Shayne Neumann (Blair, Australian Labor Party) Share this | Link to this | Hansard source

I move:

That this House:

(1) acknowledges the hard work of the Government to bring the free trade agreement with the United Kingdom into force on 1 June 2023;

(2) welcomes the successful resumption of tariff-free sugar exports to the United Kingdom for the first time in 50 years, with the first shipment arriving in London from Queensland on 6 September 2023;

(3) recognises that as a trading nation Australia's prosperity is linked to open international markets, with trade contributing 29 per cent of Australia's gross domestic product and supporting one in four Australian jobs; and

(4) notes jobs in export industries pay five per cent above the national average income.

I'm pleased to move this motion. Australia's free trade agreement with the United Kingdom is one of our most comprehensive, innovative and ambitious trade agreements, and it has ushered in a new era in our economic relationship with the UK. The United Kingdom is one of Australia's major trading partners, with two-way trade worth $10 billion in 2022 and two-way services trade worth over $11 billion in 2021-22, making it our second-largest services trading partner.

Under this agreement, over 99 per cent of Australia's products will enter the United Kingdom duty free, and these include some of our key exports such as wine, rice, sugar, honey, nuts, olive oil and food supplements. The UK tariffs on Australia industrial goods are eliminated, including on auto parts, electrical and fashion items. Australia's agricultural products will have duty-free transition quotas, with the eventual elimination of all tariffs, and this includes on beef and sheep meat, and sugar and dairy products. For Australian consumers, tariffs on 98 per cent of UK imports to Australia are eliminated, with the rest to be removed within six years. By reducing tariffs, the agreement is increasing the choice of everyday household items and driving down the cost-of-living pressures, and that's passed on to consumers both in Australia and in the UK. This trade agreement makes it easier and cheaper for Australian businesses to export our homegrown products to the UK. In the first month that the trade agreement entered into force, Australia's exports to the United Kingdom increased by almost 200 per cent from the same time last year. After a short transition period, all of Australia's imports from the UK will be tariff free.

In 1879, during colonial times, the first ever export of frozen red meat travelled from Australia to the United Kingdom—obviously by boat. Since then our global red meat exports have grown to nearly A$14 billion per year. Under this trade agreement, increasing volumes of Australian red meat can be exported to the UK tariff free, and this will see us grow the value of Australian red meat by exporting it to where the demand is, making it more affordable for people in the UK to buy Australia's high-quality meat product.

Recently, in my electorate of Blair, JBS Australia announced it would create 500 new jobs at its Dinmore processing facility to support local employment and increased demand for Aussie beef. JBS Dinmore is one of the leading exporters of red meat in the country, with approximately 10 per cent of Australia's total beef processing capacity. It produces a wide range of beef brands that are supplied to overseas markets. JBS Dinmore, in my electorate, stands to benefit from this deal.

The removal of tariffs on sugar reopens what was a thriving market for us before the UK joined the European Economic Community in 1973. When I was in the UK a few years ago they were very keen, in the post-Brexit era, to return to their old friends, including Australia.

It's not just tariffs that are removed under this agreement. This agreement makes it easier for Australian professionals, service providers and investors to do business in the UK market. Australian businesses can access skilled workers from the UK, including innovators and early career professionals, to meet local demand, thanks to new mobility pathways. The agreement strengthens our people-to-people links with the UK. Australian professionals will have the same access to UK job markets as nationals from the European Union, except those from Ireland. This agreement includes measures designed to improve the mobility of skilled workers and young people in both directions. From 31 January next year, Australians up to the age of 35—up from the current age of 30—will be able to apply for working holidays in the UK and stay for a maximum of three years instead of two.

Australia's financial services sector stands to benefit from preferential access to the UK's vibrant fintech ecosystem. Under this trade agreement the removal of localised data-hosting requirements is a game changer which will allow businesses to plan their growth, knowing they can collect, process and transfer data between the UK and Australia without facing unnecessary hurdles.

It's not just through the bottom line that Australia and the UK benefit from this agreement; it's also through the exchange and transfer of world-class skills, ideas, innovations and inventions, which will make our lives better. The implementation of this trade diversification agenda under Minister Don Farrell is a very important one, and I commend him for his work, particularly the work in the EU.

Mike Freelander (Macarthur, Australian Labor Party) Share this | Link to this | Hansard source

Is the motion seconded?

David Smith (Bean, Australian Labor Party) Share this | Link to this | Hansard source

I second the motion and reserve my right to speak.

Kevin Hogan (Page, National Party, Shadow Minister for Trade and Tourism) Share this | Link to this | Hansard source

I commend the member for Blair for moving this motion. I note that at the end he acknowledged the current minister, Don Farrell. I commend the current government for ratifying this deal, because it was important that it went through the parliamentary processes to be brought into force.

I'm somewhat disappointed, though, that the member for Blair couldn't mention the previous government, who actually negotiated and signed the deal. We can be bipartisan here when we know there were certain factual things that happened. Well done to the member for Blair for mentioning the deal. I agree with everything he said about the importance of this deal and everything that was done with this deal. I'm disappointed that he couldn't bring himself to acknowledge the previous government—in fact, the minister at the time, Dan Tehan, who negotiated this deal, signed it before we left government—but what he said was correct: this was an exceptionally important deal for Australia. In fact, I think it's the template for a free trade agreement. The liberalisation we got across a whole range of products was really important.

I remind the chamber that one of the great achievements of the previous three governments, from 2013 to 22, was in the free trade area. When we came to government in 2013, around 25 per cent of goods and services that we exported were covered by a free trade agreement. By the time we left it was close to 80 per cent, with the last two of those being significant. One of those deals was the deal with the UK and the other one was the preliminary deal with India. Both were really important deals.

I acknowledge what the member for Blair said. He mentioned the EU deal, and I say that the template they need to use for the deal that the current government is trying to negotiate is the UK deal. We will be measuring the achievements of the new government, in this free trade agreement they do with the EU, against what we achieved with the UK. There are some great things there, and with all due respect—I actually have great personal admiration for the current minister for trade—he does have his work cut out because we know there are elements of the Labor Party that do not like free trade agreements, and I say this respectfully; I respect their opinion. The CFMEU are on the record for having criticised the UK deal. They appeared before a parliamentary committee on the deal, when it was going through ratification, and spoke against the deal. So I know the minister has his work cut out.

In the deal that the current minister is negotiating with the EU, measuring it against the deal we did with the UK, I'll look for some of the products the member previously brought up—the complete liberalisation of sugar, the complete liberalisation of beef and the complete liberalisation of sheep meat. Let's look at those as the starting point. Again, the deal we did with the UK is the template.

I get the sensitivity around all this in the ag sector. The ag sector is very important to us, Deputy Speaker Freelander. To give you some figures on trade, the four biggest trading commodities in our economy—not necessarily large exports to the UK—are coal, gas, iron ore and ag. Those are the four sectors that drive our trading performance. I'm going to use ballpark figures here: ag is a bit under $100 billion, while coal and iron ore, depending on prices, can be well over $100 billion, but let's say the four of them generate about $400 billion of exports in our country. Again, the trade deals that we did from 2013 to 2022 have helped that. We have a lot of investment into export areas. Those four sectors drive a lot of economic activity. When you look at royalties, when you look at company taxes and when you look at the personal income taxes of the people who work in those sectors, we're probably talking over $100 billion from those four sectors alone.

The previous minister for trade has just walked in, the member for Wannon. To the previous minister, I acknowledge you for doing this deal. The member for Blair, who moved this motion, couldn't quite bring himself to do it, but I will. This is the template that we should be using; the deal that the member for Wannon did with the UK is the template that we need to use for the deal that the new government is doing with the EU. You've raised a bar in the deal that you got, and it's a high bar. We look forward to the current government getting the same types of results.

I will end here by reiterating the importance of trade and the importance of being a low tariff and low taxing economy. That's what drives this economy. I commend the previous minister for doing this wonderful deal.

David Smith (Bean, Australian Labor Party) Share this | Link to this | Hansard source

I rise today to also speak in favour of the member for Blair's motion about the Australia-United Kingdom Free Trade Agreement that came into effect earlier this year. I particularly congratulate the member for Blair for his advocacy in this space, and I congratulate all in this parliament who've done important work in this space.

We're already seeing significant benefits flowing from the UK free trade agreement. In the first month since the agreement entered into force, the value of Australia's exports to the UK increased by almost 200 per cent from the same time a year earlier. Australian farmers and agricultural exporters of beef, sheep meat and wine are reaping benefits that have not been experienced since the UK joined the European Economic Community, as it was known then, in 1973.

Both sides of the House agree that the UK FTA is a strong free trade agreement. The Joint Standing Committee on Treaties noted earlier this year that the agreement reflected the longstanding importance, quality and depth of the political, cultural and economic relationship between Australia and the United Kingdom, while looking to set a framework for future trade and co-operation. The joint standing committee also stated that the UK FTA would contribute to diversifying Australia's trade, and it addresses traditional free trade agreement concerns while incorporating a wider range of social and economic principles. At the same time, the UK FTA preserves policy and regulatory space for parties in rapidly evolving sectors, such as digital trade and financial services.

This deal includes strong commitments on the environment, including climate change and labour. This agreement will preserve the right of the Australian government to regulate in the public interest, including for the environment, education and health. It represents one of the most comprehensive, innovative and ambitious free trade agreements entered into by Australia to date, and strengthens an already close relationship between Australia and the UK. The agreement supports the government's trade diversification strategy, delivering unprecedented benefits to Australian businesses and creating new, well-paying jobs.

Prior to the Australian government implementing Australia's trade agreement with the UK, Australian exports, particularly in the agriculture sector, faced extremely high barriers. But the agreement now also facilitates the two-way flow of professionals and helps to address the skills shortage in Australia by providing an overdue framework for professional bodies to agree to streamlined licensing and qualification processes for qualified professionals. This is something that I used to run into a fair bit when I represented engineers. It provides greater certainty in digital trade rules and facilitates trade for Australian businesses looking to grow their digital footprint in the UK. This agreement underpins and deepens our already strong bilateral investment relationship with the UK, which is the second-largest source of foreign direct investment in Australia—valued at around $138 billion in 2022.

But trade is more than just the exchange of products and services; it also boosts the exchange of ideas. This free trade agreement establishes procedures for artists, including First Nations people, to receive royalties when their artworks are resold in the UK. The Australian government has sought high-quality commitments on key sustainability issues, such as environmental protection and labour rights, that align with internationally agreed principles, standards and rules. We have already prioritised the establishment of strong regulatory practice and compliance provisions that create a more predictable business environment for Australian companies.

This government has tilted the playing field to become level again, allowing innovative and hardworking Australian farmers and businesses to compete fairly in the British market. Importantly, an investor-state dispute settlement mechanism is not part of the agreement. This means that Australia's sovereign right to develop and implement legitimate policy measures in areas such as public health and the environment is preserved. But this agreement creates new opportunities to deepen and expand trade investment with one of Australia's most important and longstanding trading partners. It's consistent with our approach to ease the cost of living in Australia by removing tariffs on UK-made goods, which will see Australians pay less at the shops for imported goods from the United Kingdom.

I again commend the member for Blair for this motion, and the Minister for Trade, Senator Farrell, for his hard work in delivering this free-trade agreement.

Dan Tehan (Wannon, Liberal Party, Shadow Minister for Immigration and Citizenship) Share this | Link to this | Hansard source

I'll just have to pick up on the previous speaker's conclusion there because this wonderful UK-Australia free trade agreement was negotiated and signed by the previous government! I had the great honour of being Australia's trade minister at that time, and it's why I was very keen to speak on this motion. The member for Blair may or may not be aware that when we were negotiating this free trade agreement I went to the Tate and Lyle Sugar factory, which is on the Thames. In the very early seventies or late sixties, sugar boats used to sail from Australia. They would sail up the Thames and drop the sugar off there. It would then be manufactured by Tate and Lyle into golden syrup and other things.

When the UK went into the EU that all stopped. One of the things I was very determined to do in negotiating the agreement was to make sure that we got an outcome on sugar. I particularly want to thank Australia's High Commissioner at the time, George Brandis, a Queenslander, who was also very determined to get an outcome on sugar. We were able to get a fantastic outcome on sugar, and my hope is that we will all be able to celebrate when that boat arrives, goes up the Thames and delivers sugar back to Tate and Lyle again. It will be a fantastic outcome for Australia because it will give us diversity in markets; that's what free-trade agreements are all about.

The great thing about the Australia-UK Free Trade Agreement is that it's the most comprehensive free trade agreement we've done outside the one we've got with New Zealand, which has closer economic relations and is the global gold standard when it comes to free trade agreements. The Australia-UK Free Trade Agreement is as good as the New Zealand one in almost all aspects but isn't quite as comprehensive. Hopefully, over time we might be able to continue to negotiate to add to it even more.

What we were able to do in the UK free trade agreement was deliver greater access not only when it comes to sugar but also right across the board: lamb, beef, dairy—you name it. It is the most comprehensive agricultural access that we've got in any agreement since the one we negotiated with New Zealand. One of the great things about a charity run I just did to raise awareness for a disease called CJD—along with 11 other runners, I ran from Canberra to Warrnambool, over 950 kilometres. Along the way, we went through the heartland of rural Australia, including along the Murray, where we bumped into some citrus growers. It was fantastic to hear about the first shipment of oranges that will be going to the UK since the early seventies. Not only have we managed to get sugar back into the UK market; we're also getting citrus back to the UK market as well as our beef, lamb, dairy products and wine. All these things have benefited, and regional and rural Australia, where one in four jobs come as a result of trade, has particularly benefited from this outcome.

I will draw on some remarks that were made by the shadow minister for trade which I think were important remarks for all of us to remember. Currently the new government is negotiating the Australia-EU free trade agreement. We did 12 rounds of that when we were in government. We were setting it up for a big finish, and now the baton has been passed to the new government to conclude. One of the keys to that agreement is that we have to get access for agricultural producers from that agreement, because you only get one chance in a free trade agreement to get your ag sector looked after. The World Trade Organisation has great difficulties getting an outcome for agriculture, so we have to do it in free trade agreements. We did it in this agreement, and that's why we're here celebrating what we've been able to do on sugar, but, when it comes to the EU agreement, we've got to make sure we can get exactly the same agricultural outcomes.

Matt Burnell (Spence, Australian Labor Party) Share this | Link to this | Hansard source

I'm delighted to rise in support of the motion moved by the member for Blair. I also commend the contribution made earlier by the member for Bean, who I know is a very proud chair of the United Kingdom parliamentary group. This is a motion for which all sides of the chamber can come together to both support and celebrate just as much as both sides of this trade agreement can too. Despite our differences at times, we can certainly come together in support of free, fair and open trade, and I know that this is something the Albanese Labor government both believes in and supports wholeheartedly. This is particularly the case with the Australia-UK Free Trade Agreement. When a deal is this good, how can you be silent?

The process involved with the agreement was one several years in the making. It's seen a change of government on our side. It's seen three prime ministers and three secretaries of state for international trade in the UK. It's proof that our countries' relationship and our commitment to work together towards common goals and mutually beneficial outcomes will stand the test of time beyond slight changes in the headwinds in our respective nations. Whilst the United Kingdom may not presently be our largest trading partner, they are certainly Australia's oldest trading partner. It goes without saying that many things do change somewhat over those long years too, with the United Kingdom turning its gaze more toward its own doorstep, to Europe. As for Australia too, over those years, we diverted our gaze quite intently toward Asia and toward our Pacific neighbours both in respect of trade and also by forging strong bilateral relations within our own corner of the world. However, this has definitely not dimmed the close bonds and friendships shared between our nations—except, perhaps, during the Ashes.

In 1973, when the United Kingdom first joined the European Economic Community, the forebear to the European Union, we experienced sharp decreases in trade, which can largely be attributed to high tariffs and quotas that were particularly punitive to our agricultural exports to the UK. As someone who grew up on his family's farm and now sits on the House's Standing Committee on Agriculture—from farm to table would be an elegant way to put it—I know that many farmers across Australia would be the first to cheer on this trade agreement, given it is one that effectively scraps 99 per cent of tariffs on a giant list of goods that I don't have close to enough time to list.

In tribute to the member for Blair's home state, I'll give an honourable mention to sugar in particular. To those farmers and those involved in this industry, many from Queensland, it is the first time in 50 years that they have tariff-free access to the UK market. Prior to this agreement, sugar had a tariff of 62 per cent placed on it. Is this the sweetest part of agreement? No, not by far, and after a brief interlude to talk about Queensland sugar, my one-track mind will once again proudly turn to my state of South Australia. It is one that is set to benefit greatly from this agreement.

Whether it be the world-renowned honey produced by Ligurian bees on Kangaroo Island or wines produced across many regions in South Australia and consumed across the globe, viticulture and many other industries will have further and fairer access to a market of 68 million people. Decreasing trade barriers means increasing consumer choice. I know that the things we grow and the things we make here can stand on their merit on the world stage and we will prosper in a market that allows us to compete on a level playing field. Soon we can start seeing less wine from Bordeaux and more from the Barossa being consumed in restaurants, bars and homes across the UK.

I opened in a bipartisan spirit. I intend to close on that same note—a rarity at times, I know. Free trade agreements are, after all, a long process, and I would like to end by acknowledging the tireless work that our trade minister has done in order to bring this deal home. I also acknowledge the former trade ministers for their efforts along the way, particularly the efforts of the initial minister, Senator Birmingham, along with the member for Wannon. I am sure that over the years we will continue to see the benefits amplify, when tariffs and quotas are further reduced and abolished on our exports, seeing both our economies and our peoples enriched as a result. I'm pleased to see Australia become a stronger trade partner with the UK, though it would be difficult to find a closer ally or friend. I thank the House.

Colin Boyce (Flynn, Liberal National Party) Share this | Link to this | Hansard source

The Flynn electorate is made up of diverse industries that contribute an incredible amount to the Australian economy exporting abroad. Thanks to the coalition, there will be more opportunities for industries in Flynn to expand into the UK market. The UK's trade agreement with Australia was the very first trade agreement that it reached following its exit from the EU. It was signed on 17 December 2021 and came into force on 31 May 2023. It is a highly ambitious agreement, commenced and negotiated by the Liberals and Nationals in government. Farmers and producers will have improved access to more than 65 million UK consumers who value safe, sustainably produced foods and beverages with a strong origin in Australia.

There are a few benefits for the industries in my electorate of Flynn. Roughly half of Australia's cattle population lives in Queensland, and roughly one-third of that is in Central Queensland. For beef, a tariff-free quota of 35,000 tonnes at entry into force will expand to 110,000 tonnes in year 10. Tariffs on beef will be eliminated after 10 years. Bundaberg and the North Burnett's rich red soil, abundant rivers and surrounding seas are the source of never-ending seasonal and varied produce, growing 25 per cent of Australia's fresh food produce. For horticulture, tariffs were eliminated on most fruits and vegetables at EIF, with tariffs on other products of Australian export interest to be eliminated over three years and all remaining tariffs to be eliminated over the next seven years.

In 2021 the sugar industry spent and generated $72 million and employed 520 people in the Flynn electorate, according to the Australian Sugar Milling Council. In my neighbouring seat of Hinkler, over the same period, the sugar industry had a total impact of $615 million and employed over 3,000 people. For sugar, the current tariff-free quota of 80,000 tonnes at entry into force will expand to 220 tonnes by October 2030 and will then be eliminated. According to the Queensland Farmers Federation:

Queensland milks 150,000 cows on approximately 430 farms located throughout southeast Queensland, Darling Downs, Wide Bay, Central Queensland around Monto, Rockhampton, and Eungella, and in Far North Queensland near the Atherton Tableland.

For dairy, there will be an elimination of tariffs over five years, with immediate access to duty-free quotas for dairy products during the transition period. According to the Queensland Department of Agriculture, Queensland commercial fisheries have produced an average of approximately 17,000 tonnes of seafood per year since 2015. For seafood, there will be an elimination of tariffs on most products on EIF and remaining tariffs over three years. Tariffs eliminated on EIF include those on all finfish and the 12 per cent tariff on fresh and frozen rock lobster. Chickpeas, sorghum, wheat and mung beans are the most significant commodities produced in the Central Highlands, with barley, corn, peanuts, sunflowers and forage crops also grown. For wheat, barley and other cereals, there will be an elimination of tariffs over four years, immediate access to a duty-free quota of 80,000 tonnes per year for wheat and a duty-free quota of 7,000 tonnes a year for barley.

Australian households and businesses will save around $200 million a year, with tariffs on almost all UK goods being eliminated on entry into force. Professionals will have the same access to the UK's lucrative jobs market as their European competitors, except from the Republic of Ireland. This means that Australian jobseekers can compete on an equal footing with EU nationals in the UK for the first time in more than 40 years. Young people will have more time to travel the UK for a working holiday and will be able to stay longer, with the age of eligibility to participate in working holiday opportunities raised from 30 to 35 years of age and stays allowed for up to three years in each country. Australian businesses will have a guaranteed right to bid for a greater variety of UK government contracts in a procurement market worth an estimated half a trillion dollars annually. UK businesses will be encouraged to invest in Australia thanks to the best investment practice rules, including to set up regional headquarters in Australia to leverage our network of free trade agreements.

Free trade agreement will deliver more for Australian jobs and businesses and opportunities for exporters. Australian producers and farmers will receive a significant boost by getting greater access to the UK market, which is welcome in the electorate of Flynn.

Mike Freelander (Macarthur, Australian Labor Party) Share this | Link to this | Hansard source

The time allotted for this debate has expired. The debate is adjourned, and the resumption of the debate will be made an order of the day for the next sitting.