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Tuesday, 3 August 2004
Page: 25326


Senator O'BRIEN (12:34 PM) —I rise to speak to the US Free Trade Agreement Implementation Bill 2004 and the US Free Trade Agreement Implementation (Customs Tariff) Bill 2004 only because Senator Conroy, who would normally lead for the opposition on this matter, is involved in a press conference with Mr Mark Latham. They are announcing to the media and to the Australian public Labor's response to these bills and to the overall free trade agreement. I have had the privilege of examining the agreement as a member of the Senate select committee, which is yet to table its report to the Senate. That matter will be canvassed at another time.

Noting that the Senate has taken a decision to alter the membership of that committee at this very late stage in the process I indicate that it was rendered necessary on the basis that, if the committee needs to meet again, it needs to be fully constituted. It would have been the opposition's wish not to have disturbed the membership of the committee—because it was not our wish to replace Senator Peter Cook as a member of the committee—but, as I think everyone in this chamber is well aware, Senator Cook underwent surgery this morning and he will be unable to take part in the activities of the committee and this chamber, certainly for the duration of the debate on this legislation and the consideration of the committee's report, should that be required, later this week or, I expect, next week.

On behalf of Senator Conroy and I, I indicate that Senator Cook operated as chair of this committee in very difficult circumstances—he was placed under a great deal of pressure by coalition senators—and in a remarkably even-handed fashion. He was at pains to assure members of the committee that everyone would have a chance to ask their questions. That, of course, put the committee under time pressures in trying to deal with witnesses and meeting the timetable set by the committee. Senator Cook attempted to make sure that the proceedings of the committee were conducted in the fairest possible manner and in a manner conducive to getting onto the record the views of all of the witnesses, whether members of the committee found them agreeable or disagreeable.

I think that set Senator Cook apart from certain other members of the committee who thought it appropriate to effectively heckle witnesses whilst they were giving evidence, even though in some cases those witnesses had been invited by the committee to submit a point of view and to come and give evidence. I found in those difficult circumstances that Senator Cook handled himself remarkably well. I must say that I considered some of the activities in those proceedings to have been quite provocative of Senator Cook and that, in the true professional manner in which we have come to expect Senator Cook to operate when holding a position of such responsibility, he acquitted himself very well.

What do we now face with this legislation? Yesterday I took part in a press conference which has been described as an unusual one. Senator Peter Cook was the disembodied voice heard through a device sitting on the table at the press conference. I am sure that he would not have wished to have participated in such a fashion. But the medical realities being what they were and Senator Peter Cook's commitment to his task being what it was, it was appropriate that he participate and it was the only way in which he could participate and respect and cooperate with the advice he had been given. He could not travel to Canberra to participate and then return to Perth in time to be operated on this morning.

That press conference announced the position not of the Labor Party but of three Labor senators as to how they thought the parliament ought to respond to this legislation. I think it is important to recount part of what was described by me yesterday as the collective view of the committee—that is, the entering into the free trade agreement was an action which the US Trade Representative, Mr Robert Zoellick, told congress in March 2001 should be approached on a bipartisan basis within Australia. He said:

... if we approach this—

that is, the free trade agreement with Australia—

I want to make sure that it's done in a fashion that has bipartisan support in Australia.

This government did not listen to that advice. Instead, this government acted unilaterally and pursued a free trade deal which was more to do with politics than with free trade and in what we describe as an unrealistic negotiating time frame imposed on us by the US electoral cycle—and I suspect our own. This was a deal which the Deputy Prime Minister, Mr Anderson, described as potentially being unAustralian if it did not include sugar. Yet, at the end of the day, no sugar producer will gain a benefit from this agreement because sugar has been excluded—and it was excluded in breach of that commitment by the Deputy Prime Minister. The government repeatedly said that the Pharmaceutical Benefits Scheme was `off the table'. But, frankly, it was on the table from day one. In the end, we were presented with a deal which included matters relevant to the Pharmaceutical Benefits Scheme but which did not include sugar.

In asking for this legislation to be passed through the parliament and thereby onto the people of Australia, it requires us all to take this government on trust. There are some outstanding issues surrounding the agreement that are simply not addressed by this implementing legislation. Senator Cook, Senator Conroy and I have set out a number of recommendations to our colleagues in the caucus and to the parliament that seek to address these many and varied shortcomings and unknowns. We recommend that the parliament support the legislation in the context of the position which I will clarify further.

We announce quite a number of concerns that we have about the agreement. That is why we believe that it is necessary for the parliament to take steps beyond those contained in the legislation. I think I am at liberty to say that we will be supporting the legislation, but in two key areas—the Pharmaceutical Benefits Scheme and the protection of Australian media content, because these are so important to the Labor Party—we will move in this chamber relevant key legislative amendments.

Specifically, the amendments are to protect the Pharmaceutical Benefits Scheme by preventing drug companies stopping cheap generic drugs from coming onto the market through the use of what I describe as a `dodgy patent process'; to allay concern about any future reductions in local content for free-to-air television, pay television and radio; and to legislate the current local content standards in this process—in other words, not relying on the current process of imposition of local content standards but requiring the parliament to set those standards so that the only way that they can be reduced is by a vote of both houses of the national parliament.

Labor are committed to those amendments to the point that we will insist on them. We will not resile from those amendments in pursuit of the legislation. Those amendments should be carried—and, after all, we can see no reason why the government should not support them. Labor will say to the government that, if they seek to push the legislation through without them, we will be insisting on those amendments.

Concerning other aspects and consequences of the legislation, we think there are many things that ought be done and a Labor government will commit to doing those things. I am sure that that is what Senator Conroy is in the process of announcing to the media at the moment. Labor will enhance transparency in relation to the Pharmaceutical Benefits Scheme by requiring that all documentation submitted to the independent review mechanism established to examine unsuccessful drug listing applications on the PBS be published on the Internet within 48 hours, subject to commercial-in-confidence constraints—I am talking about real constraints, not imaginary ones.

A Labor government will require the Productivity Commission to monitor and report annually on the impact of the free trade agreement on the PBS, including the impact of the independent review mechanism. If the differential between the US and Australian drug prices is narrowing, a Labor government will change the independent review mechanism. Each acceptance by the Pharmaceutical Benefits Advisory Council and the Minister for Health and Ageing of the recommendations of the independent review shall be reported to the parliament in a ministerial statement. The terms of reference of the medicines working group will include a commitment to the principle of universal access to affordable medicines. The medicines working group will not be charged with considering any policy issue that could be seen to undermine the principle of universal access to affordable medicines. Under Labor, the medicines working group will operate with appropriate transparency with regard to agenda items, minutes and recommendations.

Prior to entering any tender round involving blood or blood products, a Labor government would amend the Therapeutic Goods Act to ensure that any blood plasma fractionation products approved for use in Australia must be manufactured in accordance with Australia's policy of self-sufficiency using Australian blood and in accordance with currently established good manufacturing practice which requires dedicated processing facilities. Labor will ensure transparency in the plasma fractionation agreement currently being negotiated with CSL, the review of this agreement required by the FTA by 2007 and any subsequent tender process for blood plasma products.

Labor will ensure that the free trade agreement does not dilute the capacity of the government to regulate for local content on future media. Labor will legislate to ensure that the FTA definition includes but is not limited to future media already identified. Labor will establish an inquiry to examine further options for effective government regulation of local content on future media mechanisms. Labor will also announce a policy package to encourage investment in Australia's film and television industry before the next election.

Concerning copyright and intellectual property, Labor will require the Attorney-General to report annually to parliament on the impact of changes to the Copyright Act 1968 on universities, libraries, educational and public research institutions, particularly with regard to any increased costs that they might bear. To ensure there remains a fair balance between copyright owners and users, Labor will examine options for broadening the fair dealing and copyright usage provisions of the Copyright Act.

To ensure there remains a fair balance between innovation and consumers and owners of copyright in relation to technological protection measures, Labor will ensure it is permissible to sell, purchase and use legally manufactured video, DVD and related software items, including components equipment and hardware, regardless of place of purchase. Labor will set up a commission of inquiry to look at the impact of the FTA on Australian manufacturing, particularly automotive components and the textiles, clothing and footwear industry. We will be announcing terms of reference for such an inquiry.

In relation to agriculture, Labor will utilise the annual ministerial meeting arrangements which are established under the free trade agreement to seek for Australia a most favoured nation provision from the US—meaning that, if the US gives a better deal to someone else, we should have access to the same terms. Labor will closely monitor the government's sugar compensation package to ensure that it achieves significant reform in the cane farming and milling sectors because, if nothing else comes from the free trade agreement, something must come for the sugar districts—other than a one-off package to buy votes, which is what the government is involved in at the moment.

Concerning quarantine, Labor will require that both qualitative and quantitative science based risk assessment processes are used in developing import risk assessments and, importantly, in enshrining the Import risk analysis process handbook in regulations, requiring the consent of both houses before that process could be varied—in other words, that no process of the FTA could be imported into our current import risk assessment process without the support of both houses of parliament.

Future trade agreements under Labor will operate under a quite different environment. Prior to entering into free trade agreement negotiations, a Labor government—and indeed future governments, if Labor were to implement these procedures—will table in both houses of parliament a document setting out its priorities and objectives. This will include an assessment of the costs and benefits of any proposals that may be negotiated. The assessment will also consider the economic, regional, social, cultural, regulatory and environmental impacts which are expected to arise. Once the negotiation is completed, a Labor government will table in the parliament the proposed treaty, together with any implementing legislation.

That is a comprehensive response from Labor to this agreement. We say that the legislation ought to pass, but we say it is critically important that those amendments which I have indicated that we will insist upon be part of the passage. The government, through its bureaucracy, has repeatedly assured the committee and the public that there will be no impact on the Pharmaceutical Benefits Scheme from this agreement. The minister has tried to defend his pretty shabby negotiating process—and I absolve the negotiating team of responsibility in this regard, because this was, in our view, a politically managed process—but the fact is that more could have been done in relation to the Pharmaceutical Benefits Scheme. Nevertheless, the government says that the scheme is not affected or jeopardised by the arrangements it has put in place. If the government is happy with the agreement as it stands, what stands in the way of the government supporting Labor's amendment to make sure that nothing it has done can ever come back and bite this nation on the backside? Frankly, there is a lot of concern about the Pharmaceutical Benefits Scheme. Mr Mark Latham said some time ago that the Pharmaceutical Benefits Scheme was a deal breaker as far as the Labor Party were concerned, if it was found that there was a negative effect on the PBS.

We are moving amendments—and, in this regard, an amendment—to ensure that that there is not a hidden substantial cost of hundreds of millions of dollars to the taxpayer arising from this agreement. That amendment will be entirely consistent with the agreement and, if the government is sincere in its desire to maintain the PBS, it will support Labor's amendments. Equally, in relation to local content, if the government says there is no reason to reduce the current standards, we ask: what is wrong with legislating them and what is wrong with putting the power in the hands of the parliament to determine if they are ever to be reduced? Under this agreement, the ratchet clause means that, once reduced, they can never be returned to their current level. What Labor are saying is: protect the current levels. (Time expired)