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Monday, 22 October 2018
Page: 10603

Mr ZAPPIA (Makin) (16:56): This legislation, the Shipping Registration Amendment Bill 2018, makes the shipping registration system of Australia more flexible and transfers the registration process to the Australian Maritime Safety Authority. It effectively simplifies the registration process, particularly when changes need to be made to the registration process itself, and that is something that Labor welcomes and supports.

As the minister pointed out in his second reading speech, approximately 12,000 vessels are currently registered on the Australian general shipping register. Most of those vessels, I suspect, are likely to be fishing or tourism vessels, because the reality is that Australia has very few cargo ships domestically registered and flagged. For an island country with—as the member for Grayndler quite rightly pointed out—around $400 billion annually exported through shipping, which represents about 90 per cent of our exports, it should be a national concern that so few of those ships are registered in Australia.

It is not just Australia that has lost its shipping fleet over recent decades. In fact, over the past four decades, in deadweight tonnes, the ratio of merchant ships flagged in developed economies has fallen from around 55 per cent in 1980 to about 25 per cent today. Panama, Marshall Islands and Liberia alone now account for around 56 per cent of vessel registrations based on deadweight tonnes. Countries including Malta, Antigua, Barbuda, Bahamas, Cyprus, Gibraltar, Saint Vincent and Cambodia are also places where ships today are being registered. All of those countries I named are not exactly countries that are thriving. Indeed, they are all developing countries. The ships, however, whilst registered in those countries, are owned by entities that are based predominantly in Greece, Japan, China, Germany and Singapore. None of those countries could be described as developing. The trend to shift the registration from developed economies to developing economies is done for particular reasons. In particular, it is because the places that those ships are registered are generally considered to be low-tax jurisdictions. But, more importantly, once the ships are registered in those countries and carry the flags of those countries, they can employ much cheaper, Third World labour from countries where seafarers are paid a pittance, as other speakers on this side of the House have quite rightly pointed out.

The trend in Australia over recent years has been identical to the international trend. I quote from a Senate inquiry that reported back to the House in July 2017. It's the Senate Rural and Regional Affairs and Transport References Committee. I noticed that the member for Whitlam used some of the same statistics. I want to quote directly from paragraph 1.29 of that report. It says:

Statistics on vessels operating on the Australia coast in 2014-15 reveal the decline in Australian-flagged vessels:

in the major trading fleet there were four vessels registered to Australia for major international trading, a decrease from nine in 2005-06;

for coastal trading, there were 20 registered ships, down from 32 ten years prior; and

there were 15 major Australian registered ships (over 2000 dead weight tonnes) operating under a general licence, a decrease from 33 vessels in 2005-06.

Those statistics paint a very clear picture about the demise of Australian shipping.

One shouldn't be surprised that we have had that demise, because, for the last two decades, coalition governments have been doing their best to destroy the Australian shipping industry. We had the Patrick dispute 20 years ago, where the Patrick Corporation and the coalition government led by then Prime Minister John Howard, with support of his minister Peter Reith, connived and concocted a scheme to sack Australian shipping crews, replace them with scab labour and ultimately replace them with foreign shipping crews.

Honourable members interjecting

The DEPUTY SPEAKER ( Mr Hastie ): Order! Members will cease interjecting.

Mr ZAPPIA: A paramilitary antistrike force with guns and dogs was used to escort hardworking Australian sea crews from their jobs and have them replaced with more compliant workers. There was no consideration for those workers' families and no consideration for their livelihood or for their future. The only concern of the Howard government at the time was the interest of the corporate profits. It was only court action and Justice North's court judgement that scuttled the Howard government's plan.

It was, however, not the end of attempts by coalition governments to get their way and to dismantle the Australian shipping industry, because coalition governments have never given up on their tricky schemes to cut out Australian seamen from Australian shipping. Why have they gone down that course? For two reasons: firstly, to destroy the Maritime Union of Australia and, secondly, to ensure that increased corporate profits flowed to those companies that were using the shipping.

Every piece of legislation that this government introduces with respect to shipping further opens the door to Australian seafarers being replaced by overseas crews. That is not in Australia's economic interest or in the national interest, let alone in the interests of the workers who are already in that industry and the environment of this country.

For example, the International Energy Agency requirement for fuel stock reserves would have countries have a 90-day supply of those reserves. Australia falls short of that 90-day-reserve quota not just by a little but by a lot. According to one analysis, Australia holds 21 days of petrol, 16 days of diesel and 19 days of aviation fuel. That is roughly 20 per cent of the requirement of the International Energy Agency.

That leaves Australia clearly vulnerable to the mercy of overseas shipping operators and foreign entities for our fuel supplies. It is not a good position to be in. It occurs simply because corporate greed is put ahead of national security and local jobs. If there is a conflict with another country and we only have, at best, 21 days of petrol supplies, where does that leave Australia? That's particularly the case given that my understanding is that some 75 per cent or thereabouts of our own crude oil is exported overseas, and most of our petrol is imported from overseas, so we don't have the capacity to refine it here in Australia.

The other concern that I have as to all of this has already been raised by other speakers from this side of parliament. We also have a responsibility to try to protect the Australian coastline and the environmental assets that are there. As other speakers have already made clear, it's Australian seafarers who not only understand the Australian coastline well but also value, and are likely to protect, that coastline—more so than seafarers from other countries on ships that are flagged in other nations.

Of course, the concern with all of this comes down to the missed opportunity that arises, because shipping in itself represents a huge economic opportunity for this country. Quoting the figure of $400 billion each year of exports, one can see the amount of volume that equates to that figure, and, therefore, the amount of economic activity it generates. It would be in the national interest to have as much as possible of that product handled and transported via Australian-flagged ships, where tax to the Australian government would be paid by not only the operators but also the seafarers when they earn their own income. So the income tax generated would have to be massive.

It would be akin to suddenly saying, 'We will wipe out the Australian trucking industry or the Australian airline industry,' if we were to turn our backs on those two industries. Yet we don't, because they operate within our landmass, and we tend to take the view that what's outside of the landmass doesn't really matter. But it does matter, because it's still part of Australian territory. But, regrettably, it is not on this government's radar to look at the opportunities that shipping provides and to support the industry so that it will not go backwards but rather will grow. We now have a situation where it is not only the shipping that has been essentially put into foreign hands; much of the resources that those ships carry are also controlled by foreign entities. And we have now allowed the port of Darwin, for the next 99 years, to be effectively controlled by a foreign entity.

We are clearly going down the wrong track, in terms of not only national security measures but also generating and building the economy of Australia. Shipping represents an opportunity to do that. This legislation, whilst it will be supported by our side of parliament, only makes a minor difference to the shipping regime in this country and does nothing to grow what could be a major economic asset for the future of this country.