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

Mr President, my question is to the Minister representing the Minister for Trade and Investment, Senator Cormann. As the senator would be aware, in the 2010 blue book prepared for the potential incoming coalition government, the Treasury warned:

… the potential benefits of [free trade agreements] under negotiation had been oversold and their negatives largely ignored.

The Treasury then cautioned that the coalition should:

… avoid bindings that limit future domestic policy flexibility. Exercise caution in accepting … investor-state dispute settlement—

commonly known as ISDS provisions. The Treasury has clearly issued a red flag to the government on free trade agreements, and it is warned not to risk our national sovereignty. Why is the government going against Treasury advice by including ISDS provisions in the TPPA and the Korean free trade agreement, and what safeguards is it putting in place to limit future litigation against the Australian people for simply creating legislation on their behalf?

Mathias Cormann (WA, Liberal Party, Minister for Finance) Share this | Link to this | Hansard source

I thank Senator Whish-Wilson for that question. The first point I would make is that I completely reject the assertion that we are going against Treasury advice. The government have a very simple commitment. Our commitment is to pursue policies that strengthen our economy and create jobs. To the extent that entering into free trade agreements helps us strengthen our economy and create jobs, we will pursue them; to the extent that it does not, we will not. That is a very, very simple equation.

I would make this more general observation: not having free trade agreements in place where the nations that we compete with do actually puts us at a serious disadvantage. If I can just take the free trade agreement that we agreed on with Korea last week as an example. The United States of America, who we compete with in that market, in particular in relation to agricultural products, was taking significant market share away from Australian farmers. Why? Because it was able to access that market at much superior conditions than Australian farmers. So the point—

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

Mr President, I rise on a point of order going to relevance. I clearly asked: what safeguards Senator Cormann was putting in place to limit future litigation against the Australian people.

John Hogg (President) Share this | Link to this | Hansard source

Order! The question was broader than that. The minister is addressing the question; the minister still has 55 seconds remaining. There is no point of order.

Mathias Cormann (WA, Liberal Party, Minister for Finance) Share this | Link to this | Hansard source

This is actually a very important issue, and it is one that does need to be debated and argued across the Australian community in a responsible fashion, which is why I am actually going out of my way to give you a very genuine answer, Senator Whish-Wilson. The point here is this: we will only pursue free trade agreements that are in the national interest. We will only pursue free trade agreements that help us strengthen our economy and create jobs.

In relation to investor-state dispute settlement clauses, what we have said very clearly, what Minister Robb—who achieved outstanding success with Korea the other week, success that the previous government was not able to achieve during six years in government—has said very clearly is that we will only consider inclusion of those sorts of clauses on a case-by-case basis where, as part of an overall package, we consider the overall package to be in the national interest.

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

Mr President, I ask a supplementary question. In relation to that last point made by Senator Cormann, given that there is ample evidence that carveouts and exceptions failed to limit litigation under ISDS clauses in previous trade agreements, can the government commit today to not trading away low-cost medicines for Australian people, or any aspect of the Pharmaceutical Benefits Scheme, through the Trans-Pacific Partnership Agreement?

Mathias Cormann (WA, Liberal Party, Minister for Finance) Share this | Link to this | Hansard source

The government have been very clear that they will not do anything that puts at risk the strength and the integrity of the Pharmaceutical Benefits Scheme. The senator can be reassured that that is one of the issues that is always top of mind for this government.

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

Mr President, I ask a further supplementary question. As the senator would be aware, under the North American free trade agreement the multinational corporation Archer Daniels Midland, known as ADM, successfully sued Mexico under ISDS provisions for legislation enacted by the Mexican parliament. Given that the ADM bid for GrainCorp was recently rejected under a national interest test, can the minister rule out whether, under ISDS provisions, foreign investors could sue over future national interest test outcomes or changes to our foreign investment framework?

Mathias Cormann (WA, Liberal Party, Minister for Finance) Share this | Link to this | Hansard source

Mr President, I would invite you to reflect on the question that was just asked because I believe that Senator Whish-Wilson is actually asking me for a legal opinion, which I do not think is the appropriate thing to ask me to do. But let me just make the general point again—

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

Mr President, I am seeking clarification on relevance. I was not asking for a legal opinion. Those words were not mentioned. I was asking the minister—

Honourable senators interjecting—

John Hogg (President) Share this | Link to this | Hansard source

Order! Senator Whish-Wilson, what is your point of order?

Senator Heffernan interjecting—

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

And certainly Senator Heffernan and the Nationals would be very interested in knowing the answer to this question.

John Hogg (President) Share this | Link to this | Hansard source

There is no point of order. I listened very closely to the question. The minister can address that question insomuch as it does not go to seeking an opinion. That is part of the standing orders. I invite the minister, with 43 seconds remaining, to address the question.

Mathias Cormann (WA, Liberal Party, Minister for Finance) Share this | Link to this | Hansard source

I did actually provide the answer to that question, to the extent that I can assist the senator, in my initial answer—that is, the government have clearly stated that we will assess the appropriateness of agreeing to ISDS clauses in relevant free trade agreements on a case-by-case basis based on our judgement of Australia's national interest.