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Monday, 28 May 2012
Page: 5677


Mr McCORMACK (Riverina) (13:16): Typically, as with so much legislation rushed through this parliament, there has been insufficient time for stakeholders to comment about the bills being debated.

Those who could have, would have and—most importantly—should have had a say in Shipping Reform (Tax Incentives) Bill 2012, Shipping Registration Amendment (Australian International Shipping Register) Bill 2012, Coastal Trading (Revitalising Australian Shipping) Bill 2012, Coastal Trading (Revitalising Australian Shipping) (Consequential Amendments And Transitional Provisions) Bill 2012 and Tax Laws Amendment (Shipping Reform) Bill 2012 were given little time to respond despite the complexity and wide range of changes in the package.

The number of Australian-flagged vessels has declined by 34 to just 21 during the past decade. Only four now operate on international routes. This, as the member for La Trobe correctly pointed out, is an astonishing figure. She pointed out that it is an astonishing figure, and she is quite correct given the resources boom Australia is presently enjoying. I am so pleased the said member is using her spare time to read the Nationals policy platform. I urge her to read on. There are many other outstanding issues and policy ideas in the document to which she referred that would and will make a great boost to this nation yearning for good government. A number of reforms were recommended when the House of Representatives Standing Committee on Regional Development and Local Government tabled a report into Australia's coastal shipping industry in 2008. That committee was headed by the member for Ballarat with the member for Hinkler as her deputy, and its report was entitled Rebuilding Australia's Coastal Shipping Industry.The following year the minister formed a shipping policy advisory group, and a discussion paper was published in December 2010 as a result of advice given. The minister then, in February 2011, set up three industry reference groups to investigate different aspects of legislative reform: taxation, skills and training, and regulatory change.

Last September the minister declared he would introduce a shipping reform package and broadly summarised its contents. When he did so, scant detailed information was provided to the industry on exactly what form the reforms would take. This is not an uncommon practice for this government. Only this morning the health industry in general and doctors in particular expressed concern about their readiness for the electronic health record system which this government rushed through this parliament and which will take effect in just five weeks.

Also today, the independent Murray-Darling Basin Authority, commissioned by the government, released to the states its basin plan, which retains the 2,750 gigalitres of surface water to be taken from agriculture and given to the environment.

The DEPUTY SPEAKER: I call the member for Riverina back to the amendment.

Mr McCORMACK: This government often talks of the number of bills passed in this difficult, hung parliament. But it is one thing to pass legislation—good legislation—and another to blindly force new laws through which are onerous on those they affect and which do little to benefit the nation.

Just before last Christmas, the minister released the exposure draft of the coastal trading bill for public comment. Serious shortfalls were identified in the bill's drafting through this consultation process which resulted in a further draft being released on 20 February. The four remaining bills which comprise this package were also released at that time. Despite the multifaceted and extensive changes in the package, stakeholders were given only until 5 March to provide feedback. This is not time enough and not good enough by this government. In spite of this the minister bulldozed through the package, with some further revisions, on 22 March. Now we are debating it, and it is imperative that we get this right because, as the Leader of the Nationals and shadow minister for infrastructure and transport pointed out earlier, Australia's shipping industry must play a more important role in our freight network.

My Riverina electorate is landlocked, but, because it is such a productive region contributing more than $5 billion annually—that is just the Murrumbidgee Irrigation Area, by the way—to the Australian economy, the nation's shipping industry is vital to our export capabilities and certainly those of the MIA.

Australia has the fourth largest shipping task in the world. Sea transport carries all but one per cent of Australia's international cargo by weight and about 75 per cent by value. Domestically, ships carry about 25 per cent of our freight. With freight demands set to double by 2020 and to treble along the eastern seaboard over the same period, it is essential that shipping have a greater role in Australia's freight network. Shipping can move massive quantities of cargo across vast distances, reducing the number of trucks on already busy roads and relieving pressure on the rail network.

The five bills making up the shipping reform package are aimed at achieving a regulatory framework for coastal trading in Australia to boost growth in the number of Australian ships on our coast, enhancing the role of shipping as part of our national freight network and maximising the use of Australian flagged vessels. The package seeks to accomplish these objectives by bringing in a variety of financial incentives for Australian flagged ships, including company and income tax changes and hastening depreciation for ships, and by creating a second register of Australian ships to be known as the Australian International Shipping Register. This is available to ships which meet the eligibility criteria which includes the requirement to have two senior Australian officers on board. Also, the package abolishes part VI of the Navigation Act 1912 and thereby abolishes the current permit and licence system with a new three-tiered licence system.

The coalition referred these bills to the House Committee for Infrastructure and Communications and the Senate Committee for Economics for their consideration. The House committee was given inadequate opportunity to view the bills and assess the numerous submissions provided by various industry participants as to deficiencies in the bills. These bills, if passed, will have a major impact on Australia's coastal shipping industry.

The minister has called this reform of our shipping industry 'historic'. If it is so crucial and so necessary, why then was the House committee, supposedly acting with renewed transparency and due process in this new paradigm in which this parliament is supposed to be functioning, given time to have only a cursory glance at the package? This, on top of the fact that the Senate committee inquiry into the bills is not due to be tabled until June—long after debate in the House of Representatives. The lower house will not have the benefit of the Senate's advice before being expected to vote on the bills before us, and that is unacceptable. Ultimately, the value of this legislation is whether it will meet its objectives. Will the bills before the House re-energise the Australian shipping industry? Will the bills before the House lead to a substantial increase in the number of Australian flagged vessels operating on our coast?

The opposition spokesman on Infrastructure and Transport, who has more experience on these matters than anyone in this place, remains unconvinced.

Mr S Jones interjecting—

The DEPUTY SPEAKER: The member for Throsby, it is your turn next.

Mr McCORMACK: I hear the member for Throsby crying out, but even he would agree about Warren Truss's absolute experience in this field.

The coalition members on the House committee for Infrastructure and Communications felt the same as the opposition spokesman. Significantly, industry participants harbour concerns about these bills. They need to be listened to and they have not been. They have not been given enough time. There are fears that the Australian shipping industry could deteriorate to such an extent that our maritime cluster—the associated industries which rely on coastal shipping—will reach the point of no return.

Tom Pinder, one of the principals of Australian Coastal Shipping Pty Ltd—a wholly independent company whose prime objective is to service the needs of those companies and individuals with a requirement to transport cargo in the most economic fashion both within Australia and externally—made some pertinent remarks about these bills to the House committee. He said that a continuation down the path of a one-size-fits-all policy would eventually result in all of the current east-west freight task being diverted to what he termed the 'inadequate infrastructure of road and rail' with 'hugely increased costs and a totally detrimental effect on the carbon footprint of the country'. I know that the member for Throsby would not want that. For a government which has pinned its flag to the mast of a carbon reduced economy, Mr Pinder's warning needs to be heeded.

One thing for sure is that industry submissions to both the House and Senate inquiries argue that the new licensing scheme will increase the regulatory burden on the shipping industry. More bureaucracy is not an incentive for any industry, particularly for one in decline. The prospect of cheap imports replacing Australian manufacturing and industry is deeply concerning. Federal Labor seems intent on increasing the costs to manufacturing and industry to such an extent that it is no longer economically viable for some industries to continue. In what sort of country are we living when it is cheaper to ship sugar from Thailand than around the Queensland coast?

Mr Christensen: Shame!

Mr McCORMACK: I know that the member for Dawson would be extremely concerned about that. When it is less expensive to ship cement from China than from port to port? What does this say to our home-grown, proud Aussie manufacturing industry providing local jobs for local people? Then again, after the recent revelations that the government has approved a scheme to allow mining magnate Gina Rinehart to bring in 1,700 overseas guest workers for her Pilbara iron ore project, without making proper attempts to find local workers first, why should anyone really be surprised?

The government's regulatory impact statement acknowledges that freight prices might go up under this legislation before the House but ignores the fact that there are alternative supplies overseas which can replace our local industries and, disastrously, the jobs which go with them. Many customers have sought more information on the financial effects of the package on the cost of moving freight. Several submissions to the House and Senate inquiries demanded that a Productivity Commission inquiry be held to determine what impact this complex regulatory change will have on the Australian coastal shipping industry, the cost of freight and the costs to coastal shipping customers. The coalition supports this move, particularly in light of the abridged House committee inquiry which was held.

We would also ask that the Productivity Commission look into the implications on the cruise industry, because what this means to our tourism industry is also vitally important to consider. It is often forgotten that tourism is subject to the same requirements as the coastal cargo trade, and its concerns have been largely overlooked in the reform agenda. The coalition is committed to the Australian coastal shipping industry and agrees that it is important that it be revitalised. We do not, however, believe this package will achieve that aim and for this reason move the amendments to the package to improve the wording and the policy.