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Thursday, 24 June 2004
Page: 31586


Ms GRIERSON (6:15 PM) —With regard to the free trade agreement with the US that we are debating today with the US Free Trade Agreement Implementation Bill 2004 and theUS Free Trade Agreement Implementation (Customs Tariff) Bill 2004, it is important to remember that the earliest date that the US congress has been required to make a decision on this is the middle of July. But, in this country and under this government, democracy John Howard style says: `Ram it through. Indulge in fear and smear. Wedge everyone possible and make sure the advertisements and cheques keep flowing.' So here we are today being forced to debate the free trade agreement with the United States even though the verdict from our own Senate inquiry is not in yet. It is correct that our position is that we should await the Senate committee's report and we should see that the concerns that have been raised by all parties have been assessed and evaluated. We do look for a decision that says the free trade agreement is in the national interest. We should not be bullied but, unfortunately, this government does wield its power of incumbency like a bludgeon.

What do we know so far about this Australia-US free trade agreement and what are those economic benefits that we would anticipate from such a lengthy process? There are three economic studies of the Australia-US free trade agreement by economic analysts. One estimates it will raise Australian incomes by $52.5 billion over the next 20 years. A second says it will make us $47 billion worse off. And a third expert report estimates that, at best, the free trade agreement with the United States will generate maybe $53 million a year. They are all experts and they all predict very different outcomes, so certainly a decision is not something that we should rush.

The first report—the one with the biggest bang for Australia—was prepared by and on behalf of the Australian government. Its argument rests on the diminished operation of the Foreign Investment Review Board. Professor Ross Garnaut says that even this fails the laugh test in the real world and that you certainly could not get new greenfield investment of $3 billion a year from a minor change to investment rules. The second report, by contrast, was commissioned by the Australian Manufacturing Workers Union. Its argument rests on opportunity costs—that is, what we give up by signing up for the free trade agreement. I think everybody understands that and, generally, we always give up something. The AMWU's concerns about this free trade agreement are that Australia will be prevented from developing into a knowledge based economy, that the agreement will compromise our research and development capabilities and that the intellectual property provisions in the agreement will compromise Australia's ability to build a first-class knowledge based economy, compromising our manufacturing and production industries that are state of the art. We do not want to depend on agreements; we really want to depend on excellence. I consider that the free trade agreement's restrictions on industry policy have not been given enough attention. The third report was released last week. It was put to the Senate committee by Philippa Dee, now at the Australian National University. For her, the bottom line was a fairly devastating $53 million a year—a very tiny harvest from a major political and bureaucratic endeavour.

I must say that there has been some belief in my electorate that manufacturing industry would benefit greatly from this trade agreement. That would not be the case. In our region, we already export to the US Navy submersible vessels that are state-of-the-art. We have not needed trade agreements with the US to gain those markets. It really does come down to an excellent product, and we have skills and expertise in this country which we must retain. Often they do come from R&D processes, which also appear to be certainly at risk in this agreement.

Labor have looked at this agreement and obviously there are some major lessons for us in history. Whilst in office from 1983 to 1996, Labor governments were twice confronted with US proposals for a free trade agreement. The proposals came from the US. Interestingly, this time it is John Howard's idea to have this free trade agreement—no-one else's. On both occasions, those Labor governments decided against bilateral trade agreements in favour of emphasising multilateral negotiations. But the agenda is clearly set by the government and the opposition are inevitably in the position of having to respond and react to the government's very managed and very controlled agenda. I remind people that we have had to endure and pay for this process of selling a free trade agreement with the US in many ways: trips to America by our Prime Minister so he can address the American Congress on the FTA; a US presidential visit; forums around the country by our trade and industry department, selling the benefits of globalisation; and specific forums around the country about the benefits of this free trade agreement. I could go on. You only have to go to the web site and look at the many free fact sheets and guides. Selling this free trade agreement has certainly been big business.

Obviously, when you are in opposition it is much harder to analyse, counter and perhaps criticise what is projected. One of the best tools we have is public debate, and that is why we successfully moved—and the Senate resolved on 13 May—to set up a select committee on the free trade agreement. I am told 525 submissions have been received; yet, according to this government, we should make a decision before we even look at the final report. Such is democracy Howard style. Our general position has always been that this free trade agreement does need to pass some tests. Those tests were and are that it has to deliver significant and comprehensive benefits to Australian agriculture in a reasonable period of time.

Let me say what the bottom line is on agriculture in this free trade agreement. If, over time, the American farmers find they cannot compete with the cost of the goods coming from Australia, they can spit the dummy, basically. They can say, `Sorry, the deal is off with regard to agricultural products.' The tariff barriers would then go straight back up in America and our farmers can just say goodbye to their products being exported to America. That is a fairly one-sided approach, I would have thought.

We do want to make sure the FTA delivers significant employment and investment gains, again, particularly for manufacturing and service industries but without that knowledge-edge base and the threat that this free trade agreement has to R&D. Our scientist groups are saying that the investment this country has made into CSIRO and other research has been public moneys—which has resulted in research that has benefited all industries and all manufacturers—and that is now at risk because that research will be shared, free of charge, with the United States. Of course, we have not seen them investing in our R&D in the past. We would certainly like to see that the FTA does not undermine the capacity of our government to protect Australian culture by regulating for local content.

We also have major concerns about the health area. And it is the health area that is particularly important to me. I think it is the issue that the Australian public feel most strongly about at the moment. We are very concerned obviously that the free trade agreement will compromise some of the things that we hold dear. We do have concerns about the PBS and about the ability of a review board to decide whether the listing of drugs on the PBS is a good or bad thing and to boycott that. We did have great faith in the PBS system until this government decided that the advisory council should include drug companies. As the previous speaker has said, the cholesterol drugs—the statins—that have been available extensively under the PBS have certainly resulted in greater cost to the PBS. We all know that there are other options that are cheaper for us—exercise, lifestyle, important health changes in treating high cholestrol.

The PBS was a system that we would have had great confidence in, but under this government we have seen it corrupted. The costs have been allowed to blow out. They are willing to play politics with something I think the Australian public have always had great faith in.

The previous speaker also mentioned the risk to blood products, and that is of particular concern. I am a member of the Joint Committee of Public Accounts and Audit. We held a public hearing in March, and we looked at the negotiated agreement for the provision of blood products. At that hearing, we were actually looking into a new agreement that had been entered into for the supply of blood products. That new agreement with CSL, who had been and is the main provider of blood products to Australia, is now a short-term contract. The original contract had an option to be renegotiated and extended for a considerable time at the same cost. The inquiry found that the health department actually made no attempt to exercise that option, even though it would have clearly been the most cost-effective for this country.

The blood review by the National Blood Authority has said that CSL were the preferred partner for the Commonwealth. They recommended that that partnership should continue in the national interest for Australia. The review report concluded that Australia's future plasma fractionation needs would be best met through the national facility opened by CSL. But that was not the outcome from the health department's contract negotiations. The new short-term contract that was negotiated with CSL is much more expensive for us, but it does allow for one thing: the Commonwealth government can close down the contract whenever it wants. I suspect that they will want to do that in 2007 when, under the free trade agreement, they have the opportunity to review the arrangement for blood products. As we have heard the member for Lalor say, one of the options would put blood products up for tender. We are not really sure why the government would give up one of the best deals we had, one that has delivered very well for the Australian public. Obviously, the 2007 trigger point means free-market politics again could compromise the standards that this country has held dear.

Clearly, the Australia-US free trade agreement does have direct interest in gaining US access to specific areas of health-related products—that is, blood products and pharmaceuticals. In Australia we have had a system that has worked in both cases. We have delivered affordable health products to consumers, and we have allowed health practitioners to provide those products and, therefore, save our health system considerable cost. For me, the bottom line is that unless those health needs can be met—as they have been—and not compromised, we certainly should not be passing this free trade agreement.

With regard to the PBS, I am not into cringe politics. I know that in my electorate Labor's decision this week on the PBS has been a very difficult one. The copayment decision will see costs increase for people. This government has legislation before the House to bring that into effect as fast as it can. I remember very clearly as a new member of parliament opposing the decision to increase that PBS copayment. At that time, the budget in this country was in surplus big time. It was very easy to say, `Hey, let's not hurt people when we have got money to spare.' We held tight at that time and for two years we were able to protect those people that this government always overlooks. I regret that, at this stage, we have not been able to continue with that protection from increased financial burden.

I remind people that increasing the PBS copayment is not our policy; this is a policy of the government. We are now into the worst time of all in the running of this country, when wedge politics and dirty tricks influence the decisions made in this place. We also know that the government have now spent much of that surplus, and they have spent it by giving out pre-election cheques in the mail to as many of the voters they need as possible, and tax cuts to those who earn over $52,000. In my electorate that is only 10 per cent of the population who will qualify for that. By spending so much money in this period leading up to the election—and I must not forget $150 million for advertising—I think the Australian public see that that is a fairly mean and tricky way to spend their money. Let us campaign fairly and decently, and let us not use public funds to do that. We face a situation now, after 8½ years of this government, where public education has virtually been compromised to a point where the public are saying, `Come on, let's save it once and for all.' We have seen public hospitals and public health systems compromised. (Time expired)

Sitting suspended from 6.30 p.m. to 8.30 p.m.