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Thursday, 24 June 2004
Page: 31579


Ms HALL (5:43 PM) —As I was saying when I made my earlier contribution to this debate on the US Free Trade Agreement Implementation Bill 2004 and the US Free Trade Agreement Implementation (Customs Tariff) Bill 2004, I and the people of the Shortland electorate have serious concerns about this legislation and, as such, cannot support it until and unless those concerns are addressed. Unlike the Howard government, I believe that any free trade agreement with the US or, for that matter, any country should benefit Australia. It should in no way have a negative social, economic, cultural or environmental impact on Australia. It is the role of the Australian government to protect Australia's interests. To this extent I do have some concerns. There is a process in place at this particular time. The government has chosen to ignore that and play cheap politics by bringing this matter on for debate before the winter recess.

Before question time I was discussing the possible impact of a free trade agreement on the Pharmaceutical Benefits Scheme. If my concerns are verified I do not believe that Australia should sign the agreement. As I said earlier, intellectual property regulations like those discussed in the free trade agreement have led to the extension of pharmaceutical monopolies by delaying and preventing the entry of low-cost generics into the market. The PBS analysis data indicates prices of brand name—that is, patented—drugs fall by an average of more than 20 per cent after the patent's expiration and the entry of generic medicines into the market. Therefore, delays will significantly increase pharmaceutical expenditure in Australia over time. This is one of the elements of the free trade agreement that is causing me considerable concern. Delays weaken the PBS reference pricing system. Studies estimate that the PBS pricing controls save Australia between $1 billion and $2.4 billion annually; therefore IP provisions in the free trade agreement have the capacity to create upward pressure on co-payments and threaten the sustainability of the scheme in the long term.

IP reforms in the free trade agreement will also have an impact on the prices of over-the-counter medicines. Therefore additional over-the-counter costs as a result of the pharmaceutical IP provisions will be directly borne by patients. For example, Claratyne—an over-the-counter medicine—is one drug that would decrease in price. But, if that patent is extended, then the Australian people will be asked to bear a significantly higher cost. Australian negotiators are under significant pressure to make concessions in this regard. I am hearing from the Australian people I meet that these are concessions that they do not wish made.

Reforms that threaten the sustainability of the PBS and transfer costs directly to patients are a high price to pay for possible gains in other sectors of the economy. Changes to the PBS and IP regime will increase financial uncertainty for the ill and ageing and create economic barriers for access to essential medicines. The inclusion of such a chapter in the free trade agreement means that subsequent governments could be blocked or sued by US corporations if they attempt to pass legislation to improve the PBS or regulate the supply of medicines in Australia. We in Australia would like to be able to determine that ourselves. I have very serious concerns about this matter. The PBS has served the community for some 55 years very well and has enjoyed bipartisan support. It is a crucial component of Australia's universal health system—a component that should not be allowed to be jeopardised by the free trade agreement.

I would like to very quickly turn to the implications of the free trade agreement on jobs. We have heard from the government that it is going to create many jobs within the Australian economy and society, but experience overseas has thrown a question mark over this. Much of the information I have read on this matter also creates concerns. Large-scale job losses can and will be experienced—you just need to look at the Canadian free trade experience of 276,000 jobs lost between 1989 and 1997. That is not something we want to see here. Windscreen manufacturer Pilkington has already announced a reduction of the work force due to losing a 70-year-old contract with Holden due to the increased import competition arising from the Australia-Thailand free trade agreement. Previously, Pilkington lost a contract with Ford Australia, who chose to source from China. The impact on Victoria would be over 1,100 full- and part-time jobs lost from the motor vehicles and parts industry. These are serious concerns—this is one little area that I am touching on and bringing to the attention of the House—that we need to consider. They are concerns that are being considered by the Senate Select Committee on the Free Trade Agreement between Australia and the United States of America. I worry that we are rushing through legislation when we should be allowing the proper processes to take place.

I will quickly touch on the area of agriculture in the free trade agreement. For Australia, all agricultural imports will be duty free from the signing of the agreement. For the United States, this is not the case. The United States maintains both quota and out-of-quota tariff regimes over a variety of agricultural products. These are called TRQ regimes. The TRQ regimes of particular interest to Australia are beef, sugar, dairy products and other crops. I do not think that we can enter into an agreement until this system is fairer. This will become really apparent during the Senate select committee's deliberation. There are also issues relating to quarantine where there are some extremely sensitive aspects and legitimate community concerns. Once again, I feel that these need to be addressed.

I am also quite concerned about cultural diversity and the impact it will have on our performing arts and cultural industry, particularly the film industry. The US is the largest exporter of cultural content in the world, dominating both screen and box office time. In 2001-02 Australia imported $518 million worth of film and television programs from the US. US films comprise 80 per cent to 90 per cent of gross box office takings. Australian content on television is a concern for our film industry.

I believe that this is an industry worth protecting. I believe that this industry would be jeopardised by the proposed free trade agreement. These issues need to be fully examined and reported on by the Senate select committee. The full democratic process should be observed—the process that has been allowed to take place in the US but has been denied us here in Australia, simply because we have a government that has only one thing in mind: winning an election and trying to promote itself at the expense of good government and what is good for Australia.

There are many other areas of great concern: issues of libraries and education and paying for what is now free, copyright issues, and the implications that all these changes will have if you look at the DMCA and consumers' fair access and use. All these issues have been brought out in submissions to the Senate committee.

Introducing this legislation is a desperate act by a government that believes playing politics and staying in power are more important than protecting Australia's interests. A free trade agreement with the US must benefit Australia. It must not be a one-sided agreement which benefits the US and not Australia. The government must allow full and thorough examination of the agreement. If it disadvantages Australia then it must not be signed.