Helen Haines (Indi, Independent) Share this | Link to this | Hansard source

by leave—on behalf of the member for Warringah, I move amendments (1) to (3) together:

(1) Title, page 1 (lines 1 and 2), omit "Export Finance and Insurance Corporation Act 1991", substitute "law relating to the Export Finance and Insurance Corporation".

(2) Page 7 (after line 16), at the end of the Bill, add:

Schedule 3 — Fossil fuels

Export Finance and Insurance Corporation Act 1991

1 Subsection 3(1)

Insert:

fossil fuel-based infrastructure:

(a) subject to paragraph (b), includes infrastructure for:

(i) the extraction or transportation of fossil fuels; or

(ii) fossil fuel-based electricity generation; and

(b) does not include electricity transmission infrastructure.

fossil fuels includes any of the following:

(a) coal;

(b) oil and other petroleum-based products;

(c) natural gas;

(d) products, by-products and wastes from extracting or processing fossils fuels to which paragraphs (a) to (c) apply.

2 Subsection 3(1) (definition of Northern Australia economic infrastructure )

Repeal the definition, substitute:

Northern Australia economic infrastructure:

(a) subject to paragraph (b), has the same meaning as in the Northern Australia Infrastructure Facility Act 2016; and

(b) does not include fossil fuel-based infrastructure.

3 Subsection 3(1) (definition of overseas infrastructure development )

After "of infrastructure", insert "(other than fossil fuel-based infrastructure)".

4 Before section 81

Insert:

80A Prohibition on assistance for fossil fuel-based infrastructure

(1) Assistance must not be provided under this Act if the assistance is for purposes relating to, or is expected to result in, the development of fossil fuel-based infrastructure.

(2) It must be a condition of any assistance provided under this Act that the assistance not be used (whether directly or indirectly) for the development of fossil fuel-based infrastructure.

(3) Assistance includes a guarantee, indemnity, loan, insurance, reinsurance, financial service, financial product, subsidy or investment.

(3) Page 7 (after line 16), at the end of the Bill, add:

Schedule 4 — Freedom of Information Act 1982

Freedom of Information Act 1982

1 Division 1 of Part II of Schedule 2 (item dealing with Export Finance and Insurance Corporation)

Omit "4 or".

2 Application of amendments

The amendment made this Schedule does not apply to documents brought into existence before the commencement of this item.

Zali Steggall (Warringah, Independent) Share this | Link to this | Hansard source

[by video link] These amendments will improve the functioning of the EFA by prohibiting taxpayer handouts to fossil fuel projects overseas as well as improve EFA's transparency and accountability. Taxpayer money should not be wasted on assets that will be stranded, especially as we get close to $1 trillion in public debt. Agencies like EFA should also be transparent with the public about their activities and if they are making potentially loss-making investments. Regarding items 1 and 3, research conducted by Jubilee Australia has found that over a hundred potential fossil fuel transactions could not be properly identified due to poor disclosure requirements for EFA and an inability to FOI documents because EFA's commercial and national interest accounts are exempt.

Further, it's the purpose of this bill to allow the ability for EFA to make equity investments, which will increase the risk profile of transactions. And we get the compounded effect of riskier investments with a lack of transparency. The Australian people have no idea where money has been going. Potential losses are being incurred in their name. Any changes to equity investment ability must, therefore, be matched with corresponding changes to transparency provisions. To promote transparency, removal of the FOI exemption was a recommendation of the Productivity Commission in their 2012 review of the operations. As a reason for this, the Productivity Commission stated:

… the FOI Act exemptions reduce the ability of the public and the Australian Parliament to examine facilities for their environmental, social and human rights impacts …

Items 1 and 3 of these amendments will, therefore, amend the Freedom of Information Act 1982 to remove the freedom of information exception provided to part 4 of the Export Finance and Insurance Corporation Act 1991. After commencement of the bill, around 90 per cent of the transactions would be able to be FOI'd under this change. This is an important amendment. Importantly, the exception of part 5 of the EFIC Act, national interest accounts, remains in force, which would still provide important national security safeguards. Part 4 of the EFIC Act will also still be protected by existing FOI safeguards under sections 33 and 47 of the FOI Act.

The Australian public have no idea of the true extent of money being spent on fossil fuels through EFA. They deserve to know. It is simply remarkable that the EFA has operated in the dark for this long. Items 2, 3 and 4: we are experiencing rapid, alarming warming that jeopardises Australia's safety, security and future prosperity. It is clear from the recent IPCC report and from the advice from the International Energy Agency that we must rapidly transition away and stop funding fossil fuels. Item 2 will, therefore, introduce a third schedule to the bill and introduce a definition of 'fossil fuel based infrastructure' and 'fossil fuels'. Item 2 substitutes the definition for 'northern Australian economic infrastructure'. Items 23 and 24 make clear there will be prohibition any assistance, direct and indirect, given by EFA for fossil fuel based infrastructure. That includes guarantees, indemnity, loans, insurance, reinsurance, financial services, financial products, subsidies or investment for the purpose of supporting extraction, transportation of fossil fuels and energy generation. We must stop our fossil fuel spending spree, and these amendments will do just that. I call on both sides of the House, and in particular the opposition, Labor: if you are genuine in your commitment to transitioning to low emissions and dealing with the IPCC's very real warning then we cannot continue to fund fossil fuels.

Helen Haines (Indi, Independent) Share this | Link to this | Hansard source

There is no doubt export finance is an important foreign relations and trade policy lever. Indeed, if we use our export finance regime effectively it can be a tremendous force for good. In principle I don't oppose the idea of expanding the mandate of Export Finance Australia to make equity investments in strategic projects abroad in the national interest. We should do this as a leader of the region. What I do oppose, however, is direct public investment in foreign fossil fuel based infrastructure. The world is experiencing rapid and alarming warming that jeopardises our safety, security and prosperity. Countless other nations know that export finance must be used to lead global investment in the clean energy transition, instead of wasting it on soon to be stranded fossil fuel assets. It's the last thing that Australian taxpayers need. It is the last thing our partners in the region need.

When introducing the bill, the minister said:

This reform will align Australia with other countries, like the USA, China, Japan, Canada and South Korea, which are already making equity investments in our region to support their development and commercial objectives.

Well, this is not entirely true, Mr Deputy Speaker. Many of these nations have also taken proactive measures to prohibit export finance agencies investing in fossil fuels. President Biden has directed the US export credit agency to identify steps through which the United States can promote ending international financing of carbon-intensive fossil fuel based energy. The UK government banned its export credit agency from funding any new coal and gas projects, in line with the urgent recommendations of the International Energy Agency. South Korea has committed to end public financing for overseas coal-fired power plants, and, just this year, Denmark, France, Germany, the Netherlands, Spain, Sweden and the UK launched the export finance for the future coalition, with each country committing to massively increased support for sustainable projects and to assessing how to best phase out export finance support to oil and gas industries. That's what export finance leadership looks like.

This bill will punish regional Australians twice: first as taxpayers who'll see their contributions to the public purse wasted on foreign fossil-fuel subsidies; and, second, as bystanders who'll have to see billions of dollars in foreign investment in renewables in their own backyards draining out of their towns and offshore. This is not how this equation should be.

That's why I introduced the Australian Local Power Agency Bill 2021, which would require any new foreign-owned large-scale renewable energy project in Australia to offer the local community a chance to co-invest up to 20 per cent in that project. The House Standing Committee on the Environment and Energy will hold a public inquiry into that proposal tomorrow, and I encourage all MPs in this place—especially those who represent regional electorates—to tune in and hear what regional Australians are calling for when it comes to foreign investment in renewables.

These detailed amendments would stop us from making more of a mess than we already have. It's time for solutions, and I commend these amendments to the House.

Kevin Andrews (Menzies, Liberal Party) Share this | Link to this | Hansard source

The question is that the amendments be disagreed to.

Question agreed to.

Bill agreed to.