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Tuesday, 3 August 2004
Page: 25433


Senator EGGLESTON (6:29 PM) —I rise to speak on the US Free Trade Agreement Implementation Bill 2004 and the US Free Trade Agreement Implementation (Customs Tariff) Bill 2004. At the end of the last session of parliament I attended a farewell dinner for the Canadian High Commissioner, who spoke of the free trade agreement the Canadians have had for many years with the United States. When asked what he thought was the greatest benefit of the free trade agreement he said that quite simply it was access to the United States market. So it will be with Australia. We will have access to the world's largest economy and a market of 300 million people under this free trade agreement. The benefits to Australian agriculture, industry and service providers are potentially immense. There is no guarantee that Americans will buy Australian goods but, by having access, we can compete in their market. That is, I believe, of great benefit to Australia.

As Senator Boswell has said, the free trade agreement will be particularly valuable to the Australian agricultural sector and, in other ways, to various aspects of our manufacturing industry. The manufacturers of utility vehicles, which are commonplace in Australia but which are quite unknown in America, will benefit. We will be able to export utes and services. We will have access to the United States federal government procurement process and also to that of some 44 states. As the United States economy grows, as it inevitably will, so will the benefit of this free trade agreement to Australia grow, or so I and the government definitely believe.

In the very short time available to me to talk about this tonight, I would like to address two issues: the issue of the PBS, which has been raised several times, and the issue of our audiovisual and cultural productions, which other people have said will be threatened by this agreement, but I do not believe that that is the case at all.

It has been suggested that the price of medicines will be raised under the free trade agreement. As I understand it, the price of medicines under our PBS will not be affected by the free trade agreement with the United States. All that has happened is that we have agreed to a review of the process under which the Pharmaceutical Benefits Advisory Committee authorises a medication to be placed on our pharmaceutical benefits list. There is no implication at all that prices will be increased. It simply gives American manufacturers a means of being informed why, if it is the case, their brand of some medication has not been authorised as a pharmaceutical benefit in Australia. It is a review process that provides information to the American pharmaceutical industry. It will not in any way provide any mechanism of appeal or challenge to the decision of the Pharmaceutical Benefits Advisory Committee. As other people have said this afternoon, the Pharmaceutical Benefits Scheme, which we have in Australia, is unique. It has provided the Australian population with quite cheap medicines by world standards. The government will in no way compromise that scheme, because it has been of great benefit to Australia. I would like to lay that particular concern to rest.

The other concern that has been consistently raised today relates to our audiovisual products. There have been claims made that local content quotas for broadcasting will be compromised by the free trade agreement. That is not the case either, in my view. The text of the agreement makes it clear that our right to ensure local content in Australian media and the capacity to regulate new and emerging media is respected and retained. Australia has successfully negotiated reservations in the services chapter that ensure that the government's continuing capacity to regulate for Australian content is preserved. There are, in fact, two reservations in two annexes to the agreement which allow Australia to maintain or adopt measures that enable us to maintain local content and ensure that our audiovisual productions are preserved. It has to be said that the US has recognised that Australia is already a very open audiovisual market. The binding commitment that Australia is making will give the United States certainty that we will not close our market in the future or introduce significant trade restrictive measures.

A lot of people have said that they would have liked to have seen in the United States free trade agreement a reservation for cultural products similar to that included in the Singapore free trade agreement—the so-called Singapore reservation. But the reality is that Singapore does not have a very big audiovisual sector—nothing, of course, like the United States movie industry, which, as everybody knows, is the biggest and most powerful movie industry in the world. So, in dealing with the United States, Australia has had to be cognisant of the fact that the United States has that great film industry. We have had to work out an agreement that allows for the interests of the American film industry.

We have had reservations built into this agreement which preserve our cultural identity and enable the government to retain the capacity to support the Australian cultural sector—including the film industry, cultural institutions and so on—through grants, subsidies and tax incentives. The regulatory capacity provided by the agreement will give the Australian government sufficient freedom to respond to changes in media technology. Specifically, it will give Australia the freedom to both retain its existing local content requirements and extend these or introduce new ones in specified circumstances to address the impact of changing technologies. Of course, the technology used in audiovisual production is changing. We are moving into the digital era. Being able to retain our rights to have defined quotas of Australian content is very important given that things are going to change very much with new technology.

It is quite clear that the Australian free trade outcome in respect of audiovisual content clearly contains greater specificity than the Singapore free trade agreement outcome. In short, the US agreement is more targeted than the broad Singapore free trade agreement reservations. It is my belief that the negotiated outcome addresses Australia's genuine concerns while meeting the US's legitimate interests in having some certainty about the future openness of the Australian market. In particular, the key reservation in annex 2 gives Australia the right to introduce new measures as well as to maintain existing measures. Those are important points for the Australian public to be aware of. This government certainly is not going to abandon Australia's voice—as it is put—in the audiovisual world. This government will preserve the Australian film industry and ensure that it is strong and vibrant in the future.

(Quorum formed)