash rejected the suggestion of federal action to crack down on the labour hire companies driving foreign worker scams. She said regulation should come from the labour hire industry. This is a clear sign that the government has no real desire to stamp out the exploitation of foreign workers by unscrupulous employers.

I think the potential for that aspect of ChAFTA to be a precedent for future FTAs, including that presently being negotiated with India, is self-evident. Australia's labour mobility commitments in ChAFTA will be the new baseline demand from all countries with which Australia is negotiating FTAs. As I said, Australia is currently negotiating an FTA with India, once again under a self-imposed deadline of the end of 2015. India is the largest country in the 457 visa program, with 24 per cent of all visa grants.

I also want to mention the issue of mandatory skills testing. There is a side letter to ChAFTA that does away with mandatory skills testing by the Australian government, in a range of trades, before Chinese-trained workers come to Australia. These include high-risk trades like electrical work, which is inherently dangerous. We have stringent electrical training and safety standards in Australia and we must be very careful not to erode these standards, as doing so could lead to accidents, injuries or deaths.

Mandatory skills assessment of 457 visa applicants from high-risk countries, including China, was introduced in 2009 by the former Labor government to help restore some integrity to the 457 program. Before that, it was commonplace for employers to nominate Chinese and other workers for skilled 457 visas in trade occupations but work them as semi-skilled or unskilled workers. For example, some Chinese workers granted 457 visas as professional engineers were found to be working as labourers on Australian construction sites. There was also concern about trade training standards and qualifications and document fraud in some countries. Authorities like the World Bank say that those concerns are still valid.

We also ought to think about Australian manufacturing. Some of the hype about the China-Australia Free Trade Agreement fails to acknowledge that the benefits promised at the time deals are signed are often unrealised due to behind-the-border barriers and other unforeseen problems. Only 19 per cent of Australian exporters make use of Australia's existing FTAs, and somebody needs to point out that there are losers in Australian manufacturing, too, who have to date received little attention. The tariff reductions on paper products are inequitable, to the detriment of Australia's paper industry, as are the arrangements for fibre packaging. Companies like Armstrong World Industries, who do vinyl flooring, and Alucoil, who do aluminium building products, have expressed their concern about the impact of the China free trade agreement on their businesses.

Labor's changes will complement the China-Australia Free Trade Agreement by introducing safeguards to support local jobs, wages, conditions and skills and to deter the exploitation of overseas workers, and I welcome and support those changes. Labour market testing is to be written into migration regulations, and this obligation will extend to all work agreements in the migration system, including of course the investment facilitation arrangements under the China free trade agreement. A second aspect of these protections relates to Australian wages and conditions, with the requirement that the enterprise agreement rate has to be the reference rate for the purposes of the market salary rate. The third area of these protections is new conditions that require trade workers to obtain their occupational licence within 90 days, with a prohibition in their visa conditions to work without holding that licence and a requirement to notify the immigration department if the licence is refused or revoked, which will also be written into the regulations.

Labor's package also includes additional transparency requirements for the annual reports from the immigration department and a set of new guidelines which sets out some of the requirements, such as the Australian jobs test, training plans, skills transfer requirements and overseas worker support plans.

I welcome and support those changes that have been introduced and I hope that they act as an effective protection both for Australian workers and against the exploitation of foreign workers.

Wyatt Roy (Longman, Liberal Party, Assistant Minister for Innovation) Share this | Link to this | Hansard source

It is a great honour to rise in the chamber to talk about the transformative China-Australia Free Trade Agreement. A point often made by the Prime Minister is that we live in a rapidly changing world. Globalisation is shrinking our communities and our societies, the world is more interconnected than ever before and technology disruption is changing our industries at an incredibly fast rate. But we also live in a world of enormous opportunity, and the Prime Minister always makes this point in the chamber. This is the most exciting time in human history and it is the most exciting time to be an Australian. And, when we look north to our partners in Asia, we see enormous opportunity not just for this generation of Australians but also for the next generation of Australians.

In China, we are seeing over a billion people come into the middle class—over a billion people. For us as a country of 23 million people it is quite hard to understand what that looks like. But, when we look back in 20, 30, 40 or 50 years time, the idea of starting an Australia business with the intention to sell to a marketplace of just 23 million people will seem somewhat archaic and retro. The opportunities the China-Australia Free Trade Agreement will unlock mean that, instead of having access to a market of only 23 million people, we will have access to billions of people, including a billion coming into the middle class.

We have a strong history, a strong foundation, with China and our Asian neighbours when it comes to our traditional strengths as a country. We have an enormous story to tell when it comes to the resources boom in this country and also the agricultural success of this country. I come from a farming family—and I am incredibly proud to say that I come from a farming family. My brothers work in the coalmines. This has been a great strength for our country, but as the world changes, as globalisation takes off, as technology changes this world, it is important that we do not allow fear to define our response to the changing environment that we are in. It is important that we embrace that change, embrace the future and diversify our economy. The transformative treaty that is before the parliament today, the Australia-China Free Trade Agreement, is that opportunity to diversify our economy.

While this agreement offers enormous access for our traditional strengths when it comes to resources and when it comes to our farmers, the untold story so far is what it will do when it comes to the services side of the economy. The services side of our economy currently makes up about 70 per cent of our domestic economy but only 17 per cent of our international exports. So the real opportunity for us as a country and for future generations of Australians is to turn that 17 per cent in exports into a much greater proportion of our economic output. That is where we will see the future jobs that we need and the increasing economic prosperity and the rising living standards that we should hand over to the next generation of Australians.

In this agreement, effectively for the first time ever, the Chinese have decided that our country is a great testbed to open new grounds in a free market way. They have decided that our country should have the right in many ways or the opportunity to establish 100 per cent Australian-owned businesses in health care, education, architecture and legal services—a whole range of services that they have not allowed access in the past. What that will mean is that, where we have these great strengths on the services side of our economy, where we have these innovative Australian businesses here domestically, they will be able to scale and grow these businesses at an enormous rate. They will be able to take these businesses from a situation where they might only be selling to 23 million Australians and turn them into businesses, companies, that sell to billions of people. There are a billion people coming into the middle class in Asia, through the China-Australia Free Trade Agreement, through the Japanese economic partnership, through the South Korea Free Trade Agreement and through the Trans-Pacific Partnership. These agreements will unlock the enormous potential that our country has to grow that market access that will be the driver of future prosperity, future jobs growth and rising living standards in this country.

I turn to my own electorate to give a few examples of what this agreement means in terms of job opportunities and increasing prosperity for my local community. This agreement has the potential to create enormous job opportunities and greater prosperity locally and, I would say, even pride for our region. We have some of the best farmers around. I am very biased, of course, with my family being farmers. We have some fantastic farmers. In this agreement, the tariff barriers that are currently stopping trade into this enormous marketplace will be removed. It will allow these enterprising farmers to have access into that Chinese marketplace, particularly the high-end of that market. We have an incredible brand in this country of clean and green that we should capitalise on to its full extent, and the China-Australia Free Trade Agreement will allow our farmers to get that market access ahead of our competitors globally—because we are obviously competing in a global sense. It will allow them to sell their products—their fruit and vegetables and agriculture products—into what is probably one of the biggest markets in the globe.

I will give another example—one that I think is a great traditional strength for our country and something that we do not talk up enough. In my electorate, in Narangba, we have a company that is over 100 years old in Packer Leather. Packer Leather is a manufacturing firm that produces leather products for iconic brands—kangaroo cricket balls, Sherrin footballs and R.M. Williams boots. These are iconic Australian brands. Packer Leather is in many ways bucking the trend. It is an incredible manufacturing story: employing more people by the day, competing globally and exporting into these marketplaces. In the China-Australia Free Trade Agreement, the tariffs around kangaroo leather—it is quite a bizarre arrangement that there are tariffs on kangaroo leather going into the Chinese market place; it is about 14 per cent—will be completely removed over time. What that will allow is an iconic Australian business like Packer Leather from Narangba to have access into this rapidly increasing marketplace—a marketplace that is finding individuals with much greater wealth who want to buy these high-end products. This will really drive the prosperity of this local business and give them enormous opportunities into the future.

These are quite practical changes that will have a very positive impact not just on the nation but also on my local community. I think in decades to come when generations of Australians look back, they will be very proud of what we have achieved in the parliament today with the China-Australia Free Trade Agreement. I personally am very proud of what the Minister for Trade and Investment, Mr Andrew Rob, has managed to achieve in this agreement. In the short time since we have come to government, he has managed to deliver in the actual practical sense but also through this parliament free trade agreements with some of our largest trading partners. The Japanese-Australia Economic Partnership Agreement is, again, a completely transformative free trade agreement. It gives us access into the Japanese marketplace that effectively no other Western country on earth has. There is this fantastic agreement with China. There is also a very significant agreement with South Korea. Of course, in recent days, we have had what I think will really transform global trade in the world—the Trans-Pacific Partnership. This is a very exciting time. These agreements represent an opportunity for us to grasp the potential that our country has to embrace the future and the change that we need. It is a very exciting development not just for this generation but for generations of Australians to come.

Clare O'Neil (Hotham, Australian Labor Party) Share this | Link to this | Hansard source

I am really pleased to contribute to the debate this afternoon, and there are three big points I want to make in the time allotted to me. The first is that the labour market issues and other concerns that Labor had about this agreement were very real but, in large part, they have been resolved. I will take some time to go through some of the issues that we identified and how they did, ultimately, get resolved. The second point agrees with some of the comments made by the member for Longman—there is significant opportunity in this agreement and significant opportunity in China. The third point is the barriers that we face to embracing those opportunities. One of our very intelligent caucus members said today, 'On the other side, they see a trade agreement as the end of the discussion; we see a trade agreement as the beginning of the discussion.' I want to talk about some of the policies that Labor want to implement to ensure that we do not just have a great looking piece of paper but that we have lots of people who are benefiting from the agreement right across the Australian economy.

I think that we can all say in full frankness that the China-Australia Free Trade Agreement contained some provisions that Labor would not have signed up to. There are real issues with the way that this agreement was negotiated in terms of the ability that it gave Chinese business owners in Australia to bring Chinese labour into the country and to do what we saw as threaten some Australian jobs. Some of the things that were allowed under the agreement meant that companies that were undertaking projects worth more than $150 million—which, in infrastructure terms, is actually not such a large number—would be able to use Chinese labour on those projects. One of the other issues was around skills assessment. The agreement specifically laid out a set of skills for which a visa could be granted without the applicant having to demonstrate the ability. These were amongst a range of issues that Labor saw in the agreement. We went out and talked to Australians, and they talked to us about worries that they had and how this would affect them. That is the basis on which we have negotiated with the government.

I want to pay tribute to the shadow minister Senator Wong, in the other place, who has done something really quite extraordinary and made bigger changes to this agreement than have been made to any other agreement that Australia is a signatory to. I will turn to some of the things that have been achieved through the negotiations of Senator Wong and the Labor team working with our leader Bill Shorten. On labour market testing, the fundamental issue has been resolved, so labour market testing will now be written into all work agreements for all different types of jobs in Australia. An Australian jobs test, again, will now be written into department guidelines. Training plans were important for Labor, and again those have been written into departmental guidelines. Skills transfer requirements have been implemented. Overseas worker support plans have been implemented. Something quite important is that, because of Labor's changes, the ChAFTA plus, the minister will now have an ability to include conditions such as ceilings on 457 workers. Something else that has been very important to Labor is transparency. We want to understand the labour market impacts of this agreement over time. Labor have been able to negotiate for the immigration department to report annually on the impact of the agreement on Australian workers. That gives a little bit of a flavour to how wide, varied and significant the changes that Labor have been able to negotiate are. I think this is quite consistent with Labor's philosophy and approach to trade—that is, we really are the party of free trade. We have done so much on this side of the House to open up Australia's economy to the world to help our exporters access overseas markets. But we are not going to do it in a way that means that ordinary Australians do not benefit. That is not what the Australian government is there for.

I am very proud of the changes that have been made. They now allow us, as a parliament, to turn our minds more to the opportunities and benefits of this agreement and what it is that we need to do as Australians to embrace them. I say that with full acknowledgement that there are some significant wins in the China-Australia Free Trade Agreement. We hear a lot about the opening up of markets for goods exporters—so tariff reductions for wine, manufacturing goods, resources and commodities. Dairy has also been a significant winner under the agreement. Those things all very exciting, but we should not ignore the extraordinary difference that this will make to the services industry and its ability to export to China. Financial services, education services, mining services—and we have some of the best firms in the world in that regard—telecommunications services, legal services, construction services, and architectural services will now be able to realistically export to China.

I have not seen what I believe to be good estimates of the jobs figures, but I think that, when we want to understand the potential impact of this agreement, we need go no further than look at the quantum of the market size in China versus Australia. I will share a few figures with House. If we are looking at education, the number of young people in Australia between the ages of five and 20 is just over four million; in China, it is 236 million. In relation to motor insurance, there are 18 million cars on the road in Australia at the moment; in China, there are 154 million cars on the road. One of the provisions in this agreement allows motor insurers to export their products to China, and that is the market size that they will be looking at. In financial services, there are 236 people living in Australia right now who have more than $100 million in private wealth; in China, that number is almost a million, and it is growing. So you can see that there is an enormous opportunity to be captured here, and a free trade agreement gets us at least to that first step.

The benefits that we see are significant. With goods, we will see some jobs growth in Australia and some revenue and profits realised in Australia. With services—both those delivered here in Australia and offshore in China—we hope to see some jobs results there as well. We talk down a little bit the services economy in Australia, but, when you look at the data, there is a lot of reason to celebrate what we see as a thriving services industry in our country. The reality is that the vast majority of Australia's GDP is generated through services; the vast majority of Australians work in services. That is something that we should be celebrating. The reason is that, when we look at economies around the world, it is quite clear that, as economies develop, services over time take up a larger share of the economy. That is what we have seen happen to Australia.

The agreement is important for another broader reason, which I have not really touched on. It will allow Australia to export more. Again, when we look at the data, we can see that there is significant opportunity for us to grow faster if we are able to export more. There is a simple fact in all this, and it is that if we look to 2020 Australia's economy is projected to grow at just under three per cent—but we have quite a large growing population, so it is actually not such a large figure—but the Chinese economy is projected to grow more than six per cent. So if we can tap into that growth then we are going to grow faster. It is simple maths.

We also see it when we look at the share of our GDP that our exports make up. For a country like Australia, exports are actually quite a small share of our GDP. That is something that this agreement will have some capacity, at least, to change. When we look at the ratio of exports to imports, in 2012 we see that Australia exported about 21 per cent. But a nation like Korea exported 57 per cent. So we can see that there is significant growth potential there.

One other point that I want to mention before I move on to some of the barriers in the path of accessing the benefits of the agreement is to note that, on the Labor side, we talk a lot about the jobs of the future. When we look at the 10 fastest growing, high-skill jobs, we see they are all jobs in services. In fact, when we look at the 10 fastest growing, low-skill jobs, I think nine out of 10 of those are in services. This is just the reality and the quicker that we understand how to promote and build a strong, thriving and high-skill services economy then the quicker we will take up these opportunities.

One critical difference between those on this side of the House and those on the other side of the House is that we regard this agreement as the beginning of the discussion about Chinese engagement, not the end of it. We see that there is real discussion in the Australian community about this, the tone of which suggests that this is a fait accompli, that Asian engagement, our connection to China and the growth that will be built on this opportunity is just going to happen without us really trying. When we look at the figures, there is lots of evidence to suggest that that is absolutely and completely incorrect. There is a lot more thinking that we need to do as a country both within government and within the private sector about how we engage with Asia and how we can improve that engagement because, today, we are quite behind where we need to be.

A great microcosm of the deficiencies in this area is the treatment of the Australia in the Asian century white paper. The former Labor government worked incredibly hard, negotiated and consulted widely, and put together an excellent document that would chart Australia's increased engagement with Asia over what will be the Asian century. That document was brimming with policy ideas, but it has been taken down from all the government websites and thrown in the bin and locked in all the cupboards. It is as if the document did not exist. I hope that with the new Prime Minister there is an opportunity for him to say that this is good policy, that it is a good document, that it is a set of initiatives that are urgently needed to resolve this problem of Asian engagement.

It is particularly critical because the services exports that we have been talking about so excitedly in the chamber are going to require a much deeper level of engagement than we would usually regard as essential for goods exporting. If I could provide a quick example. What we might see for an exporter of wine, for example, is that they need one really good quality relationship to make an export opportunity work in China, because they can transport the ownership of wine on the dock to an importer in China and the legwork can be done at the other end. It is not how all the export arrangements work, but it is how some of them work.

We see there is an opportunity in aged care, for example, where an Australian businessperson is going to be expected to find partners in Asia, buy property, understand the complex regulatory environment for assisting the aged, understand cultural things about how to care for people when they are sick and understand extensive human resources and staff management issues. These are very delicate matters that are going to be hard to do if interpreters are going to be required at every step of the way. Things like Asian languages, spending time overseas studying in Asia—all of these things will be critical.

I will conclude my comments because I know we are trying to move through this debate quickly. I reiterate that I am really proud of the way that Labor have handled this agreement. We have been able to step back from what has been a fiery public debate and accept that there are benefits on the table here but also acknowledge that we need to conduct our free trade negotiations in a way that ensures free trade benefits for ordinary Australians. That is what we have been able to do. I am proud to support this on behalf of the people of Hotham. Thank you.

Jane Prentice (Ryan, Liberal Party) Share this | Link to this | Hansard source

China is the most populous nation on earth, a vast nation of 1.35 billion people. It has one of the world's fastest-growing economies, with gross domestic product having more than doubled in the past six years. It is now the world's second largest economy, and it is only a few years away from overtaking the United States of America as the largest economy on the planet. Every year, tens of millions of Chinese enter the middle class. China is now Australia's largest export destination. Australian exports to China have more than tripled in value since 2007. One in every $3 earned from Australian exports is now earned from trade with China.

With this Customs Amendment (China-Australia Free Trade Agreement Implementation) Bill 2015 we have a once-in-a-generation opportunity to build on these strong foundations by breaking down the remaining barriers to trade with China. This bill enacts the China-Australia Free Trade Agreement, which will remove 95 per cent of the remaining tariffs on Australian exports to China. This agreement is big news for my electorate of Ryan, for reasons that I will shortly explain after a brief digression.

Many members like to praise the intelligence of their electorate, but I have the numbers to prove it. According to the 2011 census, Ryan is the most educated electorate in Australia. There are more education professionals in my electorate than in any other electorate in Australia. We also rank in the top 10 for health professionals and for design, engineering, science and transport professionals. What this indicates is that the local Ryan economy is very much a service economy. Thousands of locals work as professionals in the Brisbane CBD or at large local institutions such as the Wesley Hospital and the University of Queensland.

With apologies to my rurally-based colleagues, in my view, it is the service economy rather than agriculture or mining that offers the greatest opportunity for further export growth. Already, one in $7 earned from exports to China are earned from service exports. After iron ore, coal and gold, education related travel is the fourth largest Australian export earner in the Chinese market. With the slowdown in mining, the service economy share of exports to China will only grow further. For the service economy, this agreement is crucial. China is already Australia's largest export market for education services. But this agreement will ensure the trade relationship is further strengthened and deepened.

Within 12 months of the commencement of this agreement, an additional 77 Australian private higher education institutions will join the 105 Australian providers already listed with the Chinese Ministry of Education. This will act as a gateway to substantially increase their visibility among prospective Chinese students and will boost the number of Chinese students who choose to study in Australia. Even more Australian institutions may be added in the future.

In further good news, education ministers have signed memoranda of understanding to ensure improved higher education qualifications recognition in both countries, as well as enhanced mobility of students, researchers and academics. These moves will cut red tape and reduce barriers to trade. There are also commitments to further discuss how to increase student and teacher exchange between Australia and China and to increase marketing and recruitment opportunities for Australian education providers in China.

All of this is in addition to the links already being established through the New Colombo Plan, under which young Australians are being assisted to study and undertake training in nations in our region. Almost one in five students in the 2015 cohort have elected to undertake study in China and Hong Kong.

Beyond education the Australian health and aged-care sector will benefit from the easing of restrictions on establishing Australian owned hospitals in the major cities of Beijing, Tianjin and Shanghai, as well as the populous and relatively affluent provinces of Jiangsu, Fujian, Guangdong and Hainan.

In construction and engineering, China has guaranteed market access to Australian companies established in the Shanghai free trade zone. And, in the area of legal services, Australia has secured a world-first agreement on commercial association between law firms. Within the Shanghai free trade zone, Australian law firms will have the ability to establish commercial associations with Chinese law firms and will be able to offer Australian, Chinese and international legal services without restriction.

There is no doubt that this agreement is good for my electorate and also good for Australia. It will boost growth in industries that employ millions of Australian workers. With the livelihoods of so many Australian workers and their families riding on trade with China, successive governments, including Labor governments, have been working towards improving Australian access to Chinese markets. The benefits of the agreement are clear and obvious to any fair-minded observer.

We have seen former Labor Prime Ministers, former Labor trade ministers and serving state Labor Premiers show their support for this agreement. The Australian newspaper has compiled a list of Labor luminaries who support the agreement. Victorian Labor Premier Daniel Andrews said:

The free trade agreement is something that I support, that our government supports.

Queensland Labor Premier Annastacia Palaszczuk said:

Of course I support the free trade agreement with China … our largest trading partner.

ACT Labor Chief Minister Andrew Barr said:

Free trade encourages jobs growth. It’s not free trade but the Australia/China preferential trade agreement will be good for … exporters.

Former Labor Prime Minister Bob Hawke said:

The party must not go backwards on this issue—the party and the trade union movement. Talk of opposing it is just absolutely against Australia's best interests.

Former Labor leader Simon Crean said:

… we diminish our opportunities for jobs going forward if we do not sign this agreement.

Former Labor foreign minister Bob Carr said:

Our analysis of the FTA is that any incoming Labor government would have all the mechanisms it needs to protect … Australian workers.

New South Wales Labor leader Luke Foley said:

I agree with Bob Hawke when he says that the China-Australia free trade agreement should not be torpedoed.

And, finally, Tasmanian Labor leader Bryan Green said:

Labor wants to see this FTA deliver good outcomes for China, good outcomes for Australia and good outcomes for Tasmanian workers.

Industry groups have lined up to support it, as have the lion's share of informed financial and political commentators.

Sadly, there is a lonely island of opposition to this agreement. The incorrigible dinosaurs of the CFMEU have kept up their record of opposing every piece of worthwhile economic reform in recent memory. This time they have managed to outdo themselves by running a marketing campaign of startling intellectual dishonesty and thinly veiled xenophobia. CFMEU advertisements have been blanketing the airwaves, darkly warning of invading armies of foreign labour, legions of shonky Chinese electricians and wave after wave of substandard products. This, of course, is complete nonsense and has been debunked many times over.

I am pleased that the Leader of the Opposition has been convinced to back this agreement. It is the right decision for working Australians and it is the right decision for Australia's long-term economic future. I commend the Minister for Trade and Investment for his tireless efforts to secure this agreement. I commend this bill to the House.

David Gillespie (Lyne, National Party) Share this | Link to this | Hansard source

I rise in support of this legislation. The China-Australia Free Trade Agreement is a landmark free trade agreement. In decades to come people will look back on this in a similar fashion to how they look back on the original post-war trade agreement with China that a previous leader of the National Party, Black Jack McEwen, was at the forefront of.

It is with great honour that I stand here as the member for Lyne. I want to bring to the attention of the House that this is a very successful conclusion by our current Minister for Trade and Investment. He has done a fantastic job getting the trifecta of trade agreements up. The negotiations for this China-Australia Free Trade Agreement were started over 10 years ago by my forerunner in the seat of Lyne, former Deputy Prime Minister Mark Vaile. I know he, amongst many other Australians who are producers and exporters, will be very pleased when this bill has passed the House and is on its way to the Senate.

The potential of the China-Australia Free Trade Agreement is enormous for people in my electorate who are producers of milk, dairy, beef—but dairy and beef, in particular—and fisheries. We have premium wine producers in the Hastings and in the Gloucester region and in the south of the electorate as well. There are many people who can benefit from this. Even the announcement of the trade agreement and the original signing of intent to ratify and formalise this agreement has led to hundreds and thousands more cases of wine leaving the Hastings valley on the mid-north coast in the north of the Lyne electorate and heading to China. Imagine the effect when it is formally introduced and in action. The potential is huge.

We do have great products in the Lyne electorate. There is the potential for seafood exports and for more dairy exports. To the north of us, Norco is producing milk now that is going all the way to China into the fresh milk market. The Manning valley, home to over 52 dairy producers who produce over a third of the state's milk, will be able to produce even more if it gets into this export market. In Wingham we have Wingham Beef Exports. In Wauchope we have Hokubee Australia, which is a beef exporter. With this free trade agreement, the potential for all those producers to export into China is huge. It is to be commended.

We also have service industries. We have people in the defence space in our electorate. People in that space make high-tech gear which we can export into China. We have legal services. We have architectural services. There are many services, even in a regional electorate like mine, that with the ubiquity of online trading have the ability to become exporters into China.

There is another benefit for Australia. There are many envious nations around the world that look in wonder at our achievement of a free trade agreement with China. They will see us as a potential production venue to export their goods into China, whether it is in the pharmaceutical space or in complex manufacturing. There are many who have spoken to me and hope to expand their existing Australian production basis to cater for the Chinese market, whether it is vitamins or pharmaceuticals. They are the two obvious ones that could be ramped up exponentially to produce goods for China.

There are so many spin-offs for the Australian economy in this. It means all these primary producers have another market to deliver their goods to. In the beef industry, traditionally, your opportunities ended with selling to an abattoir. But if the abattoirs are exporters competing with the Australian market abattoirs, it will lead to higher farm gate prices. You have only got to see what has happened in the beef industry over the last 18 months to two years. We have had record prices at the Wingham abattoirs, and sales at Kempsey, Taree, Gloucester and across all of south-eastern Australia are really encouraging.

It is the first time in 20 years that many beef producers are actually making serious profits. They now have a tax problem. To be making enough profit to have to pay tax is a great problem to have. Many of them have just been living on a zero-sum game for decades, producing and making marginal profits. Even big producers with really big outfits, if they were not getting good prices, then they had a big turnover and they had marginal profits and they had increased land values. But now it is such a relief to know that you can make a profit out of breeding animals and producing really high-quality beef that is a prime product.

For my wine producers, seafood producers and service providers there are all sorts of opportunities, and between the internet and these free trade agreements the sky is the limit for Australia. I am really looking forward to this bill passing the House, going to the Senate and going through the ratification process because it will open doors for so many businesses in my electorate, let alone across the whole country. I commend the bill to the House.

Bob Katter (Kennedy, Independent) Share this | Link to this | Hansard source

I feel sorry for the members of the government, I really do. They get a brief and they have got to get up and tell us how wonderful the free trade deal is and how it is going to save the world. I was in this place and saw the then Prime Minister stand up and lead the clapping for Andrew Robb on the free trade deal with China and I thought, 'Maybe I know nothing about politics, but if this is getting you votes I am a Martian astronaut!' Four weeks later he was thrown out a window.

You think you are deceiving the people of Australia. You are not. When they hear 'free trade deal', they hate you. Understand that, because I might not be an expert in a number of fields, but after 41 years of straight wins in pretty hostile territory, I can tell you that I know a little tiny bit about politics. I sat at the feet of the great master, Bjelke-Petersen. So if you are not interested in governing the country, if you are not interested in helping your country, maybe you might just think about your survival.

I feel sorry for the LNP. They somehow think that Australia is this big, huge country and that it can produce a magnificent amount of agricultural production. It most certainly can produce a lot more than it is producing. But it is not a big, huge agricultural country at all. There is 53 per cent of Australia that is designated as desert and 23 per cent is designated as Indigenous lands. Since the governments of Australia will not give title deed to those lands, they are sterilised. That is 76 per cent gone. There is seven per cent that is national parks. So, if you take out that 83 per cent, there ain't a lot left.

The concept that huge areas of land will produce huge areas of food—sorry; that is wrong. There are a few thousand hectares, maybe 30,000 hectares, of land that is producing about a quarter of Australia's beef production. They are called lot feeders. Basically the cattle do not wander around chewing grass. That is not the way beef is produced anymore in America or in Europe or in Australia. It is done in lot feeders. So you have a different concept altogether, where you do not need huge areas of land. Your competitive advantage is in that lot feeder. That is where the action comes. You have a competitive advantage in that area.

Somehow they think, 'There are millions of people in South-East Asia, and we're going to be able to sell all this food to them.' Mr Deputy Speaker, I would refer you to the statistics. In fact, there is a pretty good chance that we will be importing food from those countries. Let me be very specific. When I stood up in this place 15 years ago and said that this market fundamentalism, this free market rubbish, will destroy your country, I said that Australia could become a net importer of food. Every 10 years, the imports increase at 103 per cent and the exports increase at 21 per cent. You do not have to be Albert Einstein to figure out that the graphs will soon cross.

Mr Deputy Speaker, you must understand that, if every Chinese city had two 20-storey buildings with tanks on each storey, then they could produce all of the protein requirements for China. They do not have to buy any of our beef. They do not have to buy any of our seafood product. In fact, if you look at a graph of the increase in seafood production in China, if you extrapolate that graph on for about 30 or 40 years, in theory all of the world's protein would be coming out of the prawn and fish farms in China.

I am fascinated by how this is going to help Australia. The last speaker, the member for Lyne, touted the beef industry. I do not know if he knows anything about it. I rather doubt that he does, but he touted the beef industry. Well, let us have a look at what this free trade deal does for the beef industry. We sell our beef at the present moment at $2 a kilogram. If you look at the average price, it is a lot less than that, but I will take $2 a kilogram. Its 10 per cent tariff has been abolished, so that is a 20c advantage we get. The beef sells over there for $32 a kilogram. Those are the figures that have been given to me. But now the Australians are going to have a terrific advantage of 20c, so it is $31.80 now. Jeez, that will lead to a huge increase in the benefits for the beef producers of Australia! A difference between $32 and $31.80, and the member of parliament who sits beside me here, the member for Lyne, seriously touted that as something that is going to help the beef industry? Why doesn't he do his homework? Why does he just take the drivel that comes from the frontbench? And the drivel that comes from the frontbench is dictated by the giant corporations that bankroll the mainstream parties.

Having dealt with the LNP, we will move on now to the ALP. If ever there was a day on which 'Red Ted' Theodore would turn in his grave and the founders of the labour movement would spit upon the people that sit in this House and call themselves Labor members, today is the day. When I walk out of this place, there is a magnificent portrait of a bloke called Charlie McDonald. Charlie McDonald was the first member for Kennedy, and every time I go out I salute Charlie. Six of Charlie's first seven speeches in this place were railing against the importation of foreign labour. Well, this document opens the door to it. This man went out and helped form the Labor Party, the labour movement, of Australia. They fought and died, literally—there were three shearers shot dead at the strike, where Waltzing Matilda was written a couple of months later—and the entire executive of the AWU were jailed for three years with hard labour for having a strike. These men and their families went hungry. What happened when they got arbitration was that the miners said, 'We're bringing the coolies in from China. Ha, ha. Take that, Buster Brown; take that.' And the cane plantations said, 'We're bringing the Kanaks in to be cane cutters, so take that, Buster Brown; take that.'

So the first member for Kennedy stood up in this place and courageously fought to create the Labor Party—and the people who sit here on $200,000 or $300,000 a year, enjoying the benefits from the creation of that labour movement, sit here and betray every principle that was put forward by those people. Charlie McDonald would turn in his grave. But I am proud to say that the people of Kennedy are still represented by people who are not sell-outs, who are not under the control of the big plantation owners or the big mining companies. No. We are under the control of the people of our area. That is who we are under the control of and proud to say it. This opens the door that the Charlie McDonalds died for. The ALP today sold them out—lock, stock and barrel. There is not a trade unionist in Australia who is not looking at the ground and being ashamed of his association with the labour movement.

Let me become very specific. I am fascinated. I am just a poor, humble, simple Cloncurry boy. Clearly, these wunderkind—over here and over there—have decided to have free markets. The honourable member over there, Mr Brough, is making faces; he thinks it's funny! I will tell you how funny it is, my friend. You have to buy everything from overseas. The last whitegoods factory, which is at Orange, closes this year. So you have to buy all your whitegoods from overseas. About 40 per cent of the steel in your house—the roofing on it, the reinforcing steel for your floor—comes from overseas. About 40 per cent of your cement comes from overseas. All your whitegoods and all the motor cars in your garage will come from overseas, next year. The clothes you wear will all come from overseas. Your footwear will all come from overseas. The petrol you put in your car comes from overseas. Everything we buy comes from overseas. Where are we going to get the money to buy all of these things?

The honourable member there, Mr Brough, laughed at me. People have laughed at me ever since I came into this place and started talking about this. I want it on record that he laughed at me, because the history books will pass judgement upon him. They will say: 'Who are the people who destroyed this country?' We have to buy everything from overseas. Where are we going to get the money to buy all our petrol, to buy all our motor cars, to buy everything in our houses and to buy the clothes on our backs?

Let me turn to food—and people in this place laugh at me about this. This country is now a net importer of pork. It is a net importer of seafood. It is a net importer of fruit and vegetables. It is only a matter of time. As I said, it is 103 per cent every 10 years, the last time I looked, and a 21 per cent increase in exports every 10 years. Inevitably—as the sun rises—we will become a net importer of food. You cannot eat live cattle or unprocessed grain, but if you take those two commodities out we are getting pretty close, in fact, to being a net importer of food. People in this place have laughed at me, but the people of Australia are passing judgement upon them, already, as we talk.

Where are we going to get this money from? We have only two things now that we export, and everyone knows that they are iron ore and coal. I am not here to denigrate those industries. In fact, I pray every night of my life to the good Lord that it does not come to pass, the continuation of what we are suffering in the thermal coal industry. But I would not like to be backing myself in, and I will not go into the problems of the thermal coal industry. What you have is what you have, in iron ore.

The country has to buy everything from overseas—and all they have to buy it with is iron ore and coal. A little bit of gold. Of course, aluminium is doomed. Aluminium is electricity. It came to Australia when we had the cheapest electricity in the world, in Queensland. Australia now has the second highest electricity charges in the world. So it will be bye-bye aluminium. It will be bye-bye all mineral processing, because it all depends upon—and I am sick and tired, in this place, of hearing 'It's high wages that are killing us!' Wages look pretty bloody small when compared with the cost of mineral processing, which is the cost of electricity.

It is due to the incompetence of the people in this place and of state governments who have taken electricity charges up 400 per cent in 10 years. That is what your free markets and privatisation have done: 400 per cent increase, in electricity charges, in 10 years. For 10 years before that, in Queensland, there was no increase at all. For 10 years before privatisation and a deregulation of the pricing mechanism we had no movement in price at all. My case rests. It dooms aluminium and it dooms mineral processing, so you are left with iron ore and coal. The income from iron ore and coal—maybe $150,000 million or whatever it is—is not enough to meet our imports. It is nowhere near enough.

You are living in a country that is going broke at 100 miles an hour. You cannot buy everything from overseas when you have nothing to sell overseas. The people in this place with their market fundamentalism, their fanaticism, have imposed upon Australia a regime that no other country on earth has to suffer under. Every other farmer on earth gets 40 per cent of his income from the government. Our poor farmers get six per cent. I conclude on that note. So much for your free trade. (Time expired)

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

On the back of the previous speaker, the comments I frequently hear from farmers, in my part of the world, are that they look for market access and, so often, I hear the term 'level playing field'. That can be farmers or anyone else in business and industry. The future prosperity of Australia relies on bilateral trade agreements, which is why I support this Customs Amendment (China-Australia Free Trade Agreement Implementation) Bill 2015. The coalition government has secured a landmark deal for Australia with the China free trade agreement. No-one could dispute this fact. It is an historic agreement, without any question. It is an outstanding achievement of this government coming on the back of successive free trade agreements with Japan and Korea.

I want to acknowledge and congratulate the Minister for Trade and Investment and his very hard-working team of negotiators and thank them for their efforts. I have no doubt there were some very robust discussions in the process of all of these free trade agreements. They will look back and know that they were part of a critical agreement between Australia and China. Why? We know that China is both Australia's largest export market and source of imports. We export $107.6 billion worth of goods and services to China or 32 per cent of our total exports. This is divided into goods exports worth $100.1 billion and services exports worth $7.5 billion. In return, we import $52.1 billion worth of product from China, or 15 per cent of total imports. The trade advantage is heavily weighted in Australia's favour.

As I have said, the China free trade agreement builds on agreements already concluded with Korea and Japan. It will give Australian businesses unprecedented levels of access—and they will work on this themselves—to a market of more than 1.3 billion people which includes a rapidly rising middle class. That is an extraordinary opportunity for business. That is what they tell us that it is for them. I can see many Australian businesses fitting into the high-quality niche product areas in these markets, because that is what we produce.

It is all part of a powerful trifecta of agreements with Australia's three largest export markets, accounting for more than 61 per cent of our export of goods. Of course, the key booster for access to trade is both access to markets and the removal of tariffs on products and merchandise exports. Most importantly, tariffs will come down on a range of Australian products—especially agricultural ones.

Some of our goods are subject to tariffs in China of up to 40 per cent. And if you are the producer back in Australia, that 40 per cent is a huge advantage to others in the market. More than 85 per cent of all Australia's goods exports will be tariff free when the China free trade agreement comes into force. On full implementation, 95 per cent of our goods will be tariff free. Importantly for the electorate of Forrest and the south-west of Western Australia, tariffs will be abolished for Australia's $13 billion dairy industry—and I recently read of a deal being done on milk and honey in Western Australia.

Australia's beef and sheep farmers will also gain from the abolition of tariffs of from 12 to 25 per cent. By 2030, the total benefits for beef production are expected to approach around $3.3 billion. All tariffs on Australian horticulture will be eliminated, which is great news for the fruit and vegetable growers in the south-west. The dairy industry says an agreement will lead to the creation of new jobs in the dairy industry in the first year alone. And tariffs on products such as barley, oats, sorghum and millet; certain wood and paper products; and certain base metal ores and their concentrates will be eliminated on entry into force of the agreement.

I note that the National Farmers' Federation president, Brent Finlay, said:

This agreement is a game-changer for Australian agriculture … Common sense has prevailed – there was always too much riding on this agreement for it to be sidelined.

Ratification will mean Australian farmers and agribusinesses can take advantage of the reduced tariffs on Australian food and fibre products as soon as possible. This presents huge opportunities for Australian farmers, boosting economic growth and farm-gate returns.

That is where we want to see it—at the farm gate. The NFF went on to say:

The NFF has maintained the position that the China FTA will create more jobs for Australians on the back of increased food and fibre exports and the positive flow-on effects to our rural and regional communities.

That is something that is very dear to my own heart—two phrases in there: 'returns at the farm gate' and 'benefits to rural and regional Australia.

It is not just for agricultural products: 75 per cent of our national GDP is derived from services, and we export only 17 per cent of these. There are enormous opportunities for our service providers, especially in education and financial services. In fact, the Financial Services Council says that the increased access that will be given to financial services alone will create perhaps an additional 10,000 jobs between now and 2030 in that sector.

Resources, energy and manufacturing will benefit. We will see tariffs on coal exports to China eliminated within two years of implementation, helping Australian exporters of coal to compete with Indonesian firms that already benefit from preferential access to China.

Alumina is produced in the south-west and shipped out of the port of Bunbury, and we see that alumina is included in the free trade agreement. Cristal Global produces titanium dioxide at Kemerton, and this is also included in the free trade agreement. So I am looking at companies and individual businesses getting particularly busy in these markets. Recipients of preferential status in China have received either immediate tariff elimination or phased reductions over several years for key products, and there has been a tariff disadvantage in favour of Australia's competitors over time.

So we can see that there will be genuine benefits for business and industry. I could look at the beef sector, perhaps, and at a box-meat deal between processor V&V Walsh, based in Bunbury in my electorate, and China's Grand Farm. The potential is huge, with thousands of extra lamb and beef numbers needed for this deal alone.

Everyone is aware of the internationally-known, quality Margaret River wines and their opportunity in this market. Perhaps not as many people are aware of the Geographe Wine Region in the south-west, that also produces some fine wines. I would like to see both of these regions benefit by their work in China through this deal. I am sure that local producers will see it as an opportunity and will be working hard on getting into or expanding their access in China

Timing has been all important. Scheduled tariff cuts are based on the calendar year, which will see an immediate round of tariff cuts, followed by a second round of cuts on 1 January 2016. This will be a real boost to our exporters. They will benefit enormously from two rounds of tariff cuts over, really, a three-week period at the end of this year and in early 2016.

On that basis, there are a lot of reasons to support this deal and I am particularly pleased to support this bill in the House this evening.

Alannah Mactiernan (Perth, Australian Labor Party) Share this | Link to this | Hansard source

I rise to speak on the Customs Amendment (China-Australia Free Trade Agreement Implementation) Bill 2015.

Of course we must engage with China in trade. Of course we must engage with China in culture. And we must engage with China politically. China is the major force within our region and, of course, is increasingly becoming a dominant player globally. So it makes absolute sense for Australia, as a trading nation, to attempt to liberalise its trading arrangements with China. I want to note and repeat the comments that were made by the Leader of the Opposition: it was the Labor Party, the labour movement, that first modernised our relationship with China. The Leader of the Opposition reflected on that historic journey that Gough Whitlam took to the People's Republic of China to open up the relationship with Australia, pre-empting even the US into that area.

But I also want to go back one step further to the 1930s when, indeed, it was the labour movement within Australia that was the first to stand up for the rights of the Chinese people, that was the first to stand up and say that something needs to be done about what is happening in China, that, following the Japanese invasion, the Chinese population was being persecuted. It was not Australian businesses out there—they were still very keen to be selling that pig iron to Japan. It was indeed the trade union movement, so don't you on the other side lecture us and describe us as xenophobic when the union movement raises these very important concerns about whether, in the detail, this agreement is a good one.

Mr Hutchinson interjecting—

I note the member opposite commenting on the MUA. Indeed it is the MUA and the CFMEU unions—I know your most recent hate figures—that actually have very much in the core of their DNA protecting the rights of workers around the world. Let's get that historical context right of who it is that is acting as a good global citizen.

We have heard many members opposite and members on our own side talk about the benefits that will come from the China free-trade agreement. And there is absolutely no doubt that there will be significant benefits to come from the China free-trade agreement in specific areas. No-one would possibly in their right mind claim that there are not in fact going to be substantial winners arising out of this. I think it has been pointed out that much of the agricultural sector has a lot to gain from it. But at the end of the day, you cannot just have an assessment of an agreement that just pulls out the winners and describes those winners any more than you can make a rational assessment on the agreement by just pulling out the figures of those that are going to lose. But we do have to understand that we have got ourselves a bit into a mindset here, as the Productivity Commission noted in 2010 when it said:

… the Commission is concerned that, at least in some quarters, there tends to be a mindset of ‘agreements for agreement’s sake’, premised partly on the view that Australia must follow a trend in other countries.

I think this is what we have seen emerge with the current government. They have been very resistant to there being any questioning of the detail of this agreement. They have been very resistant to anyone who might say: this bit of the agreement does not look very good to us or we are concerned by the chapter 10 provisions about the free movement of labour. When you are dealing with a population the size of China, 1.3 billion people, that free movement of people provision for a whole range of contractual services can indeed fundamentally change the whole balance of migration and population and labour market demand in our country, so all of these things have to be subject to some detailed rigorous analysis. Every time that an issue has been raised by the labour movement or by civil society or by the union movement, the only answer we get is 'you are being xenophobic', 'you are not drinking the Kool-Aid' or 'you are not going with free-trade agreements'.

Free-trade agreements can be good. You can have balanced free-trade agreements. You can have free-trade agreements that do not compromise your sovereignty. I would argue that this may not be one of those. You can have free-trade agreements that are entered into with a rational analysis of what we are going to win and what we are going to lose. You can make that public and let us make a determination as to whether or not this is a good thing. I do not dismiss anything that has been said on the other side about some of the benefits, but none of them are quantified. It is all just, 'Let's pick up the stuff that looks good and talk about that,' and not have anything that indeed causes us to reflect and to quantify the nature of the negatives and positives.

I think we need to be a little bit cautious of a lot of the boosterism that has gone on about this agreement. We hear that the service sector will boom. I hope that is true. But many of these sectors are only being given access to the Shanghai Free-Trade Zone; they are not being given access across the entire population—admittedly, I imagine the Shanghai Free-Trade Zone is something in the order of 20 million people but it is certainly not 1.3 billion people. The education sector access is unclear. Some commentators say that the benefit may be as little as being entitled to be listed on a website. Again, we need to get down to the detail. There is much talk about the benefits to our biggest exporters in the resource sector. While I acknowledge that the WA mining industry will benefit from the cut in tariffs for products like alumina, the big-ticket items that we are exporting, iron ore and LNG, are already not subject to tariffs. So it is highly misleading when the minister chooses to say that 92 per cent of Australian resource exports will now enter China tariff-free. Is that an honest statistic when 74.7 per cent already enter in duty-free without this agreement?

So there has been an enormous amount of bolstering to this agreement without the rigorous analysis that we need to make a rational decision, to determine whether or not this is in fact going to be in our long-term benefit, and to ensure that we do keep, on our own shores, within our own community, sufficient skills for us to be able to leverage off and develop new industries. We should not be giving up on manufacturing in Australia. We will not be, and should not see ourselves as, just a provider of services; we are vulnerable in that area. I think people are being quite deluded about this. The ability for Chinese people—very, very skilful Chinese people—to very quickly overtake us in areas of architecture and engineering is already evident in some of the things that we are seeing in Perth, where we are seeing large Chinese firms already doing their own detailed engineering design for civil construction projects in Western Australia.

I believe in globalisation. I think it is good that we have a system that enables the poorer nations of this world to lift themselves out of poverty. But I do not believe that these agreements necessarily all deliver this. I think very often what we see happening is that a privileged few, who are the beneficiaries, both in our country and in our partner countries, are taking the lion's share of the benefit. So, as to much of the talk about the alleviation of poverty, I have a little bit of cynicism because, whilst I actually agree with that principal as underpinning the need for internationalists like those of us on the Labor side to be supportive of globalisation, that is not in fact in detail how these things are really panning out.

I want to end with a couple of quotations from Nobel-Prize-winning economist Joseph Stiglitz when he says:

In short, globalization, as it's been managed, is narrowing the choices facing our democracies, making it more difficult for them to undertake the tax and expenditure policies that are necessary if we are to create societies with more equality and more opportunity.

He also says:

We have learned the risks of unfettered markets for our economy and how to temper capitalism so that it serves the majority of citizens, not a tiny, powerful fraction. So too, we can temper globalization; indeed, we must if we want to preserve our democracy, prevent our rampant inequality from growing worse, and maintain our influence around the world.

So my plea is: I hope this agreement works. I hope it turns out that this is a net benefit for our community. I hope it is a net benefit for the people of China and not just a small few. But for us to know if this has been achieved, it is absolutely essential that we put in place a rigorous mechanism for assessing the short-term, medium-term and long-term impact of this agreement, and I hope that we will do that.

Kelly O'Dwyer (Higgins, Liberal Party, Minister for Small Business) Share this | Link to this | Hansard source

The China-Australia Free Trade Agreement, ChAFTA, is a historic agreement that will provide unprecedented opportunities for Australian households and businesses both large and small.

Not only is China Australia's largest trading partner, but Australia and China also have highly complementary economies. Australia is able to provide the natural resources needed to develop the Chinese economy, as well as food supplies and highly valued services such as education. And it is just a start. With the growing middle class in China, the demand for high-quality Australian products and services is ever-increasing.

As small business minister, I am tremendously excited about the opportunities for small business not only today but for tomorrow. The timing of this FTA is critical for Australia as there is a softening mining boom. It gives us the opportunities now to access a market of more than 1.35 billion people. As I said before, the growing middle class will provide a huge opportunity for small businesses in Australia as they will buy our clean agricultural products and our sophisticated services.

The preferential trading opportunities offered by the FTA are delivered by means of reduced tariffs and regulations for Australian goods and services entering China. Australian goods exported to China are currently subject to tariffs of up to 40 per cent. However, once ChAFTA is fully implemented, 95 per cent of goods will be duty-free. This tariff reduction can bring benefits to our most economically significant export industries. Furthermore, market access will be improved in 40 services sectors from insurance to banking. This will have significant benefits in growing diversification of our exports and broadening what we can offer other nations, thereby delivering a more stable future for all Australians.

Small businesses will also benefit substantially from reduced tariffs and regulations which offer a huge opportunity for growth and for job creation. For example, Fiona Wall Fine Foods, which employs 12 people, already ships thousands of packets of Anzac and choc chip biscuits to China. The implementation of ChAFTA will mean that the current Chinese tariffs of 15 to 20 per cent on biscuits will be eliminated within four years of the free trade agreement coming into force, meaning that Fiona's biscuits will be more competitive than ever in the Chinese market. In fact, Fiona is already looking at a deal that would give her access to another 100 stores in Shanghai.

Even before passing the necessary measures into law to activate the agreement, our increasing engagement with China has started to help small business. Ensitech, a small business which manufactures and supplies world-leading stainless steel cleaning equipment, has already seen an increase in its inquiries. These have come from larger buyers, which means that the company may be able to set up a distribution point instead of dealing with individual purchasers in the future. Once the agreement comes into full force, Ensitech will also benefit from the elimination of a 9.5 per cent tariff on their products. However, the benefits of ChAFTA do not accrue to just small businesses. More business for companies like Ensitech as a result of the FTA will ultimately lead to more local jobs for Australians.

ChAFTA will of course also bring great benefits to Australian consumers through lower prices on imported goods and services from China. This is inherently anti-inflationary and will support a better standard of living for Australians. The deal will also lead to an increase in Chinese investment in Australia, which will create local jobs on our soil, so Australia can glean benefits from both the export and the import terms of this agreement.

The measures outlined in the FTA are significant, given that for many years Australia has been at a competitive disadvantage when compared to countries like New Zealand, Chile and South Korea, and also the ASEAN group, who all have free trade agreements with China. With competitive access to the Chinese market through tariff reductions and the removal of limiting regulations, the China-Australia Free Trade Agreement dramatically boosts Australia's potential export fortunes. It will also give Australia a significant advantage over major economies with bilateral free trade agreements, including the US. In fact, the China-Australia Free Trade Agreement is the most liberalising deal that China has done with any nation to date, meaning that Australia has been afforded equivalent or superior access in trade of both goods and services to other nations already engaged in an FTA with China. Furthermore, Australia has been given most favoured nation treatment, which means that, if another country negotiates better access to the Chinese market, Australia will automatically receive that access. So we get an edge and we get to keep it. This is extraordinarily good news for Australians, it is extraordinarily good news for Australian businesses and it is reflective of the growing importance of the China-Australia relationship for both nations.

The China-Australia Free Trade Agreement, combined with the free trade agreements with Japan and Korea, will provide excellent outcomes for Australian exporters, investors and consumers, equating to around $24 billion over the next 20 years. These agreements are a major part of the coalition's economic agenda which seeks to boost economic growth and create new jobs. They are an investment in Australian jobs, our future and the region.

Mr Katter interjecting—

It will create almost 8,000 jobs next year alone. The legislation before us today is the enabling legislation for the China-Australia Free Trade Agreement. It amends the Customs Act 1901 to fulfil Australia's obligations in chapter 3 of ChAFTA, which outlines the rules of origin—

Mr Katter interjecting—

criteria for which goods will receive preferential access into Australia. This legislation is accompanied by the customs tariff amendment, which will implement Australia's tariff commitments. This is the only legislation required to bring this agreement into force.

The CFMEU and the ETU, supported by some opposite, have been peddling untruths about the China-Australia Free Trade Agreement, saying that it will foreign allow workers unfettered access to the Australian labour market. The reality is that, under this agreement, there are no changes to migration laws and there are no changes to legislated protections for Australian workers. All temporary visa holders must be paid in accordance with Australian salary and employment conditions. Furthermore, Chinese workers applying for a 457 visa will still have to pass the requisite language and skill requirements. Australia has set a very high bar for allowing temporary foreign workers to be employed here and none of this will change under the China-Australia Free Trade Agreement.

Those leading the fictitious and misleading scare campaign—

Bob Katter (Kennedy, Independent) Share this | Link to this | Hansard source

That's a lie.

Kelly O'Dwyer (Higgins, Liberal Party, Minister for Small Business) Share this | Link to this | Hansard source

I can hear the echoes of someone who might be put in that category—are putting thousands of jobs on the line that will be created through this very iconic agreement. They are putting thousands of Australian businesses at threat and they will lose millions of dollars if this deal does not go through. Furthermore, they threaten Australia's ability to engage in further trade deals with other nations. If Australia is seen as a country that changes parts of agreements already made or takes years to pass a FTA through the parliament, other countries will be deterred from seeking trade deals with us. In point of fact, I am convinced that to resist this legislation is to resist a better future for the Australian people, all for populist headlines that will not achieve one job here.

What is increasingly apparent is that the broader Australian community do not see any sense in further delay. In fact, you do not need to look too much further than Labor Premiers such as Daniel Andrews and Jay Weatherill who have openly supported the China-Australia Free Trade Agreement, with Daniel Andrews saying:

The Chinese free trade agreement is good news for Victorian jobs ...

That is good news for all Victorians. Further, support has come from former Labor leaders, including former foreign minister Bob Carr, who reiterated that Australian jobs are safe under the China-Australia Free Trade Agreement. Only recently, in The Australian,he said:

... any incoming Labor government would have all the mechanisms it needs to protect … Australian workers.

Jennifer Westacott, Chief Executive of the Business Council of Australia, said:

Australia can't afford to have a lack of bipartisanship on ChAFTA, which is one of the most important trade opportunities in our history.

Most reasonable people know that the China-Australia Free Trade Agreement is exactly the sort of initiative that Australia needs. Until recently, federal Labor was in real danger of being led by a very fringe group within the Australian parliament: the economic luddites of Australian politics. Happily, today they have agreed to pass the China-Australia Free Trade Agreement, and we congratulate them for coming to the realisation that most Australians have had for some time.

There is a powerful economic imperative for the China-Australia Free Trade Agreement to come into place before the end of the year. If it does, we will get a double cut in tariffs, one for 2015, and then another for 2016. A delay in the implementation of the agreement could see a loss of up to $300 million to the agricultural sector, and $110 million to the minerals industry. Our nation cannot afford to delay this agreement.

Bob Katter (Kennedy, Independent) Share this | Link to this | Hansard source

You told us that with the United States one.

Tony Smith (Speaker) Share this | Link to this | Hansard source

Order! The member for Kennedy is warned.

Kelly O'Dwyer (Higgins, Liberal Party, Minister for Small Business) Share this | Link to this | Hansard source

So, I would commend this legislation in support of a historically important agreement, an agreement that delivers benefits for our export industries, investment benefits in multiple sectors, and cheaper everyday goods for Australians. We can expect to see growth in employment through this investment, export performance, and a more stable future as we become less single point sensitive to the mining boom—the mining boom that is coming off. In closing, I urge our reluctant supporters opposite to get on a bus that is heading for a prosperous future, and stop letting down its tyres.

As Minister for Small Business I happily stand behind the China-Australia Free Trade Agreement. It will provide enormous opportunities for our services sector and the goods we produce and export. To those opposite I say: get out of the way of what will be economic progress, more jobs and more investment for our country, and a more prosperous future for all.

Adam Bandt (Melbourne, Australian Greens) Share this | Link to this | Hansard source

Well, parliament has drunk the Kool-Aid. Labor and the Liberals have well and truly drunk the Kool-Aid, and presumably we are sitting here late tonight because at the appointed hour the free trade saviour is going to come and take us to a better place. Never has there been a more apparent instance where bipartisanship, when it chooses to ignore the evidence and ignore government departments, flips over into collective self-delusion. When you have not just the unions but also the Productivity Commission and the Treasury saying, 'Hang on, we don't think the benefits are actually what you say they are, and we think the costs are much higher than anyone is talking about,' perhaps we ought to sit down and take a closer look. But, instead, parliament is being given a 'take it or leave it' agreement containing a provision that not even John Howard was prepared to sign up to, that has no analysis by Treasury or the Productivity Commission of its benefits, and contains holes so big that you could fly plane-loads of exploited and underpaid overseas workers through them.

If there was ever any case for saying that our treaty-making process is broken, it is this. When we are being given a 'take it or leave it' agreement, where all of the stakeholders and the Treasury and the Productivity Commission do not get the chance to look at it beforehand, and we are being told to take it on faith that it will deliver all of these wonderful benefits we are told about, and then we are being told to sit here till as late as necessary to pass it through, parliament and the treaty-making process are well and truly broken.

We need to reflect on something our Prime Minister and opposition leader are about to do. Malcolm Turnbull and Bill Shorten are about to agree to something that not even John Howard would agree to. Parliament is about to rubber-stamp an agreement that contains a provision that will allow overseas corporations to sue the Australian government when it passes laws that are in the public's interest but that affect the profits of these companies. These clauses are called investor-state dispute settlement clauses, or ISDS clauses. What it means is that when parliament passes a law that says we want to protect people's health or we want to look after the environment, then, a company from China, in this instance, is able to come and sue the Australian government and say, 'You are affecting our profits and we want that law changed.' Those cases are then dealt with by a secret panel—not a panel of judges but of appointed people on a secret panel—and they get to decide whether or not parliament gets told to change its law. In other words, an overseas company is able to say, through a secret disputes panel, that the Australian parliament must change its law. Members opposite are saying this is simply not true.

The investor-state dispute settlement provision contained in this agreement is open-ended. It says that we want our companies to have the right to sue an Australian government over a variety of matters, and we will get around later to telling you what those matters are. When DFAT gave evidence to the Senate inquiry about it, they said that China will know what it wants in these clauses, once it has completed bilateral negotiations with the EU and the US. In other words, we have to wait for a couple of years to find out what this agreement will contain that will allow overseas companies to sue Australian governments.

In Canada, the government said they wanted to put a moratorium on coal-seam gas development, until they worked out what it meant for people and for agriculture, and a company sued them for it. They said they wanted to restrict the use of certain pesticides or fertilisers, and they got sued. The thing about getting sued is that it does not matter what the outcome of the case is a lot of the time. The fact that governments worry about getting sued means that governments are less likely to pass laws that protect people, the environment, farmers and the local economy. That is exactly what these agreements are about. It is not about free trade. It is about a new blueprint that means the Australian parliament and Australian democracy is subservient to a panel that gets to decide what happens when a corporation sues a government.

The benefits of this agreement are overstated. We have been told that this is a cornerstone of Australia's future prosperity. We have been told that this will usher in an era of unprecedented growth. Okay, so give us some evidence. If that is the case, you, the government, have a whole series of departments at your disposal. You have the Productivity Commission at your disposal. Give us some evidence about the benefits that are going to come from it.

One of them, we have been told, is jobs. We have been told that tens of thousands, if not hundreds of thousands, of jobs are going to flow from this. In the Senate it has been said by the government that modelling shows that, as a result of all the free trade agreements, 'between 2016 and 2035 there will be 178,000 additional jobs, on average 9,000 extra jobs a year'. They based that on a Centre for International Economics report. There was nothing from the government, nothing from Treasury and nothing from the Productivity Commission. What they did not realise was that they had misread the table. The table went through and said, 'In this year, here's how many jobs it will create; in the next year, here's how many jobs it will create.' That was a point in time; it was not cumulative. The government added it all up and said there would be over 100,000 new jobs. Do you know what? When you work out from that report how many jobs are going to come from this agreement and make an estimate, you see that there will be about 3,300 jobs by 2035. That is the only evidence. If that was wrong, you would imagine that the government would line up with Treasury paper and Productivity Commission paper, saying, 'You've got it wrong.' They do not—because they have drunk the Kool-Aid and they want us to drink it, and they are not prepared to come with anything other than rhetoric. I am not prepared to accept rhetoric.

What we do know—and, again, the government has not contradicted this—is that, when we remove tariffs, we remove revenue from tariffs. In other words, over the next 20 years expect the impact from this agreement to be a $40 billion hit to the budget. Forty billion dollars for 3,300 jobs is about $12 million a job. Thanks to this government, we are paying $12 million to create one of 3,300 jobs.

This parliament is choosing, because of this collective delusion that Labor and Liberal are buying into, to ignore what Treasury is saying. When Treasury appeared before the Senate committee and were asked about it, they said that, if they incorporated the supposed benefits of these trade agreements into our nation's forward projection of GDP, it was not substantive enough to make a difference. That is what your Treasury said—'Not substantive enough to make a difference.' Your Productivity Commission said, 'We don't think the benefits are what we they are said to be; give us a chance to model it,' but they were told, 'No.' You would imagine that the government would be lining up report after report, and they cannot, and Labor has swallowed it. We are told that tariff reductions are going to mean so much for exporters. When it comes down to a few cents per bottle of wine or per serve of beef, you do not have to think very hard to realise that the movement of the Australian dollar overnight could completely wipe that out. We have more to worry about for our exporters with the level of the Australian dollar and its rise and fall than we do with tariffs. You would imagine again that the government would come along and make a persuasive case, and they have not.

They are also hiding from the very important question of what this means for the workforce, here and overseas. There should be a simple starting point. Whether you come from overseas or whether you are local, everyone should be paid local wages and conditions and no-one should be exploited. That should be the simple starting point. But, as I said, in this agreement today, because Labor has caved in to the government, we are now about to pass an agreement that contains no protections that will be enshrined in legislation. The only minimal protections that have been negotiated—and I will come to the quality of those in a moment—are in regulation. In other words, Labor is saying to us, 'We are putting our faith in the Liberal workplace relations minister of the day not to repeal those regulations, and that's good enough for us.' What we do know is that there are holes in this agreement that are big enough to fly planeloads of underpaid and exploited overseas workers through. What is crystal clear is that there is a whole category of visas and workers available under this agreement—they are called contractual service suppliers—that will not be touched by anything that the Labor opposition negotiated today. At least the Leader of the Opposition had the courage to admit that in parliament, when he said today:

Labor still remains concerned at how broadly the government has defined 'contractual service suppliers' in chapter 10 of ChAFTA given its agreement to remove labour market testing for these workers.

What does that mean? It means: if you are a company here, you can bypass any requirement to advertise locally just by badging one of the workers that you are importing as one of these contractual service suppliers. They could be an engineer, an electrician or a retail worker. You could bring them in and not have to go through the process of advertising locally.

Mr Katter interjecting—

Ian Goodenough (Moore, Liberal Party) Share this | Link to this | Hansard source

Order! Member for Kennedy.

Adam Bandt (Melbourne, Australian Greens) Share this | Link to this | Hansard source

When people are needed in Victoria to maintain our electricity network—

Honourable members interjecting—

Ian Goodenough (Moore, Liberal Party) Share this | Link to this | Hansard source

Order! The member will be heard in silence.

Adam Bandt (Melbourne, Australian Greens) Share this | Link to this | Hansard source

the electricity network that powers everyone's homes—most people would expect that you would at least advertise locally for people to work on it and that you would go overseas if you could not find local labour. Now you just have to call someone a contractual service supplier, or call them an installer under another provision, and you get to bypass all these so-called protections that have been negotiated and you just get to bring them in. That is why these so-called protections have massive holes in them and why we should not be supporting this agreement. It is another of the reasons that we should not be supporting this agreement. I could go on. There is nothing in this agreement about ensuring that minimum environmental conditions are not undercut. That could have been something that was negotiated and it is not there. So we are given a take-it-or-leave-it agreement that, as I said, contains a provision that not even John Howard was prepared to sign up to.

We have, in many ways, a crossing of the Rubicon here. This parliament, with the full support of the opposition, is about to sign up to something that contains an ISDS clause—an open-ended ISDS clause. If we are about to do that—

Terri Butler (Griffith, Australian Labor Party) Share this | Link to this | Hansard source

You've already done it!

Adam Bandt (Melbourne, Australian Greens) Share this | Link to this | Hansard source

Sorry—sign up to an open-ended ISDS clause before? There are interjections that we have already done it. I do not recall this parliament ever signing up to something that says we are going to sign away our sovereignty to some overseas corporations and they will tell us about the range of matters later. This is pretty unprecedented.

Here we have a situation where standing up for sovereignty, standing up for a basic principle that says we should advertise locally first and then welcome someone in to come and work here afterwards if we cannot find local labour—the basic principle that says, 'Let's have some evidence of economic benefits before we pass it'—is being completely abrogated. This government, which came up and tore shreds off Labor, when it was in power, for not having a Productivity Commission analysis of the NBN, is now asking us to sign up to something that does not even have a Treasury analysis, a Productivity Commission analysis or any reputable analysis underpinning it. Well, I am not prepared to do that. I am not prepared to say that this parliament will write an open-ended cheque to overseas companies and that they can tell us how we are allowed to legislate for the benefit of our people. I hope that the rest of the parliament does not either.

Eric Hutchinson (Lyons, Liberal Party) Share this | Link to this | Hansard source

One could feel so depressed. But then, I realise: we should all give thanks this day that never will the member for Melbourne or his cohorts—Ludlam, Whish-Wilson, McKim—be on the government benches. Australians should give thanks today and every day that that is the case. So little faith in the future and the capacity of our country—watermelons: green on the outside but as red as can be on the inside. We have seen it before in Tasmania. The comments that the member for Melbourne made around the ISDS clause are simply, absolutely and utterly false. The examples he gave have been excluded in this agreement, as they have been in the Trans-Pacific Partnership Agreement. The man is living in the past.

This agreement, which I am very proud to speak about today, is tailor made for my home state of Tasmania. I think it was epitomised when not so long ago I had the pleasure of meeting Xi Jinping, the President of China, and his wife, Madam Peng Liyuan, when they visited Hobart. The thing that will be crystallised in my mind for years to come is the image of the President and his wife with the then grade 6 students—when they first wrote to him they were in grade 5—from Scotch Oakburn College in Launceston. The way the President embraced these young people and the initiative they and their teachers had shown is, I think, what the future is all about. I am fundamentally an optimist. China is a country of 1.3 billion people, and with the economic growth we have seen in China in the past 10 years there are opportunities for our country with the highest-quality agreement that has been signed today, and I appreciate the support of the Labor Party here in being able to do that.

Indeed, the legacy of this government has been an investment in infrastructure, and the free trade agreements—whether with Japan or Korea or, more recently, today, the Chinese free trade agreement—are indeed the economic infrastructure. Here we have delivered the third piece of the trifecta, and it is all about the future and all about opportunity. I believe that Australians—and Tasmanians particularly, and Tasmanian businesses—are up for this. The innovative people in my home state of Tasmania who have participated in so many world-leading initiatives all around the world over many, many years are absolutely ready to take advantage of these new opportunities that we will see.

I must take this opportunity to thank Minister Andrew Robb and all those departmental people. The slurs that are being made by some in this place today are not only criticism of the government but also criticism of the fine people within the department who have negotiated an agreement of the highest quality for the future of our nation. I represent a rural and regional electorate, and it would be remiss of me not to talk about the benefits that will flow to agriculture directly and to manufacturing businesses indirectly as a result of that negotiation. I welcome today the announcement by the Tasmanian Farmers and Graziers Association in their press release, encouraging and being very grateful for the support that the Labor Party has provided for the ratification of and support for this agreement. This is a really good thing.

But to get to the specifics of the benefits for my state in terms of agriculture—the removal of all tariffs on our dairy products—Tasmania is now nearly the second-largest dairy producer in the country. We will produce probably within 12 months nearly a billion litres of milk, and 98 per cent of that will be processed and exported. Some of those products have tariffs as high as 20 per cent, and within four to 11 years they will all be removed. I think of businesses in my electorate like Ashgrove Cheese at Elizabeth Town, and Pyengana Dairy up in the north-east. But I think of the many, many more—the scores of dairy farmers around the state—who are supplying those factories and businesses up in the electorate of my colleague the member for Braddon, in Burnie and Smithton.

Regarding the removal of 12 to 25 per cent of tariffs on beef over the next nine years, I think not only of processors such as Tasmanian Quality Meats, the Regional Exporter of the Year in 2013, and of all the employees at JBS Swift's facility at Longford in my electorate but also of the hundreds of farmers around my electorate who will be receiving—no question at all—better prices for their products in years to come.

The same applies to sheepmeat—between 12 and 23 per cent over the next eight years. I think of those very talented farmers such as the Bond family from Cressy, the Toll family from Cressy and the hundreds of other farmers that are supplying high-quality lamb from my home state of Tasmania.

There will be benefits for the wine industry. Many here would have appreciated the 'Flavours of Tasmania' that was held in this place last Wednesday night, perhaps the best annual event held in this place. Over the next four years, tariffs on wine will be reduced by between 14 and 20 per cent. That will benefit the nation's leading producer of pinot noir, the Brown Brothers, who operate in my electorate between Bicheno and Swansea on the east coast of Tasmania. It will also benefit medium-sized producers like Bec Duffy at Holm Oak, Andrew Hanigan at Derwent Estate and Michael Dunbabin at Milton who are looking to grow their businesses.

I think many people in this place have heard the stories about horticulture, but there is Tim Reid and the expansion that he has seen as a result of the Korea free trade agreement. He sold between six and eight tonnes for the last five years; take off a 23 per cent terrif and he went to 180 tonnes. The opportunities for growth will expand with the China free trade agreement. I think of people like Tim Reid in the Derwent Valley in my electorate and Howard Hanson growing cherries in the Derwent Valley.

I thank Minister Robb for the work he did on wool quotas. Australia now has a country-specific access quota and that is an advantage for an industry that has been very good to me over many years.

Seafood is another product that my state is well-renowned for. I recently went with a crayfisherman out of Eaglehawk Neck. He said that, as a result of the Korean agreement, the price of crayfish has been spurred on and it basically saved his boat. He had his quota cut by the state government, but he is receiving higher prices, largely with Chinese buyers. The Korean free trade agreement enabled him to keep his boat.

I think of Craig Lockwood an oyster producer at St Helens in my electorate on the north-east coast; John Lilly, who owns the abalone farm at Bicheno; and Julian Wolfhagen, who is a honey producer. And I think of the larger manufacturers in my state—Nyrstar in the member for Denison's electorate and Pacific Aluminium. All of these businesses will benefit.

There is the opportunity for pharmaceuticals from the removal of tariffs, including the removal of tariffs on vitamins and other health products. The Minister for Innovation, Industry and Science made mention of this: the relationship that Tassal in Triabunna in my electorate has with Blackmores, and the opportunity to expand their markets around the world. This is indeed a great story for my state.

Services have been touched on and others have spoken on this to a greater extent. Seventy per cent of Australia's economy is made up of services, yet only 17 per cent of our exports are in that space. I think particularly of the largest of those services exports, the tourism sector. The opportunity for my state is enormous. We will see more Chinese visitors coming to Tasmania and more students wanting to study at the University of Tasmania. This is a good thing.

I think of Peter and Elizabeth Hope and the Elizabeth Hope baby club. As a result of the China free trade agreement and the ability to own profit-making health services in China for the first time ever, they are expanding their baby club with water being supplied out of my home state and milk powder currently being supplied out of Victoria to the growing market of mothers who want the highest quality products for their babies.

I look forward to the roadshows that will support the small and medium enterprises in my electorate and encouraging them to take full advantage of what is a wonderful agreement for Australia. As a nation, we will be able to take full advantage of it. It will mean more jobs for our generation as well as the next generation. Thank you.

Matt Thistlethwaite (Kingsford Smith, Australian Labor Party, Shadow Parliamentary Secretary for Foreign Affairs) Share this | Link to this | Hansard source

The China-Australia Free Agreement that was negotiated by the Abbott government was a good deal for Australian businesses. But Labor's amendments and improvements make this a good deal for Australian businesses and for Australian workers. The Liberals always forget about the workers. They always forget about the little person. The original ChAFTA forgot about Australian workers. In fact, it disadvantaged them.

We have this side deal, this memorandum of understanding, which provides for investment facilitation agreements. These agreements are new. They have never been negotiated in a free trade agreement in the past. They provide for Chinese companies that fund infrastructure projects above a threshold of $150 million to bring in foreign labour without testing the Australian market, without first offering those positions to Australian workers. You can see how this government forgets about Australian workers. Labor's general amendments to some of the migration regulations will address this injustice.

I want to congratulate Senator Penny Wong, our trade spokesperson, who has managed to negotiate some substantial amendments to Australian regulation to fix this injustice that was done to Australian workers. With these new provisions in the migration legislation, before entering into a work agreement which includes these investment facilitation agreements, the subject of the MOU, the responsible minister will be required to have regard to whether the agreement will support and create Australian jobs—so this is an Australian jobs test; a labour needs statement provided by the employer demonstrating why they need to utilise temporary skilled migration; a training plan adopted by the employer showing how they will improve the skills of local workers; and whether the 457 visa workers will be able to transfer skills to Australian workers. Also included in this package is an overseas worker support plan, showing how the employer will provide 457 visa workers with support and assistance during their stay in Australia, including information about workplace entitlements and community services.

These additional amendments will also provide the minister with the power to impose additional safeguards on work agreements to ensure that they have a positive impact on Australian jobs. They will also require the minister to publish a register of work agreements entered into and to report annually to the parliament on the operation and impact of those work agreements. These are additional protections that Labor has negotiated on behalf of workers to ensure that their interests are not forgotten under this China free trade agreement.

The agreement that was made by the Abbott government also potentially undercut Australian workers' wages. Again, Labor have sought to rectify this. We have done this by pegging the standard work visa to the relevant EBA rate of pay. So the enterprise bargaining agreement that is relevant to the particular industry that the 457 visa worker will come into will be pegged to the rate of pay in that particular job. That will be enshrined in regulation. This is a safeguard to stop Australian wages being undercut by these deals.

Labor are also protecting Australia's workers' interests when it comes to the licensing, qualifications and standards of foreign workers who may come to work in Australia. The China free trade agreement would have relaxed a lot of those protections that exist to do with the certification and licensing requirements of workers from overseas, particularly those at a trade level. In the past, there have been free trade agreements done where there has been a relaxation of some requirements at a more senior level but never before with tradespeople. The China free trade agreement went to a new low when it came to this sort of thing. Because of this, Labor opposed this deal. We have been able to strengthen the visa conditions for overseas workers in licensed occupations by strengthening the enforcement of the skills assessment and occupational licensing requirements by creating new criteria and conditions for 457 visa workers in occupations where it is mandatory to hold a licence, registration or membership. The new criteria will require visa applicants in these occupations to either hold the relevant licence when they apply for the visa or demonstrate that they meet the requirements for obtaining a licence. These criteria will need to be met for the minister to grant a 457 visa.

The new visa conditions will require 457 visas holders in licensed occupations: not to perform the occupation before obtaining a licence; to obtain a licence within 60 days of arriving in Australia; to provide the department with documentation showing they hold the licence and showing any conditions or requirements imposed on their licence before they perform the occupation; to comply with any conditions on the licence; not to engage in any work which is inconsistent with the licence or conditions imposed on the licence; and to notify the department of any changes to their licence or the conditions imposed on their licence. This is a set of important protections that will ensure the integrity of Australia's licensing and trades qualification system when it comes to, in particular, tradespeople such as electricians, carpenters and plumbers. Once again, this represents Labor protecting the interests of Australian workers when it comes to these sorts of deals.

These are positive amendments that Labor have been able to secure. They are not specific to one particular trade deal; they apply generally. We are not discriminating against one group of workers at all. They will apply generally. So we have been able to improve not only the conditions associated with this particular free trade agreement but also the conditions associated with other free trade agreements. That is a positive step for Australian workers. On the whole, with this deal you will get freer trade between Australia and China but also greater protection of the interests of Australian workers. Under Labor you get a better free trade agreement. The benefits will flow not only to businesses but also to Australian workers and their families.

I want to make some general comments in respect of the provisions of the agreement. The focus has generally been on goods and agricultural products. There have been some positive advances in freeing up trade and having greater access to markets for Australian products. That is good. But I believe that the real benefit from this trade agreement will come in the area of services. China now has the world's largest middle-class. It occurred this year that they surpassed the United States. There are 110 million people in the middle class in China now and there is a growing demand for services. The China free trade agreement will grant Australia and Australian businesses the best offer that they have made on favourable service commitments in a free trade agreement. This is a big advance for Australia. Aside from Hong Kong and Macao, Australia will have the greatest access when it comes to services in the Chinese market, providing those services to the largest middle-class in the world.

Associated with this is a 'most favoured nation' provision in the agreement, which means that, if China were to negotiate a better deal with another nation, the deal would be reciprocated with Australia. This will mean improvements in a number of areas, particularly legal services. Australian firms will be able to establish commercial relationships with Chinese law firms in the Shanghai economic zone. Australian businesses will get access to a new market for economic services and the ability to advertise on particular educational websites throughout China. Telecommunications businesses, financial services businesses and tourism businesses will benefit from this as Australia supplies, constructs, renovates and operates wholly owned Australian hotels and restaurants in some parts of China. Importantly, this will also apply to aged-care and healthcare services.

Like Australia, China has an ageing population. It will have one of the largest populations above 60 years of age in the future. There is a big opportunity for Australian aged-care providers and health service providers to access that growing market. As I said, as the Chinese middle-class expands, that appetite for services—aged-care services, in particular—is going to grow. The focus has been on agriculture and goods, but there also needs to be a focus on the service agreements that are made through this because I believe that they are a great advance for Australia.

On the whole, it is a positive result for Australia. The amendments that Labor has been able to secure ensure that the benefits of this trade agreement flow not only to businesses but also to Australian workers and their families. We have been able to ensure that businesses have greater opportunities in Australia, but we have protected the integrity of Australian workers' wages and conditions from the competition that is inevitably going to come from Chinese and other sources of foreign labour into the future. It represents Labor getting a better free trade agreement for Australia.

Craig Kelly (Hughes, Liberal Party) Share this | Link to this | Hansard source

The transformation that we have seen in China over the last 25 to 30 years simply has no historical precedent. At no time in human history have so many people lifted themselves so quickly out of poverty. They have done so using that old tried and tested method—they abandoned collectivisation, they abandoned central planning, they encourage entrepreneurship and the starting of small businesses and they unleashed market forces in their economy. They combined that with providing their people and their businesses with abundant low-cost energy—and, as always, that is what drove their prosperity. Yet it amazes me to hear the contribution from the member for Melbourne and the contributions from so many other members that sit on that side of the chamber. They simply deny those very factors that have been the reason for lifting people out of poverty and they want to go back to those old failed methods.

Before being elected to parliament, I made countless trips to China. I first went to China when you flew into the old Kai Tak airport in Hong Kong, and you would come in on a bit of an arced angle over the city and over the hills and over the mountains. I have travelled often through Guangdong province, travelling by car from Zhongshan to Dongguan and back to Zhuhai and Guangzhou. I have travelled countless miles over many trips. Over the years, each time I went I would see these amazing and remarkable changes. You would not even recognise towns and cities that you once went to when you went back to them a year later. One time you would be driving down an old, potholed road. You would be competing with people on bicycles and with horse-drawn carts, donkey-drawn carts and old broken-down trucks. You could come back to that same place 12 months later and there would be a multilane expressway with a median strip full of miles and miles of plants and flowers down the middle.

I have seen it in the development of their retail shops in their towns. You would go to an old town and you would see what would normally be retail shops, but they were little more than workshops facing the street with old roller shutters. You could come back 12 months later and that same area would be a boutique with a glass front and lighting that was the equivalent of anywhere in the world. I have also seen it in their sporting facilities. Mission Hills golf club, just north of Shenzhen, is a place that has come from basically nowhere to now have 11 championship golf courses. It is the largest golfing sector in the world. I have seen it in food. On some of the early trips I made to China I would fill my suitcase with Mars bars and a few snakes and a bit of bottled water because the food was almost inedible. When I went on later trips, the food would be the equivalent of anywhere in the world.

That is what we have already seen. That is exactly where we are now. Yes, we buy a lot of goods from China. We buy $50 billion worth of goods from China, everything from sporting equipment and electronic goods to clothing and footwear. People think we are inundated with all these imports from China, as we have heard in some of the speeches here tonight. We import $50 billion worth of goods from China. But we last year we sold $100 billion worth of goods to China. We sold China goods worth twice as much as all those goods we were importing from them—and that is just where we are today. This is only going to improve.

We are seeing a growing number of Chinese middle-class consumers. We know China has not drunk the Kool-Aid on global warming. They are continuing to roll out coal fired power stations. They are continuing to lift hundreds of millions of their people out of poverty. This creates boundless opportunities for Australian individuals and businesses, both large and small. These opportunities are of gold rush proportions. As a government, we can only do so much. We can get these free trade agreements into place. We can lower the tariffs. We can lower the duties. We can lower the quotas. But ultimately it will be up to Australian businesses and our entrepreneurs to take full advantage of this free trade agreement.

Recently there has been some famous dud predictions about what goods will be sold. I will go to a few of those dud predictions. Recently someone said, ' … even the rain that falls isn't actually going to fill our dams …' But I would like to give you another dud prediction. This was from a former China free trade sceptic, a Mr Bill Shorten, before he was a member here, and he said:

What is it that we're going to sell China in the future that we're not selling them now?

I would say, 'What can't we sell to China in the future that we're not selling to them now.' It is not just agriculture. It is not just manufactured goods. It is all the services. I would say to anyone in the Australian economy today, whether you are in sport or in arts or in industry, you should be looking at what opportunities there are for you in China.

As a nation, we need to become more export oriented. After all, 98½ per cent of the world's economy is beyond our shores. This free trade agreement gives those opportunities to Australian companies. I would encourage every company, irrespective of what business that you are in today, to think about it and look at it and maybe take some of your profits or some of your capital and invest it into a trip to China to participate in a trade show and see what opportunities are there for you, because, as I said, these opportunities are of gold rush proportions for our nation.

I would like to quickly respond, in the shortened period of time, to some of the comments made by the member from Melbourne. He talked about jobs and asked what evidence there was that this would create jobs. Since 2007 we have already seen another 100,000 jobs created in this economy that are directly involved in exporting to China. You only have to look at one small example, the vitamins company Blackmores. Over the last 12 months, even before the extra access to the market has come in, they have increased their sales from $2 million to $70 million. That has enabled them to create 100 new jobs at Warriewood on Sydney's North Shore. Their British-born CEO, Christine Holgate, recently said, 'There has never been a better time to be an Australian.' With that I concur. She is exactly right.

I would also like to comment on what the member from Melbourne said about the tariff reductions. He does not seem to understand that those tariff reductions actually mean that Australian consumers, the average workers of this society, will get cheaper goods. That is what they mean. Tariffs are an extra tax on the goods that consumers buy. Removing those tariffs means that the retail goods that consumers buy—clothing, footwear, motor vehicles or whatever—become cheaper to the Australian consumer.

Also, on the issue of investor-state dispute settlements, this is something which is very easy to mislead people on by giving them false information, and that is exactly what we saw from the member from Melbourne, unfortunately, tonight. It is clear you need some type of investor-state dispute settlement mechanism if disputes arise. This is important in order to have confidence in investment. Chinese companies are not going to invest in Australia and, likewise, Australian companies are not going to invest in China if they are not sure those investments have some stability under the rule of law. That is what the investor-state dispute settlement provides. There is nonsense that goes on about environment and all this. In the provisions that are part of this agreement, there are general exceptions for all measures that protect human health and the environment. So the examples that the member from Melbourne gave simply do not apply. If it has to do with human health or the environment, those investor-state dispute settlements do not apply.

The schedule also has reservations which allow Australia to maintain our existing measures and reserve policy space to maintain or adopt new measures in sensitive areas, including security, human health and the creative arts. I would say those investor-state dispute settlements are, on balance, of greater advantage to Australia, because, if there is a case where an Australian company is investing in China, to create more exports to China, and there is a dispute with the Chinese government, the company has these investor-state dispute settlement regulations there to rely on.

This is a wonderful achievement of the coalition government. This free trade agreement will create more jobs. It will create higher-paying jobs. It will create greater wealth. It will create lower prices for consumers. But most of all it will create opportunity. This is a wonderful achievement of the coalition, and I commend it to the House.

Richard Marles (Corio, Australian Labor Party, Shadow Minister for Immigration and Border Protection) Share this | Link to this | Hansard source

I rise to support the Customs Amendment (China-Australia Free Trade Agreement Implementation) Bill 2015 and the Customs Tariff Amendment (China-Australia Free Trade Agreement Implementation) Bill 2015 and acknowledge the significant moment this represents, both in the economic history of our country and in the way in which this parliament has operated to deliver the best outcome that we can deliver in terms of the way in which the China free trade agreement will operate.

The Australia in the Asian century white paper that was delivered by the former Gillard government was, in my view, one of the most important economic narratives that came from the Rudd-Gillard era. Its thesis was that, as a small country of 23 million people, we were unlikely to be able to maintain our standard of living unless we were an active trading nation and that what we had on our doorstep was the most significant social phenomenon that we are seeing in the world today, and that is the rise of the Asian middle class, and we are particularly seeing that in China. That represents an enormous opportunity for the Australian economy in terms of providing both goods and services to that rising middle class, in circumstances where ours is of course an economy geared to providing goods and services to our own middle class. You cannot be in that space without having a free trade agreement with China, which is why we have, on this side of the House, always supported the idea of a China free trade agreement and why we pursued that throughout the Rudd-Gillard era.

And all of that, of course, is an extension of what you saw during the Hawke-Keating governments—a much greater integration between Australia and the East Asian economies. We saw that with the establishment of APEC, which was one of the critical achievements of the Hawke-Keating era. You can go back further, to the Whitlam government. Indeed, Gough Whitlam as Leader of the Opposition in 1971 visited China—

Russell Broadbent (McMillan, Liberal Party) Share this | Link to this | Hansard source

I can go back that far too. I don't think you can!

Richard Marles (Corio, Australian Labor Party, Shadow Minister for Immigration and Border Protection) Share this | Link to this | Hansard source

Indeed. And, in this month in 1973, as the Prime Minister, Gough Whitlam visited China and began the process of establishing diplomatic relations between us and that country. Indeed, we can go further—I do not know whether you can do this, Mr Deputy Speaker—back to 1947 and Doc Evatt's participation—

Russell Broadbent (McMillan, Liberal Party) Share this | Link to this | Hansard source

No. You got me!

Richard Marles (Corio, Australian Labor Party, Shadow Minister for Immigration and Border Protection) Share this | Link to this | Hansard source

in the Asian Relations Conference in New Delhi. The Chifley government was focused, in the immediate postwar era, on seeing Australia's future embedded in Asia and the need for us to participate in that growing economy. The foresight then and that line of action that you have seen through successive Labor governments demonstrate the fact that a China free trade agreement—what we see before the parliament now— and what we saw with the Australia in the Asian century white paper are part of a long Labor tradition, both of liberalising trade and of engaging with Asia.

I saw this firsthand when, along with the then trade minister, Dr Emerson, I led a trade mission to China on behalf of the Australian government—the Australia-China 2.0 Trade Mission—back in 2011. We went to Guangzhou but we went to a series of secondary cities as well—Changsha, Wuhan, Chengdu, Jinan and Chonqing—and saw the enormous opportunity coming from the growth of the Chinese middle class.

This was a trade mission that had 100 Australian businesses across a range of activities, many involved in services. It included John Bilmon, from PTW Architects, who was the principal architect involved in designing the famous Water Cube where the swimming events were held at the Beijing Olympics. He saw the opportunity of providing his services to the Chinese economy. We had people who were engaged in environmental services, education, training, banking and the list goes on.

As trade minister I had the great opportunity of visiting Beijing, in July 2013, when I participated in the negotiations for the China free trade agreement. I remember being advised by the department of the dairy industry and what this agreement would mean for them. It is an instructive example about the opportunity this represents for the economy as a whole. Back in 2008 the dairy industries in Australia and New Zealand were about the same size. That was the year New Zealand signed its free trade agreement with China. In the five years between then and 2013 we saw a massive increase in New Zealand dairy exports to China—something like a tripling of those exports—to a point where that industry was almost twice the size of the Australian industry just five years later. In 2013 there were 40,000 Australians, I was advised, working in the Australian dairy industry. That example demonstrates the opportunity to be gained from this agreement, and you can replay that in respect of beef, wine and a whole lot of agricultural services.

That is an instructive example of the opportunity this China free trade agreement represents for Australia's economy. It needs to be, and we have always believed it has been, a critical economic plank of our future strategy for goods and services—the opportunity for Australian universities to participate more in China, the opportunity for Australian banks, architecture firms, law firms, environmental services and the like. The opportunity of a free trade agreement with China is immense.

That said, the precise agreement arrived at by this government is not the one a Labor government would have negotiated. There were legitimate concerns, we felt—as did many in the union movement—around the labour-mobility clause and its capacity to be open for abuse. It is in that respect that I place on record my admiration for the work of our shadow trade minister, Penny Wong, in the negotiations she has undertaken with the government on the way the government will engage with the existing free trade agreement, in respect of these issues. What she has negotiated—and I need to acknowledge the trade minister, Andrew Rob, in the same breath—what both have negotiated is labour-market testing to be applied across all work agreements.

When we are talking about 457 visas, in relation to the market salary rate test that is applied to 457 visas, the government is willing to have a situation where enterprise-bargaining agreements are referenced as the benchmark. That is not just in respect of 457 visas issued in relation to this China free trade agreement, it is across the whole regime of 457 visas. It ensures that where people are working in Australia and requiring an occupational licence, that becomes a condition of their visa.

These are significant changes to the arrangements that will apply in respect of the China free trade agreement, which have been negotiated by Senator Wong and the trade minister; it is to the credit of both of them that this has occurred. This agreement will provide much better safeguards for Australian workers. It goes—I do not pretend to say it goes the whole way—some of the way in dealing with the legitimate concerns that have been expressed by many, including those in the union movement.

In the same breath, I put on record my admiration, as well, for the leadership of Bill Shorten, the Leader of the Opposition, in respect to the way in which this has been handled. It has not been easy. We have always supported the idea of a free trade agreement with China. We have been deeply engaged with it. It is part of, in many respects, a Labor tradition going back to the Chifley government. But we did have legitimate concerns in respect to the labour-mobility clause and the way in which the Leader of the Opposition has handled this, and the outcome is an enormous credit to him. Ultimately, it is a credit to this parliament. As a result of his work, the work of Senator Wong, the work of the trade minister and the work of this parliament we will have a much better China free trade agreement being implemented in this country.

There remains an issue in relation to the whole space of those from overseas working in Australia, under temporary work arrangements, on temporary work visas. That is part of the context in which we have concerns about this particular agreement. We need to ensure that the visas we have operating in Australia that provide for temporary work do the job intended. We have work rights afforded to people who are here studying, which is appropriate. People on student visas should be able to undertake some work, in order to sustain themselves, while they gain a qualification from one of our fantastic educational institutions. But where we see students' work rights overshadowing their ability to study, that not only undermines why those students are here but also short-sells the great education-export industry we have in this country.

We have seen working holiday visas being industrialised in some instances, where people who come here are engaging in a lot of work and not much holiday under a visa which is about trying to promote a cultural exchange and to give people the opportunity to live in Australia and experience life here for a period of time. And, of course, 457 visas play a critical role in our economy in dealing with skills gaps. But where you see labour market-testing arrangements fail, that has the effect of skilled Australians missing out.

All of this needs to be looked at very carefully. We need to make clear a fundamental principle in this country, which is that if you work in Australia you should be working under Australian conditions of employment. And the concerns that have been expressed by many, including those in the union movement, are very legitimate in relation to this. As the Leader of the Opposition stated in his speech this morning, both myself and the member for Gorton, the shadow minister for employment, will be reviewing this issue and looking at ways in which a future Shorten Labor government can reform this sector to give rise to a much fairer outcome for those who are working here in such a way as to prevent the exploitation of those people and to better resource our industrial relations system so that it can enforce a circumstance where those who do work in the Australian labour market do so under Australian conditions of employment.

But as a whole, today is a good day. It is a good day for our parliament in how those of us in this place have worked together to get a much better outcome than was originally proposed. It is a good day for our economy, because we will see a China free trade agreement put in place with all the consequent opportunity that that represents for our businesses in supplying goods and services to that rising Chinese middle class. And it is a great day, I think, for the leadership of both parties in being able to work out the arrangements which are being consecrated in the legislation before us today.

Melissa Price (Durack, Liberal Party) Share this | Link to this | Hansard source

May I take this opportunity to thank the opposition for finally coming to their senses and to the table, and showing bipartisan support for the China-Australia Free Trade Agreement. For a minute there I thought that Andrew Robb had no role whatsoever as trade minister in the negotiation of the ChAFTA agreement. I thought it was all credit to Penny Wong! But it is so good that they have finally come to their senses.

On this side, we know that the opposition has now done the right thing by supporting Australian jobs and Australia's future—our future, our children's future and our grandchildren's future—by leaving the politics at the door. I congratulate the Labor Party for that.

I am thrilled to rise today to speak about the Customs Amendment (China-Australia Free Trade Agreement Implementation) Bill 2015, because this will be of immeasurable benefit to my electorate of Durack, not just for today or tomorrow but for many years to come. This is a hallmark day in Australia's history. This deal, this agreement—'ChAFTA' as we call it—will be of unquantifiable value to Australia's economy. Chinese tariffs on key exports such as beef, dairy, horticulture, wine and coal will be slashed. We will see improved trade opportunities for a whole raft of services in education, hospitality, aged-care services and tourism, and also an improvement for the pharmaceutical industry—all of which will service the largest middle class in the world.

Independent economic modelling around ChAFTA, together with the Japanese and Korean free trade agreements, shows that it will add an additional $24 billion to Australia's economy between 2016 and 2035. We know—and we also know that those opposite know—that increased exports and cheaper exports will create more Australian jobs. It will allow Australian businesses to hire more workers.

I want to take this opportunity now to put on record my thanks to the Minister for Trade, Andrew Robb, for his tireless work on negotiating this excellent deal. This is truly an historic day in Australia's young history. The work that Minister Robb has done should be applauded, and I am pleased that he is getting some credit—although not a lot—from the other side.

Combined with the free trade agreements signed by Korea and Japan since we came to office just over two years ago, the China free trade agreement is forecast to create some 7,900 net jobs next year, and will peak at over 14,500 jobs in 2020, before returning to be over 5,400 jobs higher in 2035 than we would otherwise have had but for these three free trade agreements. Increased economic activity as a result of these free trade agreements will also encourage higher incomes, with real wages forecast to be over half a per cent higher by 2035 as a result of the benefits of these free trade agreements.

This increased economic activity is welcome news to the people of Durack, as higher incomes and lower prices will benefit these hardworking regional people. The Chinese free trade agreement will be of great benefit to my large and diverse electorate of Durack. The last agricultural census in 2011 illustrated that there were about one million head of cattle in Durack. In 2013-14, total beef exports from Durack, both live exports and beef produce, were worth approximately $215 million. Needless to say, this deal will have enormous benefit to my pastoralists in Durack—across the Pilbara, the Kimberley, the Mid West and the Gascoyne regions. Due to ChAFTA, opportunities for Durack cattle producers are limitless.

However, it is not only pastoralists in Durack who are going to benefit from this agreement. The largest grower and processor of chia seeds in the world, and one of the largest exporters of them in the world, The Chia Co, is just one business which is set to flourish under this agreement.

For those who are listening and who do not know, chia is a super food. For those wondering, it is a great source of fibre, protein and omega 3.

An interesting little stat is that the Aztecs really liked it back in the 1500s because it was one of their staple foods. So for those of you who are not on Chia seeds, you should be on them very soon. Based just outside of Kununurra, the Chia Co. has tried to get into the Chinese market for years and will no doubt be ecstatic on hearing the news about the passing of this legislation very shortly. I have no doubt that this agreement will help facilitate them to get into the Chinese market. After four years of trying to jump through all the hoops but not striking gold, they expect that their trade with China will turn over $1 million in the first 12 months of entering that market. This is just one example of the great news which ChAFTA has delivered. I would like to mention another great example in the midwest, in Durack, the Geraldton Fishermen's Co-operative. The Geraldton Fishermen's Co-operative are the largest live rock lobster exporters in the world. I know that they will welcome this opportunity as they will be able to directly export into China, benefiting all of those cray fishermen in my vast electorate of Durack.

Only this side of the chamber understands how to live sustainably whilst at the same time growing the Australian economy. In 2004, under the Howard government, the parliament voted the Australia-United States Free Trade Agreement into law. At the time, it was that Australia's largest ever bilateral trade deal with the world's largest economy. Today as I stand here, the China-Australia Free Trade Agreement will become this country's biggest ever bilateral trade deal with our biggest trading partner. This deal represents the first stage of what promises to be one of our most successful economic relationships. This deal, along with the other free-trade agreements, illustrates that this coalition government can deliver a strong and prosperous economy for a safe and secure Australia. It is deals like this that have led to Australia's impeccable record of 24 years of continuous growth.

This is indeed a significant day in Australia's history. The China free-trade agreement will be the largest bilateral trade deal on record. The agreement's benefit will be enormous to the Durack pastoralists, to horticultural businesses in Durack and also for other parts of Western Australia including the dairy farmers and the wine industry. This will increase Australia's economic pie while increasing real wages at the same time. This agreement has the Liberal Party fingerprints all over it. I again congratulate the minister for trade in his work in securing this deal.

This deal has been endorsed by a number of senior figures in the community including our Labor icons like Bob Hawke, Kevin Rudd and Martin Ferguson. I am sure they are delighted with the way we are progressing with this legislation now finally. Fortescue Metals, the National Farmers' Federation, the Australian Dairy Farmers and the Export Council of Australia are all among the many businesses and people who have publicly shown their support for the agreement, and I am sure they are charging a glass this evening as well.

Growing Australia's economy and creating jobs are two things I am very proud that this government has achieved since coming to office only two short years ago. I commend the bill to the House.

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

It is always interesting to hear these debates and hear individual member's contributions. I point out the member for Durack claims it is great that the Labor Party has come to its senses and we have had this agreement zooming through parliament. But she might just want to reflect on the fact that if the member for Warringah had taken a less bellicose position in this parliament then perhaps we would have arrived at this position a lot earlier, because all the opposition has ever wanted is not to wreck this trade deal but to improve it. We want to improve it by protecting Australian jobs through labour market testing; by upholding Australian pay and conditions through a better wages system for 457 workers, for guest workers, for those with skills; and we want to maintain Australian skills and safety standards by ensuring that foreign workers have a relevant licence under Australian law.

These are all pretty straight forward things for the labour movement. If the government had sat down rather than taking a bellicose and obstreperous position then we would have arrived at this point a lot earlier. The government has got to take responsibility I think for the overall state of politics in this House—they set the tone. Now that we have—I am not sure if it is a new government or an old government—the Abbott-Turnbull government, we know eventually it is going to be the Abbott-Turnbull-Morrison government. We have a ChAFTA-plus situation here today and that is a great tribute to Bill Shorten and it is great tribute to Penny Wong. I think a part of the work that we are going do is improve the 457 wages system, our immigration system and the state of visas in this country.

I heard previous speakers talking about the transformation of China and I always think that one should always remember Disraeli's point at this juncture:

What we anticipate seldom occurs: but what we least expect generally happens.

That was what Disraeli said. It is a useful thing to remember that economic transformation in the past is no guide necessarily for the future. I remember when I first got interested in politics there was a very good historian called Paul Kennedy, who wrote a book called The Rise and Fall of the Great Powers. This book was all the rage around '91, '92 in Washington and in London. Foreign policy elites and the like were all reading it. It is quite a famous book and a very good book. It charts the rise of Europe but before that it documents the state of the world economy at the time and it pointed out that China was the largest economy at that time before the industrial revolution. So what we are, in a sense, returning to is the norm in terms of China. He was a great historian but he went on in the end of this book to make a number of predictions. It is very interesting that many of those predictions did not come to pass. Indeed, many of his predictions focused on the economic strength of Japan, which we now know fell into a state of very low growth, with zombie banks roaming around its economy. We no longer talk about Japan being an economic powerhouse; it is certainly still economically strong and still an important nation for the world, but we do not talk about it in the same terms that we talked about it in the late eighties and early nineties.

It is interesting, when you hear speakers talking about the growth in China, that very few of them talk about the Lewis turning point. I would point them to an article in the Financial Times titled 'China migration: at the turning point' written by a journalist who I had the pleasure of meeting when I was in China. He points to the fact that the Lewis turning point may well now have been met in China. He says in this article:

… economists say the most dynamic phase of China's transformation to an urban society is complete. The once-limitless pool of impoverished rural labour from areas like Guang'an is rapidly drying up.

The end of surplus rural labour—a significant milestone that economists call the Lewis Turning Point—carries profound implications for China's economy. As the flow of low-paid migrants into Chinese factories flows, workers demand higher pay, a phenomenon that has been evident for several years. This either drives low-end manufacturers out of business or forces them to raise prices, actions that could slow the export growth that has helped drive the country's economy for decades.

The article then goes on to quote:

"Labour and capital will become more limited and more expensive," says Ha Jiming, investment strategist for private wealth management at Goldman Sachs in Hong Kong. "The economy will rebalance as exports slow due to rising factory prices. Investment will have to slow. That's exactly what we're seeing in real estate and manufacturing."

So we are now seeing a very different point in China's growth cycle, and behind that there is a looming political transition, of course, for the country as well. We now look at President Xi and see a strong leader, but we know that recently the Chinese Communist Party has been racked with the greatest and most open conflict that they have had really since Mao's departure, and we saw Bo Xilai, and many, many other senior Chinese figures, including some at the politburo level, being tried and imprisoned for corruption. And there is an open question, I think, in China about the rule of law and how that process is operating.

So China's future economically, politically and socially is an untold story. Its peaceful rise and its development are critically important for the world and for Australia, and we should not be myopic about the opening of these markets. Opportunities will depend on a wide variety of factors and, indeed, I think growth just because of tariff reductions will not necessarily occur. These tariff reductions are welcome for barley, pulses, wine and food, and all of those things are important for my electorate. But we will have to pursue those export opportunities. We will have to pursue prosperity. And it is critically important that we have a good relationship in the process, economically and diplomatically.

As I said before, we set out to make ChAFTA plus, to protect Australian workers. I have been in this House many times talking about the 457 visa program and about some of the backpacker visas and some of the abuses of that visa program, and I think so much of the angst about these trade deals is that they have mixed up trade with migration, and migration issues are topical in the Australian workplace at the moment. I think it is a very good thing that the members for Gorton and Corio are doing work on this issue in policy for the opposition, and I think we need to have a serious look at these programs, because they are, in some instances, operating as guest-worker programs, and terrible abuses are being made. That undermines Australian workers and undermines Australian jobs. But also those people who visit our country and often become permanent residents—about half the 457 visa holders who come here become permanent residents—are sometimes treated appallingly. They are forced to pay for the visas, and we see a bill in this House this week about that. They are forced to pay excessive amounts for accommodation. They are treated very, very shabbily at work, while having their visa and working conditions held over their head. I do not think that that is the mark of the Australian character or the Australian nation.

So it is completely understandable that workers, particularly in the building trades like electricians and carpenters—people who make things for a living—who are basically at the sharp end of that system, and who see a lot of egregious abuses, big and small, on their work sites, are sceptical—they are entitled to be entirely sceptical—about this government and its commitments. They rely on the Labor Party to force this government to put in place these protections for Australian workers, and they rely on us to do good policy work to offer to the Australian people when we come to an election and of course if we form government.

So, with those comments, to conclude: we did not set out to wreck this deal; we set out to improve it, and improve it we have. Bill Shorten and Penny Wong have been very productive and very constructive. The government, I take it, this week has been very productive and very constructive, and we should now get on and look at some of those other issues which are causing such angst in the Australian community.

Natasha Griggs (Solomon, Country Liberal Party) Share this | Link to this | Hansard source

I would like to take this opportunity to commend the excellent work of Minister Robb and his team in the department for the work that they have done. Since the 2013 election, the coalition government has made significant progress on a number of major trade agreements. Of course the legislation before the House today, the Customs Amendment (China-Australia Free Trade Agreement Implementation) Bill 2015, relates to the China-Australia Free Trade Agreement, or ChAFTA, as we affectionately call it. We have also seen some incredible progress made on the Trans-Pacific Partnership or TPP.

I understand that Minister Robb, after his very famous stand-off with the United States over intellectual property protections for medicine in the TPP, has returned to Australia to engage with the Labor Party on some of the finer points of this agreement. I am very pleased to see that the sensible solution has been reached—one that, if I may borrow a phrase from the minister's earlier statement, provides clarity and comfort with regard to some of the issues those opposite raised. Now that we have finally seen the Labor Party come to the table in good faith and discuss this in a rational way, I call on those elements of the union that have been so aggressive in debate, particularly the CFMEU and the MUA. I would like to see them deal with this agreement on a sensible level.

Speaking as the only coalition representative of the Northern Territory in this place, I would like to take a few moments to outline why I have been so enthusiastic in my support of this agreement. Australia, as we all know, is an island nation, so the terms under which we engage in international trade will always be a significant factor in determining the nation's overall wealth and the quality of life that our citizens enjoy, and nowhere more so than in the Northern Territory.

China is Australia's largest two-way trading partner. That in itself may not be surprising. Anyone who has ever shopped in Australia would be familiar with the 'Made in China' tags and stickers on so much of our merchandise. What may be surprising is that Australia exports to China more than twice as much as we import. On 2014-15 figures, we sold $107.6 billion worth of exports to China. That is nearly one third of our total exports. China, by contrast, sold $52.1 billion to us. Whenever we discuss the details of this legislation and we talk about the drop in tariffs on certain products, it can sound like small change. To keep it in context, what we are really talking about is nearly one third of Australia's export market. China has more than 1.3 billion people and a rapidly growing middle class, as many of my colleagues have commented on. If we, through this agreement, can boost that trade by even a few percentage points, that change will ripple across 1.3 billion consumers, totalling one third of our export market.

In terms of the Northern Territory, beef production is big business. Historically, we have relied on live-cattle exports to Indonesia, so irreparable damage was done to that market when the Labor government banned the live exports to Indonesia in 2011. Since then, though, the beef industry has diversified. We are finding new markets for exports of live cattle. A $90 million abattoir has opened just outside of my electorate and the focus will be to process boxed beef. Currently, live cattle attract a 10 per cent tariff in China that will be eliminated in just four years under ChAFTA. Processed beef tariffs of up to 25 per cent will be eliminated over nine years. What does this mean? It means that for 1.3 billion Chinese people Australian beef will be more competitively priced on supermarket shelves and in restaurants. If just a small portion of the 1.3 billion people switch to Australian beef, we will have created enormous growth in the sector.

Meat and Livestock Australia have crunched some numbers on what the China free trade agreement could mean for the beef industry. By their calculations, once the agreement is fully implemented, beef production could increase by $270 million every year. In the 2013-14 financial year, the Northern Territory exported $3.2 billion worth of gas. That figure is only going to grow as projects such as INPEX come online from 2016 and ConocoPhillips looks beyond the Bayu-Undan development. The China free trade agreement will lock in tariffs at zero per cent for this multibillion-dollar industry.

You might ask: what benefits are there when we already have no tariff? Put simply, it eliminates risk. The minister for Northern Australia and I toured both the INPEX and the ConocoPhillips facilities a couple of weeks ago. To give you an idea of the scale of these investments, the INPEX facility is five kilometres from the front gate to the seafront and then there is more than 800 kilometres of subsea pipe to the gas field in the Timor Sea. To build new facilities in that industry, we are talking about tens of billions of dollars. This is an investment in an industry where prices of the product produced can fluctuate. With ChAFTA, locking in tariff-free trade with our single-largest trade partner, we are removing one more risk. We are increasing business confidence and we are making it more likely that future developments will go ahead.

If I had the time, I would go through every industry in the Northern Territory and talk about the benefits that the agreement will bring, such as for pearls, for instance. We export $20 million worth of pearls every year. A 21 per cent tariff would be eliminated over four years. I spoke to James Paspaley about this tariff reduction and he was really delighted. He is very happy. The Northern Territory has a couple of boutique producers creating buffalo mozzarella. That is exactly the sort of product that could sell as a luxury in the China market. I do not believe that they export yet, but New Zealand's dairy exports to China have grown by 864 per cent since they implemented a free-trade deal. I am sure that the Territory's producers would appreciate access to that market.

In terms of services, the Territory has expertise in management, mining and extractive industries, aquaculture, agriculture, civil works and construction. All of those companies and the people in the area will now find it easier to work in China. I want to emphasise that because this point has been absent from a lot of the discussion around the agreement, particularly the points raised from those opposite.

The China free trade agreement is bilateral—it works both ways. Access will be improved for our specialists and professionals who need to work in China, as it will for the equivalent Chinese people who need to work in Australia. This approach to limited labour mobility is not new, and it will not mean, as the trade unions have suggested, that Australia will be swamped with Chinese workers—no more than we were swamped with Chilean workers when we signed a free trade agreement with that nation.

The 457 visa system will remain in place. The wages and conditions of anyone working in Australia will continue to be protected, and anyone working in this country will need to demonstrate that they have the appropriate skills to work in that field. Amendments negotiated with Labor will introduce additional clauses regarding mandatory reporting of cases where licences, registration or permits are refused or withdrawn.

China already has free trade agreements in place with a number of countries, including Pakistan, Chile, New Zealand, Singapore, Peru, Costa Rica, Iceland and Switzerland. Every day in Australia that we do not have this agreement puts us at a trade disadvantage against these nations. By contrast, getting this legislation through before the end of this year will pay a double dividend to Australia. If enabling legislation for the China-Australia Free Trade Agreement can pass in this calendar year, then the first year's tariff drops will come into effect on that day. The second year's tariff cut would then come into effect on 1 January 2016.

The legislation before us today is the enabling bill for one of the most significant trade agreements this House has ever debated. China is already Australia's largest single trade partner, and this bill will turbocharge that relationship, allowing greater access to markets and investment for both China and Australia. For my home, the Northern Territory, this will give our exporters a boost and will mean lower prices for both business and individual consumers.

In conclusion I want to reiterate that the regulations we are introducing will ensure labour market testing is required in all circumstances, before foreign workers can be brought to Australia. This means Aussie workers will always get first go and a fair go at applying for Australian jobs. It also means foreign workers will be able to enter the country only if no Australian worker is available to fill the role they are taking up. It is important to note that this has always been the case, in terms of policy, but now it is going into be regulated. It is for this reason that Labor is now supporting the China-Australia Free Trade Agreement. This puts paid to union claims that the China free trade deal will lead to foreigners stealing Australian jobs. It never would have, but that did not stop the scaremongering. These regulations will make doubly sure that that is the case.

I strongly commend this bill to the House. I am really pleased that Labor has finally come to the table and are supporting this very important deal for Australians, to ensure that we create the jobs we need for the future.

Terri Butler (Griffith, Australian Labor Party) Share this | Link to this | Hansard source

I support closer ties with China, and I support Australian jobs and conditions. Consistent with my belief that it is strongly positive for Australia to continue to build a durable and close relationship with China, I am an enthusiast for entering into a China-Australia Free Trade Agreement. But that does not require me to be an uncritical cheerleader of any agreement served up by this coalition government. My support for closer ties with China does not of itself remove my concerns about the effect of the agreement, and about labour and skills. It is more important than ever before in the post-war period to be careful about the consequences of our decisions about labour, skills, and power at work.

Before going to those issues I wish to thank the Leader of the Opposition, and the Leader of the Opposition in the Senate, Senator Wong, along with all of Labor's leadership and front bench, for their work in seeking and achieving real change in relation to the implementation of the China-Australia Free Trade Agreement.

In the face of the Tories' shameful and silly name-calling campaign, Labor has stood firm in saying that this trade agreement should serve the interests of Australians, and not threaten their prosperity and safety by undermining labour and skills standards.

I also acknowledge the work of those union leaders standing up for skills and jobs, and I thank everyone who has pushed through the posturing and pomposity from the Tories, to drag them to the negotiating table. Frankly, it is about time that the coalition stopped trying to exercise command and control, and started negotiating instead.

As I have said in this place before, Labor has shown great leadership over many decades in building the relationship between China and Australia. Ten days from now will be the 42nd anniversary of the first visit of a sitting Australian Prime Minister to China. Gough Whitlam had already been to China, as opposition leader, in 1971, and you will recall that he went to China even before the US in that year. By the time he returned, in October 1973, he was Prime Minister. His visit marked Australia's trade agreement with the People's Republic of China.

The coalition at the time rubbished Gough's interest in China. Prime Minister McMahon thought Australia was at risk of becoming a pawn of the great communist power in the region. As always, the coalition was backward, while Labor looked forward, and very little has changed. Today, on the first anniversary of his death, it is particularly important to acknowledge his legacy, not just in relation to China, but in relation to everything he did for this nation.

Every Labor Prime Minister in the decades since Gough's visits to China has done his or her part to strengthen this nation's relationship with China. As I have said previously in this House and outside, I am a strong supporter of a China-Australia Free Trade Agreement and closer ties with China. I want to see the economic benefits. I want Australian industry and firms to have greater access to Chinese markets. I want more Chinese visitors to come to Australia, whether for education or tourism, our two biggest service export industries. I want the broader benefits that come with closer ties. The world is changing. Power is changing. China is changing. We have to respond to that change.

As I said, none of that makes me an uncritical cheerleader. This is a parliament, not a fan club. It is our obligation, not just our right, to apply scrutiny to trade deals. I am far from alone in thinking that scrutiny is required. Earlier this year, the Productivity Commission wrote of the need for greater evaluation of preferential bilateral and regional trade deals. The commission wrote:

… preferential trade agreements are not as effective in improving national welfare as unilateral action to reduce or eliminate trade barriers (primarily through greater domestic competition), or multilateral trade and investment liberalisation … Preferential agreements also add to the complexity of international trade and investment, are costly and time consuming to negotiate and add to the compliance costs of firms (in the evaluation and utilisation of preferences) and administrative costs of governments.

The Productivity Commission noted that multilateral trade liberalisation is preferable to bilateral and regional preferential agreements and went on to draw attention to several concerns about those preferential agreements, such as this bilateral deal with China, including differing rules of origin for merchandise and services trade and investment; variable coverage of services across agreements and the likely effectiveness of services sector liberalisation; likely costs of more stringent intellectual property rights protection; concerns about the variability, effectiveness and unfunded liability posed by investor-state dispute settlement provisions—and there is one in this agreement, of course; and the evaluation of negotiated text of agreements. Each of those is a valid concern, of course, and with respect to the commission. I share those concerns.

I am also concerned about the labour market impacts and skill impacts of trade agreements that affect migration and labour. Labour and skills concerns are important, notwithstanding the attempts by those opposite to downplay and dismiss them. In Australia, labour's share of national income has been in decline since the late 1970s compared to the profit share of national income. Wages growth is sluggish, the slowest it has been since the wages price index began being kept in the 1990s, and inequality is on the rise. Those at the bottom of the income distribution—and I am talking about the bottom 40 per cent—have shared in the benefits of our national prosperity disproportionately less than those at the top of the income distribution.

Those facts should alert us to the need to think about power at work and why working people seem to be less able now than at any time in the past 100 years to exercise power in their own financial interests. It is no accident that increasing job insecurity and declining collectivism are leading to workforces having less power vis-a-vis their employers. This is not to dismiss the challenges that employers face in building enterprises, taking risks and creating value. Ultimately, you do not have to choose between supporting workers and supporting business. Their shared interests are obvious. And, more broadly, everyone in our nation has a shared interest in avoiding extreme inequality given it is a handbrake on growth and bad for community cohesion and security. To curb the increase in inequality, it is important that people on low and middle incomes, including people whose labour is their living, are able to exercise power at work. I say that because of the way wages and other forms of labour income are fixed in this country. Since the early 1990s, we have had enterprise bargaining of various kinds. In addition, at common law, people have employment contracts, or contractor arrangements, individually with their employers or principals, as the case may be. Almost since Federation we have had an award system which has set, variously, minimum and paid rates. Nowadays, those award rates are low and intended to be minimum rates. In addition, we have a minimum wage which should be the lowest rate paid to employees. The wages and conditions fixed under those different mechanisms, formal and less formal, depend, to varying extents, on the relative power of the owners and those who work for them.

It is just naive and wrong to think that the parties to employee-employer relationships and similar relationships are in a perfect equilibrium of power all of the time. For those on the labour side, power depends on many things. It depends on whether you are acting collectively or individually. It depends on whether it is a buyer's market or a seller's market for the type of labour you have to offer. And it depends on your job security. If you are scared you could lose your livelihood easily, that gives you less power.

That is one reason why I am so concerned about job insecurity. Job insecurity does not just make it harder to convince a bank to give you a mortgage or to plan your family's future. It reduces your power compared to your employer's in circumstances where you already have less power almost by definition. Job insecurity has been on the rise in Australia for the past 35 years. Firstly, casualisation rose sharply from the 1980s to the early 2000s. At the same time, there was a distinct move away from employment to contracting. The Productivity Commission's report Self-employed contractors in Australia: incidence and characteristics observed that the share of self-employed contractors in total employment grew at least 15 per cent over the two decades to 1998. Employers found new ways to reduce job security by using labour hire. Labour hire grew at 15.7 per cent per year from 1990 to 2002—massive growth. It remains to be seen how the new trend towards platform economics will affect job insecurity. This insecurity and the effect on millions of Australians' conditions and living standards is why the member for Scullin and I have written to the Productivity Commission asking them to rethink their cursory and dismissive treatment of job insecurity in the current inquiry into the workplace relations framework. All of those job insecurity questions are relevant to power—and there is another one we need to consider a nation.

As a nation, we need to come to grips with the power differential between temporary skilled migrants and their employers. Mr Deputy Speaker, as you know, temporary skilled migration is a particularly insecure form of work. If you are new to this country, you are unfamiliar with our laws and your visa conditions require you to either keep your job or leave Australia, the possibility of exploitation is obvious. When I was in practice, I represented a man who was here on a subclass 457 visa, a man by the name of Djoko Puspitono. His case is reported in the Federal Court papers. Shortly after complaining about his employer not paying him overtime and not paying his superannuation, among other things, Djoko was sacked. The termination letter told him he had five days to return to Indonesia. I asked the Federal Court to reinstate him and the company surrendered. They flew the white flag. He was reinstated by consent, on an interim basis, but later he was sacked again. Ultimately, he returned to Indonesia. In the later court decision, the judge recorded that Djoko left because he could not find another sponsor to take over his subclass 457 visa, he did not want to be in Australia illegally and he did not have enough money. The court went on to note that Djoko had paid for his own return to Indonesia, as well as paying for the transport of his possessions. It was a terrible story, where this person found that he was at a significant disadvantage as a consequence of having the temerity just to ask to be paid for the work that he did and to receive his entitlements.

Ultimately he was successful in his claim against the company. The court awarded him compensation. But the decision came three years after the initial sacking, almost to the day. And if it had not been for his membership of his union he would have had neither the power nor the resources to challenge a company that was prepared to exploit and sack him. For every person like Djoko who speaks out, who has a union behind him, there will be many more subclass 457 visa holders who will not, who do not have the power, who do not have a unions behind them, who do not have the opportunities that he had.

My point is that temporary skilled migrants are less powerful—probably by definition—than permanent Australian employees. And in a country where wage fixing depends on working people having a reasonable amount of power, it should be obvious that having large numbers of powerless people in an occupation puts at risk not just those people's own pay and conditions but the pay and conditions of others across the industry or sector in which they work. There are hundreds of thousands of temporary skilled migrants in Australia. I support the temporary skilled migration scheme. I want employers to be able to manage skills and labour shortages, and that scheme should operate with integrity. It should not be a means of reducing the workforce's power or pushing-down pay and conditions. Those on subclass 457 visas need security, and because of their special vulnerability they need protection from exploitation. There should never be an economic incentive, intended or otherwise, to hire a temporary skilled migrant ahead of a local, because that is an incentive to misuse the scheme. It should be a genuine scheme to deal with short-term skills shortages, and those who use it—those who seek to benefit from the scheme—ought to demonstrate their commitment to skilling Australians for Australian jobs into the future so that we can reduce our reliance on temporary skilled migration by actually planning for the skills we need.

As the member for Gray knows, one of the resources companies told us they had Norwegians operating on one of the big resources projects because they could not get the skills they needed in Australia. This is why Bill Shorten has been talking for such a long time about skills, about science, about technology, about engineering and mathematics. This is why Labor has led the charge to improve the skills needed for those types of occupations in this country. The obligation, the national interest, should be: how do we ensure that Australians have the jobs in the future? We ensure that Australians have the skills they need for the jobs of the future.

So, temporary skilled migration, while an important tool and one that should be maintained, needs to be what it was intended to be: an opportunity to fill skills gaps while at the same time working to prevent skills gaps from arising in the future. It is a challenge, and it is becoming more difficult as jobs change more rapidly. But we have to come to grips with this. We have 800,000 people on the unemployment queues in Australia. It is a national disgrace. We need to come to grips with this. I share the labour market concerns that arise from preferential deals like this. I want to see us as a nation come to grips with how we make sure that those who do come are treated with respect and dignity and are not exploited and that we decrease the reliance on temporary skilled migration into the future.

I am also concerned about skills particularly in occupations where skills are crucial in relation to worker and public safety, as is the case with electrical workers. I acknowledge the Electrical Trade Union's concerns in that regard, and I commend them for their advocacy in workers' interests and the national interest. It would be nice if instead of complaining about their advocacy those opposite actually acknowledged the work that union has done in the public interest and that other unions have done, including the CFMEU, who those opposite like to complain about, to draw to the public's attention the issues of concern in respect of jobs.

Ann Sudmalis (Gilmore, Liberal Party) Share this | Link to this | Hansard source

Today is one that is particularly important for Gilmore, and many living in the region are unaware of the large leap of change that has taken place. The China-Australia Free Trade Agreement will come into force before the end of the year—we hope—after a compromise deal was finally struck between the federal government and the opposition. Prime Minister Malcolm Turnbull today spoke in the House and declared that this was a 'historic trade deal', that this was the beginning of exciting times in Australia. For the opposition to move to a compromise on such a great opportunity is seriously worthy of note.

There has been a great deal of misunderstanding around the potential benefits of the China-Australia Free Trade Agreement. For growers, service providers and manufacturers in Australia, we have a domestic market of around 23 million people. If those growers, providers and manufacturers want to thrive and prosper, there is now a market door opening to the aspirational Chinese, who have income to spend. And there is predicted to be 1.3 billion people within the next decade who will become consumers. Already, since 2007, the relationship between imported goods to Australia from China and exports to China has changed drastically, with significant growth in our exports. With this agreement, that trend of export growth has considerable potential to increase exponentially.

Initially, the confusion around workforce conditions and 457 visas caused a media and union backlash, giving rise to phone complaints, union members stalking me in the electorate, and tradespeople being genuinely worried about their future employment potential. A number of revisions to these rules have been put on the table for negotiation, and with bipartisan support we now have these incorporated. Some aspects were in the wording, which could have been interpreted more loosely, but the intent of the agreement has remained unchanged.

I was always reassured that mandatory labour market testing was to be applied to investor facilitation agreements or projects over $150 million, that base pay threshold for 457 visa workers were to be firmly adhered to and that strict licensing conditions would be imposed for trades men and women looking to come to Australia. In addition, in one of my briefings I was assured that the 457 visa applications would be reviewed in light of specified skills lists and compared with the demand in the chosen destination in Australia. If the applicant had not done such an analysis, then the application would be refused. This was of particular concern for plumbers and electricians. I can fully understand this, as our tradespeople are generally much better trained than those coming from other nations. Andrew Robb, Minister for Trade, has said:

We should now be on track to be able to have an exchange of letters with the Chinese before the end of the year.

If ChAFTA is passed by the Senate in 2015, before the end of this year, then two rounds of tariff cuts will take place, one late this year and then immediately after 1 January 1 2016. That is a double bonus for Australian exporters.

There are industries in Gilmore that are just waiting in the wings for this agreement to pass through legislation. Let me describe a few. The first is about a baby product developed by a local mum whose child's skin was supersensitive. She sold to a local manufacturer, and the following is from their website, with a beautiful changing photo slide banner showing babies from all over the world:

Cherub Rubs wants the best for you and your baby … naturally.

Our products are FULLY CERTIFIED ORGANIC—not just a couple of organic ingredients, but more than 95% of all the ingredients in the majority of our range are certified organic. The entire range is manufactured under strict organic standards in a certified organic manufacturing facility.

This year Cherub Rubs is being recognised in the upcoming Premier's New South Wales Export Awards. The product is already hitting the mark in Hong Kong, Singapore and Malaysia, is about to establish in Thailand and is looking forward to the signing of the ChAFTA. One of the part owners is NowChem, and the director John Lamont told me:

The China free trade agreement is a positive opportunity to create more jobs, especially for Nowra Chemicals, a regional employer.

This will allow access to a large market of consumers who want to buy high quality goods and services.

The Chinese market is one that is growing in affluence. People there wish to access to the same cosmetics and beauty products available in Australia. Goods made and manufactured in a market they can trust for quality.

With the low Australian dollar, Australian Manufacturers are able to pay higher local wages and compete for high value innovative products in this growing and developing market.

The only issue facing many manufacturers is the decline in manufacturing due to poor government policy, such as a carbon tax, rather than an emissions trading scheme. That made many people review their manufacturing in Australia.

For those remaining, the current low interest rate climate is an excellent time to re-tool, re-invest and take manufacturing forward in Australia.

We have a significant agricultural base in Gilmore, so the change in tariffs in this agreement has the potential to be a game changer: growth, production and jobs. What more could we ask in an area of extremely high unemployment?

Whilst some of our vineyards are boutique in size, there are others, also having medal-winning wines, who could benefit from the change in tariff, with 14 to 20 per cent tariffs eliminated over four years. We have many wonderful wine-making enterprises: Crooked River Wines, Yarrawa Estate, Kangaroo Valley Estate, Roselea Vineyard, Jasper Valley Wines, Silos Estate, Wileys Creek, Mountain Ridge Wines, Coolangatta Estate, Two Figs Winery, Cambewarra Estate, Lyrebird Ridge Organic Winery, Cupitt's Winery, Kladis Winery, Fern Gully Winery and Bawley Vale Estate. I have a fairly large electorate, so it is quite a spread. Together they have received more than 1,000 national and international awards.

Our local bus company, Nowra Coaches, is already a unique service exporter in Gilmore. They sell holiday packages to Chinese visitors. They invested in a Chinese-language website and currently have more than 10 Chinese-based travel agents selling their holidays back here in Australia. The owner has told me there is a pent-up demand to see Australia. We have yet to cater to their accommodation model to maximise the potential of this aspect of trade between our nations.

Gilmore is home to Australia's Oyster Coast. It is a proud company that is now exporting premium-grade fresh oysters to China, building on the company's earlier export success in Hong Kong and Singapore. It will gain from the elimination of the 14 per cent tariff in the next four years. Forty-five of Australia's leading oyster growers are shareholders in the new company, operating across eight estuaries from Shoalhaven Heads to Eden.

Australia's Oyster Coast region is unique as it produces three varieties of premium oysters, including the Sydney rock oyster, the rare Angasi 'flat oyster' and the popular Pacific oyster. These oysters are grown under rigorous environmental management systems in some of the world's cleanest waters by passionate oyster growers with generations of experience. These oyster growers include the Greenwell Point oyster farmers Brian and Barry Allen, Jim Wild, Steve Newnham, Jess Zealand in Shoalhaven Heads and Mark Ralston in Batemans Bay.

Australia's Oyster Coast had their beginnings recently and launched the concept just two years ago with a fantastic photographic display and oyster tasting in this very house. It is a great example of the hard work and fantastic outcome. They have developed a sustainable and fast supply chain so the delivery of oysters to customers can take place within 30 hours of the oysters being harvested. This means that oysters that were growing in the estuaries in Gilmore one morning can be presented for dinner service at a restaurant in Asia the next day. They can do nothing but grow further with this China-Australia Free Trade Agreement.

Ulladulla Fishermen's Co-op Society may also be able to gain market share as a result of the ChAFTA. They have a great reputation and already export, but the potential can be increased.

We have a new enterprise in Bomaderry, Argyle Prestige Meats. They employ locals. They have great potential to grow, and they may now explore export options, knowing that the tariffs on beef to China will be eliminated over the next nine years. That may sound like a long time, but markets take a while to develop, trust needs to be built up, and over that time market share can be gradually increased to coincide with the reduced tariff.

Another industry that already exports but can increase markedly is the supply of veterinary products. One local company, Pharmplex, is located in Milton, and it manufactures supplements to treat sheep, goats, cattle, deer, alpacas and camels. There is enormous potential for it—more jobs and more growth. I am very pleased about that.

In Gilmore, the Shoalhaven Business Chamber has a stunning record of achievement, celebrating local businesses. This year the standout winner was Stormtech. This company has designed a unique shower drain system, one that runs parallel to the wall or the door rather than a grate in the middle. It is suitable for those with a disability. It can fit to existing plumbing and is qualified for Standards Australia and certified internationally. The drains are in high demand already for international hotel construction, and the company is already an exporter. The potential for this company is pretty awesome.

Finally we have the most iconic industry of all for the South Coast. It is there for all to see as visitors and residents alike travel in the Illawarra and the Shoalhaven: our wonderful dairy industry. In the region, including the highlands, we have 121 dairies. They have been doing it tough over the last few years. Low milk prices have made economic survival difficult. There are about 300 people currently employed in Gilmore in dairy, and that has huge potential to grow. With tariffs of up to 20 per cent being eliminated within the next four to 11 years, this industry can make up for some of its lost revenue. Our milk products are certainly in demand. In our local region the dairy revenue is over $60 million. That is a lot of milk produced each year. It is a hard industry—it is tough getting up so early to milk those cows in the morning—but some of our visionary farmers developed the South Coast Dairy and are in the process of expanding their production capacity. They are perfectly positioned to utilise the change in the trade arrangements with China.

I commend all our producers, our manufacturers, our innovators and our creators. They all put a bit of risk out there when they put their investments online, but this change in the market in China will assist so many in Gilmore to build their businesses, to find employment and to feel part of our national growth and participate in life rather than just surviving the process of living.

Gary Gray (Brand, Australian Labor Party, Shadow Minister for Resources) Share this | Link to this | Hansard source

I rise to speak on these bills which implement the China-Australia Free Trade Agreement. The bills are the Customs Amendment (China-Australia Free Trade Agreement Implementation) Bill 2015, which will provide free and preferential rates of customs duty on most Chinese originating goods and will maintain excise equivalent rates of duty on certain alcohol, tobacco and petroleum products, and the Customs Tariff Amendment (China-Australia Free Trade Agreement Implementation) Bill 2015, which amends the Customs Act 1901 to introduce new rules of origin for goods imported from China to allow these goods to enter Australia under preferential Chinese tariff rates.

There has been a lot of stuff and nonsense spoken about Labor's attitude to the China-Australia Free Trade Agreement. Political opponents on our left and on our right have tried to position Labor as anti-China and anti-trade. That is stuff and nonsense, indeed. Labor and China go back a long way. In 1949, Ben Chifley supported the admission of the newly formed People's Republic of China to the United Nations. Today is of course the anniversary of the death of the great Gough Whitlam. In 1971, Gough led a Labor delegation to Beijing which saw the first high-level political contact between Australia and China in over two decades. When he addressed the Australian parliament in November last year, Chinese President Xi Jinping acknowledged that Prime Minister Whitlam's decision to establish diplomatic relations with China in 1972 is the foundation of our strong relationship today.

Northern Australia and Western Australia, particularly, have defined Australia's modern relationship with China, from the Channar iron ore agreement in the 1980s to the North West Shelf LNG sale to China in 2002. I also go back a long way with China. As Labor's National Secretary I enthusiastically built relationships with the All-China Youth Federation. Later, I was a part of the North West Shelf team that worked with Prime Minister Howard to conclude the world's first LNG sale to China in 2002.

Our country and our people have benefited from bipartisan, practical, measured and realistic Asian engagement. That is why the last Labor government commissioned the Australia in the Asian century white paper—a plan to seize the opportunities and navigate the challenges of Asia's rise to ensure that we all win. Labor are the party of free trade and trade liberalisation. We recognise that reducing barriers to trade boosts growth, creates jobs and gives consumers greater choice and lower prices. Labor have been the great moderniser of Australia's economy and our relations with the world. It was Labor that brought down the post-war tariff barriers, floated the dollar, deregulated the banks, established the free trade agenda, initiated the Asia-Pacific Economic Cooperation forum and argued for the creation of the G20.

Significantly, the China-Australia trading relationship is, at its heart, a Western Australian-North Australian and China relationship. That is because the state of WA and northern Australia export most to China. WA's iron ore, LNG and other hydrocarbons, minerals, food and fibre comprise the lion's share by value and volume of Australia's trading relationship with China.

As we embrace the Asian century, Australians must understand that there is competition from other countries. This is also their Asian century. There are many other countries eager to become suppliers to China and many eager economic partners for China to select from. Indeed, as we speak here today, President Xi Jinping sleeps at Buckingham Palace. The Queen of Australia will use all of the royal British trappings to sell a British economic partnership with China. So we do need to compete.

People I meet, by and large, want to support a free trade agreement between Australia and China, but they want one that supports jobs and working conditions here and in China. I led the work developing the former Labor government's enterprise migration agreements, or EMAs, so I understand the power, productivity and benefits of flexible migration agreements for big projects. I also argued publicly for that policy position and for us to have the world's best practice in our migration laws and to have migration laws that support safety and, importantly, productivity.

I also know that the investment facilitation arrangements in this agreement are not EMAs. EMAs were designed for resource construction projects valued at $2 billion or more and a peak workforce of a minimum of 1,500 workers. IFAs will allow Chinese workers to be engaged on Chinese funded infrastructure projects worth more than a mere $150 million.

As part of the free trade agreement negotiations, Australia and China have also agreed to drop mandatory skills assessments for Chinese workers in a range of trades. Like so many of the temporary migration changes, the motivation for this change, and its impact, was poorly explained. The framework for managing them is now improved. I thank Minister Robb and the Prime Minister for this, and I congratulate my colleagues for wanting this outcome.

What has been most frustrating is that the government keep getting the important details of ChAFTA wrong. The Minister for Foreign Affairs in this place said that the China-Australia Free Trade Agreement would remove tariffs on Australian iron, Australian gold and Australian crude petroleum and LNG exports to China. These commodity exports, of course, already have zero tariffs. Ms Bishop was simply overselling, even misstating, the effects of ChAFTA.

The ChAFTA will deliver benefits for the Australian economy—the western and northern Australian economies in particular—by improving access to the Chinese market for our exporters in agriculture, mining and resources, education, manufacturing and services. The ChAFTA will be more helpful for certain sectors and not as helpful for others.

The Productivity Commission has said that the increase in national income from free trade agreements is likely to be modest. While such agreements can reduce trade barriers and help meet other objectives, their potential impact is limited and other options may be more cost-effective. But one thing is for sure: we cannot allow our competitors even a small trade advantage. Strengthening our relationship with China is an important and bipartisan national policy objective and a national advantage. There is deep and fundamental bipartisan support for a China-Australia Free Trade Agreement that supports and creates jobs and that makes our community proud of our parliament.

Labor depart from our political opponents only in our desire to ensure the China-Australia Free Trade Agreement supports and creates Australian jobs as a first priority. The government initially responded to Labor's genuine concerns about the labour provisions in the agreement with bluster and even extreme xenophobia rather than facts. It is time that we all recognise that name-calling will not substitute for real debate or allay concerns about anything, let alone this trade deal. Labor has consistently argued for safeguards in three specific areas: labour market testing, protecting Australian wages and conditions, and upholding workplace skills and safety standards. Today, Labor and the government have negotiated new legal safeguards in each of these areas without the need to renegotiate the ChAFTA.

Over the past decade many trade ministers have worked very hard to make this trade deal a reality, and we should pay tribute to Mark Vaile, Warren Truss, Simon Crean, Stephen Smith, Craig Emerson and Richard Marles. In particular, I pay tribute to my friend Andrew Robb for the great work that he has done in our national interest to deliver this agreement in a way that will bring benefits for Australia. I thank the Prime Minister. I thank the Labor leader. I thank Penny Wong. The work that they have done to bring a compromise to our parliament is simply exemplary. It shows us at our best in this place.

I also thank the leaders of the resources and agricultural sectors who thoughtfully trusted Labor to deliver on the ChAFTA. In government, Labor helped to negotiate the ChAFTA and, in opposition, here we are helping to secure the passage of ChAFTA through this parliament. I am pleased to support these bills and to vote for this agreement and to congratulate all of those ministers who, over all of those years, have worked in our national interest to deliver an agreement that is as good as it can be.

Sharman Stone (Murray, Liberal Party) Share this | Link to this | Hansard source

I rise to very strongly support this Customs Amendment (China-Australia Free Trade Agreement Implementation) Bill 2015. I only wish we could have celebrated this event some five or even seven years ago. As the National Farmers' Federation said in their submission to the Joint Standing Committee on Treaties inquiry into the trade agreement between Australia and China—and I belong to that committee:

There are approximately 115,000 farm businesses in Australia, 99 percent of which are family owned and operated.

Each Australian farmer produces enough food each year to feed 600 people, 150 at home and 450 overseas. Australian farms produce around 93 percent of the total volume of food consumed in Australia.

At the same time, we import over 37 per cent of our manufactured food product, in particular frozen vegetables and manufactured vegetables, and we need to really think hard about that. The agricultural sector contributes some 2.4 per cent of Australia's total GDP at the farm gate, and the gross value of Australian farm production in 2013 and 2014 was $51 billion, which was a six per cent increase from the previous year. The good news is that during that year, while we had horrendous drought, there was a drop in the Australian dollar and some recovery from the millennium drought, Australia's longest and worst drought on record.

However, when you add in the value of the vital value-adding processes that food and fibre goes through after it leaves the farm, along with all of the value of all economic activities supporting farm production through such things as the farm inputs, then agriculture's contribution to our GDP averages out at around 12 per cent, or $155 billion.

All of that is a rosy picture, as presented by the NFF, but the fact is that without international market access Australian agribusiness cannot thrive or continue to grow. My electorate of Murray depends on the further development and growth of export market access for the food and fibre that we produce. For example, if all farms were wholly dependent on domestic food sales in Australia, whether for selling their fresh or their processed product, they would be at the mercy of a grocery retail sector which has the most concentrated buyer power in the world. Coles and Woolworths own more than 80 per cent of the retailing action for food and beverages in the country. They can and do exercise that market power mercilessly. The ACCC has only recently begun to put some brake on the impacts of this exploitation and market domination. There have been fines, warnings and efforts to get compliance with voluntary codes of conduct, particularly in the grocery sector, with particular focus on Coles and Woolworths.

When a food grower or manufacturer can export their fine foods and beverages, thereby stepping out of the clutches of the big duopoly, then they have a better chance to maximise the value of their research and development investment in innovative new product and in their brands. In Australia they face the tyranny of the big two's drive towards replacing manufacturers' sometimes historic and certainly iconic brands with 80 per cent generic labels or home brands at down, down and everyday low prices. The big two in Australia seem to think that all the customer ever wants is cheaper and cheaper food. They imagine a dollar a litre for milk is a dream come true for the average householder in Australia.

China is Australia's largest export market for agricultural products. These exports are worth some $10 billion to the economy, but we are less competitive than our neighbour New Zealand when it comes to beef, wheat, sugar, dairy, wine, horticulture and seafood exports because of the high tariffs we now experience when Australia sells to China. We need this agreement to eliminate this range of punitive tariffs, and we need this agreement yesterday.

The New Zealand free trade agreement was signed on 7 April 2008 and came into force in October that year. The Chinese consumer has had seven years to become familiar with the New Zealand dairy products, in particular their infant formula and their cheeses. They have come to believe in the value of their wines, their beef and their fruits. It took New Zealand only three years and 15 rounds to negotiate their agreement with China. It took us ten years and 21 rounds before our agreement was completed in November 2014—and if the Australian unions could get their way, we would still be stalling this agreement with concocted fears of a flood of cheap, unskilled Chinese labour turning up on work sites across our wide brown land.

I have to laugh because, of course, within my electorate I have some very old goldmining towns like Rushworth, and not far away are Bendigo, Maryborough and Castlemaine. I have in my house a piece of furniture from the 1800s with a stamp on the back that says, 'Guaranteed European labour only. Made in Australia.' This was the fear at the time—that Chinese labour would be outcompeting the good old Aussie, who of course at the time was probably born in Germany, the UK, Ireland, Scotland or the US. The fear was that these Chinese labourers off the goldfields would destroy the working man's wages and conditions if they were allowed to ride roughshod over their competing labour in the workplace.

And, you know, that fear is with us still. In a press release sent today by the Australian Unions team, they say, 'Come to our town hall meetings, where we can talk about how to stop any of these agreements in the future.' 'Shock, horror, fear and loathing,' I say to myself. What a terrible shame and what an indictment of all Australians, when there is this pretendy fear, which is still with us and which must have been really quite concerning for some of our Chinese agents and traders who have been working with Australia for a very long time now and who perhaps had not experienced that xenophobia before. But it is alive and well, of course, in the Australian Unions team, as they call themselves.

New Zealand has already reached zero tariffs on apples and on seafood. We have great apples and pears and seafood too in Australia. In fact, the vast majority of apples and pears are grown in my electorate. Some 80 per cent of Australia's pears are grown in my electorate. But it will still take us another four years to reach that zero tariff equivalent with New Zealand for apples, pears and seafood after the China free trade agreement with Australia comes into play and when we have got those protocols developed and completed for each of those products. Hopefully all of that will happen sometime very soon, and I am so pleased that the opposition has finally come to its senses.

All the New Zealand tariffs on butter, liquid milk and cheese will be phased out by 2017, not very long away, while Australia's dairy products will still not see an elimination of tariffs for between four and 11 years. That is because we are starting so late. We need this free trade agreement with China, as I say, not in a year's time, not in five years time, not 'never, ever', as the unions would have it; we actually needed it yesterday, not stalled indefinitely by the out-of-touch union movement struggling to have some airplay or some relevance in the 21st century. New Zealand will have some 96 per cent of all of their China tariffs for their agricultural products phased out by 1 January 2019. Australia will have those tariffs removed some seven years later. We are beginning some seven years behind.

As China's population increases and their middle classes expand, as their arable lands, once used for agriculture and their own food sufficiency, are diminished by industrial contamination or urbanisation and as their rural workforce ages and concern about their own food safety grows, Australia stands poised to fill the gaps. We can provide their infant formulas, their children's foods, foods for their middle classes, their boutique products, their wines, their confectionery. We can also of course supply marvellous services—things that we excel in like aged-care and health services, which they are increasingly understanding they will need as their population ages.

My electorate of Murray is a pre-eminent high-quality food production region. Pactum Dairy in Shepparton, for example, provides milk to China's Bright Dairy right now, for 250-millilitre protein drinks. Bega in Tatura is manufacturing and exporting fabulous infant formula. More unusually perhaps, more than 10,000 live young heifers have been sent to build the dairy herds of China. Recently a Shepparton vet was recruited to manage some of these dairy herds for Fonterra in China. It will be ironic, in that many of the cows he is dealing with will either have been born and bred in the Goulburn Valley or will be descendants of those heifers, many of them sent during the worst drought on record, the Millennium Drought, in an effort to save the remaining herds in the Goulburn Valley.

We now have some Chinese ownership of dairy farms in the Goulburn and Murray valleys, and we welcome that, as we welcomed the New Zealand dairy farm owners a generation before. As I mentioned before, there are also Australian education and health services which are being welcomed in China. They are appreciated as their population ages. Our aged-care innovation and agencies are being sought out to add real value and innovation to China.

But there are also some unique Australian products in demand in China, despite the 14 per cent tariff now in place. I am referring to kangaroo leathers manufactured by Packer Leather of Queensland. They gave evidence to our Treaties Committee as part of the ChAFTA inquiry. They employ over 116 staff, both casual and permanent. China is their third-largest market, and in all they export to 19 countries. They aim to have their product used in the highest-quality men's shoes, particularly sports shoes, in China. In this case, there is no doubt that this free trade agreement will address the HS code classification for kangaroo skins, because, at the moment, the HS code is also used for goat and kid skins, swine and reptiles. Clearly kangaroo is in a little bit of a class of its own when you compare it with those other products.

This will be part of the efforts which will continue once this free trade agreement is finally through this parliament. There will be so much more work to do with developing the protocols and looking at the HS codes which are used. I too would like to commend all of those who over the years have slaved away to try and bring about this agreement. I am sorry that it has taken so long. I am sorry that it has been stalled, or that attempts have been made by the Australian trade union movement to stop it in its tracks. I think that is a disgrace. Clearly they are totally out of touch and have no interest in the jobs of Australians and in greater opportunities for agribusiness in this country. I strongly commend this China-Australia Free Trade Agreement to the House and to the nation.

Tim Watts (Gellibrand, Australian Labor Party) Share this | Link to this | Hansard source

On the first anniversary of the passing of the great man Gough Whitlam, we remember that in 1971 he, then Leader of the Opposition, headed a Labor delegation to China, where he met with Premier Zhou Enlai. In 1973 the then Prime Minister returned to China, becoming the first Australian Prime Minister to ever visit China. When he returned he addressed the National Press Club. He said:

The hopes of that region rest upon not only a better understanding with China but a better understanding of China. … China, Australia and all the countries in our region will be the beneficiaries of a better mutual understanding.

It is fitting that on the one-year anniversary of Gough Whitlam's death Australia is following his leadership and actively engaging with China in our region and taking another step on this journey. The Labor Party has a strong history of embracing trade liberalisation and engagement with our region. Labor governments have opened Australia up to the world, often unilaterally and often despite protestations from those opposite. We did this through Whitlam's across-the-board tariff cut, Hawke and Keating's dismantling of protectionism and the Rudd and Gillard government's pursuit of free trade agreements and, later, the Asian century white paper, a comprehensive platform for engagement with our region and a plan for an open, confident and engaged Australia.

We are a free-trading party because trade benefits working people by giving consumers more choice and lower prices and driving economic growth that creates jobs. This is why trade with our region is so important and today approximately one in every seven Australian jobs depends on exports. Currently, trade with our region is at its highest point in Australia's history. Of that trade, China is our largest trading partner. Last year our two-way trade in goods and services was worth over $150 billion. Our exports to China have also grown in recent years, from 8.5 per cent in 2003-14 to 32.5 per cent in 2013-14.

Trade and investment with China is central to the wealth and prosperity of all Australians, and the China-Australia Free Trade Agreement builds on this remarkable economic boom between our two countries. Once this agreement comes into force, more than 85 per cent of Australia's trade with China will be tariff-free. At full implementation of this agreement, 95 per cent of our trade with China will be tariff free. Many of the current tariffs will be phased out immediately. China is Australia's largest resources market, with Australian exports to China worth over $77 billion in 2014 alone.

China will remove or significantly reduce tariffs on Australian beef, sheepmeat, dairy products, horticultural products, wine, barley, seafood and processed foods. Agriculture is not the only sector that will benefit. ChAFTA removes Chinese tariffs on Australian resources and energy commodities, pharmaceuticals and other manufactured products. ChAFTA will also open up access to the Chinese market for Australian services businesses. It will deliver improved access for financial-services providers, such as banks, insurers and funds' managers; more education and training providers will be able to market their services in China; Australian hotel, hospitality and tourism operators will be able to invest in China; Australian health and aged-care facilities will be able to be established in China; Australian law firms will be able to service the Chinese market; Australian construction and engineering companies will be able to undertake joint construction projects; and there will be improved access for Australian telecommunications, manufacturing services, mining services, architects, software implementation and environmental services.

China is already the second-largest economy in the world, by some metrics, and will become the biggest in our lifetime. The China-Australia Free Trade Agreement enables Australian businesses to make the most of this growth, and it will be important for Australia's future. Australia's and China's economies do not compete, they are complementary, in many respects. This trade agreement should seek to strengthen our economic ties, but it will also, inevitably, strengthen our cultural ties. This is an opportunity to deepen our relationship.

Regardless of the benefits of this free trade agreement, we in Labor have said many times that the coalition could and should have secured a better deal, particularly regarding the inclusion of an investor-state dispute settlement provision. I have spoken in this chamber a number of times about the ChAFTA agreement and other free trade agreements that Australia has entered into and how invidious these provisions are. There are legitimate public concerns about the potential impact of investor-state dispute settlement provisions on public policies for health care. We have seen this with plain-packaging legislation and environmental protections. Labor has argued strongly against these provisions and adopted a policy of refusing to include them in trade agreements when we were in government.

It is true that some of these provisions already exist in other trade agreements, exposing us already to this kind of litigation, but this is no reason to unnecessarily further expose ourselves to this kind of risk. Labor is also concerned about the effect ChAFTA will have on the Australian labour market and, consequently, our temporary migration system. We want Australians to benefit from free trade's proven record of creating more jobs, not simply replacing them with temporary migrant labour. Labor has negotiated with the government and achieved a package that ensures proper safeguards are put in place to protect Australian jobs.

I am very pleased that good faith has been shown on both sides of this process and that there has been genuine bipartisan commitment to overcoming differences of values and perspective to agree on a way forward for this important agreement. Here is how these concessions will work: ChAFTA will allow for Chinese workers to work on Chinese funded infrastructure projects in Australia that are worth more than $150 million. Labor's safeguards will require those companies to conduct labour-market testing to ensure there are no local workers are available before being allowed to import labour from abroad.

Labor has also secured arrangements on the broader temporary migration system. They require employers to demonstrate a labour-market need for 457 visas, adopt training plans showing how they will train local workers to address these skill shortages and implement overseas worker-support plans to ensure migrant workers understand their rights in the workplace. This follows an increase in the salary rate for 457 workers, both to ensure migrant workers are treated fairly and that employers are not circumventing the system and using overseas workers for financial gain. This will not discriminate against Chinese workers, but will apply across the board.

Labor has also secured a deal to strengthen skills assessments that were removed by the government in the original agreement. Labor's safeguards will ensure that the Chinese free trade agreement will be a far better agreement for Australian jobs. While there remain issues in this agreement Labor would not have accepted if it had signed the agreement, the amendments that have been negotiated do ensure that the effects of those issues are minimalised and the benefits can be enjoyed by all Australians.

In the debate about this bill, a great many silly things have been said about this agreement and the other free trade agreements that have been negotiated by the current government. Here are some job-creation claims made in the name of ChAFTA by members opposite, in this chamber, and in the other place. Senator Abetz said:

These trade deals will create almost 9,000 jobs per year.

Senator Ronaldson said that in the absence of ChAFTA:

… there will be $4 billion lost to the Australian financial services sector alone by 2030, at a cost of 10,000 jobs.

Senator Payne quoted the sector as saying that without signing up to ChAFTA we would lose:

… 'some 10,000 jobs in financial services alone by 2030.'

Senator Birmingham said:

When it is fully implemented there will be some 178,000 additional job opportunities for Australians under ChAFTA, including skilled Australian workers.

The member for Hindmarsh, in this place, said:

This agreement will provide tens of thousands of new jobs …

The member for Banks said:

We have an agreement here that is going to create 178,000 jobs.

The member for Corangamite said:

It is estimated that over the next 20 years the ChAFTA will deliver some 178,000 new jobs.

And of course the trade minister said:

This is the future and these free trade agreements will lead to tens of thousands of new jobs …

Indeed, he even told the ABC that these free trade agreements would deliver 'literally' many hundreds of thousands of jobs.

His claims are notable because on the government's own figures, and according to the modelling by the Centre for International Economics, the KAFTA, the Korean Free Trade Agreement, the Japanese Free Trade Agreement and ChAFTA agreements combined will produce a total of 5,434—bizarrely specific economic modelling—additional jobs by 2035. As Fairfax economics correspondent Peter Martin points out, by 2035 the total Australian workforce will be over 15 million, so the cumulative employment impact of these agreements, on the government's own figures, will be less than one-half of one-tenth of one per cent of the total workforce. That is not nothing, to be sure, but it is certainly not 'literally many hundreds of thousands of jobs'.

I highlight these facts not because I am sceptical of free trade; I am unambiguously pro-free trade. And I am pro-free trade not for political or ideological reasons, but because I believe that it is in the interests of my constituents. It means cheaper goods and services, better choice and variety, and more jobs overall. In respect of cheaper goods and services, it is notable—given the rhetoric we heard in question time today, that this agreement is an export agreement—that the government's own modelling suggests that while Australian exports to China will grow under this agreement by 0.5 per cent, imports will grow by 2.5 per cent.

As discussed at length in the Productivity Commission's Report into bilateral and regional trade agreements, the benefits of preferential trade agreements like ChAFTA are much lower than multilateral trade agreements negotiated through the WTO. Of course there is little prospect of another successful global trade round in the foreseeable future, so we make do with what we can. But we should not let hyperbole cloud our view of the evidence. In the face of these smaller benefits from these trade agreements with a much narrower scope, we should not kid ourselves that as additional non-trade provisions are hung off the creaking framework of these treaties that the costs of these non-trade provisions could exceed the benefits we realise from free trade. You do not have to be a protectionist to believe this. The labour market and labour movement provisions in ChAFTA, as well as ISDS and intellectual property provisions are well known, and the concessions negotiated by the shadow minister for trade and investment, Senator Penny Wong, and other members of the Labor Party go a great way to remedying these issues.

Australia still has a long way to go when it comes to realising the potential of Chinese growth. Asia's middle class sits at around 500 million, and is expected to grow to substantially over the next 15 years. But merely pulling down trade barriers alone will not cause this opportunity to fall into our laps. We will all need to work for it; we will all need to work for it today, tomorrow and every day. This agreement is no silver bullet; it really just puts Australia at the starting line.

That said, it is certainly worthwhile supporting it, and I am very pleased with the bipartisan solution that we were able to reach on this agreement. I thank the House.

Lucy Wicks (Robertson, Liberal Party) Share this | Link to this | Hansard source

I too rise to support the government on the signing of Australia's Free Trade Agreement with China. I am particularly keen to rise to speak about this, given its importance to my electorate of Robertson.

I am pleased to speak on the Customs Legislation Amendment (China-Australia Free Trade Agreement Implementation) Bill 2015 in the House, not at a union-organised debate. I believe that this place is the appropriate place to discuss what the Prime Minister has described as 'a great day for Australia and an historic day that is good for jobs and good for business'. May I commend the outstanding work of the Minister for Trade and Investment, Andrew Robb, in securing this deal, a deal that will unlock more opportunity, more investment, more jobs and more enterprise with Australia's largest trading partner.

This China-Australia Free Trade Agreement also builds on the positive outcomes already generated by deals with Korea and Japan in creating jobs and boosting economic growth. And it also sits alongside the Trans-Pacific Partnership, which allows us to harness the enormous opportunities in the biggest global trade deal in 20 years. The TPP will set up a more seamless trade and investment environment across 12 countries that collectively represent around 40 per cent of global GDP.

And with the China-Australia Free Trade Agreement, we have a deal that will see 95 per cent of Australian goods exported become tariff free. This includes the abolition of tariffs on our agricultural products, as well as on a range of manufactured goods such as pharmaceutical products, car engines, plastic products and processed foods. It will remove tariffs on almost all resources and energy products, and will also open up more opportunities for Australian services. We have also secured improved market access for industries like banking, health and aged care, tourism, legal, construction, telecommunications and education services—all good news for businesses and industries on the Central Coast.

The removal of the five per cent tariff on Chinese manufacturing exports, electronics and white goods is also good for business, and will enhance our vital trade and investment relationships in this lucrative Asian region for decades to come.

But it is not just those of us on this side of the House who are endorsing this outstanding achievement for our nation. Let me share some comments with the House. Adam Kay, the chief executive of Cotton Australia, has described the agreement as vitally important. He said that more than 99 per cent of Australia's cotton crop is exported, the majority of it to China. And in the past two seasons that has represented more than $1 billion for the cotton industry. This agreement delivers important tariff cuts, and so Mr Kay describes it as a 'shot in the arm' for industry.

Noel Campbell, the president of Australian Dairy Farmers has declared that this deal matters, in particular for local famers. He said that it is a once-in-a-generation opportunity for business. And it is easy to see why, with tariffs of up to 20 per cent eliminated over the course of the next few years. As the grand-daughter of a farmer who farmed in Dubbo in New South Wales for many years, I can advise that the China-Australia Free Trade Agreement will help grow the state's almost $1.8 billion worth of agricultural exports to China, not just in dairy but also in beef, sheep meat, hides and skins, horticulture, wine and wool.

The Minerals Council of Australia has also declared that the trade agreement with China is an unambiguously good deal for Australia. The council described it as a high-quality agreement that will deliver stronger economic growth, more jobs and better living standards. And in the case of the minerals sector, the council said the agreement will eliminate tariffs that add nearly $600 million in costs to the bilateral minerals and energy trade.

In fact, overall, we have seen independent economic modelling demonstrate that the free trade agreements with China, Japan and Korea will together add $24.4 billion to the Australian economy over the period of the next twenty years. Increased exports and cheaper imports will also allow local businesses to hire more workers, with increased economic activity supporting higher wages. I am advised that real wages are forecast to be 0.5 per cent higher by 2035 as a result of the free trade agreements. In fact, the Financial Services Council says the China agreement could result in the creation of 10,000 new jobs by 2030 in financial services alone. So with this historic agreement secure, I am rally looking forward to working with my community of Robertson on the Central Coast and looking forward to listening to the myriad ways in which we can take advantage of this breakthrough locally.

I am pleased to announce to the House today that I will be hosting a special Austrade seminar in my electorate on 5 November. The seminar is aptly titled 'Seize the Opportunity' and will be an opportunity for residents and businesses in my electorate to discover how they can benefit from Australia's free-trade agreements with China, Korea and Japan. Austrade is designing the seminar so it can equip and inspire those attending with the very latest information to help realise the benefits created by these free-trade agreements. This will include advice on how the Central Coast region can open the door to market opportunities, grants and assistance, as well as some fantastic success stories that will no doubt inspire our community as well. It will also be a great chance to learn about changes to access and tariff, managing risk, legal compliance and other frequently asked questions by businesses in my electorate. The seminar will be at the Gosford RSL Club, just around the corner from my electorate office. It starts at 9am in the Pacific Room and runs till midday, with no charge, and I invite any businesses and any interested residents in my community who would like to come along to contact my office and we will send you the details. In particular, I look forward to engaging with our strong local services and manufacturing sectors on the Central Coast.

The Australian Bureau of Statistics last year reported there were more than 12,000 small businesses in the Gosford local government area, which matches closely with my electorate, and advises there are more than 550 businesses involved in the manufacturing sector. And an analysis by the National Institute of Economic and Industry Research has found that exports in Gosford City are increasingly strong. The three largest industries were manufacturing, generating $710 million in 2013 to 2014, followed by health care and social assistance and rental, hiring and real estate services. This China-Australia Free Trade Agreement is good news for those industries in my community. China is a major export market for Australian manufactured products, with exports worth $4 billion last year.

This agreement creates new opportunities for manufacturers, particularly those looking to supply goods to China's rapidly expanding middle-class. China currently applies tariffs of up to 47 per cent on some of Australia's manufactured products, including items like paper products, car parts, clothing and film. So I look forward to engaging with more businesses in my electorate that stand to benefit, and also with those people who have genuine questions about this landmark agreement.

I commend this legislation and the agreement to the House

Ewen Jones (Herbert, Liberal Party) Share this | Link to this | Hansard source

I support the China-Australia Free Trade Agreement because we live in the world today. The days of Australia being an island continent that this fully self-sufficient in everything are long gone. We have to have access to foreign capital. We have to have access to foreign investment. We must avail ourselves of those markets overseas which are just so important to us. The days of AWA televisions and those sorts of things are long gone. Australians want the best of things and we are in a smaller world. We must make ourselves competitive on the world stage.

I want to be very specific about Northern Australia. The development of Northern Australia depends on foreign capital. The development of Northern Australia depends on our ability to develop our resources industries and our water industries, our energy products and our water products to be able to develop those niche market products that we can get into those places.

We need to be able to bring in the infrastructure that would come naturally or organically in Australia over a period of 50 years. We need to be able to shorten that period. That is why the infrastructure facilitation arrangement is just so very important. Let me clarify this: to qualify for an IFA, you must have at least $100 million—we hope it is much more than that—it must be greenfield and it must be infrastructure that is economically challenging. You can then go onto the next area where all your labour market testing is done.

The China-Australia Free Trade Agreement is brilliant for us. It follows on the great work done by Andrew Robb, Minister for Trade and Investment, and all our team. The member Gary Gray said 'this follows on from a lot of work done by everyone and we are the ones that brought it home' but Andrew Robb has been absolutely brilliant in this. I do not think we have too many people in this parliament whose work has ever been able to compare to the work that he has been able to put on the ground here. He and his team must be justifiably proud.

When I look at these things, I say that the China-Australia Free Trade Agreement is all about the north of Australia, it is all about what is good about the north of Australia and it is all about developing the north of Australia. I see nothing but positives in this for anybody in the north of Australia. We have the goal of having between five and six million people in the north of Australia by 2050. That is 35 years to more than quadruple our population. To do that we must have massive infrastructure, and in Australia we do not have enough savings in our own country to facilitate our own mortgages, let alone our infrastructure. We must bring these things forward, and being a good global citizen is all about that. So I support this agreement, I congratulate all those people who have been involved in this and I thank the House.

Rowan Ramsey (Grey, Liberal Party) Share this | Link to this | Hansard source

What a difference a change in government can make, as happened in Australia two years ago. What a difference one man has made in this particular case, and that man of course is our trade minister, Andrew Robb: not one, not two, not three but now four free trade, or, if you like, freer trade agreements—it is an astonishing performance.

Australia, of course, was built on trade. We are major exporters, and access to markets is absolutely everything to us. Any restrictions inevitably lead us to less competition and lower prices for our farmers, manufacturers and miners. Modern transport and communications mean that we are moving closer to a single marketplace in the world and, increasingly, it emphasises the necessity for nations to invest in and expand the sectors of their economies in which they enjoy a natural advantage.

Last week in this place I raised the persona of Bert Kelly. Bert Kelly is not perhaps well known to a lot of Australians now, but he was in fact the member for Wakefield in South Australia. He entered parliament in 1959 and he remained the member for Wakefield for 19 years. He is remembered as the man who blew the whistle on protectionism in the sixties and seventies in Australia—an individual who Gough Whitlam later described by saying, 'No private member has ever had as much influence on changing a major policy of the major parties.' And of course we were talking about protectionism. Bert recognised that protecting unproductive industries always came at the expense of the productive industries. In his first speech to parliament he said:

… the free flow of world trade is the best hope we have of raising the standard of living all over the world.

And he said that in 1959. Bert Kelly knew that protectionism was not only futile but also actually tore down our most efficient industries and increased poverty throughout the world. He would be well pleased with Andrew Robb and the coalition government's commitment to freer trade and, in particular, today, he would be well pleased with the ChAFTA—the China-Australia Free Trade Agreement.

The World Bank has told us that China became the biggest economy in the world in 2014. Some other banking bodies actually dispute this, but, if it is not the biggest now, it certainly will not be long. It is already Australia's biggest trading partner: $98 billion worth of goods in 2014—around one-third of our total exports, and growing. There could not be a more important trading partner to Australia than China.

Much of the focus on the advantages of this deal, the ChAFTA, has been on what it delivers for agriculture. It is easy to see why. From the very first day, tariffs on dairy, horticulture, wine, beef, coal and a range of manufactured goods will be slashed, giving unprecedented access to Chinese markets.

Just as we have watched wistfully from the sidelines as New Zealand has reinvigorated its economy—and they certainly have the jump on us in that area—now we have a chance to join them and an opportunity, perhaps, to reel in the New Zealand economy. So we can go and join them.

By the end of day one, 85 per cent of our exports will enter China duty-free. When fully implemented, this figure will rise to 95 per cent. However, there is a hook in the tail here, and it is that if the agreements are not signed off by the time we rise for the summer break then we will miss the first tranche of all these benefits and they will probably be delayed for at least 12 months—if, indeed, they are ever implemented at all. It is highly likely that the Chinese would quit—that they would walk away from the negotiating table. And who could blame them? In fact, the Chinese Ambassador, Mr Ma Zhaoxu, said: 'ChAFTA took both countries 10 years of negotiation. It represents a hard win, and this is an opportunity that should not be allowed to slip away.'

Today we received the very welcome news that the Labor Party is putting the national interest in front of politics, and I congratulate them and thank them for the support.

I condemn the CFMEU campaign in particular. It was disgraceful, particularly with the elderly—truly disgraceful, but not really surprising. And we are learning more about the CFMEU every day as the royal commission unfolds. I am just going to take a short break because I think we might move a change of standing orders.