Katy Gallagher (ACT, Australian Labor Party) Share this | Hansard source

The Register of Foreign Ownership of Agricultural Land Amendment (Water) Bill 2016 amends the Register of Foreign Ownership of Agricultural Land Act 2015 to establish a Register of Foreign Ownership of Water Entitlements, creating a national foreign-owned water register to be administered by the Commissioner of Taxation. The bill is enabling legislation to allow for the collection of information and publication of statistics about foreign holdings of registrable water entitlements and long-term contractual water rights, and Labor supports the bill.

It is clear to all Australians that water is precious. It is valuable, and it should be conserved, harnessed and treated with the utmost respect. It is therefore common sense that we as a nation should know and understand who owns our water, who has the right to use it, trade it and sell it. We know that many Australians are anxious about foreign ownership, not only for residential and rural land but also for water resources. Labor believe it is critical to engendering the confidence, trust and support of our community in our foreign investment regime that the utmost transparency is given to understanding the level and value of both land and water resource holdings by foreign interests. This is not to say that Labor are opposed to foreign investment. We are certainly not. We understand the many benefits of foreign investment: jobs, growth, access to new markets and additional export opportunities, just to name a few. But we also understand that it is a vital part of the social contract that Australians have all the facts in front of them. That way there is no room for urban myths, for mischievous claims or for outright lies to be peddled by those who want to sow the seeds of distrust and disharmony in the community.

The Turnbull government agreed to establish a register of foreign owned water entitlements in a deal with the Greens to pass the Foreign Acquisitions and Takeovers Legislation Amendment Bill in 2015. That bill lowered the Foreign Investment Review Board's threshold for foreign land acquisitions from $252 million to $15 million and for foreign agribusiness proposals to $55 million. The Register of Foreign Ownership of Agricultural Land Act includes a sunset provision moved by the Greens party which means that the act will lapse on 1 December 2016 if legislation providing for a register of foreign ownership of water entitlements does not commence before that time. In effect, the bill before us today is tangible proof of the Greens' lack of trust in the government that they would deliver on their deal to lower the Foreign Investment Review Board's threshold for foreign land acquisitions in exchange for a water register.

It is also important to acknowledge that it was Labor who initially proposed the Register of Foreign Ownership of Agricultural Land back in 2012. Labor's plan was to allow every Australian, with the click of a mouse, to see who owns what, where and what they paid for it. Going into the 2013 election, the then Abbott-led opposition promised to do the same. Unfortunately, what subsequently transpired as a land register has drawn substantial criticism, including from the National Farmers Federation former chief executive, who said that assessing foreign farm ownership on land area does not really reveal much more than would be expected.

As my colleague the member for Hunter pointed out when speaking on this bill in the other place, while the current land register provides a picture of square meterage held, we still do not have a picture of the value of the land held by foreign interests. The current land register, which commenced on 1 December 2015, requires foreign persons to notify the Commissioner of Taxation of all the agricultural land held as at 1 July 2015. They are also required to notify if they start or cease to hold agricultural land. The register is divided into two parts, the first containing the details of the identity of the foreign person and the land holdings. The second part contains statistics derived from the individual listings in the first part of the registry, which prevents the identification of any individuals. These statistical details are then published on the commission's website. The minister must also table in parliament the commissioner's annual report on the operation of the act, including statistics derived from the register. In short, we get an aggregate picture of the land holdings but no detail. Labor rightly questions whether this is the level of detail that Australians should be satisfied with on such a sensitive issue as foreign investment in land holdings. The government claims that there are privacy concerns which prevent further transparency. We are not satisfied that we have been given a full explanation as to why the land register is so inadequate in giving a robust picture of who owns our land.

Item 27 of the bill amends the register of foreign ownership act to insert new parts 3A and 3B. The effect of the amendments is that the water register will operate in a similar way to the existing land register. So, again, we get an aggregate picture but no detail. The explanatory memorandum points out that an estimated 767 foreign persons will be affected by the provisions in the bill. It is also anticipated that there will be a degree of overlap between persons who have agricultural holdings and water entitlements. There were 806 agricultural businesses with some level of foreign ownership as at 30 June 2013, and it is estimated that 604 foreign persons who hold agricultural holdings will need to register water entitlements. The EM also says that the bill's definition of a registrable water entitlement is broad, stating that it will impact not only on the agricultural sector but also on mining; irrigation; irrigation infrastructure operators; manufacturing; and energy, electricity and waste services.

It is also important to note that a contractual water right—item 6—will only be required to be notified if that right is likely to exceed five years. Affected foreign persons who, at the end of 30 November 2017, hold or will hold a registrable water entitlement or a contractual water right that is likely to exceed five years must give notice to the commissioner during the notification period, which commences on 1 July 2017 and ends on the later of 30 November 2017 or the 30th day after the day that the person starts to hold that entitlement or right.

While these dates are important, if technical, aspects of the bill, senators should note that the Bills Digest highlights the problems the ATO experienced in developing online registration forms for the preceding land register. Given the recent technical problems this government has overseen, such as the Census debacle, we can only hope that the commencement date of 1 July next year will give sufficient time for the relevant technical modifications to the existing register to be made to incorporate the additional water entitlement information. As the member for Hunter pointed out in his speech in the other place, the water register will be a good thing if it is effectively executed.

As I said at the beginning, Labor support this bill, but we do not believe the current level of transparency for both the land register and the proposed water register are sufficient. We believe they are underdone. Properly designed registers will help build public confidence in foreign capital, and more transparency is crucial to this task. Unfortunately, Labor believe that yet again this government has put forward policy that lacks transparency and delivers platitudes based on: 'Trust us.'