Peter Whish-Wilson (Tasmania, Australian Greens) Share this | Hansard source

I rise today on behalf of the Greens to put our views forward on the government business in front of us. The three separate bills before us are the Foreign Acquisitions and Takeovers Legislation Amendment Bill 2015—known as the acquisitions bill; the Foreign Acquisitions and Takeovers Fees Imposition Bill 2015—known as the fees bill; and the Register of Foreign Ownership of Agricultural Land Bill 2015—known as the register bill. These bills essentially change the thresholds that determine when foreign investment needs to be reviewed; increase the penalties for noncompliance; establish application fees for foreign investment; and establish a register of foreign investment in agricultural land.

The Greens support, and have always supported, measures to ensure that foreign investment is subject to rigorous assessment to ensure that it is in the national interest. We have also always supported the view that the public has a right to know the level of foreign ownership of agricultural land and water rights. This is perhaps where the Greens would differ from Labor on this issue. We cannot have good policies without data. When we look at the very serious issues that not just Australia but also other nations around the world are confronting around food security and water shortages, if you do not have the data to be able to quantify that how can you have good policies? Data is essential for good policies.

I think a register of agricultural land is exactly what we need in this country. I have been asking questions about this for three years, and I know that Senator Milne was asking these questions for a decade before me. I know that the ABS have looked at this. Back in 2010 they were tasked to look at levels of land ownership. They looked at water resource ownership. This process kicked off a long time ago, but we have never actually got good policy in place that we can use to help us make decisions. Based on the Greens' policy aims—that is, to increase the transparency and accountability of the Foreign Investment Review Board in making its decisions against the national interest test—I would say that the national interest test should be strengthened to incorporate the national ecological and social objectives that the Greens hold dear to their hearts. We went to the last election with a policy to legislate to strengthen the national interest test to look at what I suppose have become known as triple-bottom-line objectives. So, from our point of view, it is an absolute no-brainer to collect more data, and the best way to do that is to put resources into it by establishing a register of foreign ownership of agricultural land.

Furthermore, we believe that investment that meets certain threshold tests should be referred to the Treasurer for review. The Treasurer can reject, approve conditionally or approve unconditionally applications for foreign investment. We think that is a very reasonable thing given the importance of the national interest, although I have to say that I am not quite sure how the national interest is determined exactly. I have looked at this several times over the years, and it seems that these decisions are pretty political. Perhaps this can help with the politics as well.

We think the national implications of foreign investment are a lot broader than just looking at trickle-down economics and listening to the big end of town with their views on this particular set of bills that we are debating here today. To give you an idea, we estimate that 80 per cent of agricultural land is currently Australian owned. There is no comprehensive data on the source of other-country investment in Australia. However, as a guide, in relation to capital investment in Australian agriculture Canada, the US and the UK account for over half of the foreign investment. In terms of the arguments about xenophobia, China accounts for less than one per cent at this point in time. Senator Heffernan may have other information—I am not inviting him to stand up and interject—but that is our estimate.

Australia is also a net exporter of food. It exports $32 billion worth of food and beverages and imports $12 billion worth of food and beverages. Foreign investment in housing, interestingly, accounts for about 10 per cent of all investment, of which 10 per cent is from Chinese investors. I will get to the xenophobic politics around this debate in a minute. I agree with Senator Wong that foreign investors are a significant source of capital across the board in our country—and they always have been. We have run a current account deficit since Federation, with the exception of two years, because we have relied on foreign capital to grow our nation. That is something we have become very familiar with. But that does not mean we should not better understand the nature of foreign ownership in the country and the risk, especially in productive assets such as productive farmland.

On that point, in terms of the agricultural land component of this, the Greens sustainable agriculture policy aims to ensure that the FIRB rigorously regulates, monitors and reports on all foreign acquisition and ownership of agricultural land to ensure that it does not impact negatively on Australian agriculture and food security. I think Senator Milne would really wish that she had been here in the last couple of days, especially around the significant debate we have just had around transparency and disclosure of tax affairs and the debate we are now having on the ownership of agricultural land and putting in place measures that help us to better understand that. I think she would have loved to have been here in the Senate. These are two things she has worked on as hard as anyone in this parliament in recent years.

Senator Milne took to the last election a substantial policy about whether the world is facing a food crisis. It had a lot of quantitative and qualitative work done on it. This initiative we called the Foreign Ownership of Land initiative. And guess what? The key plank of that was the creation of a register of foreign ownership of agricultural land and water assets in this country as well. We also wanted to see a lower threshold for the review of agricultural land and water assets. On this point, our policy differs from what is being proposed by the government in terms of its FIRB threshold. In this bill, that is being lowered to $15 million but we wanted to see it lowered to $5 million. In that sense, I suppose we were a little more hardline on this. But let's think about this. We are talking about a referral to FIRB. How many FIRB referrals have actually led to a rejection of foreign ownership of agricultural assets and land? Well, we have had one—Archer Daniels Midland—

Senator Heffernan interjecting—

No, it was not land, it was an agricultural asset—and I did say agricultural assets and land. Nevertheless, there have been very few rejections—as there have been across other asset classes. So having lower levels of review is not necessarily a barrier to foreign investment; it is just a process that allows us to get better information when we send these assets—be they agricultural land or other assets—off to review. So it is not a barrier to investment; it is just something that we should reserve the right to in terms of our sovereignty and our ability to regulate this kind of thing and build our database. Unlike Labor, I do not believe that simply sending things off to review is a barrier to investment. Actually, we are rejecting outright ownership of land by state owned enterprises; this is a harder line, but this bill is asking for review.

I think the substantial interest test is interesting—and I will get to that in a minute—but the acquisition bill proposes to reduce the threshold from $252 million, indexed annually, to $15 million. We may or may not move amendments to reduce that further to $5 million. Nevertheless, we do like the direction of this. Clearly, it is not what we want, but it is better than what we have got now. We know that the new threshold is cumulative; it takes account of an investor's total land holdings. The acquisition bill does not prevent foreign governments from owning agricultural land but any level of investment in land by foreign governments will be subject to this automatic review, which we agree with.

This is the point that really interests me about this debate. However, consistent with free trade agreements, the threshold for private investors from the United States, New Zealand and Chile is $1.094 billion and for Singapore and Thailand it is $50 million. ChAFTA, the Chinese free trade deal, does not stipulate a specific threshold for private Chinese investors—although this has been slated for review. Like a lot of ChAFTA, given how politically sensitive this issue is, it has been put on the backburner or perhaps in the too-hard basket; it has been put off for the future. So I am quite interested in the interaction of the laws that we may pass today and how that is going to impact on future negotiations around the Chinese free trade deal. It has not been completed yet, but we will deal with that later.

The politics on this is interesting. Senator Heffernan and some of the Nationals senators are in the bush. As Senator Milne reflected about her electorate of Tasmania, which is largely a rural electorate, this is a big issue for farmers and those living on the land in this country. No doubt, given the fiesta of free trade deals that the Liberal Party has been signing, they want something to wave in the air and show their constituents; otherwise, they will not get any Christmas cards this Christmas. This is a good policy they can take to them to show that they are taking this issue seriously and reviewing it.

The Labor politics around this, which has been in the papers in recent weeks, is that it is xenophobic. That is a bit of payback to the government for the lines that they aimed at the Labor Party around ChAFTA. To me, it is not about xenophobia; it is about the spaghetti bowl of trade deals that we sign in this country, and the fact that we have all of these different FIRB review limits. All of these bilateral trade deals are negotiated in a totally ad hoc manner by different governments over a long period of time. It is a really good example of how we lock ourselves and our nation into policy outcomes when we negotiate these secret trade deals behind closed doors, and how we do not have a holistic approach to this kind of thing. So it is quite ironic that we are putting in place a $15 million limit when we have other limits in trade deals, and that cannot be changed.

I would also like to know, with those nations or corporations who would invest in Australia in the future, if we were to have a $15 million FIRB review, would that trigger an investor-state dispute settlement clause? These things are written into trade deals, and the investment chapters in these trade deals that have ISDSs in them relate to the other chapters in the deal. I would like to know whether we would have reneged or discriminated against a foreign firm. Could FIRB reviews be seen in the world—this new frightening world of international trade deals—as discriminating against foreign companies? Of course they could.