Senator LUDWIG (12:39 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. The Free Trade Agreement between Australia and the United States of America has attracted, as you would expect, significant attention. There have been two significant reports by parliament on this matter. The first report was report No. 61 of the Joint Standing Committee on Treaties titled Australia-United States, Free Trade Agreement. The second report—the Final Report on the Free Trade Agreement between Australia and the United States of America—was tabled today by the Senate Select Committee on the Free Trade Agreement between Australia and the United States of America. The summary of the report was made available on the web site on Monday. Obviously, on close scrutiny, there has been a bit more work done since then.

I listened carefully to Senator Brandis's speech and I agree with him on one point—which I do not often do—that it is a historic period that we are entering in relation to this agreement. This agreement is a living document. It will continue past my life and his, I suspect, and the life of the 40th Parliament. It will, in my view, create an environment of allowing trade and growth and productivity for Australia.

A couple of issues hanging in the balance at the moment and exercising the minds of Senator Brandis and others relate to the two amendments Labor has proposed. Senator Brandis says that $6 billion worth of additional benefits may flow from the trade agreement, whereas we say, based on our commissioned report into the area, that perhaps there will be a marginal gain. If one takes the view of Senator Brandis, it is difficult to understand why the government cannot pick up Labor's two amendments. The government has indicated clearly that it can accept the amendment relating to local content and I already detect in the media today some back-pedalling by the Deputy Prime Minister, Mr Anderson, and Mr Downer on the strong stance they took earlier in the week on the Pharmaceutical Benefits Scheme.

This may be a bit predictive, and perhaps not quite in order, but I think that by question time today in the House or perhaps by early next week we will witness a significant movement by the government on the PBS issue. I cannot understand why the government would put in jeopardy such a historic agreement on issues that do require protection, such as the Pharmaceutical Benefits Scheme. I think the government will come to the conclusion, as we have, that you can have both—you can protect the Pharmaceutical Benefits Scheme and you can have the free trade agreement. That goes without saying.

What Labor has said—both Mr Mark Latham and Senator Stephen Conroy—is that we will assess the Howard government's trade agreement with the US and ascribe to it a plus or minus: is it a plus or a minus for Australia? The agreement does not come into force until next year. We are now debating the enabling legislation, two bills that will give effect to the free trade agreement and allow Australia to meet its obligations under the trade treaty in Australian domestic law.

The Select Committee on the Free Trade Agreement between Australia and the United States of America in its final report came to the conclusion that on balance it was in Australia's interest to support the free trade agreement. Mr Latham and Senator Conroy said that they would take into consideration the conclusions of the Select Committee on the Free Trade Agreement between Australia and the United States. We are now at the juncture where, whether the gain for Australia from the free trade agreement be small, as indicated in the majority report, or whether it be enormous, as Senator Brandis believes, we can say without a doubt that there is a benefit to Australia. Therefore, the free trade agreement is an agreement which we should support. It marks the beginning of an important part of our history. I seek leave to continue my remarks later.

Leave granted; debate adjourned.

Sitting suspended from 12.45 p.m. to 2.00 p.m.