Kim Carr (Victoria, Australian Labor Party) Share this | Hansard source

This debate on the Customs Amendment (Product Specific Rule Modernisation) Bill 2019 is timely. It's extraordinary that, in my time here, we've seen growth in the number of bills carried by this parliament that contain an effective dereliction of duty from this chamber to the Public Service. We have a situation now where the number of bills containing legislation by regulation is growing at an extraordinary rate. The number of bills that can obtain instruments where there is no capacity for the parliament to disallow those regulations is equally growing at an extraordinary rate. The fact remains that, as legislators, we are negligent in not doing something about that. We are failing in our responsibilities as members of parliament by not insisting on the capacity of this parliament to properly supervise the work of the executive and the Public Service.

This debate is timely because it focuses on the importance of government transparency and the ability of this parliament to ensure proper oversight. It's timely because it involves our trading arrangements at a time of global economic disruption, at a time when there are trade wars going on between major trading partners, and at a time when one of our trading partners is imposing tariffs and other sanctions on this country involving some 46 per cent of our exports and our other major trading partner, the United States, is engaging in preferential trading arrangements with that country to our disadvantage. So it is no good trying to cloak this in some sort of mantra of anti-communist hysteria. This is a more fundamental issue about the role of this parliament in the protection of the Australian people and the capacity of members of parliament to do their jobs. To suggest that somehow or another this is all legitimised, because we are reducing the administrative burden, suggests to me that we could take that much, much further—couldn't we? Why do we need to meet at all? We can simply pass a series of omnibus bills giving the executive and the Public Service the power to do whatever they like. That's the logic of the argument.

This is a bill that attempts to reduce the transparency of government as well as the government's accountability to parliament. On the positive side, the bill highlights the role of the Senate committee system. I'm the deputy chair of the legislative committee that brought forward the report which led to these amendments being taken up by the Labor caucus—despite the fact that there were very few submissions, because very few people have actually read the legislation. I'm also a member of the Scrutiny of Bills and the Scrutiny of Delegated Legislation committees, and I must remind you, given the years of service that I have put in here, of the splendid work undertaken by the secretariats of those committees; at least we know there is someone here in this building that actually reads all the legislation and points out the consequences of not paying proper attention to the detail.

When I raised the issue that regulatory measures were being taken in such a manner as to take away from the parliament, people first said to me, 'That can't possibly be right.' In fact, it was. In democracies like this country claims to be we should be sceptical about attempts to reduce parliamentary scrutiny in the name of administrative efficiency and reducing administrative burden. We should be sceptical about the failure of our political system to actually keep an eye on our administrators. The minority report of the Senate Legal and Constitutional Affairs Legislation Committee makes that point, and the amendments we've moved today have come about as a result of that report. If they're not carried by the chamber, the Labor Party won't be supporting this legislation. I trust the majority of the Senate won't support this legislation, because it is time to make a stand on the question of delegated legislation and the capacity of this parliament to actually stand up when it comes to proper scrutiny.

This is a bill that relates to product-specific rules, which are important elements of bilateral and multilateral trade agreements. I've been involved in industry policy for a very long time. I have seen how these rules-of-origin arrangements are exploited and abused and how unscrupulous individuals and unscrupulous firms take advantage of them. There is a constant threat of transhipment, where firms in third countries try to export goods to Australia under favourable terms by transhipping them via one of our trade agreements to other partner countries. The consequences of that seriously damage the economic interests of this country and the revenue of this country. They undermine the political interests of this country.

Australia's antidumping commissioner for the time being—he's being given the heave-ho by this government—Mr Dale Seymour, discussed at Senate estimates the transhipment challenges faced by Australia over many, many years, including the question specifically around the matter of unfair competition to Australian firms and to Australian workers who obey Australian laws when they are faced with companies that don't have to. These are the actions that threaten Australian industry and threaten Australian jobs. We have an obligation to stand up and defend those jobs and defend those industries and not abrogate that responsibility to some faceless, unelected bureaucrat.

Australia must maintain strong antidumping measures in a time of uncertainty given the trading system as it is globally. We shouldn't let complaints about China or the many other countries—I want to emphasise that—that take advantage of our lax attitude on these trade issues, or the rabid, fact-lite commentary from the Australian media, particularly TheAustralian Financial Review, divert us from defending our national interests. We've got to make sure that we actually stand up for the Australian people, because the opportunities for circumvention and the misuse of product-specific rules make it more difficult for the Anti-Dumping Commission to ensure compliance with Australian law and with Australia's trading agreements.

The commission has reported that there were 80 measures in force as of 20 June of last year. They involve 22 countries. It's not just China; there are 22 countries. They comprise 69 dumping measures and 11 countervailing measures. Nearly two-thirds of those measures involve the steel industry. During the past five years the commission heard 273 cases, 60 per cent of them related, of course, to China. So we don't have to question the product-specific rules. What we need to ensure is that there's proper accountability in the way in which they're administered and to make sure they are updated accurately and regularly and that robust rules of origin and product-specific rules are, in fact, administered properly.

The framework, which was established in 2013 and expanded in 2015, nominates a series of activities that are likely to constitute transhipment to avoid antidumping penalties. Australia's got to remain alert to those threats, and that's why we believe changes to these regulations should be done by a disallowable instrument.

The PSRs define goods that are eligible for preferable trade treatment if they have been substantially transformed in Australia or an FTA partner country. Product-specific rules define what is sufficiently transformed. Now, based on this so-called harmonisation system, the classification of goods is based on internationally agreed descriptors for goods, and it's updated every five years. The current arrangements provide for a parliamentary role, but the bill's aim is to streamline the way in which the product-specific rules and the origins of these various agreements can be changed in regard to six of the 11 free trade agreements. The proposal is to remove these from the normal regulations. It's said, 'Well, we'll move this off to JSCOT.' JSCOT is not an effective parliamentary committee when it comes to the question of proper scrutiny. It is very low-level scrutiny. Its recommendations cannot be disallowed.

Border Force bell the cat when they make it clear,

… the domestic [Australian] process includes referring FTA amendments to the Joint Standing Committee on Treaties (JSCOT) as a Category 3 (minor) treaty action. JSCOT has agreed to treat all Harmonized System transpositions as minor treaty actions.

These JSCOT-recommended arrangements have not prompted a public inquiry or calls for public submissions, and, of course, any active JSCOT measure is dependent upon an individual member with the resources to take on the bureaucracy and the capacity to alert the rest of the parliament to failures. So the government's reason for not having these matters as disallowable instruments is hollow.

Complexity demands greater parliamentary scrutiny, not less parliamentary scrutiny. The definitions of goods and their origin are complex and technical—that is for sure. There are enormous disputes within industry as to what is a reinterpretation or a subversion. The rules of origin are complex and are critical to Australian industry and Australian workers, and there is an expectation that this parliament will take an interest in guarding the interests of Australian industry and Australian workers. This is not something that should be delegated to somebody else. Transparency and the rules of parliamentary scrutiny are therefore essential.

The Standing Committee for the Scrutiny of Bills has identified concerns with this bill as well. Scrutiny Digest No. 9 of 2019 comments:

… at a general level, the committee will have scrutiny concerns where provisions in a bill allow the incorporation of legislative provisions by reference to other documents …

Three risks are identified. It:

The same committee recently considered the implication of the growth in the number of bills, which I've already referred to. The number of bills involving such dereliction of duty has doubled in recent years, and that has important implications in a whole range of industries: civil aviation, farm household support, the NDIS, vehicle standards and building standards. These are all matters that have been referred to other committees. This is the latest move in an attempt to reduce parliamentary oversight by the Morrison government when it dodges its accountability responsibilities, and it ought to be rejected by this chamber. (Time expired)