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Wednesday, 15 August 2012
Page: 8766

Mr NEUMANN (Blair) (17:38): I speak in support of the Customs Amendment (Anti-dumping Improvements) Bill (No. 3) 2012. Antidumping and customs circumvention are not usually issues which are raised in the P&C meetings and the pubs in my electorate of an evening, but dumping really has an impact on the people of Ipswich and the Somerset region. It causes job losses. We have undertaken some serious reform to address this issue, to protect local jobs and to create a level playing field within markets.

A company in my electorate which has made a big impact in relation to this and has been at the forefront of the fight about dumping is Capral. It is a manufacturer of aluminium extrusion products. It is a 76-year-old Australian company employing about 900 people across the country. Its largest aluminium extrusion plant is located at Bremer Park, in Ipswich, and employs about 300 workers. At Capral they take a 400-kilogram aluminium billet, traditionally sourced from Australian smelters, and turn it into everyday products, extruding, ageing and finishing the aluminium to form numerous shapes and sizes for use in innovative products such as window frames, truck and bus bodies and general engineering.

The Bremer Park plant is a state-of-the-art plant, but it runs at about 50 per cent capacity. Why does it run at about 50 per cent capacity? It does so because of dumping. It does so because it is facing unfair competition from Chinese dumping in our economy. This plant is one of the most highly automated, efficient, internationally competitive plants in the world.

The managing director, Phil Jobe, and the extrusion business manager, Sven Gade, have taken me on numerous tours of the plant, and I have arranged in the last few years for Ministers Ludwig, O'Connor and Clare to tour the plant, meet with workers and management, and see what measures could be undertaken to protect jobs. Phil has said to me that the industry is under pressure. A lot of manufacturing is under pressure. OneSteel, BlueScope, G James Glass and Aluminium and a number of other plants are under pressure in the manufacturing sector because of dumping. The high dollar does not help. The international effects of the global financial crisis do not help either. But there are other pressures. The mining boom has had little impact on this particular company in my electorate, save for the pull of employment from the plant to the mining sectors in WA and Queensland. Phil Jobe has regularly stressed to me that the No. 1 pressure the company faces is the dumping of cheap aluminium extrusion into Australia by the Chinese.

I have met with Paul Howes, the National Secretary of the AWU, at the plant as well. I have met with plant workers. I want to say this. Both management and unions are in favour of free trade, but that trade needs to be free and it needs to be fair. They are not afraid of competition; they just want a level playing field. Dumping aluminium extrusion from China has seized almost half of the Australian market, and this has put our industry under a lot of stress.

The facts are that the Chinese are dumping products in our economy and taking advantage in three ways. Dumping is really the generic term for three ways that they are undertaking. The Chinese government ownership of aluminium smelters in China results in them subsidising the supply of primary aluminium. They are not doing it because they are good guys. They are not doing it because they want to sell their product in Australia at cheap prices to help our construction industry. They are doing it because they want to destroy, in effect, our manufacturing base to get a greater share of the market, and what they want is to then control it. It has resulted in a control of our market which can be up to six times as much control of the market as you would see in the US or Canada. They are not doing it because they are good corporate citizens or international competitors; they are doing it because they want to control the market.

The second way that the Chinese companies are undertaking this is by circumvention of Australian laws and customs measures. I know that, when Minister Clare was in my electorate at Capral, he was put through a very extensive discussion by Phil Jobe of just how the companies get around doing this. Sometimes it is by another company importing parts or bits and pieces, which then transfers it to another company. It is extremely complicated. In fact, I have read QC reports and legal advice on this, and it is one of the most complex areas of the law.

Sadly, I do not think that in the past we have had enough expertise in the Trade Measures Review Office. As part of the earlier tranche of legislation, we increased the expertise, gave ministers 30 days in which to make decisions and increased the size of the trade measures office in relation to this, and we propose to do so by up to 45 per cent.

But we really have a terrible situation in my area. I know that unemployment is 3.7 per cent, but when the biggest aluminium extrusion plant in the country is operating at 50 per cent, it is a problem. On this problem, Phil has said: 'We're not looking for tariffs; we're not looking for a reversion to that sort of mindset. What we're asking for is that countries that bring product into this country abide by the rules.'

If countries are not abiding by the rules, we need to declare it openly. We have an extensive agenda. Minister O'Connor and Minister Emerson announced just a few short years ago a series of measures, and this legislation belongs among the final stage of such measures. However, I do not think it is the last in the final stage of measures, because Minister Clare has appointed former Victorian Premier John Brumby to report on the idea of a Commonwealth antidumping agency. While I do not want to prejudge the report, my own view is that an agency with expertise is better that an agency that might be put together in Customs. I am not convinced from what I have seen from my experience with industry and from what I know from discussions with unions and management that the decisions of the Trade Measures Branch of Customs are always right, so I applaud Minister Clare for engaging former Premier Brumby to investigate whether a specifically prescribed agency which concentrates on antidumping and investigates whether a more timely conduct of investigations is appropriate will make trade operate more fairly. The trouble is that investigations take ages.

One of the worst decisions that the Howard government ever made was to say that China is operating as a market economy, because it means that we are hamstrung in some ways. This decision was made in about 2005, and it means that we cannot adopt what I think is the fairest way to assess whether or not dumping takes place. I can understand why they did it as a precursor to a free-trade agreement with the Chinese, but I think that an acknowledgment that the Chinese heavily subsidise their industry would have been a better recognition of economic reality in China. I think that the Howard government's decision was very bad and that the current oversight is inadequate, and I applaud the government for what they are doing.

The legislation before us will make a difference. It is about reform of three policy areas. I have talked about such reforms on numerous occasions and do not intend to talk much further about them, but the legislation aligns our antidumping and dumping countervailing systems with those of our free-trade organisation counterparts. We are hamstrung by the decision of the Howard government, as I have said before in other speeches, and we have to get around it in some way that does not breach our obligations. We need to improve our timeliness, our expertise and our examination procedures. We have already considered the idea of improving locus standi organisations which can take on antidumping cases. When industry, the unions and the National Farmers Federation are all singing from the same hymn sheet, you know you are on the right track. In politics you cannot always get everyone on your side, but you know that you are doing something right when they are all saying that we should be doing what we are doing.

This legislation is important. It inserts new provisions implementing a proposal to amend the subsidy provisions in the Customs Act. There is a new division to enable industry to apply for an anti-circumvention inquiry. There are other, stronger provisions to address non-cooperation. This legislation is important for the sake of Australian jobs. Every vote that I have ever cast internally in the ALP has been for free-trade—every single one—but China cannot continue to do this and to affect trade and commerce and jobs in my electorate. I go to the plant at Bremer Park and see—and Minister Clare has been there—how much more the plant could do for economic development and jobs and prosperity in my region. There are 300 workers there, and the workforce could be doubled. That is what we are talking about—the impacts on local communities. The antidumping laws are very complicated. They are obtuse, esoteric and vague. They are the sorts of things that Phil Jobe gets a QC to advise him on every time Capral takes on a case. In fact, in 2009 they did so and won. But they have a real impact on people's lives. Every day the workers at the Bremer Park plant worry about their jobs—I have talked to them.

I applaud the minister for this legislation. I applaud him for appointing John Brumby to look at the antidumping laws. I think that there are more things that we can do. We should take a more aggressive attitude. China is important to us, but we cannot sacrifice Australian jobs for the sake of our obligations to China. Australians come first. Well done, Minister—I think you are on the right track in this legislation, and I hope that former Premier Brumby recommends a new agency with more teeth, more power and more regulatory oversight and that we can take a more realistic approach to the antidumping laws.