Fiona Nash (NSW, National Party, Shadow Parliamentary Secretary for Regional Education) Share this | Hansard source

I rise to make some comments on the Foreign investment and the national interest report tabled today by the Senate Standing Committees on Rural and Regional Affairs and Transport. I thank the committee secretariat who, as always, do an incredibly good job, led very capably and ably by Mr Stephen Palethorpe. I thank Dr Chris Curran for his work on this report and I also thank the rest of the secretariat team. This committee is incredibly fortunate to have the support from what, I believe, is probably one of the best committee secretariats in the building. So, I thank them very much.

This has been a most interesting inquiry, as Senator Heffernan said, but they are always interesting when Senator Heffernan is chairing. It has been running for quite some time. The committee recognised that this is an incredibly complex issue and, prior to this report, the long-term implications and the long-term impacts of foreign investment in this nation had not been given the level of scrutiny needed. I do not say that as a partisan comment. My views on foreign investment are fairly well known. From the committee's and my perspective, it is not a partisan comment. We believed that it was really important to properly and objectively look at issues that surround foreign investment and foreign ownership in Australia.

In regard to agricultural land and agricultural business, there is no doubt that we do not know at this stage the level of foreign ownership and investment in that agricultural land and business. That absolutely has to be the starting point and, as noted in the report, we put forward recommendations for mechanisms to do that. It is absolutely vital that we get an understanding of where we currently sit so that we are able to figure out where we are likely to be in the future. That is what has been missing from the scrutiny into foreign ownership and foreign investment.

What we have seen to date are a lot of short-term reactions responding to immediate capital injection from foreign entities. The committee agrees that foreign investment, where appropriate, is absolutely fine. The nation has relied on it in the past and will continue to rely on it in some ways, shapes and forms. What we need to know for the future of this nation is how we want the country to look, particularly in relation to agricultural land and agribusiness. How do we want the future of agriculture to look in this nation 20, 30 and 40 years down the track? The decisions we make now are going to affect how the nation is going to look in 30 or 40 years time in a policy sense. I think we need to be smarter and we need to be more forward thinking and step outside the immediacy of looking at this issue in terms of foreign investment as being good—we get the capital injection, we cannot do without it and that is the end of the story. Certainly that capital injection plays a part, but it is not the whole story. We have to stop being so short-sighted in thinking that that is the whole story. That is a lot of what this report is about and a lot of what the inquiry has been about.

I have to commend the chair, Senator Heffernan, for his leadership on many of the issues that we traversed during the course of the inquiry, particularly the taxation issues. There are those in government and in other high places who now have a much greater understanding of the potential ramifications of foreign investment in the construct of the current taxation system than they would otherwise have had if it had not been for Senator Heffernan so robustly raising many of these concerns throughout the course of the inquiry.

The issue is, as I say, one of identification, of actually figuring out how much foreign investment and ownership there is in our nation to start with. The Foreign Investment Review Board needs an enormous amount of work done. There certainly need to be changes done because, in my view and in the view of many of my colleagues, it is not operating as effectively or as efficiently as it should. When we look at the Foreign Investment Review Board there is nobody with agricultural expertise on that board. When you consider the number of proposals regarding agricultural land and business that come through for approval by the Foreign Investment Review Board, to not have somebody on that board with agricultural expertise is simply stupid. It is unacceptable because, in my view, there is not the appropriate level of scrutiny that we should have in relation to those areas.

In fact, an application for foreign ownership of agricultural land or business has never been rejected by the Foreign Investment Review Board. That concerns me because I suspect there have been a number of instances where it should have been rejected. A couple of instances particularly come to mind. I think that the sale of Cubbie Station should have had a lot more scrutiny. The other that comes to mind is the approval from FIRB to the Treasurer for the potential takeover of SunRice by the Spanish company Ebro. It was recommended to the Treasurer as absolutely fine, tickety-boo, hunky-dory. This was a Spanish company about to own 100 per cent of SunRice, the Australian rice industry. Anyone who thinks that that would have been in the national interest simply does not understand the industry and certainly does not understand the agricultural sector. It took the industry itself to reject the proposal, recognising that it was not in their interest nor was it in the national interest.

It was subsequently good to see that SunRice is going from strength to strength. Had they sold it and had FIRB, in their wisdom, got their way then we would have seen a sensational Australian business fall into foreign hands when the necessity was simply not there. The limit for FIRB, the $244 million, as the chair has pointed out, is senseless. You are virtually only going to get one or two properties in the nation that are going to fall at that level or above which are going to trigger the scrutiny of the Foreign Investment Review Board.

What we have is the issue of accumulation. We have foreign entities coming into the nation and accumulating acquisitions. None of those individual purchases of parcels of land ever trigger the interest of FIRB. That is wrong and absolutely needs to be addressed, which is why we are recommending a drop of that trigger level to $15 million. In my view the trigger should probably be a lot lower or at zero, but, for the purposes of trying to get some forward movement, I think $15 million is certainly appropriate. And, being cumulative, any purchase after an entity has hit that level should trigger the interest of FIRB.

There are a range of recommendations that we have put forward. We certainly believe that this is an issue that, as an nation, we have to start paying attention to. As I said in the beginning, this is about the future of Australia, particularly how the agriculture sector is going to look.

We on this committee completely understand that, while a lot of these foreign entities are operating under commercial interests, they are also looking at Australian productive capacity—our paddocks—as a starting point to creating a food security pipeline back to their home nations. And fair enough—why wouldn't they? If I were another country around the globe that was looking at food security issues down the track, I would absolutely be trying to secure land in Australia to make sure that I could shore up the food security for my people of my country. It is a no-brainer. But we are not paying attention to that here. We are not looking long term. We are not looking down the track and saying, 'All right, at what level is this appropriate? At what level is this acceptable? How much foreign ownership is too much?'

We might have this debate and decide that 100 per cent of foreign ownership is absolutely fine. My argument is that as a nation we have not had that debate yet. That, by the way, is not my view on foreign ownership but it may well be a majority view at the end of the day. The issue is that we have not had the debate. We are not thinking like grown-ups. We are not thinking like mature people—looking down the track and asking, 'How do we want the nation to look?' That is what is so important.

I believe that this report gives very good guidance in terms of those issues that, whoever is in government over the next period of years, we need to look at in a policy sense to get the policy settings right so that we have the sustainability in the agricultural sector of this nation into the future. That should be absolutely one of our key priorities.